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https://www.courtlistener.com/api/rest/v3/opinions/1368446/ | 30 S.W.3d 872 (2000)
Don KLUCK, Movant-Appellant,
v.
STATE of Missouri, Respondent-Respondent.
No. 23072.
Missouri Court of Appeals, Southern District, Division Two.
September 28, 2000.
Motion for Rehearing or Transfer Denied October 19, 2000.
Application for Transfer Denied December 5, 2000.
*874 Kent Denzel, Asst. Public Defender, Columbia, for appellant.
Jeremiah W. (Jay) Nixon, Atty. Gen., Barbara K. Chesser, Asst. Atty. Gen., Jefferson City, for respondent.
PHILLIP R. GARRISON, Judge.
This is an appeal from the denial, after an evidentiary hearing, of a Motion to Vacate, Set Aside or Correct the Judgment or Sentence filed pursuant to Rule 29.15.[1] Don Kluck ("Movant") contends that, because of the ineffectiveness of trial and appellate counsel, he should have been granted relief from his jury conviction for the class A felony of second degree murder, § 565.021, for which he was sentenced, as a prior offender, to life in prison.
The underlying facts of this case were described by this Court when we affirmed Movant's conviction in response to his direct appeal, State v. Kluck, 968 S.W.2d 206, 206-07 (Mo.App. S.D. 1998). They are:
... [Movant] lived in Joplin with his girlfriend, Kelly Drury, and her children, Tiffany and Justin. On the evening of January 20, 1996, Ms. Drury was visiting with some friends in the kitchen of her home when she decided to go to the grocery store to buy some liquor. Ms. Drury went into the bedroom, where [Movant] was sleeping, and got some money out of [Movant's] coat. Around 11:00 P.M. she, her friends, and Tiffany went to the grocery store.
[Movant] woke up and came into the living room shortly after they returned from the store. Ms. Drury's friends left when [Movant], who apparently walked with crutches, slammed them on the floor. [Movant] then entered the kitchen, and began yelling at Ms. Drury, asking her where his money was. After a thirty-minute argument over the money, [Movant] hit Ms. Drury in the head with a liquor bottle, causing her head to bleed. Ms. Drury's children ran out of the house, but Tiffany went back inside to help her mother bandage her head. Tiffany had gone back outside and was talking to Justin when the children looked in a window and saw [Movant] come out of the bedroom with a gun in his hand. The children then went to the home of a neighbor, John Gabany, and called their father requesting that he pick them up. When Tiffany and Justin later went back home to get their things, Tiffany saw [Movant] sitting on a bed with a gun next to him.
Later that morning, [Movant] went to Mr. Gabany's house, told him that Ms. Drury had shot herself, and asked him to call an ambulance. Mr. Gabany complied, and the police arrived at [Movant] and Ms. Drury's home shortly thereafter. They found Ms. Drury, who had been shot in the head, lying on the kitchen floor. [Movant], who was in the bedroom when the officers arrived, had blood on his clothing and was carrying a gun in the front of his pants. After the officers arrested [Movant] and read him his Miranda rights, he told them, "Kelly shot herself."
*875 The officers took [Movant] to the Joplin Police Department, where he was interviewed by Detective Greg Helms. Initially, [Movant] told Detective Helms that Ms. Drury had gone to the bedroom, gotten the gun, and shot herself. When Detective Helms told [Movant] he did not believe him, [Movant] told Detective Helms that he handed the gun to Ms. Drury and told her to go ahead and shoot herself, which she did. Again, Detective Helms expressed disbelief, and [Movant] changed his story again, telling Detective Helms that he and Ms. Drury had struggled over the gun, and that she had overpowered him and then shot herself. Detective Helms told [Movant] that he also did not find this story believable, and [Movant] gave his final version of the events in which he said that he and Ms. Drury had been arguing about her drinking. According to [Movant], he pointed his gun at her head, she grabbed his arm, and he shot her.
Review of the denial of a Rule 29.15 motion is limited to a determination of whether the findings and conclusions of the motion court are clearly erroneous. Rule 29.15(k); Leisure v. State, 828 S.W.2d 872, 873-74 (Mo. banc 1992), cert denied, 506 U.S. 923, 113 S.Ct. 343, 121 L.Ed.2d 259 (1992). The findings and conclusions of the motion court are clearly erroneous only if, after review of the entire record, the appellate court is left with the definite and firm impression that a mistake has been made. State v. Vinson, 800 S.W.2d 444, 448 (Mo. banc 1990); George v. State, 973 S.W.2d 114, 115 (Mo.App. S.D.1998).
To prevail on a claim of ineffective assistance of counsel, a movant must show that the counsel failed to exercise the customary skill and diligence of a reasonably competent attorney under similar circumstances and that he was thereby prejudiced. Strickland v. Washington, 466 U.S. 668, 687, 104 S.Ct. 2052, 2064, 80 L.Ed.2d 674, 693 (1984); State v. Kelley, 953 S.W.2d 73, 91 (Mo.App. S.D.1997), cert. denied, 522 U.S. 1151, 118 S.Ct. 1173, 140 L.Ed.2d 182 (1998). Prejudice is shown where "there is a reasonable probability that, but for counsel's unprofessional errors, the result of the proceeding would have been different. A reasonable probability is a probability sufficient to undermine confidence in the outcome." Strickland, 466 U.S. at 694, 104 S.Ct. at 2068, 80 L.Ed.2d at 698.
Movant's first point on appeal is that the motion court clearly erred in denying his Rule 29.15 motion because trial counsel failed to conduct a reasonable investigation and present evidence to support the defense theory of suicide. He says "[a] test of the gun for its gunshot residue characteristics and measurements and forensic analysis of the scene showed that it was more probable that Ms. Drury herself fired the fatal shot, when the only evidence at trial was inconclusive." He maintains that if trial counsel had "investigated and presented this evidence, there is a reasonable probability that the jury would have acquitted [him]."
In his amended Rule 29.15 motion, Movant alleged that:
Movant's trial counsel unreasonably failed to obtain a competent expert in forensic science, crime-scene investigation, and gunshot residue, and further failed to have that expert test the residue deposition characteristics of the alleged murder weapon. With such investigation, the jury would have been presented with additional facts showing a very high probability that [Ms. Drury] had killed herself, resulting in [M]ovant's acquittal.
He further alleged that trial counsel had employed Gene Gietzen ("Mr. Gietzen"), owner of Forsensic Consulting Services, to assess gunshot residue tests conducted on both Movant and Ms. Drury following the shooting. Mr. Gietzen testified at trial that, based on the test results, it was his opinion that the levels of lead, barium and antimony on Ms. Drury "were sufficient *876 for having discharged, handled or been in close proximity of a recently fired weapon," but that he could not say whether she fired the weapon. He also testified that the test results showing no significant elevated residue being on Ms. Drury's palm did not preclude her from having fired the weapon because the palm could be protected during the firing of the short barreled pistol involved in this case. Mr. Gietzen said that he had seen other situations when a person known to have fired a gun had no increased residue levels on his or her palm, and that it was not scientifically sound to try to draw any conclusions from that fact.
In this point, Movant points to evidence presented at the hearing on his motion concerning a test firing of the pistol with which Ms. Drury was shot, and the interpretation of the results of that test as testified to by Don Smith ("Mr. Smith"), a retired criminalist with the Trace Evidence Section of the Arkansas State Crime Laboratory. He portrays that testimony as establishing that the test firing results, when compared to the residue found on Ms. Drury's hand, made it "more probable" that Ms. Drury fired the shot that killed her. In both instances, there were elevated levels of residue on the back of the hand and lower levels on the palm.
A review of Mr. Smith's testimony, however, dilutes the force of Movant's assertion in this regard. Mr. Smith testified that, based on a comparison between the residue patterns after the test firing and those found on Ms. Drury's hand, it was his opinion that "[Ms. Drury] was either in close proximity to a recently discharged weapon, had held a discharged weapon, or had discharged a weapon." He also said that there was no way to say that she did not fire the weapon, and she could not be excluded as having shot the weapon. This testimony was significantly similar to that presented by Movant at trial through the testimony of Mr. Gietzen referred to above.
A defendant is not entitled to a perfect trial or to clairvoyant trial counsel. Nave v. State, 757 S.W.2d 249, 251 (Mo. App. E.D.1988). A defendant is entitled to an attorney who exercises the customary skill and diligence that a reasonably competent attorney would perform under similar circumstances. Id. When a movant claims ineffective assistance of counsel for failure to locate and present expert witnesses, he must show that such experts existed at the time of trial, that they could have been located through reasonable investigation, and that the testimony of these witnesses would have benefited movant's defense. State v. Colbert, 949 S.W.2d 932, 945 (Mo.App. W.D.1997).
It is not ineffective assistance of counsel to fail to locate and obtain the testimony of an expert who would not necessarily provide a defense in the case. In Lockhart v. State, 761 S.W.2d 634, 635 (Mo.App. E.D.1988), movant contended that his trial counsel was ineffective for not locating and presenting the testimony of an expert at a rape trial who would testify that semen from earlier sexual intercourse could still be present in the vagina four days later when the alleged crime occurred. At the evidentiary hearing on the post-conviction motion, movant presented the testimony of a professor of obstetrics and gynecology who testified that there was a fifty-percent chance of sperm being present for four days after ejaculation. Id. The appellate court held that "[a]ssuming arguendo" that movant had been able to locate either the expert who testified at the hearing, or some other expert in the field, and that the expert would have testified if called on to do so, movant has not shown that the testimony would have provided him with a viable defense. Id. "At best, the expert would have stated that there was a one in two chance that the sperm came from someone other than the movant. Conjecture or speculation is not sufficient to establish the required prejudice flowing from the failure to call a witness to testify." Id.
*877 The Lockhart case is particularly relevant to the instant case because Mr. Smith did not purport to provide evidence that Ms. Drury fired the gun. Instead, he said that she either fired a weapon, was in close proximity to a weapon when it was fired, or had held a discharged weapon. Actually, this provides only a one in three chance that Ms. Drury shot herself. Under Lockhart this does not establish the required prejudice element. Add to this the fact that Movant did, in fact, introduce the testimony of another expert at trial who testified to essentially the same thing leads us to the inescapable conclusion that Movant suffered no prejudice as a result of the failure to call another expert on the issue of whether the gunpowder residue on Ms. Drury's hand established that she shot herself. This portion of the point is without merit.
Mr. Smith also reviewed measurements of the room where Ms. Drury was found, the path of the bullet that passed through her, the absence of blood on two walls of the room, the autopsy report, and photographs of Ms. Drury's body. From this information, he concluded that the wound in her head was a "contact wound," meaning that it was fired from "close proximity, within a fraction of an inch, or actual muzzle contact." He also recreated the path of the bullet through Ms. Drury's head. Mr. Smith concluded that, based on the physical facts, including the size of the room and the location where he hypothesized that Ms. Drury was standing, it would have been "very awkward" for someone to be able to position himself and fire the gun from the side of Mrs. Drury's head where the entrance wound appeared, but that it could have been done by someone standing in a chair. From all of this, Mr. Smith concluded that for someone else to have shot Ms. Drury, such person would have had to be left handed, and that "it's more probable that nobody else shot [Ms. Drury], that in fact she inflicted the wound." He also said that it would be "difficult" for anyone else to have shot Ms. Drury, but that "I wouldn't say that it's impossible, but it's certainly not as probable that [Ms. Drury] inflicted her own."
We are unable to conclude that trial counsel failed to exercise the customary skill and diligence that a reasonably competent attorney would perform under similar circumstances by not locating and presenting testimony like that given by Mr. Smith at the evidentiary hearing. Even if trial counsel had located Mr. Smith or another expert willing to testify that, from the physical facts, it was improbable that someone else shot her, or that it would have been "difficult" for someone else to have shot her, we are unable to conclude that there is a reasonable probability that the result would have been different. In this regard, it is appropriate to consider the strength of the other evidence against Movant in considering any prejudice that may have inured to Movant as a result of trial counsel's alleged ineffective representation. State v. Hopkins, 918 S.W.2d 350, 353 (Mo.App. W.D.1996). The fact that an error by counsel might have had some conceivable effect on the outcome is not sufficient. Richardson v. State, 719 S.W.2d 912, 915 (Mo.App. E.D. 1986). "Rather, movant, when challenging a conviction, must show there is a reasonable probability that, absent the alleged error, the fact finder would have had a reasonable doubt respecting guilt." Id. at 915-16. In considering whether a reasonable probability exists, the motion court must consider the totality of the evidence. Id. at 916.
In the instant case, Movant had exhibited violence toward Ms. Drury earlier in the evening; Movant was seen with the gun in the house before the shooting; while Movant said after the incident, that Ms. Drury had shot herself, he had the weapon tucked in the front of his pants; and he gave several varying stories to the police after his arrest, the last one of which was that he had put the gun next to her head while she was sitting in the kitchen, she grabbed his arm, and the gun *878 discharged. The evidence was sufficiently strong against Movant, that we cannot say that even if the evidence relating to the physical layout of the kitchen and Ms. Drury's location had been presented, that there is a reasonable probability that the outcome would have been different. This is especially true considering the fact that Movant admitted having gone to Ms. Drury, while she was sitting in a chair, and placing the gun against her head. This is the very thing that Movant now says that trial counsel should have tried to disprove. Counsel's failure to attempt to disprove the admission of Movant can hardly be said to be ineffective assistance of counsel which prejudiced Movant under the circumstances of this case. The motion court was not clearly erroneous in denying Movant relief on the basis argued in the first point. It is, therefore, denied.
Movant next asserts that the motion court clearly erred in denying his Rule 29.15 motion because trial counsel failed to offer a lesser included offense instruction for involuntary manslaughter. He argues that there was evidence to support such an instruction because of his statement to the police that the gun discharged accidentally when Ms. Drury grabbed his arm.
In evaluating the performance of counsel, we note that the actions of counsel that constitute sound trial strategy are not grounds for ineffective assistance claims. State v. Hall, 982 S.W.2d 675, 680 (Mo. banc 1998), cert. denied, 526 U.S. 1151, 119 S.Ct. 2034, 143 L.Ed.2d 1043 (1999). In this regard, there is a presumption that any challenged action was sound trial strategy and that counsel rendered adequate assistance and made all significant decisions in the exercise of professional judgment. Id. In the instant case, the motion court found that the failure to request an involuntary manslaughter instruction could have been trial strategy.
The fact that the failure to request the involuntary manslaughter instruction was trial strategy is indicated by the testimony of trial counsel at the evidentiary hearing. He testified that such an instruction would have been inconsistent with their contention that Ms. Drury's death was a suicide. He said that Movant "told me he wanted to go all or nothing." Where a lesser included offense instruction is inconsistent with the defense asserted at trial, it is not ineffective assistance of counsel to fail to request such an instruction. Hackney v. State, 778 S.W.2d 776, 778 (Mo.App. E.D.1989). See also State v. Theus, 967 S.W.2d 234, 242 (Mo.App. W.D. 1998). Movant's second point is denied.
In his third, and final, point, Movant contends that the motion court clearly erred in denying his Rule 29.15 motion because appellate counsel failed to raise as an issue on direct appeal the trial court's refusal to admit evidence that Ms. Drury had a blood alcohol level of 0.18% and also had Valium in her blood. He argues that such evidence would have made it more likely that the jury would have accepted his contention that Ms. Drury committed suicide. In fact, Movant characterizes this evidence as a "dead bang winner."
In order to prevail on a claim of ineffectiveness of appellate counsel, there must be strong grounds showing that counsel failed to assert a claim of error which would have required reversal had it been asserted and which was so obvious from the record that a competent and effective attorney would have recognized and asserted it. Ham v. State, 7 S.W.3d 433, 440-41 (Mo.App. W.D.1999). The right to relief due to ineffective assistance of appellate counsel "inevitably tracks the plain error rule; i.e., the error that was not raised on appeal was so substantial as to amount to manifest injustice or a miscarriage of justice." Moss v. State, 10 S.W.3d 508, 514-15 (Mo. banc 2000) (quoting from Reuscher v. State, 887 S.W.2d 588, 591 (Mo. banc 1994), cert. denied, 514 U.S. 1119, 115 S.Ct. 1982, 131 L.Ed.2d 869 (1995)).
It must be remembered that the trial courts have broad discretion in determining *879 the admissibility of evidence and will only be reversed when that discretion is abused and the abuse of discretion resulted in prejudice to a defendant. State v. Jacoway, 11 S.W.3d 793, 796 (Mo.App. W.D.1999). In this case, Movant's attorney, in cross-examining the director of the regional crime lab, inquired about the results of blood tests performed on Ms. Drury. In response to an objection from the State, he argued that the test results would go to her state of mind at the time of the shooting, and would permit the jury to draw their own conclusions about "what influences she was under at the time of the shooting." In sustaining the State's objection, the trial court stated, among other things, that it had concerns about the relevancy of the evidence to the issue of whether or not Movant shot Ms. Drury. It also noted that there was evidence already in the case that she and Movant were drinking, and that Ms. Drury was intoxicated. Movant's trial attorney then made an offer of proof concerning the contents of Ms. Drury's blood and urine following the shooting, during which the witness said that the blood showed caffeine, Valium, and approximately .18% alcohol.
In Jacoway, there was an issue about whether the trial court erred in rejecting evidence that the decedent had a blood alcohol content of .186%. The defendant contended that the evidence was relevant to whether he (the defendant) acted under the influence of sudden passion caused by the actions of the intoxicated decedent. The appellate court held that it was not error to refuse the evidence, noting that trial courts have broad discretion regarding the admissibility of evidence. 11 S.W.3d at 796. The reason they are given such broad discretion to exclude marginally relevant evidence is "because of concerns about prejudice, confusion of the issues, and interrogation that is only marginally relevant." Id. The court said that evidence of the decedent's blood alcohol content would directly show only that he was intoxicated, which does not necessarily mean that he was violent. Id. at 797.
In this case, Movant argues that the evidence was important "to the defense of suicide because it could have shown Ms. Drury to be despondent." He concludes that if the issue had been argued on the direct appeal, "this Court would surely have remanded the case for a new trial." This argument ignores, however, the discretion vested in the trial court concerning the admissibility of evidence. Here, we are unable to conclude that this issue would have required a reversal. This is especially true, considering the fact that other evidence before the jury indicated that Ms. Drury had been drinking and appeared to be intoxicated before she died. As in Jacoway, the evidence of Ms. Drury's blood content "could reasonably be considered cumulative and of marginal relevance." Id. at 797. The motion court was not clearly erroneous in denying this claim for relief. This point is denied.
We affirm the denial of Movant's post-conviction motion.
PREWITT, J., and CROW, J., concur.
NOTES
[1] All rule references are to Missouri Rules of Criminal Procedure (2000) and all statutory references are to RSMo 1994, unless otherwise indicated. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/2166268/ | 215 N.J. Super. 333 (1987)
521 A.2d 1315
RUTH F. DIXON, RESPONDENT,
v.
RUTGERS, THE STATE UNIVERSITY OF NEW JERSEY; EDWARD J. BLOUSTEIN, PRESIDENT; RUSSELL J. FAIRBANKS, PROVOST; WALTER J. GORDON, DEAN, APPELLANTS.
Superior Court of New Jersey, Appellate Division.
Argued September 22, 1986.
Decided February 24, 1987.
*334 Before Judges PETRELLA, GAYNOR and SCALERA.
Aron M. Schwartz argued the cause for appellant (Vogel, Chait, Kimmel, Schwartz & Collins, Aron M. Schwartz on the brief).
Nancy Kaplen Miller, Deputy Attorney General, argued the cause for respondent (W. Cary Edwards, Attorney General of New Jersey, attorney, Andrea Silkowitz, Deputy Attorney General, of counsel; Nancy Kaplen Miller on the brief).
The opinion of the court was delivered by GAYNOR, J.A.D.
This interlocutory appeal presents the novel question of whether an academic freedom privilege should be formulated to protect the confidentiality of material contained in promotion packets of members of the faculty of Rutgers, The State University.
By leave granted, Rutgers appeals from the denial of its motion to preclude the use of such material in an administrative proceeding wherein the Division of Civil Rights (DCR) found that probable cause existed for the claim that a faculty member had been denied a promotion from assistant professor to associate professor because of sex discrimination.[1] In permitting the evidentiary use of this confidential material, under appropriate protective restrictions, the Administrative Law Judge rejected the asserted privilege and also concluded that such use was not precluded by the terms of a collective bargaining agreement as *335 incorporated in complainant's employment contract. We agree and affirm.
Dr. Ruth Dixon (Dixon), a black female, was hired by Rutgers in 1971 as an assistant professor and chair of the Educational Opportunity Fund Instructional Department at the Camden campus of the College of Arts and Sciences. After the completion of her fifth year of employment, Dixon was notified that she would automatically be evaluated for tenure and promotion to associate professor during the 1976-1977 academic year. If tenure were not granted, she would receive a one-year terminal contract as a lecturer. Pursuant to university procedures, Dixon was evaluated by the Ad Hoc Committee, the Appointment and Promotions Committee and the Dean of the college and was unanimously recommended for tenure and promotion. Her promotion packet was then forwarded to the Promotion Review Committee (PRC). This committee, appointed by the university president, reviews all evidence previously considered in connection with a proposed promotion and granting of tenure, including the confidential letters of recommendation from sources outside the university, and then submits its recommendations to the president. The PRC declined to recommend Dixon for promotion and tenure because of "insufficient evidence of distinction in teaching, creativity and research." When reminded that Dixon had no teaching responsibilities by which distinction could be evidenced, the committee reconsidered her application for promotion and concluded that she showed "insufficient evidence of research and scholarly activities expected of a faculty member in Academic Foundations" to warrant a recommendation for promotion and tenure.
The day before Dixon's review by the PRC, the committee considered the promotion packets of Henry Eng (Eng) and William Jones (Jones), faculty members in Academic Foundation Departments on two other campuses. Eng, an assistant professor at Livingston, was recommended for tenure and Jones, an assistant professor at Newark, was recommended for tenure and promotion. The recommendations of the PRC concerning *336 Dixon, Eng and Jones were thereafter adopted by the Rutgers' Board of Governors.
Dixon's rejection for promotion and tenure prompted her to file a complaint with the DCR claiming discrimination based on her race and sex. Following an investigation, which included an examination of the promotion packets of Dixon, Eng and Jones under a protective stipulation, the DCR found probable cause to credit the allegations of sex discrimination in the decision denying tenure and promotion to Dixon. However, noting that Eng was an oriental and Jones was a black, it found no support for the claim of racial discrimination. Prior to the issuance of these findings, Dixon had been awarded retroactive tenure by the Board of Governors.[2] The matter was then transmitted to the Office of Administrative Law for prosecution by the attorney general.
In denying Rutgers' prehearing motion to preclude the admission of the promotion packets, the ALJ concluded that neither the stipulation between counsel when the files were turned over to the DCR nor the terms of a collectively negotiated agreement between Rutgers and the Rutgers Council of the American Association of University Professors precluded the admissibility of the subject files. Further, that the confidentiality ascribed to the contents of the packets did not require their exclusion as evidence, particularly in view of their availability to Rutgers to demonstrate the claimed nondiscriminating reason for rejecting Dixon's application for promotion. The admission of the material also was deemed necessary because of its relevancy to a prima facie showing of unlawful discrimination and the unavailability from other sources of evidence of qualifications considered by the committee. However, the expected confidentiality of letters from outside sources were to be protected by the excision of the authors' names from the documents *337 "so long as Rutgers did not place greater weight on one outside specialist over another because of reputation in the academic community."
In this appeal, Rutgers contends the materials are privileged against disclosure since a compelling public interest in maintaining their confidentiality heavily outweighs the asserted need for their use. It is urged that a qualified academic freedom privilege should be invoked to preclude the evidentiary use of the confidential material, as such protection would support the peer review system for faculty promotion and tenure, the reliability and integrity of which assertedly is dependent upon the confidentiality of both internal and external evaluations. Rutgers further contends that the minimal relevancy of these documents to the proceedings should not take precedence over the privilege they should enjoy. Additionally, the substantial deference required to be given to the academic judgments involved in promotion and tenure decisions assertedly should negate the claimed need for their admission. Finally, Rutgers argues that, in addition to being privileged, the confidential material is protected from disclosure by the express terms of the collectively negotiated agreement between the university and the American Association of University Professors as incorporated in Dixon's individual employment contract.
Consideration of the creation of a new privilege must begin with the premise that "all privileges ... are exceptional, and are therefor to be [discouraged].... The investigation of truth and the enforcement of testimonial duty demand the restriction, not the expansion, of these privileges." 8 Wigmore, Evidence, (McNaughton rev. ed. 1961) § 2192 at 70-73. See e.g., Fellerman v. Bradley, 99 N.J. 493, 502 (1985); State v. White, 195 N.J. Super. 457, 460 (Law Div. 1984); Cf. Wylie v. Mills, 195 N.J. Super. 332, 337 (Law Div. 1984). As privileges do not further the ascertainment of truth but rather permit the concealment of relevant, reliable information, courts have been reluctant to expand or create new privileges in the absence of *338 compelling reasons. In re Dinnan, 661 F.2d 426, 429-430 (5 Cir.1981), cert. den. 457 U.S. 1106, 102 S.Ct. 2904, 73 L.Ed.2d 1314 (1982). In addressing the issue of the judicial establishment of new privileges, the United States Supreme Court has stated that "exceptions to the demand for every man's evidence are not lightly created nor expansively construed, for they are in derogation of the search for truth." United States v. Nixon, 418 U.S. 683, 710, 94 S.Ct. 3090, 41 L.Ed.2d 1039 (1974). See also, State v. White, 195 N.J. Super. at 460. The exclusion of relevant evidence by the creation of a privilege is warranted only if the resulting public good transcends the normally predominant principle of utilizing all rational means for ascertaining truth. Trammel v. United States, 445 U.S. 40, 49, 100 S.Ct. 906, 912, 63 L.Ed.2d 186 (1980). While the authority of this court would encompass the formulation of a new privilege, see Hague v. Williams, 37 N.J. 328, 335 (1962), we are aware of the hostility on the part of the judiciary, in general, to recognize additional privileges. In re Dinnan, 661 F.2d at 430.
With these concepts in mind, we turn to the academic freedom privilege sought to be invoked by Rutgers. We are urged to establish this evidentiary privilege because, without confidentiality, the reliability and integrity of the peer review system used for faculty promotion and tenure assertedly would be seriously and substantially impaired, thereby undermining the excellence of the faculty and the consequent excellence of the university. It is argued that the attainment of such professorial quality is a societal value which transcends the search for the truth concerning the committee's action on Dixon's application for promotion.
There can be no question as to the worthiness of Rutgers' being staffed by an excellent faculty. Nor that, normally, the pursuit of such excellence should be furthered by a system which controls the advancement of the faculty by means of confidential internal and external peer evaluations. See Snitow v. Rutgers University, 103 N.J. 116, 122 (1986). Also, we do *339 not quarrel with the observation that confidentiality has been recognized by the courts as playing an important role in appropriate circumstances. See e.g. Nero v. Hyland, 76 N.J. 213, 224 (1978); Wylie v. Mills, 195 N.J. Super. at 337; State v. Kaszubinski, 177 N.J. Super. 136, 138-139 (Law Div. 1980).
But, we do not agree that the public interest which is served by the confidentiality of the promotion packets of the faculty of Rutgers outweighs the competing interest of disclosure of discriminatory treatment. The eradication of unlawful discrimination from our society has always been of predominant concern in our State. Peper v. Princeton Univ. Bd. of Trustees, 77 N.J. 55, 80 (1978). Our aversion to such disparate treatment in an employment setting was noted by the observation in Peper that "[e]mployment discrimination due to sex or any other invidious classification is peculiarly repugnant in a society which prides itself on judging each individual by his or her merits." Id. at 80. The Legislature likewise has recognized discrimination as a public injury. See David v. Vesta Co., 45 N.J. 301 (1965); N.J.S.A. 10:5-3. Cloaking the peer review process with an evidentiary privilege of nondisclosure, in the face of a charge of a discriminatory practice, would be repugnant to the public policy against discrimination as well as contrary to the public interest in providing a remedy for this type of injury. Unchecked discrimination in a university environment presents no less a public injury than such conduct in other settings. Constitutional as well as statutory rights are implicated. See Peper, 77 N.J. at 81.
Moreover, invoking the suggested privilege would severly interfere with the search for truth in denying access to relevant evidence. One of the most important sources of evidence in demonstrating discrimination is comparative materials. Id. at 84-85. See also O'Connor v. Peru State College, 781 F.2d 632, 636 (8 Cir.1986); E.E.O.C. v. Franklin and Marshall College, 775 F.2d 110, 117 (3 Cir.1985), cert. den. ___ U.S. ___, 106 S.Ct. 2288, 90 L.Ed.2d 729 (1986). While comparisons may be more difficult in the case of academic employment decisions, such *340 evidence seemingly would be essential to a determination as to whether disparate treatment was rendered. See Namenwirth v. Board of Regents, 769 F.2d 1235, 1241 (7 Cir.1985), cert. den. ___ U.S. ___, 106 S.Ct. 807, 88 L.Ed.2d 782 (1986). It is evident that a full disclosure of the relative qualifications of Eng, Jones and Dixon and the peer review materials as contained in their promotion packets is necessary to the factual inquiry of whether discrimination had been a factor in Dixon's promotion rejection. See E.E.O.C. v. Franklin and Marshall College, 775 F.2d at 116. To preclude the evidentiary use of this material would require Dixon to chase an invisible quarry. It would also effectively deny her the opportunity to demonstrate employment discrimination as evidence of qualifications considered by PRC is not available from other sources. We perceive no merit in Rutgers' contention that differences in job responsibilities and disciplines between these three academicians vitiate the relevancy of the comparison.
Furthermore, we are not convinced that the disclosure in these proceedings of the contents of the promotion packets would impair the integrity of the peer review system in acting upon faculty promotions and tenure. As the individuals being evaluated can have access to their own packet, except for the outside letters of evaluation, the peer reviewers are not operating under an assumption of strict confidentiality. It is unlikely that an evaluator, knowing that the person being evaluated will have access to the records and that the evaluation may be discoverable in a Title VII federal proceeding,[3] would feel any less "chilled" knowing that the materials may be admissible in an action instituted by the DCR. Even if such an individual does exist "[t]he chance that now and then there may be found some timid soul who will take counsel of his fears and give way to their repressive power is too remote and shadowy to shape the course of justice." Clark v. United States, 289 U.S. 1, 16, *341 53 S.Ct. 465, 470, 77 L.Ed. 993 (1933). For those who occupy "positions of responsibility ... the consequence of such responsibility is that occassionally the decision maker will be called upon to explain his actions. In such a case, he must have the courage to stand up and publicly account for his decision." In re Dinnan, 661 F.2d at 432. Given the strong public interest in disclosure of all relevant evidence, the marginal impact, if any, of the evidentiary use of the peer review process material is outweighed by the demands of fair employment. See Gray v. Board of Higher Educ., 692 F.2d 901, 908 (2 Cir.1982). Moreover, such disclosure is always subject to appropriate protective measures,
The attempt to ground the asserted privilege in the concerns of academic freedom is also unpersuasive. While academic freedom should allow a university "to determine for itself on academic grounds who may teach, what may be taught, how it shall be taught, and who may be admitted to study," [Citation omitted.] Regents of the University of California v. Bakke, 438 U.S. 265, 312, 98 S.Ct. 2733, 2759, 57 L.Ed.2d 750 (1978), and "no decision can more fully implicate an institution's academic responsibility than the decision to hire, or promote, and retain faculty," Snitow v. Rutgers University, 103 N.J. at 123, a claim of discrimination relates to a decision made on other than academic grounds. Academic freedom does not encompass disparate treatment in acting upon faculty promotions or the shielding of records which might reveal evidence of discrimination. To so extend the concept "would give any institution of higher learning a carte blanche to practice discrimination of all types." In re Dinnan, 661 F.2d at 431.
The further contention that the evidentiary use of the packets is precluded by the provision in the collective bargaining agreement between Rutgers and the AAUP restricting access to personal files to the named individuals, except for use by the university for evaluation purposes, is devoid of merit. Even if this provision were deemed applicable, the material is not being sought by Dixon, but by the DCR which is not a party to the *342 agreement. In any event, judicial considerations of the proper scope of compelled disclosure in a discrimination proceeding are not constrained by a collective bargaining agreement. Gray v. Board of Higher Educ. 692 F.2d at 910.
Rutgers' argument that nondisclosure of the peer review materials is mandated by the proscription contained in Evid. R. 34 against disclosing official information of the State is clearly without merit. R. 2:11-3(e)(1)(E).
In affirming the denial of Rutgers' motion to preclude the evidentiary use of the contents of the particular promotion packets, we also approve of the protective measure imposed by the Administrative Law Judge. However, we extend that provision to include a prohibition against the disclosure of the material to persons not involved in the proceedings.
Affirmed as modified.
NOTES
[1] The reference to Rutgers as the appellant is intended to include the individual appellants who are administrative and academic officers of the university.
[2] The record before us does not contain any explanation for this reversal by the Board of Governors.
[3] See E.E.O.C. v. Franklin and Marshall College, supra; In re Dinnan, supra. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/819454/ | Slip Op. 00-114
UNITED STATES COURT OF INTERNATIONAL TRADE
______________________________
:
AMERICAN PERMAC, INC., :
:
Plaintiff, :
:
v. : Court No. 94-10-00589
: BEFORE: CARMAN, CHIEF JUDGE
UNITED STATES, :
:
Defendant. :
______________________________:
Plaintiff, American Permac, Inc., argues it is entitled to judgment as a matter of law
because the entries at issue were liquidated by operation of law prior to the United States
Customs Service’s (Customs) 1994 liquidation of the entries.
Defendant, United States, argues it is entitled to judgment as a matter of law because the
entries at issue were not liquidated by operation of law prior to Customs’s 1994 liquidation.
Also, defendant argues it is entitled to judgment as a matter of law on its counterclaims because
Customs’s 1994 liquidation of the entries at issue was valid but contained errors. Plaintiff argues
the Court may not consider defendant’s counterclaims due to its lack of subject matter
jurisdiction or, alternatively, because the issues presented are res judicata.
Held: The Court finds there are no genuine issues of material fact, and summary
judgment is appropriate. In accordance with the United States Court of Appeals for the Federal
Circuit’s decision in American Permac, Inc. v. United States, 191 F.3d 1380 (Fed. Cir. 1999),
plaintiff’s motion for summary judgment is denied, and defendant’s cross-motion for summary
judgment is granted. Also, as this Court finds it has subject matter jurisdiction to consider
defendant’s counterclaims pursuant to 28 U.S.C. § 1583 (1994), and this Court finds plaintiff’s
res judicata defense waived, defendant’s cross-motion for summary judgment on its
counterclaims is granted.
Date: September 1, 2000
Barnes, Richardson & Colburn (Rufus E. Jarman, Jr.), New York, New York; Alan
Goggins, of Counsel, for plaintiff.
David W. Ogden, Assistant Attorney General of the United States; Joseph I. Liebman,
Attorney in Charge, International Trade Field Office, Commercial Litigation Branch, Civil
Division, United States Department of Justice (James A. Curley); Edward N. Maurer, Office of
Court No. 94-10-00589 Page 2
the Assistant Chief Counsel, International Trade Litigation, United States Customs Service, of
Counsel, for defendant.
OPINION
CARMAN, CHIEF JUDGE: This case is before this Court on remand from the United
States Court of Appeals for the Federal Circuit (Federal Circuit). See American Permac, Inc. v.
United States, 191 F.3d 1380 (Fed. Cir. 1999). Plaintiff, American Permac, Inc. (American
Permac), argues it is entitled to judgment as a matter of law because the entries at issue were
liquidated by operation of law prior to the United States Customs Service’s (Customs) 1994
liquidation of the entries.
Defendant, United States, argues it is entitled to judgment as a matter of law because the
entries at issue were not liquidated by operation of law prior to Customs’s 1994 liquidation.
Also, defendant argues it is entitled to judgment as a matter of law on its counterclaims because
Customs’s 1994 liquidation of the entries at issue, although valid, contained errors. Plaintiff
argues the Court may not consider defendant’s counterclaims due to its lack of subject matter
jurisdiction or, alternatively, because the issues presented are res judicata. This Court has
jurisdiction pursuant to 28 U.S.C. § 1581(a).
BACKGROUND
The facts in this case have been recounted in greater detail in American Permac, Inc. v.
United States, 984 F. Supp. 621, 622 (CIT 1997), and American Permac, Inc. v. United States,
191 F.3d at 1381. The facts pertinent to this opinion are set forth below.
Court No. 94-10-00589 Page 3
This case involves three entries of dry-cleaning machinery from Germany. After
Customs liquidated the three entries in 1994, assessing antidumping duties, plaintiff timely filed
protests against the 1994 liquidations alleging the entries had been liquidated by operation of
law, i.e., without antidumping duties, prior to Customs’s 1994 liquidation. After Customs denied
the protests, plaintiff timely filed a summons with this Court asserting the Customs’s 1994
“liquidation and assessment of antidumping duties [on the three entries] were barred by the
statute of limitations,” (Summons at 2.), as the entries were liquidated by operation of law prior
to that date.
In its answer to plaintiff’s complaint, defendant denied plaintiff’s claim and filed two
counterclaims asserting that while Customs had validly liquidated the entries at issue, Customs
had erred by under-assessing the antidumping duties owed on two of the three entries at issue.1
Customs under-assessed antidumping duties on the two entries in the amount of $7,186.04.2 In
response to defendant’s counterclaims, plaintiff raised no defenses in its pleadings.3 (See
[Plaintiff’s] Reply.)
1
The entries covered by defendant’s counterclaims are Entry Nos. 515334-3 and 515210-
8.
2
Defendant, in its Statement of Material Facts Not in Dispute in Defendant’s Opposition
to Plaintiff’s Motion for Summary Judgment and Cross-Motion for Summary Judgment
(Defendant’s Facts), asserted the “difference between the correct amount of antidumping duty on
Entry No. 515334-3, and the amount of antidumping duty assessed on this entry at liquidation, is
$4,607.75,” (id. at ¶ 7.), and the “difference . . . on Entry No. 515210-8 . . . is $2,578.29.” (Id. at
¶ 11; see also Answer and Counterclaims at ¶¶ 42, 45, 47, 50.)
3
The Court notes in response to Defendant’s Facts where defendant asserted the material
facts of its counterclaims, plaintiff stated, “These antidumping duties are not ‘correct’ because
the entries were liquidated by operation of law without the assessment of antidumping duties.
Without the descriptive term ‘correct,’ plaintiff admits the statements in paragraphs 1-11
[material facts of defendant’s counterclaims] of [Defendant’s Facts].” (Facts Not in Dispute in
Plaintiff’s Reply Brief In Support of Its Motion for Summary Judgment and In Opposition to
Defendant’s Cross-Motion for Summary Judgment at 3.)
Court No. 94-10-00589 Page 4
In 1997, this Court held the entries at issue were liquidated by operation of law and thus
declined to address defendant’s counterclaims. See American Permac, 984 F. Supp. at 629. On
appeal, however, the Federal Circuit reversed this Court and held the entries were not liquidated
by operation of law and remanded the matter for further proceedings. See American Permac, 191
F.3d at 1382. Subsequent to the remand and upon request of the parties, this Court ordered the
parties to submit “supplemental briefing concerning the government’s counterclaims.”
(Scheduling Order (Stipulation) signed January 31, 2000.)
CONTENTIONS OF THE PARTIES
A. Plaintiff
Plaintiff, American Permac, argues the Court may not properly consider or, alternatively,
the Court should deny defendant’s counterclaims because no protest was filed to contest the
Customs’s determinations involved in defendant’s counterclaims, i.e., Customs’s assessment of
antidumping duties. Therefore those determinations are final and conclusive on all parties under
19 U.S.C. § 1514 (1994).4 Citing United States v. Cherry Hill Textiles, Inc., 112 F.3d 1550 (Fed.
4
In relevant part, 19 U.S.C. § 1514(a) (1994) states:
Protests against decisions of Customs Service
(a) Finality of decisions; return of papers
Except as provided in subsection (b) of this section, . . . and section 1520 of this title
(relating to refunds and errors), decisions of the Customs Service, including the legality
of all orders and findings entering into the same, as to
***
(2) the classification and rate and amount of duties chargeable;
***
(5) the liquidation or reliquidation of an entry, or reconciliation as to the issues
contained therein, or any modification thereof;
***
shall be final and conclusive upon all persons (including the United States and any officer
Court No. 94-10-00589 Page 5
Cir. 1997) and Export Packers Co., Ltd. v. United States, 795 F. Supp. 422 (CIT 1992), plaintiff
argues a protest “defines the scope of what is contested, and all other aspects of the liquidation
not contested become final and conclusive.” (Plaintiff’s Supplemental Brief on Remand
Regarding Defendant’s Counterclaims at 3.) Accordingly, when a defendant counterclaims on an
issue not raised in a plaintiff’s protest, the Court may not consider the counterclaim because the
Court lacks subject matter jurisdiction or the issue posed by the counterclaim is res judicata, i.e.,
an issue already judged.5
In this matter, plaintiff claims the only issue raised in its protest was the validity of
Customs’s 1994 liquidation of the entries at issue, i.e., whether the entries at issue were
liquidated by operation of law prior to Customs’s 1994 liquidations. According to plaintiff,
defendant’s counterclaims involve the amount of antidumping duties assessed in Customs’s
liquidations, a separate and distinct issue not challenged by plaintiff. Therefore, plaintiff argues
defendant may not now assert counterclaims on the amount of antidumping duties assessed as it
is final and conclusive under the statute. To bolster its argument, plaintiff notes the statute treats
the assessment of duties and the validity of liquidation as separate issues by enumerating the
issues in separate subsections of the statute, 19 U.S.C. § 1514(a)(3) and 19 U.S.C. § 1514(a)(5),
respectively.
thereof) unless a protest is filed in accordance with this section, or unless a civil action
contesting the denial of a protest, in whole or in part, is commenced in the United States
Court of International Trade in accordance with chapter 169 of Title 28 within the time
prescribed by section 2636 of that title.
5
To support its argument regarding res judicata, plaintiff cites Smith v. United States, 1
U.S. Cust. App. 489, 491 (1911) (once a Customs’ decision becomes final and conclusive on
liquidation, the decision is “res adjudicata, unless appeal therefrom is taken in the time by statute
allowed”).
Court No. 94-10-00589 Page 6
Accordingly, plaintiff argues the Court may not properly consider defendant’s
counterclaims due to lack of subject matter jurisdiction or, alternatively, the Court should deny
defendant’s counterclaims as the issues involved are res judicata.
B. Defendant
Defendant, United States, in its cross-motion for summary judgment claims that, pursuant
to 28 U.S.C. § 1583 (1994), Customs under-assessed the amount of antidumping duties on two of
the entries at issue. Defendant argues it is entitled to collect $7,186.04 plus prejudgment interest
in under-assessed antidumping duties from plaintiff.
Defendant contends the Court may properly consider its counterclaims under 28 U.S.C.
§ 1583, which states, in relevant part, the Court of International Trade “shall have exclusive
jurisdiction to render judgment upon any counterclaim . . . if [] such claim . . . involves the
imported merchandise that is the subject of such civil action.” Defendant maintains there is no
dispute among the parties that its counterclaims involve those entries cited in plaintiff’s claim,
therefore, the Court has subject matter jurisdiction over defendant’s counterclaims.
Defendant also argues plaintiff’s other arguments against the Court’s consideration of the
defendant’s counterclaims are meritless. First, defendant contends plaintiff’s arguments may not
be considered by the Court because plaintiff’s arguments in opposition to defendant’s
counterclaims have nothing to do with the effect of the appellate court’s decision. Therefore,
plaintiff’s arguments are beyond the scope of the supplemental brief allowed by the Court in this
matter. Accordingly, it is inappropriate for the Court to consider these arguments.
Court No. 94-10-00589 Page 7
Second, defendant contends, contrary to plaintiff’s assertions, the issue of assessment of
duties is not final and conclusive under 19 U.S.C. § 1514, because plaintiff challenged both the
validity of Customs’ liquidation and the assessment of antidumping duties in its protest to
Customs and summons before the Court. (See Summons at 2.) Moreover, defendant asserts
plaintiff’s claim that the entries at issue were liquidated by operation of law under 19 U.S.C. §
1504(d), requires the Court to determine whether the actual liquidation is valid and, if so, the
correct rate and amount of duty on the entry. Defendant argues proper liquidation and the proper
assessment of duties are necessarily linked. Therefore, defendant argues its counterclaims
regarding the assessment of duties may be properly considered by this Court.
Finally, defendant argues plaintiff’s reliance on Cherry Hill is misplaced. See Cherry
Hill, 112 F.3d at 1550. Defendant argues the situation at bar is factually distinct from that
presented in Cherry Hill.
Accordingly, defendant argues the Court should consider its counterclaims and its cross-
motion for summary judgment should be granted.
STANDARD OF REVIEW
This case is before the Court on plaintiff’s motion and defendant’s cross-motion for
summary judgment. Summary judgment is appropriate if, based on the papers before the Court,
“there is no genuine issue as to any material fact” and “the moving party is entitled to a judgment
as a matter of law.” U.S. CIT R. 56(c). The Court finds summary judgment is appropriate in this
case because there are no genuine issues of material fact in dispute. See United States v.
Shabahang Persian Carpets, Ltd., 963 F. Supp. 1207, 1209 (CIT 1997).
Court No. 94-10-00589 Page 8
DISCUSSION
This matter is before the Court on remand from the United States Court of Appeals for
the Federal Circuit. See American Permac, 191 F.3d at 1381.
On appeal, the Federal Circuit reversed and remanded this Court’s determination in
American Permac, 984 F. Supp. at 621, holding “American Permac’s argument for liquidation by
operation of law must fail.” American Permac, 191 F.3d at 1382. Therefore, all that remains for
this court to decide on remand are the issues brought forth by defendant’s cross-motion for
summary judgment on its counterclaims.
A. Jurisdiction
Plaintiff argues this Court may not consider defendant’s counterclaims because it lacks
subject matter jurisdiction. This Court disagrees.
Section 1583 of Title 28 of the United States Code states, in a civil action the Court of
International Trade “shall have exclusive jurisdiction to render judgment upon any counterclaim .
. . if . . . such claim . . . involves the imported merchandise that is the subject matter of such civil
action.” 28 U.S.C. § 1583(1); see Tikal Distrib. Corp. v. United States, 93 F. Supp. 2d 1269,
1275 (CIT 2000). Accordingly, this Court would not have jurisdiction over defendant’s
counterclaims if they did not concern the same merchandise as plaintiff’s claim. See Export
Packers Co., Ltd. v. United States, 795 F. Supp. 422, 426 (CIT 1992); Shabahang, 963 F. Supp.
at 1210.
Court No. 94-10-00589 Page 9
In this case, there appears to be no dispute among the parties that defendant’s
counterclaims involve those entries at issue in plaintiff’s claim. Therefore, pursuant to 28 U.S.C.
§ 1583, the Court finds it has subject matter jurisdiction over defendant’s counterclaims.6
B. Res Judicata7
Plaintiff also argues this Court may not consider the issues brought forth in defendant’s
counterclaims as they are res judicata. Plaintiff appears to maintain that because it did not
protest Customs’ assessment of antidumping duties, Customs’s assessment determinations are
final and conclusive under 19 U.S.C. § 1514(a). Therefore, plaintiff contends defendant’s
counterclaims involve issues for which final determinations have been rendered. This Court will
not consider the merits of plaintiff’s argument.
Pursuant to U.S. CIT R. 8(d), res judicata is a defense which must be affirmatively pled
in response to a preceding pleading. Failure to plead res judicata as an affirmative defense
results in its waiver. See Aimcor and SKW Metals & Alloys, Inc. v. United States, 69 F. Supp. 2d
1345, 1348 n.1 (CIT 1999).
6
Plaintiff cites to Export Packers Co., Ltd. v. United States, 795 F. Supp. 422 (CIT
1992), for the proposition that since plaintiff failed to protest classification of the merchandise,
the Court has no jurisdiction over counterclaims concerning classification. Plaintiff’s citation is
inapposite. In Export Packers, the Court dismissed defendant’s counterclaim because it
determined defendant’s counterclaim and plaintiff’s claim “involved separate and distinct
merchandise.” Id. at 425-426. Here, both parties agree plaintiff’s claim and defendant’s
counterclaims involve the same merchandise.
7
Res judicata is the “[r]ule that a final judgment rendered by a court of competent
jurisdiction on the merits is conclusive as to the rights of the parties . . . and . . . constitutes an
absolute bar to a subsequent action involving the same claim.” BLACK’S LAW DICTIONARY 1305
(6th ed. 1990).
Court No. 94-10-00589 Page 10
In this matter, the Court notes plaintiff did not affirmatively plead its affirmative defense
of res judicata in response to defendant’s counterclaims. (See [Plaintiff’s] Reply.) In fact, it
appears the res judicata defense was only first raised in plaintiff’s supplemental brief on
defendant’s counterclaims. Its presentment at this juncture is simply not timely. Accordingly,
this Court will not address the merits of plaintiff’s res judicata defense.
C. Defendant’s Counterclaims
Pursuant to 28 U.S.C. § 1583, defendant seeks to collect from plaintiff $7,186.04 in
under-assessed antidumping duties plus prejudgment interest on two entries of dry-cleaning
machinery imported from Germany. Defendant claims it erroneously assessed the antidumping
duties in the first instance.
The Court notes plaintiff put forth no affirmative defense to defendant’s counterclaims in
its reply pleading. It appears the only defense raised by plaintiff against defendant’s
counterclaims was its claim that the entries at issue were liquidated by operation of law. (See
Facts Not in Dispute in Defendant’s Reply Brief in Support of Its Motion for Summary Judgment
and in Opposition to Defendant’s Cross-Motion for Summary Judgment at 3.) Also, in its reply
brief plaintiff admits to the substantive facts raised in defendant’s counterclaims.8 (See id.)
As the Federal Circuit determined the entries at issue in plaintiff’s claim were not
liquidated by operation of law, American Permac, 191 F.3d at 1382, and plaintiff admits
8
See supra note 3.
Court No. 94-10-00589 Page 11
Customs under-assessed the antidumping duties on the entries at issue, this Court grants
defendant’s cross-motion for summary judgment on its counterclaims.
D. Prejudgment Interest
Defendant also seeks to recover prejudgment interest on the amount of under-assessed
duties. This Court declines to make such an award.
It is within this Court’s discretion to award prejudgment interest at a rate provided for in
28 U.S.C. § 2644 (1994), in cases where no statute specifically authorizes such an award. See
United States v. Reul, 959 F.2d 1572, 1577 (Fed. Cir. 1992). This Court declines to exercise its
discretion to award interest because it finds it was reasonable for plaintiff to have believed its
entries were liquidated by operation of law and as a result Customs was foreclosed from
assessing any antidumping duties. See Eastern Air Lines, Inc. v. Atlantic Richfield Co., 712 F.2d
1402, 1410 (Temp. Emer. Ct. App. 1983) (denying prejudgment interest where underlying
recovery is uncertain) cited in United States v. Jac Natori Co., Ltd., 1998 WL 864772, at *4 (CIT
Dec. 11, 1998).
CONCLUSION
Pursuant to the Federal Circuit’s decision in American Permac, Inc. v. United States, 191
F.3d 1380 (Fed. Cir. 1999), and for and in accordance with the reasons stated above, plaintiff’s
motion for summary judgment is denied, and defendant’s cross-motion for summary judgment is
granted.
___________________________
Gregory W. Carman
Chief Judge
Dated: September 1, 2000
New York, New York | 01-03-2023 | 02-05-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/819455/ | Slip Op. 00-111
UNITED STATES COURT OF INTERNATIONAL TRADE
BEFORE: RICHARD W. GOLDBERG, JUDGE
TARGET STORES, DIVISION OF HUDSON
CORPORATION,
Plaintiff,
v. Court No. 95-04-00376
(Joined Issue)
UNITED STATES,
Defendant.
OPINION AND ORDER
On January 12, 2000, plaintiff Target Stores moved for summary
judgment in the above-captioned matter. On March 25, 2000, plaintiff
moved the Court to amend its summary judgment motion. On March 31,
2000, defendant United States cross-moved for partial summary
judgment. On May 8, 2000, plaintiff responded to defendant’s cross-
motion for summary judgment and on May 30, 2000, defendant replied to
plaintiff’s opposition to its cross-motion.
Upon close review of the submitted motion papers, the Court
finds a genuine factual dispute that is material to the resolution of
the action. In particular, plaintiff offers evidence, based on the
results of a scientific test, that the external surface area of the
uppers of certain entries1 are composed of over 90% plastic.
Defendant rebuts plaintiff’s claim by directing the Court to its own
scientific test that purportedly demonstrates that the external
surface area of the uppers of the subject entries are not composed of
over 90% plastic. Defendant further points out to the Court that its
classification, and all underlying factual determinations, are
accorded a presumption of correctness. See 28 U.S.C. §
1
The entries at issue include the following Neo Grande Sandals:
girls’ sizes 3, 4, 11, 12 and 13; boys’ sizes 1, 2, 11, 12, and 13;
youths’ sizes 3, 4, 5, and 6; men’s Greatland sizes 7, 8, 10, and
men’s Omega sizes 8, 11, 12.
2639(a)(1)(1994); United States v. New York Merchandise Co., 58
C.C.P.A. 53, 58, 435 F.2d 1315, 1318 (1970).
Although the Court recognizes that the defendant’s
classification enjoys a presumption of correctness, the plaintiff has
presented substantial contrary facts “tending to prove...that the
original classification by the [defendant] was erroneous.”
Id.(emphasis added). Thus, there remains a genuine issue of fact to
be resolved at trial: whether the external surface area of the
uppers of the entries at issue are composed of over 90% plastic. See
e.g., Associated Metals and Minerals Corp. v. United States, 77 Cust.
Ct. 100, 426 F.Supp. 568 (1976). The issue of fact is material
because the composition of the external surface area of the uppers of
the entries at issue is dispositive to their classification under the
Harmonized Tariff Schedule of the United States (“HTSUS”).
At trial, the parties will be required to demonstrate the
reliability of the conflicting evidence to determine the composition
of the external surface area of the uppers. See Libas Ltd., v.
United States, 193 F.3d 1361 (Fed. Cir. 1999). Therefore, summary
judgment is not appropriate for this issue.
Summary judgment is appropriate, however, with respect to the
imported women’s shoes sizes 5, 6, 7, 8, and 9 that the defendant has
agreed should be reliquidated under subheading 6402.99.15, HTSUS,
with a duty rate of 6% ad valorem. Thus, partial summary judgment is
appropriate on this issue.
Therefore, upon consideration of plaintiff’s motion for summary
judgment and brief in support thereof, defendant’s response; and
defendant’s cross-motion for partial summary judgment and brief in
support thereof, plaintiff’s response, and defendant’s reply; and
upon all other papers; and upon due deliberation, it is hereby
ORDERED that partial summary judgment for plaintiff is GRANTED
with respect to the imported women’s shoes sizes 5, 6, 7, 8, and 9;
ORDERED that the imported women’s shoes sizes 5, 6, 7, 8, and 9
be reliquidated under subheading 6402.19.15, HTSUS, with any refunds
payable by reason of this order paid with any interest provided by
law;
ORDERED that partial summary judgment is DENIED for plaintiff
in all other respects;
ORDERED that partial summary judgment is DENIED for defendant
is all respects; and it is further
ORDERED that plaintiff and defendant confer and jointly submit
an amended scheduling order within twenty (20) days of the date of
this Order.
SO ORDERED.
JUDGE
Date: August __, 2000
New York, New York | 01-03-2023 | 02-05-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1111268/ | 523 So. 2d 983 (1988)
C.L. THORNHILL, et al.
v.
SYSTEM FUELS, INC., et al.
No. 56166.
Supreme Court of Mississippi.
April 6, 1988.
*984 Don Barrett, Barrett, Barrett, Barrett & Patton, Lexington, Norman Gene Hortman, Jr., Gibbes, Graves, Mullins, Bullock & Ferris, Laurel, Richard D. Foxworth, Foxworth & Shepard, Columbia, Matthew Harper, Jr., Harper, Barham & Gholson, Laurel, William Wallace Allred, Collins, for appellants.
Kenneth I. Franks, Harry E. Neblett, Jr., Heidelberg, Woodliff & Franks, Glenn Gates Taylor, Copeland, Cook, Taylor & Bush, Jackson, Donald B. Patterson, Brookhaven, Deborah J. Gambrell, Hattiesburg, for appellees.
EN BANC.
HAWKINS, Presiding Justice, for the Court:
The petition for rehearing is denied. The original opinion is modified in that Harris v. Griffith, 210 So. 2d 629 (Miss. 1968), insofar as it conflicts with our holding in this case, is overruled.
C.L. Thornhill and others have appealed from a decree of the chancery court of Jefferson Davis County finding that a mineral conveyance to Thornhill in 1945 conveyed only a non-participating royalty interest rather than an undivided mineral interest of the minerals "in place." The only issue before us is a construction of this conveyance and determining which type interest was conveyed.
Persuaded Thornhill acquired an undivided one-half mineral interest to all minerals, subject only to the right reserved by the grantors to the bonuses and delay rentals from oil and gas leases, we reverse and render judgment for the appellants.
FACTS
Hardy McLeod and Joseph McLeod owned the Northwest Quarter of the Southwest Quarter (NW-1/4 SW-1/4) of Section 30, Township 6 North, Range 17 West, in Jefferson Davis County. On September 9, 1944, the couple executed an oil, gas and mineral lease covering the land in favor of Frank Ryba. Thereafter, on May 14, 1945, the McLeods executed a mineral deed to C.L. Thornhill conveying an undivided one-half (1/2) interest in the minerals. The deed to Thornhill appears on a standard "Form R-101 Mineral Right and Royalty Transfer" instrument. On the face of this deed was typed:
It is the intention of the grantors to convey, and they do hereby convey, twenty (20) full mineral acres of land of said tract.
Non-participating as to present or future lease rentals or bonuses.
A copy of the conveyance as it appears in the public record is attached as an appendix.
On July 28, 1948, four years after the mineral conveyance to him, Thornhill filed an application for ad valorem tax exemption on his mineral interest acquired from the McLeods. Paragraph (4) of the printed form states: "Fractional interest for which exemption is applied and nature of such interest: ..." Following this there is typed "1/2 Royalty."
After Thornhill received his interest, both Thornhill and the McLeods executed numerous instruments conveying fractional interests in the minerals and oil and gas leases. None of these conveyances are important to the issue before us.
On December 22, 1979, appellee System Fuels, Inc., spudded the A.M. Speights 30-13 Well on a 160-acre unit encompassing this forty acres. The Speights Well began producing oil on March 20, 1981. On November 11, 1980, System Fuels spudded the gas unit 30-12 on the tract, which began producing on February 6, 1981.
C.L. Thornhill and those claiming through him, the appellants here, filed suit in the chancery court alleging the McLeods, by the instrument in question, conveyed an undivided one-half mineral interest in all minerals in place, subject only to the reserved right of the grantors (as to such undivided one-half interest conveyed) to receive all bonuses and delay rentals *985 from the oil and gas lease in effect when the instrument to Thornhill was executed, as well as to all future oil and gas leases. The appellees, System Fuels, Inc., and others, answered, denying such ownership, and claiming that all Thornhill acquired by such conveyance was a non-participating royalty interest in the oil and gas produced, which carried with it no right to execute oil and gas leases on the land.
The chancellor found the conveyance to be a non-participating royalty interest only, and entered a decree in favor of appellees. Hence this appeal, with the sole question before us: Was this a mineral interest conveyance, or a non-participating royalty interest?
LAW
In Mississippi we have two basic types of ownership of interests in minerals.
First, by far the most common way the holder of an interest in minerals obtains his interest is either from a reservation of or a conveyance of a fractional interest in the minerals. Such a reservation or conveyance simply creates a tenancy in common between the parties as to the minerals. Thus, if A reserves an undivided one-half interest in the minerals in his deed conveying Blackacre to B, A and B are tenants in common as to the minerals. Also, if X by a mineral deed conveys an undivided one-half interest of Blackacre's minerals to Y, X and Y are also tenants in common as to the minerals. Both parties have an equal right to go upon the land and drill for or mine minerals. Both would have to sign an oil and gas lease in order for the lessee to get a good title to all the mineral interests in Blackacre and be authorized to drill. Each would be entitled to share equally in the bonuses paid for the oil and gas lease, as well as the delay rental payments made under such lease. Finally, in event of discovery of oil or gas as between the two, they would share equally in the royalty payments made under the oil and gas lease.
It is also well settled that in such a mineral deed or reservation of the grantor may convey or reserve certain attributes of this mineral ownership. Thus, in a mineral deed the grantor may convey an undivided mineral interest, but reserve unto himself all bonuses or delay rentals, or both, as to any oil and gas lease. Mounger v. Pittman, 235 Miss. 85, 108 So. 2d 565 (1959), infra. Ford v. Jones, 226 Miss. 716, 85 So. 2d 215 (1956); Westbrook v. Ball, 222 Miss. 788, 77 So. 2d 274 (1955).
Another type of mineral interest ownership is a royalty interest. This interest only becomes meaningful if there is a commercial production of oil and gas, at which time the royalty owner receives the agreed-upon fraction of the production. The owner of a royalty interest has no control or right of possession, and no obligation to the remaining mineral interest owners. And, unless or until oil or gas is produced commercially, no obligation of any kind is due him. A royalty interest does not share in the bonuses or delay rentals with the other mineral interest owners. He is not required to sign an oil and gas lease in order for the lessee to have the right to go upon the land and drill for oil and gas. His interest cannot be charged with any costs of drilling a well as it could be if he held a mineral interest as a tenant in common and his cotenant drilled a producing well. Lackey v. Corley, 295 So. 2d 762 (Miss. 1974).
Generally, it is quite clear just what type of ownership the parties have. A conveyance or reservation of a royalty interest will, as a rule, specifically state that the royalty owner has no right to sign oil and gas leases, and that he cannot participate in bonuses or delay rentals, and cannot be charged with drilling or exploration costs.
In this case we have a mineral deed which reserved to the grantors the rights to bonuses and delay rentals under any oil and gas leases. Did this reservation so change the character of the instrument from a mineral deed to transform it into a royalty conveyance? We hold it did not.
In the evolution of oil and gas law in this state, our courts have endeavored to accommodate to the practical needs of the parties involved with the end in view of *986 promoting the development of our natural oil and gas resources as efficiently as possible commensurate with fairness to all parties. The words used to denote mineral ownership have occasionally had fuzzy edges. We could, of course, hold that certain words have a definite, fixed meaning at all times and under all circumstances. Circumstances occasionally show, however, that the parties did not mean what the words standing alone might appear to mean. We therefore have had to look to surrounding circumstances in addition to relying upon the words themselves. In such instances we deemed it better to let the words remain just what they are: a strong, but not necessarily conclusive indication of what the parties meant.
Here again we are confronted with the same problem. We are asked to determine whether an instrument is a mineral deed, conveyance of a "mineral estate" of the "minerals in place," or a conveyance of a "non-participating royalty interest"? As stated in Hemingway, Law of Oil and Gas:
In probably no other area of oil and gas law, than in cases involving the mineral-royalty distinction, can examples be found of courts, on behalf of befuddled litigants, benevolently and improperly granting reformation in the guise of a judgment for title.
Section 2.7 (2nd Ed. 1983).
The chancellor's problem in this case was a consequence of our decision in Harris v. Griffith, infra, wherein we benevolently took care of "befuddled litigants" to let their words accommodate what we thought the parties intended. Before discussing Harris v. Griffith, we will give a case history of how this question has evolved in this state.
In McNeese v. Renner, 197 Miss. 203, 21 So. 2d 7 (1945), this Court recognized that minerals and land could be owned separately or concurrently, and that a reservation of "an undivided one-fourth interest in and to all minerals" reserved to the grantor a present undivided one-fourth interest in the minerals. We held the grantor owned his interest as a tenant in common with the grantee, carrying with it a right to enter the land and explore for minerals.[1]
This state has been long committed to the position that minerals, though undiscovered, could be owned "in place."
In Gulf Refining Co. v. Stanford, 202 Miss. 602, 30 So. 2d 516 (1947), this Court noted that Mississippi was one of a group of states recognizing this type of ownership in minerals. We held, however, when the grantor wrote in his deed that "in the event of any minerals, oil or gas being found in the bounds of the land we are to share the profits equally," he did not reserve an undivided interest in the minerals. Rather, the deed showed an intent of the parties that upon discovery of oil the grantor and grantee would equally share the profit when oil was brought to the surface. Therefore the grantor would only share equally with the grantee in the royalty paid under an oil and gas lease executed by the grantee. It is interesting that two members of our then six-member Court sharply dissented, contending even this reservation entitled the grantee to an undivided one-half interest in the minerals in place.
In Palmer v. Crews, 203 Miss. 806, 35 So. 2d 430 (1948), 4 A.L.R. 2d 483, we construed a holographic will of C.C. Crews, a Texas testator. Crews had many years experience in oil exploration and owned mineral interests in Texas, Louisiana and Mississippi. He bequeathed his wife a life estate in "all my royalties," without restriction as to their location. He also bequeathed his "oil interests" in Texas to his brother. One of the questions facing this Court was whether the mineral interests in Mississippi acquired by mineral deeds to the testator passed under the will. We held the testator, under Texas law, would have understood the difference between a "royalty" and an undivided interest in minerals, therefore the Mississippi mineral interests were not covered by the will. As to these mineral interests, the testator died *987 intestate. We held that a devise of royalty did not embrace minerals in place acquired by deeds.
In Abney v. Lewis, 213 Miss. 105, 56 So. 2d 48 (1952), Mrs. Abney executed a conventional oil and gas lease in 1939 on twenty acres of land she owned. The lease provided for a one-eighth royalty on the oil produced and one dollar per acre per year delay rentals. In 1942 she sold the tract to Lewis, subject to this specific oil and gas lease, and further stated in the deed to Lewis that "all rentals under said lease are hereby reserved and are to be paid to the grantor." Later, oil was found in this land. Recognizing the distinction between a royalty and delay rentals, we affirmed the chancellor's finding that Mrs. Abney did not reserve the royalties due under the lease, but only the delay rentals.
In Texas Gulf Producing v. Griffith, 218 Miss. 109, 141, 65 So. 2d 447, 834 (1953), upon a suggestion of error, we construed a "Royalty Deed" in which the grantors conveyed a one-half interest in the minerals. The deed specifically reserved to the grantor the exclusive right to execute oil and gas leases, and all consideration and delay rentals under such leases. It also stated that the grantees would not be required to join in any such lease in order to convey a good title to the lessee. The grantors also covenanted not to execute any oil and gas lease in which the grantors would receive less than one-eighth royalty. The deed then stated that it was the intention of the parties that the grantee should receive one-half of the royalties under any oil and gas lease executed by the grantors. We held this instrument was a "royalty conveyance and not a mineral conveyance."
In Westbrook v. Ball, supra, Ball, who owned an undivided 15/16 interest in the minerals, conveyed his land to Westbrook. He specifically reserved all the minerals noting that he was retaining the undivided 15/16 interest and that the remaining 1/16 interest had been previously retained. In addition to retaining all minerals, Ball retained the right to go upon the land and explore for oil and gas. The instrument recited that the grantee would receive all cash bonuses and delay rentals on any oil and gas lease, but that all royalties payable would go to the grantor.
The question facing the Court was whether Westbrook had the right to execute an oil and gas lease. We held that the right reserved by the grantor to go upon the land and explore for oil and gas necessarily carried with it the right to execute an oil and gas lease. We further held that Westbrook, the grantee, only acquired the right to bonuses and delay rentals. We stated:
The words "royalty" and "minerals" have a well defined meaning as separate and distinct estates when one is compared to the other. Palmer v. Crews, 203 Miss. 806, 35 So. 2d 430, 4 A.L.R. 2d 483. The grantor in this deed not only retained the minerals, but retained the right to go upon, enter, to explore for, drill for, mine, store and remove all of said minerals at any and all times. All these rights are necessary to the execution of an oil, gas, and mineral lease, and where minerals are reserved these rights are necessarily implied even though not specifically reserved. McNeese v. Renner, 197 Miss. 203, 21 So. 2d 7. However, in this deed all were reserved. A royalty owner has none of these rights but only has the right to share in the minerals when produced. The owner of minerals has the right to execute oil, gas and mineral leases, selecting the lessee and fixing the terms of the lease, and to receive therefrom the bonuses, delay rentals and royalties. All these rights are transferable and a grantor can transfer all of them, or only part of them, but in reserving the minerals, all are retained that are not specifically granted. Appellee reserved the minerals and it was only specified that the bonuses and rentals from any lease executed would go to appellant. [Emphasis added]
222 Miss. at 790-791, 77 So.2d at 275.
Ford v. Jones, supra, construed a "Form R-101" mineral deed such as we have in this case, conveying an undivided one-fourth mineral interest. Typed into the *988 instrument were the following two paragraphs:
It is the intention of grantors, by this instrument, to convey and the intention of grantee to purchase an undivided ten (10) royalty acres under the above described lands.
It is understood and agreed that this land is now subject to an outstanding oil, gas, and mineral lease and grantee waives the right to receive any part of the delayed drilling rentals as provided in said lease.
226 Miss. at 718-719, 85 So.2d at 216.
We held the grantee acquired an undivided one-fourth interest in the minerals in place, with all rights of ownership incident to such ownership, except the delay rentals due under the outstanding oil and gas lease, which would be paid to the grantors.
We concluded with this statement:
It is well-settled that grantors and grantees in oil, gas and mineral deeds may separate in their conveyances the several interests constituting a mineral estate. (citing Westbrook v. Ball, supra)
226 Miss. 722, 85 So.2d at 218.
In Holifield v. Perkins, 233 Miss. 876, 103 So. 2d 433 (1958), there was a transfer of one-half mineral interest on a Texas form, which had written thereon: "This sale does not include any part of the delay rentals on the present oil lease on this property or on future leases."
Following conventional rules of construction,[2] we held that there was excluded from this conveyance only the delay rentals from the outstanding oil and gas lease and any future oil and gas leases. Again, recognizing the severability of incidents of ownership in a mineral interest transfer, we held bonus payments under any oil and gas lease were not excluded from the transfer and the grantor had no right to them.
In Mounger v. Pittman, supra, we recognized that particular words in a mineral transfer should not control, but the entire instrument should be examined. We held the reservation to be of a mineral interest in place as opposed to a royalty interest. The reservation read as follows:
We do hereby reserve for ourselves, our heirs and assigns, one-eighth of all the oil and gas which may be produced from said lands to be delivered in tanks and pipelines in the customary manner, and this shall be a covenant running with the land and all sales and other conveyances of said lands shall be subject to this reservation and agreement.
235 Miss. at 86, 108 So.2d at 566.
We then stated:
The distinguishing characteristics of a non-participating royalty interest are: (1) Such production is not chargeable with any of the costs of discovery and production; (2) the owner has no right to do any act or thing to discover and produce the oil and gas; (3) the owner has no right to grant leases; and (4) the owner has to receive bonuses or delay rentals. Conversely, the distinguishing characteristics of an interest in minerals in place are: (1) Such interest is not free of costs of discovery and production; (2) the owner has the right to do any and all acts necessary to discover and produce oil and gas; (3) the owner has the right to grant leases; and (4) the owner has the right to receive bonuses and delay rentals.
235 Miss. at 86-87, 108 So.2d at 566.
In Rogers v. Morgan, 250 Miss. 9, 164 So. 2d 480 (1964), we construed a royalty conveyance, in which the grantor specifically reserved bonuses, delay rentals and the right to execute oil and gas leases on the land. Although called upon to do so, we did not address the question of whether the holder of executive rights had a fiduciary duty to protect the interest of all owners.
In Payne v. Campbell, 250 Miss. 227, 164 So. 2d 780 (1964), we construed a royalty deed in which the grantee claimed to own an undivided one-half interest in the *989 minerals in place. The first paragraph of this conveyance read:
One-half (1/2) of the whole of any oil, gas or other minerals, except sulphur, on and under and to be produced from said lands; delivery of said royalties to be made to the purchaser herein in the same manner as is provided for the delivery of royalties by any present or future mineral lease affecting said lands.
250 Miss. at 233, 164 So.2d at 782.
The remainder of the conveyance made it clear that the grantor reserved all executive rights, and the right to collect all bonuses and delay rentals from oil and gas leases.
We considered the deed as written, the consideration paid for the conveyance, and the situation of the parties at the time of the conveyance. The chancellor found that the grantee only acquired an undivided one-half interest in the one-eighth royalty paid the lessor under any oil and gas lease. We affirmed the chancellor's finding because it was the only reasonable interpretation which could be made under the circumstances.
The mineral deed in this case is on a form customarily used to convey a mineral estate with all appertaining rights as opposed to a royalty interest only. The only change made in the terms and conditions of the printed form is the typed insertion that the grantee would not receive bonuses or delay rentals from any oil and gas lease. Under conventional rules of construction, this appears a simple conveyance of an undivided one-half interest in all the minerals, with the grantor retaining the right to bonuses and delay rentals from oil and gas leases. Under our decisions in Westbrook v. Ball, Ford v. Jones, and Mounger v. Pittman, supra, it is well settled these rights could be separated without changing the character of the instrument from a mineral estate to a royalty interest only.
Also, under ordinary rules of construction, all that was not unequivocally and specifically reserved was conveyed by the granting clause. Holifield v. Perkins, supra; Oldham, et al. v. Fortner, et al., 221 Miss. 732, 74 So. 2d 824 (1954); The Texas Co. v. Newton Naval S. Co., 223 Miss. 468, 78 So. 2d 751 (1955).
Harris v. Griffith, supra, is the only case from this Court which, arguably, could support a contrary conclusion. That case, however, is distinguishable on its facts from this case. In 1937 the Griffiths executed an oil and gas lease. In August, 1944, they executed a mineral conveyance on a "Form R-101," as used in this case, conveying an undivided one-quarter interest in the minerals to Thomas O. Payne. Typed in this deed (in addition to the land description) were the following sentences:
It is the intention of the grantors herein to convey 64 3/4 full mineral acres.
This instrument is to be non-participating both as to bonuses and lease rentals.
210 So.2d at 631. Also, the following changes were made in the deed. In the heading the word "RIGHT" was marked through and "DEED" typed in capital letters above it. In the final conveying paragraph, all but the following first sentence thereof was marked out:
This conveyance is made subject to any valid and subsisting oil, gas or other mineral lease or leases on said land, including also any mineral lease, if any, heretofore made or being contemporaneously made from grantor to grantee.
210 So.2d at 631.
In Griffith we also noted there were elements of estoppel against the parties who claimed to own a mineral interest as opposed to a royalty interest. They had paid none of the production costs for the producing well, and had not asserted any more than a royalty interest when the Griffiths had to employ an attorney, (and pay him forty percent of their mineral estate) to secure a release of an oil and gas lease from the oil company which had shut down production. When another operator took over drilling operations, over $34,000 in debts attributable to this tract had been paid by the complainants. The final operator produced a commercial well. Thereafter, in 1960 (and notarized in 1966) the defendants executed an oil and gas lease to a third party. The complainants sought to cancel the oil and gas lease as a cloud upon *990 their title. The chancellor held the deed to Payne was only a non-participating royalty interest and that all executive rights, bonus and delay rentals remained with the grantor.
In Harris this Court first stated that parol evidence concerning the effect of the deed was not competent, because of the need for a consistent, coherent body of law on the construction of oil and gas conveyances. We added that ordinarily such instruments are not regarded as ambiguous, and that courts should construe them so as to best comport to the parties' intention appearing on the instrument itself. We quoted with approval Richardson v. Moore, 198 Miss. 741, 22 So. 2d 494 (1945):
In trying to solve this question, we should keep in mind certain well-established principles of construction of contracts. Those applicable here are (1) the deed must be read in the light of the circumstances surrounding the parties when it was executed; (2) that the construction should be upon the entire instrument, and each word and clause therein should be reconciled and given a meaning, if that can be reasonably done; (3) that the main document and that to which it refers must be construed together; (4) that if the wording of the deed is ambiguous, the practical construction placed thereon by the parties will have much weight in determining the meaning * * *.
210 So.2d at 633.
We then stated:
Accordingly, the Griffith-Payne deed should be analyzed in the light of the objective circumstances surrounding the parties when it was executed. Moreover, the construction must be upon the entire instrument.
210 So.2d at 633.
This Court recognized that the printed form was used to convey a fractional interest in minerals in place. We then noted that the parties showed an intent to substantially change the form to the effect the interest conveyed. We first noted that the heading had been changed, and that this change indicated an intent to convey a royalty only. We also considered the typed intention clause: "This instrument is to be non-participating both as to bonuses and lease rentals." We held this as indicative of an intent to convey something other than an interest of minerals in place and that the retention of bonuses and delay rentals was closely and materially related to the executive right. Considering the deed further, we noted the parties struck out the last printed paragraph:
... but for the same consideration herein above mentioned, grantor has sold, transferred, assigned and conveyed and by these presence does sell, transfer, assign and convey unto grantee, his heirs, successors and assigns, the same undivided interest (as the undivided interest herein above conveyed in the oil, gas and other minerals in said land) in all the rights, rentals, royalties and other benefits accruing or to accrue under said lease or leases from the above-described land; to have and to hold unto grantee, his heirs, successor and assigns.
210 So.2d at 634.
We held that the striking of the above-quoted provision tended to show that the parties did not intend to sell the rights, rentals, royalties and other benefits under the existing lease. We then stated:
The deletions in the title and the last printed paragraph may be considered in order to arrive at the true meaning and the intention of the parties. They are relevant factors under the circumstances of this case and the terminology of the deed in assisting the Court to reach a reasonable interpretation of the instrument.
* * * * * *
In the instance case, the reservation of bonuses and rentals, together with the other above-discussed terms of this deed, constituted an implied retention of the executive rights. [Emphasis added]
210 So.2d at 635.
We were also influenced by the fact that, as in this case, Payne, the grantee, was an experienced oil and gas investor, whereas Griffith, the grantor, lacked experience and *991 education. Finally, this Court took into account the timing and long period of delay by the lessors under the 1960 oil and gas lease before they asserted any claim to the executive right.
There are two additional amendments to the printed form in Harris v. Griffith, not present in this case. Also, as we noted above, the defendants in Harris v. Griffith did not deem themselves to be tenants in common with the grantors when the grantors had to employ legal counsel to secure a release of an oil and gas lease, and the defendants paid none of the legal fee. See: 86 C.J.S. Tenancy in Common, § 68(d), p. 452, and cases cited. Further, the defendants had assumed none of the expenses or costs when the previous drilling had far more expense than income. As tenants in common, their interest would have been chargeable with a proportion of such costs. Mounger v. Pittman, supra, 108 S.Ct. at 566. Lackey v. Corley, 295 So. 2d 762 (Miss. 1974). See also: Martin v. Humble Oil and Refining Co., 199 F. Supp. 648 (N.D.Miss. 1960), affirmed 298 F.2d 163 (5th Cir.1961), rehearing denied 301 F.2d 313 (5th Cir.1962); P & N Investment Corp. v. Florida Ranchettes, Inc., 220 So. 2d 451 (Fla. Dist. Ct. App. 1968); Shaw & Estes v. Texas Consolidated Oils, 299 S.W.2d 307 (Tex. Ct. App. 1957); White v. Smyth, 147 Tex. 272, 214 S.W.2d 967, 5 A.L.R. 2d 1348 (1948); Little v. Mountain View Dairies, 35 Cal. 2d 232, 217 P.2d 416 (1950).
The circumstances and facts of that case caused this Court to make an exception of what otherwise would unquestionably have been termed a conveyance of mineral interest in place, and not simply a conveyance of a right to royalties. Those circumstances and facts are not present in this case.
In this case the chancellor found no element of estoppel and noted the parties had not struck any of the printed portion of the mineral deed.
In our original opinion, because we found Harris v. Griffith clearly distinguishable (despite the very able dissenting opinion), we saw no necessity to consider overruling it.
The extensive briefs filed by the parties in connection with the petition for rehearing, as well as the views expressed in the dissenting opinion, however, have convinced us that Harris v. Griffith needs to be overruled, insofar as this Court construed that the instrument therein by its terms conveyed only a non-participating royalty. We are convinced that in this respect the Court erred, and that the instrument by its terms remained, despite the changes noted by the Court, a conveyance of an undivided one-half interest in the oil and gas minerals, subject only to a reservation in the grantors of the bonuses and delay rentals.
Harris v. Griffith was cogently criticized in an article published in Volume XLI, Mississippi Law Journal, Spring 1970, No. 2, p. 189, "An Analysis of the Rights and Duties of the Holder of the Executive Right," Joel Blass and Jean Rand Richey, pp. 201-205. The authors were of the view this Court erred in finding that the reservation of bonuses and delay rental "justifies the implication of an intent to retain the executive right in the grantor." They further contended this was at variance with our consistent holdings that the various incidents of ownership in a mineral estate could be separated, Westbrook v. Ball, supra, and the conventional rule of construction that in a conveyance of a mineral estate all is conveyed that is not specifically reserved or excepted, p. 204. The confusion the authors predicted would result from this decision have indeed come to pass. We have therefore concluded that Harris v. Griffith, while containing sound pronouncements of law, nevertheless erred in concluding that there was an implication of a reservation of executive rights simply by a reservation of bonuses and delay rentals. Our view is precisely the reverse: that the grant of an entire interest in minerals conveys all incidents of ownership thereto that are not specifically excepted or reserved, and that the reservation by the grantor of all rights to bonuses and delay rentals from oil and gas leases does not carry with it by implication executive rights, or any other incident of ownership.
*992 We therefore overrule Harris v. Griffith insofar as it holds that an instrument such as there executed does not on its face convey an undivided one-half interest in the minerals with all rights incident thereto, with the sole exception of the reservation in the grantors of the rights to receive bonuses and delay rentals from oil and gas leases.
We must hold, therefore, that the chancellor erred in holding this conveyance to be a non-participating royalty transfer rather than of an undivided one-half interest in the minerals.
The conveyance to Thornhill was of an undivided one-half interest of the oil and gas minerals, reserving only to the grantors the right to bonuses and delay rentals from the existing and future oil and gas leases. Executive rights were not reserved. The decree of the chancery court will be reversed and judgment rendered here for the appellants.
REVERSED AND RENDERED.
HAWKINS, P.J., and PRATHER, SULLIVAN and ANDERSON, JJ., concur.
DAN M. LEE, P.J., ROY NOBLE LEE, C.J., and GRIFFIN and ZUCCARO, JJ., dissent.
ROBERTSON, J., concurs in denial of petition for rehearing with separate written opinion.
*993
*994 DAN M. LEE, Presiding Justice, dissenting:
The original appeal of this case was from the Chancery Court of Jefferson Davis County, Mississippi. On September 9, 1987, this Court reversed the lower court and rendered judgment for appellants, C.L. Thornhill et al. To that decision I vigorously dissented. The appellees filed a Petition for Rehearing, hoping to illustrate the majority's error. In reviewing this petition, this Court again is asked to construe a "Form R-101 Mineral Right and Royalty Transfer" which contains the following type-written phrase:
Northwest 1/4 of Southwest 1/4, Section 30, Township 5 North, Range 17 West, containing 40 acres more or less. It is the intention of the grantors to convey, and they do hereby convey twenty (20) full mineral acres out of said tract.
Non-participating as to present or future lease rentals or bonuses.
Specifically, we are called upon to determine what effect "non-participating as to present or future lease rentals or bonuses" has upon the conveyance. Did the McLeods convey a mineral interest or a royalty interest? Did Thornhill buy a mineral interest or a royalty interest? By holding that Thornhill bought mineral rights in 1945, the majority, and the concurring opinion, trample upon several well established areas of the law, including deed construction, appellate review, and most fundamentally, basic oil and gas law. In so trampling, the majority has found it necessary to overrule our decision in Harris v. Griffith, 210 So. 2d 629 (Miss. 1968), insofar as that opinion holds that retention of bonuses and delay rentals by the grantor necessarily implies retention of executive rights. Contrary to the opinion of the majority that Harris is some sort of aberration from our well established oil and gas law, Harris did what this Court has failed to do here it applied our well established principles of deed construction, appellate review and basic concepts of oil and gas law. With all due respect to the majority, again I vigorously dissent, both to the holding in the present case and to the overruling of Harris.
FACTS
Hardy McLeod and Josephine McLeod owned the northwest quarter of the southwest quarter of Section 30, Township 6 North, Range 17 West, in Jefferson Davis County, Mississippi. On September 9, 1944, the couple executed an oil, gas and mineral lease covering the land in favor of Frank Ryba. Thereafter, on May 14, 1945, the McLeods executed a mineral right and royalty transfer to C.L. Thornhill. This instrument appeared on a standard "Form R-101 Mineral Right and Royalty Transfer." On the face of the deed is typed "it is the intention of the grantor to convey and they do hereby convey twenty (20) full mineral acres of land of said tract. Non-participating as to present or future lease rentals or bonuses."
On July 28, 1948, four years after the mineral conveyance to him, Thornhill filed an application for ad valorem tax exemption on his interest acquired from the McLeods. Paragraph 4 of the printed form stated "fractional interest for which exemption is applied and nature of such interest... ." Following this is typed "one-half royalty."
On December 22, 1979, appellee, System Fuels, Inc., spudded the A.M. Speights 30-13 Well on a 160-acre unit encompassing this 40 acres. The Speights well began producing oil on March 20, 1981. On November 11, 1980, System Fuels spudded the Gas Unit 30-12 on the tract, which began producing on February 6, 1981.
C.L. Thornhill and those claiming through him, the appellants here, filed suit in the chancery court alleging the McLeods, by the instrument in question, conveyed a one-half mineral interest in all minerals in place, subject only to the reserved right of the grantors to receive all bonuses and delay rentals from the oil and gas lease in effect when the instrument to Thornhill was executed, as well as to all future oil and gas leases. The appellees, System Fuels, Inc., and others, answered, denying such ownership, and claiming that all Thornhill acquired by such conveyance *995 was a non-participating royalty interest in the oil and gas produced, which carried with it no right to execute oil and gas leases on the land.
I.
Some Basic Oil & Gas Law
In the "objective accessible world," of which the concurring opinion is much enamoured, but which both the concurring and the majority opinions ultimately ignore, the McLeods owned the surface and minerals of the 40 acres. In 1944, the McLeods leased their 40 acres in minerals to Frank Ryba. In 1945, the McLeods conveyed 20 full mineral acres to Thornhill; however, in the typed-in portion of the mineral deed, the McLeods retained the rights to all present and future bonuses and lease rentals. Appurtenant to ownership of minerals is the right to bonuses and delay rentals, along with the right to execute leases. The effect, then, of retaining the rights to bonuses and lease rentals turned what started out to be a mineral conveyance into a royalty deed. The reason this is so is because two of the rights appurtenant to ownership of minerals were retained by the McLeods, bonuses and delay rentals. But what of the right to execute leases? The right to receive bonuses and delay rentals are necessarily appurtenant to the right to execute leases. In order to understand why this is so, it is necessary to understand what a bonus is. A bonus is the cash consideration paid by the lessee for the execution of an oil and gas lease by the mineral owner. 7 Will. & Myers, Oil and Gas Law, Manual of Oil and Gas Terms 80. It is true that the bonus can take some other form than cash it can be a royalty bonus or overriding royalty reserved to the mineral owner in addition to the usual mineral owner's royalty. But a bonus by any other name is still a bonus, and its purpose is to compensate the mineral owner for executing a lease.
Where the majority opinion fails in this case is when it plays a theoretical game of separating the right to execute a lease from the consideration a mineral owner is paid to execute the lease. Here, the majority says that because McLeod, in an instrument which Thornhill drew up, did not expressly retain the right to execute leases on 20 acres, the right went to Thornhill, but McLeod is still entitled to receive the bonuses on any lease Thornhill executes on the other one-half of the mineral estate. Why in the world would Thornhill want the right to execute leases while allowing the McLeods to retain the bonuses from a lease he, Thornhill, executes, when the whole purpose of the bonus is to compensate the lessor for executing the lease? In the "objective accessible world," an experienced oil and gas person, as Thornhill was, would not do that unless he, too, were playing games with the inexperienced McLeods. Furthermore, under today's majority opinion, if Thornhill executes a lease on his 20 mineral acres and there is delay in drilling, the delay rentals on Thornhill's lease would also go to the McLeods. Why would Thornhill do that?
The point is that the "executive right" the majority creates today is no more than a legal theory. An executive right unhinged from the bonus is meaningless, because by definition whoever retains the right to execute leases has the right to the resulting bonus. The bonus is nothing more, or nothing less, than consideration paid for executing a lease. Harris v. Griffith, 210 So. 2d 629 (Miss. 1968), was infinitely correct, in the real world, when it held that the retention of bonuses and lease rentals justifies an implication to retain the right to execute leases. Harris at 634. It is the only implication that makes any practical sense. Otherwise, both the grantor and the grantee are left with meaningless rights.
For example, consider the following two scenarios. If the McLeods are entitled to the entire bonus on the property but have only a right to lease one-half of the property, as is the case under the majority opinion, then the McLeods' interest in the entire bonus is in effect limited to a one-half interest in the bonus if Thornhill should refuse to lease. Why would a grantor in the real world so limit his interest? In scenario two, Thornhill is left with a meaningless *996 right as well. Under the majority opinion, Thornhill is vested with the right to bargain with and contract with a lessee for a lease covering his 20 mineral acres; however, the right to receive the cash bonuses and delay rentals is vested in the McLeods. No matter how hard a bargain Thornhill may drive with the lessee as to cash bonuses and delay rentals, nothing will inure to his benefit, because the bonus and delay rentals go to the McLeods. What can Thornhill do? He could perhaps refuse to bargain for a lease that provides for a cash bonus and delay rentals and instead negotiate for a paid-up lease for an excess royalty. But, Thornhill's duty of good faith and fair dealing to the McLeods under the conveyance dictate that he turn over the excess royalty to the McLeods a bonus by any other name is still a bonus. So, Thornhill has no personal incentive to drive the hard bargain for a lease. In either scenario, the McLeods are potentially deprived of the very benefits, bonus and rentals, they expressly reserved in the conveyance.
The avoidance of these problems formed the underlying rationale in Harris and that rationale did not, nor does not, stand alone in oil and gas jurisprudence. See, e.g., Hudgins v. Lincoln National Life Insurance Co., 144 F. Supp. 192 (E.D.Tex. 1956); McVey v. Hines, 385 P.2d 432 (Okl. 1963); Ledoux v. Voorhies, 222 La. 200, 62 So. 2d 273 (1952); Skelly Oil Company v. Cities Service Oil Company, 160 Kan. 226, 160 P.2d 246 (1945).
I further point out that Harris is no aberration from our previous decisions on oil and gas questions. In fact, Harris was the first case in which this Court had to decide the precise question of whether or not the right to execute leases follows the right to receive bonus and delay rentals where the conveyance expressly retained in the grantor the bonus and delay rentals but was silent as to the right to execute leases. In deciding the question, the Harris Court applied long established principles of oil and gas law and deed construction.
The similarities between this case and Harris are striking. Attached to this opinion is a copy of the conveyance in Harris. A copy of the conveyance from the McLeods to Thornhill, the subject of today's case, is also attached for comparison purposes. The same "Mineral Right and Royalty Transfer" form was employed in both cases. Considering this form, the Harris Court commented:
The parole evidence offered by appellees, as to conversations between Griffith and Payne before execution of the deed, and the inquiries of Griffith concerning the effect of the deed as changed, was not competent. Parol evidence of this nature is not ordinarily admissible in the construction of a mineral deed. Because of the need for a consistent, coherent body of law on this subject, ordinarily such instruments are regarded as unambiguous, and a construction is placed upon them that will best comport with the parties' intention appearing from the instrument itself. Williams & Meyers, Oil & Gas Law, §§ 219.4, 204.10, at 501 (1964). [emphasis added]
Harris, 210 So.2d at 633.
Furthermore, the Harris Court employed long established principles of contract construction first outlined in Richardson v. Moore, 198 Miss. 741, 749-50, 22 So. 2d 494, 495 (1945):
(1) the deed must be read in the light of the circumstances surrounding the parties when it was executed; (2) that the construction should be upon the entire instrument, and each word and clause therein should be reconciled and given a meaning, if that can be reasonably done; (3) that the main document and that to which it refers must be construed together; (4) that if the wording of the deed is ambiguous, the practical construction placed thereon by the parties will have much weight in determining the meaning... .
Harris at 633. Of the "Mineral Right and Royalty Transfer" form, the Harris Court stated: "This form has been in use in this state for a long time. It is well known that unchanged it has the effect of conveying a fractional interest in the minerals in place. See Ford v. Jones, 226 Miss. 716, 85 So.2d *997 215 (1956); Gulf Refining Co. v. Harrison, 201 Miss. 294, 28 So. 2d 221, 30 So. 2d 44, suggestion of error overruled, 201 Miss, 294, 335, 30 So. 2d 807 (1947); Cummings v. Midstate Oil Corp., 193 Miss. 675, 9 So. 2d 648 (1942)." Harris at 633-34. However, the parties to the conveyance in Harris, as in today's case, made changes on the form. "They clearly intended to change in a substantial way the effect of the instrument." Harris at 634. Speaking of the parties' intent, the Harris Court noted:
Payne, an experienced oil and gas investor, must have been well aware of the significance of the form used, and must have intended material alterations in its effect. In short, the parties were unwilling to use the regular printed form, which would have conveyed to Payne the minerals, including the executive right.
Harris at 634. Thornhill, in this case, as was Payne in the Harris case, was an experienced oil and gas investor, and by making the changes in the conveyance form, must have intended at the time the conveyance was executed, to receive a royalty interest. Thus, as Harris pointed out:
A non-participating mineral interest is in substance a royalty interest. This deed does not create a non-executive mineral interest, which is defined as the right to royalty and to either bonus or rental, or both, under existing or future leases, the owner of which has no development right and no executive right. Bonus or rental in the present deed were not conveyed. 1 Will. & Meyers, Oil & Gas Law, § 301 at 441 (1964) [emphasis added]
Harris at 634. Summarizing, then, the effect of the conveyance, Harris states:
The printed granting clause, on its face, conveyed a 1/4 mineral estate. However, when considered along with the "non-participating" clause ... an intent to make the interest conveyed non-participating is significantly indicated. Moreover, the retention of bonuses and lease rentals under these circumstances justifies the implication of an intent to retain the executive right in the grantor. They are closely and materially related to the executive right. The latter may be separated, but this should be done explicitly.
Harris at 634. And then, the Court in Harris hit the nail squarely on the head when it said:
The potential difficulties from an opposite approach are illustrated in the instant case. Mesdames Crain and Griffith executed the purported lease on their 1/8 interest to Harris without receiving any bonus, but instead took an overriding royalty. Yet Griffith, clearly entitled under the deed to receive lease bonuses, is deprived of any such benefit under the Harris lease. This is not consistent with a duty of good faith and fair dealing by the owner of the executive right.
Harris at 634 [emphasis added].
The Harris Court, then, clearly recognized these potential problems, problems that will now arise under today's majority opinion in the McLeod lease, as discussed above.
The cases cited by the majority that led up to the Harris decision construed other limitations on oil and mineral conveyances, but did not address the precise issue before the Harris Court and before us today does the right to execute leases follow the right to a bonus? It must, by virtue of the plain meaning of a bonus. Harris correctly applied basic concepts of oil and gas law to decide the issue and cannot, therefore, be a case that stands outside our precedent, as the majority claims.
II.
Some Principles of Deed Construction
The majority arrives at its theoretical separation of the right to execute leases from the right to a bonus by ignoring several principles of deed construction. In the first place, when a written or type-written provision of an instrument cannot be reconciled with the printed provisions, the written provision controls. Holifield v. Perkins, 233 Miss. 876, 880, 103 So. 2d 433, 434 (1958); Ford v. Jones, 226 Miss. 716, 720, 85 So. 2d 215, 217 (1956); Dale v. Case, 217 *998 Miss. 298, 308-10, 64 So. 2d 344, 346 (1953). Applying this principle to this case, the conveyance by the McLeods of one-half of their minerals was modified by the typed-in portion. Two of the rights appurtenant to the ownership of the minerals were retained by the McLeods. Further, applying the principle analyzed above that the right to execute leases must necessarily obtain to the right to a bonus all of the rights appurtenant to owning the minerals stayed with the McLeods. Therefore, by this conveyance Thornhill did not participate in any of the rights appurtenant to owning minerals; he received the right to share equally in any royalty the McLeods retained in any leases, and that is all he received. He received a royalty deed. Harris applied this long established principle of deed construction when it determined that such a conveyance amounts to a royalty deed, as pointed out above. Harris is no aberration in this respect.
Second, the majority ignores the proper method for separating the rights appurtenant to ownership of minerals. Harris stated, as pointed out above, that "[t]hey [bonuses and rentals] are closely and materially related to the executive right. The latter may be separated, but this should be done explicitly." Harris at 635. This principle arose from Westbrook v. Ball, 222 Miss. 788, 791, 77 So. 2d 274, 275 (Miss. 1955), where this Court said that the right to execute leases and receive bonuses, rentals and royalties are transferrable, but all are retained that are not specifically granted. The McLeods did not convey the right to execute leases; therefore, they retained that right. Furthermore, Thornhill would not participate in any bonuses or delay rentals obtained from any leases the McLeods may execute. This reading of the conveyance, then, leaves Thornhill with a royalty interest, a reading that consistently applies our long held rules of deed construction. The Harris opinion is no aberration on this point, either.
Third, the majority opinion finds this conveyance to create an ambiguity, contrary to the chancellor's findings, and then proceeds to ignore the principles we have applied to construing ambiguous instruments. In Clark v. Carter, 351 So. 2d 1333 (Miss. 1977), this Court wrote:
Although the terms of a contract generally are construed more strongly against the grantor or maker when they are vague or ambiguous, it is also an established principle of law that such terms are construed more strongly against the party preparing the instrument.
[emphasis added] Clark at 1336. See also Stampley v. Gilbert, 332 So. 2d 61, 63 (Miss. 1976); Globe Music Corporation v. Johnson, 226 Miss. 329, 84 So. 2d 509 (1956); Love Petroleum v. Atlantic Oil Producing Company, 169 Miss. 259, 152 So. 829 (1934); Home Mutual Fire Insurance Company v. Pittman, 111 Miss. 420, 71 So. 739 (1916). Thornhill prepared this instrument and carried it to the McLeods for execution. If we construe this instrument more strongly against Thornhill, as we are bound to do under our precedent, we can only conclude that Thornhill, an experienced oil and gas person, knew the effect of conveying minerals but retaining in the grantor the rights appurtenant to ownership of the minerals. The effect was to create a royalty deed. Thornhill knew what he wanted to buy and knew the difference between minerals and royalty. This principle of instrument construction becomes crucial when a court is faced, as we are here, with grantors who in 1945 were elderly black people in their seventies, who could neither read nor write, and who signed the conveyance with an "X." This principle was also recognized and applied in Harris when it found that Payne, an experienced oil and gas investor, intended that the conveyance give him a royalty interest. Harris at 636.
Finally, the majority and the concurrence embrace the principle set out in Harris that courts should construe instruments so as to best comport with the parties' intentions appearing on the instrument itself. In this respect, Harris embodies principles of deed construction, as pointed out above, set out early on in Richardson v. Moore, 198 Miss. 741, 749-50, 22 So. 2d 494, 495 (1945). See also Payne v. Campbell, 250 Miss. 227, 164 So. 2d 780 (1964); Salem *999 Brick & Lumber Co. v. Williams, 210 Miss. 560, 50 So. 2d 130 (1951). However, while paying lip service to these principles, the majority fails to apply them to this case, something in Harris we did not fail to do. The very words of the 1945 conveyance itself shows the intent of the parties, as discussed above. The typed-in portion expressly turns the mineral conveyance into a royalty conveyance. But if, as the majority claims, the instrument creates an ambiguity, we can look to the circumstances surrounding the parties when the conveyance was executed, and we can look to the practical construction the parties themselves placed upon it. What speaks volumes are two facts. First, in 1948, Thornhill acknowledged that his interest was a one-half royalty when he applied for an ad valorem tax exemption. Second, Thornhill delayed until 1979 in asserting his executive rights. The McLeods continued to execute leases covering this property in 1949, 1959, 1971, 1974, 1976, 1977 and 1979; Thornhill did not attempt to execute a lease until five months before the well was spudded in 1979. Thus, the objective circumstances surrounding this deed points strongly to the conclusion that it conveyed only a non-participating royalty interest, especially when considered in the light of the fact that Thornhill, the experienced oil and gas person, prepared the conveyance and obtained its execution from elderly, illiterate grantors. The chancellor likewise found these two facts to speak volumes and weighed them into his findings.
III.
Some Principles of Appellate Review
Finally, the majority fails to follow this Court's precedents of appellate review. Again and again we have articulated the scope of review. Early on we stated:
[E]vidence which supports or tends to support the decree, together with all inferences which may be reasonably drawn from it and which support the decree, must be accepted.
Blakeney v. Blakeney, 244 So. 2d 3, 4 (Miss. 1971). Accord Culbreath v. Johnson, 427 So. 2d 705, 707 (Miss. 1983). We have also stated our scope of review in terms of manifest error: It is that where the chancellor was the trier of facts, his findings of fact on conflicting evidence cannot be disturbed by this Court on appeal unless we can say with reasonable certainty that these findings were manifestly wrong and against the overwhelming weight of the evidence. Even if this Court disagreed with the findings of fact and might have arrived at a different conclusion, we are still bound by the chancellor's finding unless manifestly wrong as stated above. Richardson v. Riley, 355 So. 2d 667, 668 (Miss. 1978).
We combined this test into our now familiar substantial evidence/manifest error rule:
We have repeatedly refused to reverse a chancery court's finding of fact where there is any substantial credible evidence which supports it.... Put otherwise, the chancery court's findings must be allowed to stand unless manifest error is present and apparent.
Dunaway v. Busbin, 498 So. 2d 1218, 1220 (Miss. 1986). Today's majority opinion steps outside our scope of review, something the Harris court did not do, to avoid the chancellor's findings of fact as a true ascertainment of the parties' intent at the time the conveyance was signed in 1945. The chancellor below made the following findings:
(1) Neither Hardy nor Josephine McLeod could read or write, and, therefore, could not have prepared the deed;
(2) The deed was prepared by Thornhill or his agent;
(3) The party who carried the deed to the McLeods for execution was familiar with what he wanted to buy and knew the difference between minerals and royalty;
(4) The deed was not ambiguous, and
(5) The deed conveyed a non-participating royalty interest. The majority obviously overlooks our precedent in connection with disturbing the chancellor's findings and ignores the fact that the chancellor, *1000 having heard the testimony of Thornhill, is in the best position to make findings of fact based on the evidence presented in this case. There is substantial credible evidence that Thornhill knew in 1945 that he bought a royalty interest in the McLeod estate, for the conveyance which he prepared states in plain language that he did not receive the rights appurtenant to mineral ownership. Moreover, considering the objective circumstances surrounding the conveyance and the practical construction both parties placed upon the conveyance for some 34 years can only lead to the same credible conclusion the chancellor came to. By stepping outside our scope of review to reverse the chancellor's findings, we render a decision today contrary to our basic principles of oil and gas law and deed construction, principles which the chancellor correctly applied to the facts before him.
CONCLUSION
The majority sees this decision as a mere interpretation of words in a deed; however, the ramifications of this decision will have troublesome effects upon Mississippi's oil and gas law, not to mention the incredible injustice we do to the grantors in this case who have relied on this conveyance for 34 years. The majority has fashioned a legal theory that has little practical meaning, except to open the door for title busters and oil sharks to feast upon the unsuspecting people unversed in the legal niceties of theories and terminology. I cannot join in the creation of such a theory. I, therefore, would hold that the deed from the McLeods to Thornhill conveyed a one-half non-participating royalty interest and affirm the chancellor's findings.
ROY NOBLE LEE, C.J., and GRIFFIN and ZUCCARO, JJ., join in this dissent.
*1001
*1002
*1003 ROBERTSON, Justice, concurring in denial of petition for rehearing:
I.
The result the Court decrees is the best the law affords on these facts. Occasional loose references to intent aside, the majority's painstaking review of our prior cases I find quite congenial and most useful in unmasking the phantom, Harris v. Griffith, 210 So. 2d 629 (Miss. 1968), as outside the mainstream both historically and logically.
Still there is much in this case that is disturbing. There is a sincerely motivated dissent from respected colleagues whose views I do not dismiss lightly. There is an ably drafted petition for rehearing prepared by experienced and competent oil and gas counsel suggesting that we have violated long established canons of construction. Most disturbing is the suggestion that we speak with inconsistent voices in the field of oil and gas law, a fact which upon reflection I must concede.
In the end my concerns are twofold and related: principled integrity in our law and the practical needs of the individual and his lawyer searching the land records.
II.
Today's majority and dissenting opinions are filled with much talk of mineral estate versus royalty interest. `Tis but an object lesson that lawyers practice under a tyranny of labels.[1] All too often we yield to the tyranny when, as here, we should stand and fight.
Not that we could live without the law's labels, for all words in the end are but labels. They are inherently incapable of exact correspondence with their object. Holmes said, more metaphorically, a word is but the skin of a living thought. My targets are careless word usage and notions of mutual exclusivity.
We need not trace the tyranny of labels to its source, though in some sense it is surely educational. The form of that tyranny is mistake in function. We try to make the law's words do too much. We employ them as tools of logic when their function can be but descriptive, definitional. Words may be used to describe legal reasoning but they are without power to participate in that reasoning. We get into trouble when, as here, we try to force legal labels to exceed their capacity to assist us.
The most familiar form of the tyranny is the either/or. The matter is either this or that, with this and that being mutually exclusive categories separated by some hard-edged, case-deciding line of demarcation, or so the myth maintains. The method of the tyranny then requires forcing the case under one label or the other as though once that has been done all else will follow. Think, for example, of law versus fact,[2] of substance versus procedure,[3] of resulting trusts and constructive trusts,[4] of agents and independent contractors,[5] of sanity and insanity,[6] of direct and circumstantial evidence[7], to name but a few selected at random. And think of how we (mis)use these labels.
Today's case and, as well, many of our recent oil and gas decisions presents two such tyrannical dichotomies imagined distinct but in reality quite otherwise. First is *1004 mineral interests versus royalty interests.[8] Our law has long functioned through shorthand facilities that allow us to effect transfers and agreements. These are usually in the form of words or concepts which lawmakers attempt to give a clear and precise meaning.[9] Mineral interest (or estate) and royalty interest (or right) are two such terms. We have attempted to delineate what is meant by such terms in cases such as Mounger v. Pittman, 235 Miss. 85, 86-87, 108 So. 2d 565, 566 (1959); and Westbrook v. Ball, 222 Miss. 788, 790-91, 77 So. 2d 274, 275 (1955). Justice Hawkins' restatement of the definitions in practical common sense terms is quite valuable.
The realities represented by the labels "minerals" and "royalty" are complex. Problems arise when one speaks in terms of the underlying realities while another insists upon labeled communications. Such communication is impossible. When one talks in terms of underlying realities and the other insists upon the simplistic security of the labels, losses and often lawsuits loom large.
Our law recognizes many separate incidents of mineral ownership. Some of these are
A. The power to sell all or a part of the mineral estate.[10]
B. The authority to alienate short of sale, that is, to lease (executive right);[11]
C. The authority to go upon the land to drill and develop the minerals (right of ingress and egress).
D. The burden of participating in the cost of exploration, discovery and production;
E. The right to receive bonuses;[12]
F. The right to receive delay rentals;[13]
G. The right to receive (a part of) the proceeds of production;[14]
H. Reversionary interests, to take effect at the end of the primary term of a lease or at the cessation of production;[15] and
I. Benefit of covenants, express and implied.[16]
*1005 These incidents of ownership may be separated and conveyed or retained as the parties see fit.[17]Holifield v. Perkins, 233 Miss. 876, 880, 103 So. 2d 433, 434 (1958); Westbrook v. Ball, 222 Miss. 788, 790, 77 So. 2d 274, 275 (1955); Ford v. Jones, 226 Miss. 716, 722, 85 So. 2d 215, 218 (1956). Nothing in our law requires that all, nor any particular combination of mineral incidents, reside in any particular party.
Listing the incidents of mineral ownership unmasks another myth. Mineral interests and royalty rights are never mutually exclusive categories. Royalty rights are one incident of a whole mineral estate. Conveyance of minerals without more conveys the right to receive royalties as well. Royalty is thus seen a subspecies of the mineral estate. It may be severed and conveyed, "participating" or "non-participating".[18]
The point is as simple as it is fundamental: the owner of a (partial or whole) mineral estate has legal power to convey to another any one or more of the various incidents of his estate and to retain the others, as he sees fit. Oil and gas economics and custom may suggest some combinations more sensible than others. The law is indifferent to his choice.
Today's is one of those cases in which the parties broke away from the law's facilities. They laid aside the labels of convenience. The instrument at issue reserved to the grantors, Hardy McLeod and Josephine McLeod, the right to receive all bonuses and delay rentals from an eight month old oil and gas lease then in effect and, as well, from all future oil and gas leases. Once they did this, the parties moved beyond the shorthand descriptives "mineral interest" and "royalty interest." It became positively dangerous to continue to speak in those terms, as this lawsuit certainly demonstrates. Those who ask after that point whether a mineral interest or a royalty interest was conveyed by McLeod to Thornhill are simply asking the wrong question. Here lies the fundamental error of Appellees, System Fuels, Inc., et al., and of my colleagues in dissent.
Our question is, which of the incidents of mineral ownership were conveyed to Thornhill on May 14, 1945, and which were retained in the McLeods? More precisely, the judicial mind has become charged to locate the authority to lease the oil and gas interest conveyed to Thornhill.[19] Was that authority retained by the McLeods or conveyed to Thornhill?
The majority opinion, as much as I agree with it, makes the same mistake as everyone else, first on page 986 and at several points thereafter. The question is not, whether the McLeods conveyed "a mineral estate" or a "royalty interest only," but which of the various incidents of mineral ownership were conveyed and which were retained.
Two oft cited cases may be used to explain how we should construe mineral conveyances and how we should not.
Mounger v. Pittman, 235 Miss. 85, 108 So. 2d 565 (1959) is a case of consequence. Grantors reserved a one-eighth interest in the land pertaining to oil and gas. The question was whether grantor's interest was chargeable with one-eighth of the cost of production. The language at issue was
"We do hereby reserve ... one-eighth of all the oil and gas which may be produced from said lands. .. ."
235 Miss. at 86, 108 So.2d at 566. Everything else was conveyed to grantees. *1006 Though the matter could have been made more certain, construction is not difficult. The conveyance by its language gave grantees everything not reserved. Specifically, grantors reserved no right to drill or explore for oil and gas. They did reserve one-eighth of the oil and gas "which may be produced ...," that production, if any, to be generated by the parties with the right and authority to drill and explore. The words "which may be produced" could sensibly mean only "which may be produced by others than grantors." Grantors reserved the right to physical delivery of their one-eighth to themselves or as they might direct. From this it is a short step to reading the reservation as providing that grantors get their one-eighth without strings attached. The Mounger Court nevertheless offers careful definitions of "non-participating royalty interest" and "minerals in place". 235 Miss. at 86-87, 108 So.2d at 566. These definitions were unnecessary at the time. They have proven mischievous as they reinforce the tyranny of labels[20] and contribute to the methodology that leads today's dissenters astray.
Lackey v. Corley, 295 So. 2d 762 (Miss. 1974) is wonderfully wrong and right. Grantees were not chargeable with cost of production because, as a matter of common English usage, the wording of the grant and reservation said they weren't, not because their interest was a "non-participating royalty interest." The Lackey Court reasoned wrongly that grantees' interest had "three of the four characteristics of a non-participating royalty interest," that the fourth freedom from costs of production would be implied to yield a "non-participating royalty interest," and that because grantees held a non-participating royalty interest they were not chargeable pro rata with cost of production. Lackey, 295 So.2d at 764-65. This is nonsense. Why go by way of China to cross the street? The shortest distance between two points is a straight line, and this is so in law and logic as in geometry. The Lackey grantees were not chargeable with cost of production because the words in the instrument, as a matter of elementary English usage, said they weren't, period.
III.
A.
I turn to the tyranny's second presence: the labels "ambiguous" and "unambiguous". These labels are productive of much mischief. Yet we have used them in construing mineral conveyances and in other contexts as a supposed means of deciding admissibility of parol or extrinsic evidence. Compounding the felony, we say such evidence then becomes an aid to identifying intent.
I will explain.
For one thing, there are in each word, phrase or expression a core of certainty and a penumbra of doubt. One shades into the other. The same wording may be clear or ambiguous depending upon the question sought to be answered.[21]
Second, there is no sharp or distinct line of demarcation between that core and penumbra. Compare McBrayer v. State, 467 So. 2d 647, 648 (Miss. 1985). The reality is a continuum pointing toward clarity at one pole and ambiguity and indeterminacy at the other. Here we have an archetypal example of the tyranny of labels: two distinct, formally exclusive words, "ambiguous" and "unambiguous", used to reflect an underlying reality that is nothing but an in-between, for no word, phrase or legal rule is absolutely ambiguous or absolutely unambiguous. Yet we use these two words to decide cases, to dispense fortunes.
I have often wondered how long it will be before lawyers recognize this reality and quit phrasing their arguments in terms of whether certain wording is clear and unambiguous, on the one hand, or ambiguous, on the other, as though two separate and distinct realities were the alternatives.[22] Ambiguity, *1007 like beauty, lies in the eye of the beholder. I would jettison from our law the labels "ambiguous" and "unambiguous" as they are at best ambiguous.
B.
No notion in our law is more misunderstood and misused than that of "intent". To be sure, laws, be they public or private, do not come into being willy-nilly. The maker has in mind some purpose and purpose properly gleaned informs construction and application. What is critical is that we remember that we should seek purpose in the objective accessible world. In contracts and property, purpose or intent should be inferred from the words employed. In torts and crimes, from actions.
We are concerned here with privately made law, the May 14, 1945, instrument of conveyance executed by the McLeods and delivered to Thornhill. But this is a very special kind of privately made law. The instrument conveys an interest in land. It has been placed of public record there to be seen, examined and interpreted by third parties who have no knowledge of or easy access to the McLeods or Thornhill.
I for one am not nearly so interested in what the parties intended as in what they said.[23] In identifying what has been said, I would place enormous emphasis upon correct English definition and language usage. Ordinarily we should give an instrument that construction which makes sense to an intelligent layman familiar only with the basics of the English language. There is no guide to interpretation more reliable nor more capable of enduring.
No doubt there are exceptions which must be granted. Certain words have core legal meanings not commonly known by those unlearned in the law. I doubt the word "consideration" means the same to English teachers as to lawyers. Laymen think a tort a pastry. Moreover, a sentence should not be given an artificial "diagramed" meaning when its core idea is reasonably clear. Henderson v. State, 445 So. 2d 1364, 1366-68 (Miss. 1984). Nor should mismatched subjects and verbs necessarily infect a sentence's sense. See West v. Arrington, 183 So. 2d 824, 825 (Miss. 1966). Still in the overwhelming majority of cases I would accord the work of Noah Webster and the Strunk & White[24] a higher status than any judicial utterance.
The problem faced by the oil and gas lawyer is that our decisions reflect an inconsistent resort to the king's English. For example, in Miller v. Lowery,[25] 468 *1008 So.2d 865 (Miss. 1985); West v. Arrington,[26] 183 So. 2d 824 (Miss. 1966); and Cook v. Farley,[27] 195 Miss. 638, 15 So. 2d 352 (1943), the Court read the language in the instrument of conveyance as would a competent English teacher, all in the context of the facts appearing on the public record. Miller, West, and Cook seem correctly decided. By way of contrast, it seems to me that we missed the boat in Pfisterer v. Noble,[28] 320 So. 2d 383 (Miss. 1975); Oldham v. Fortner,[29] 221 Miss. 732, 74 So. 2d 824 (1954); and Wilson v. Gerard,[30] 213 Miss. 177, 56 So. 2d 471 (1952). I think Pfisterer, Oldham and Wilson were incorrectly decided. I say this in the sense that in each of these latter three cases the Court engaged in various flights of fancy to ignore what common familiarity with the English language reflects.
In saying these things I am well familiar with the lawyer's itch for certainty. I have felt it. Title lawyers have it worse than others and understandably so. Yet we learn as children that the itch must be endured, that scratching only makes it worse. I have no illusion that the language of the law is certain and capable of mechanical application. This being so, I do not suggest it may be demonstrated with any such certainty that Miller, West, and Cook are right and that Pfisterer, Oldham and Wilson are wrong. My conclusions above are at most what I think may be demonstrated the better view.
*1009 IV.
What then of the so-called canons of construction? System Fuels cites many: resolve uncertainties against the party who prepared the instrument, Clark v. Carter, 351 So. 2d 1333, 1334, 1336 (Miss. 1977); give great weight to the practical construction the parties have placed upon the instrument, St. Regis Paper Co. v. Floyd, 238 So. 2d 740, 744 (Miss. 1970); and several others. Such sayings, to be sure, appear in our cases.[31] Recorded instruments of conveyance may not be so construed. However valid or useful these canons may be in resolving disputes regarding private, unrecorded contracts, a different conductor calls our cadence.
Again, I must explain.
Two wholly different categories of persons resort to recorded instruments of conveyance, read those instruments, and need to know meaning: (1) the parties (and those in privity with them) and (2) third parties checking the land records, seeking to understand the state of title, the location of rights and powers. What such instruments say must be the same, whichever type of party ponders meaning. The controlling realities are those practical limitations of the land records title searcher's access to information. I will not assent to assigning meaning by resort to references beyond practical access of the land records title searcher. Conversely, all within her access she is bound to know.[32]
In the context of today's case, I would ask, what in the chancery clerk's office tells of the practical construction the parties have given an instrument? How is the title searcher to determine which party prepared the instrument? At whose insistence were the typewritten additions added to the instrument? What in the land records gives a clue regarding the relative education levels of the parties? Their relative sophistication in oil and gas parlance? And how is the third party in reading the deed books to know the subjective state of mind of the grantor? The grantee?
Surely it follows intuitively that an instrument of conveyance from A to B should be held to have the same meaning when A and B are at each other's throats as when C reads it in the land records. Indeed, most lawsuits have a liberal sprinkling of involved original and innocent third parties. Hence, the rules of construction I outline above.
None of this is to say there should not be special rules for suits between original parties, e.g., estoppel, fraud, reformation, and the like. If an oil shark overreaches an innocent mineral owner to the extent that we intervene and void ill gotten gains, we do so on the basis of other law, not that words in a recorded instrument of conveyance mean something in that case other than their meaning in the normal case. We may hold Thornhill, for example, to a duty of good faith and fair dealing vis-a-vis the McLeods.[33] That duty may on certain facts prove outcome determinative. But this in no way alters meaning that ought be ascribed to the deed of May 14, 1945.
V.
Much is said about Harris v. Griffith, 210 So. 2d 629 (Miss. 1968). The opinion of the Court authored by Justice Hawkins quite properly overrules Harris, though the dissent sees it sacred. We should visit Harris with some care, as much may be learned from it.
There is good in Harris. I applaud Harris' rejection of parol evidence of conversations between the parties before the execution of the deed. 210 So.2d at 633. Harris *1010 is quite sound in its insistence that the construction given such instruments of public record make no reference to such extraneous matters. Moreover, Harris insists the deed's meaning is that which may be gleaned "from the instrument itself." 210 So.2d at 633.
Harris quotes from prior decisions regarding principles of construction. Two are quite appropriate:
That the construction should be upon the entire instrument, and each word and clause therein should be reconciled and given a meaning, if that can be reasonably done; ... [and] that the main document and that to which it refers must be construed together.
210 So.2d at 633. Two others I regard problematical: that contracts be read in the light of circumstances surrounding the parties at the time of execution and that the practical construction placed upon an instrument by the parties will have weight. These principles call for parties to go beyond the public record. How is one examining the land records, charged with interpretation of instruments there found, to learn of the fact of such extraneous circumstances, much less their content?
Harris employs substantially sound methodology. In the performance of that methodology, however, the Court errs.
First, the instrument in Harris was the printed form entitled "Mineral Right and Royalty Transfer" (MMRT). The parties struck out the word "Right" and inserted "Deed", thus choosing for the title "Mineral Deed and Royalty Transfer." Harris concludes that this change "indicates an intent to convey a royalty only." 210 So.2d at 634. The point escapes me. Insertion of the word "deed" in the instrument's title suggests a conveyance of minerals, that all mineral interests were conveyed except those expressly reserved.[34] The Harris Court offers no explanation for its deduction from this change of title, and none is apparent.
Second, the Harris deed contained this new language:
This instrument is to be non-participating both as to bonuses and lease rentals.
The Harris Court offers a rather odd statement of interpretation. "This was not phrased in terms of a reservation or exception of bonuses and lease rentals." 210 So.2d at 634. Two paragraphs later the Court refers to this same clause as "the retention of bonuses and lease rentals." 210 So.2d at 634. I regard retention a synonym for reservation. See Roget's International Thesaurus § 660.12, p. 506 (4th ed. 1977).
Harris reaches new heights in judicial artificiality in its handling of the word "non-participating." First inexplicably the Court severs "non-participating" from the remainder of the clause: "both as to bonuses and lease rentals." Yet the language flows together. True, the phrase "this instrument" is a bit awkward. But the rest of the sentence seems quite accessible: The interest conveyed is "non-participating both as to bonuses and lease rentals." This can only mean that the grantee does not get the bonuses and lease rentals and, conversely, that the grantor retains those. The Harris Court is simply wrong when it reads this language as indicating "that the interest conveyed does not share in the right to execute leases or to explore and develop." 210 So.2d at 634.
Harris' second sin regarding this "nonparticipation" clause is worse.
It was not stated that the deed would be non-participating "only" as to bonuses and rentals.
210 So.2d at 634. [Emphasis mine]
I dare say that if the sentence were given to one hundred competent high school English teachers and each was told of the various incidents of mineral ownership and each was asked the sentence's meaning, all one hundred would answer that the interest conveyed was non-participating as to bonuses and to lease rentals and as to nothing else.
*1011 Harris correctly recognizes that the power to execute leases may be separated from bonuses and lease rentals then mysteriously adds: "but this should be done explicitly." 210 So.2d at 634. But this is exactly what occurred. Bonuses and lease rentals were separated from the other incidents of mineral ownership. The general words of conveyance elsewhere in the deed vested these other incidents in the grantee. This would seem explicit enough to my mind. It makes no more sense to require that the instrument go further and expressly provide that the executive right is conveyed than to add that the right to royalty was conveyed.
But it is said Harris has been on the books for almost twenty years and we ought respect it, right or wrong. I accept that in no area of our law is stability as important as in property law. Yet Harris should must does fall and for two overpowering reasons. It is inconsistent in principle with all that has gone before. And, it is demonstrably wrong.[35] The history of our law is strewn with the carcasses of cases long defended in the name of stare decisis untimately reversed by the rule of reason. Harris is destined to be such a case. I applaud today's decision to bite the bullet and cut everyone's losses.
VI.
Why, when all is said and done, does the legal power to lease an undivided one-half interest in the minerals in, on or under the NW 1/4 of SW 1/4 of Section 30, Township 6 North, Range 7 West, Jefferson Davis County reside in C.L. Thornhill, and those claiming through him?
Our answer may be found in the objective accessible world. In May of 1945, the land records reflected that the McLeods owned the minerals in, on or under a forty acre tract, subject only to an outstanding lease they had given eight months earlier. The mineral deed the McLeods gave Thornhill conveyed to him an undivided one-half of what they had, less reservations. We find this expressed in the great language of the printed form and, as well, in typed language appearing on the face of the instrument. The typed wording reads:
It is the intention of the grantors to convey, and they do hereby convey, twenty (20) full mineral acres of land of said tract.
These words are reasonably unequivocal. Because the McLeods had forty mineral acres and without specification conveyed twenty, their conveyance was of an undivided one-half interest in the entire forty. This is made clear by the typed "one-half (1/2)" insertion in the printed grant which proceeds to refer to the McLeods' interest in their forty acres. There is then no reason to read these words of grant as meaning anything other than as they provide. Subject to any exception that may follow, they create a conveyance of the whole bundle of incidents of an undivided one-half interest in the McLeods' forty acre mineral estate.
As we approach the matter of exceptions, we note our rule that
in order to except certain property out of a conveyance, which without the exception would carry all, the words of exception must be as definite as those required to convey title; and that, if they are not so, the whole property passes.
The Texas Company v. Newton Naval Stores Co., Inc., 223 Miss. 468, 476, 479, 78 So. 2d 751, 753, 754-55 (1955), quoting Richardson v. Marqueze, 59 Miss. 80, 94 (1881). What affords this rule of construction its legitimacy and durability is its consistency with conventional English language meaning and word usage.
This rule in mind, we confront the typed exception clause in the McLeod-Thornhill conveyance:
Non-participating as to present or future lease rentals or bonuses.
No language suggests exclusion of any incidents of the mineral estate other than rentals and bonuses. No wording excludes anything other than rentals and bonuses *1012 "in word ... as definite as those" in the typed and printed granting clauses. The McLeods, as grantors, conveyed twenty (an undivided one-half interest in their forty) full mineral acres and reserved present or future lease rentals (delay rentals) or bonuses.
We are told the leasing power never moved to Thornhill but remained in the McLeods because the McLeods reserved the right to receive bonuses and lease rentals. The argument proceeds on two premises: first, that bonus is the payment made when a lease is given, therefore, retention of bonus is retention of the power to lease; and, second, if Thornhill has the leasing power, he might ignore the McLeods' interests by leasing for higher royalty (which he will get) and lesser bonus and lease rentals (which the McLeods will get).
The second objection helps answer the first. Bonus and rentals are not all the holder of the leasing power bargains for and receives when he grants a lease. Vastly more significant are the proceeds of production, a percentage of which the lessor will seek. If the McLeods retained the leasing power, they could prejudice Thornhill regarding his interest in the proceeds of production.
That bonus is the payment made when an oil and gas lease is signed does not necessarily imply that bonus be paid to the lessor. There is nothing irrational or illegal about mineral owners, such as the McLeods, seeing a producing well about as likely as finding the proverbial pot of gold at the rainbow's end, being quite content to let Thornhill chase that rainbow for a modest fee. This is particularly so when it is remembered that the McLeods retained one-half the minerals, a source of assurance of a share of any such pot of gold.
Recall that the first production began thirty-six years after the McLeods gave their mineral deed. They may in 1945 reasonably have regarded the prospects of production slim and none and that a few hundred dollars coming in whenever Thornhill gave a lease of his one-half interest would be like finding money in the middle of the street, a periodic though modest bonus as Thornhill pursued the will-o-the-wisp. I find nothing nonsensical about the notion the McLeods may for such consideration have been willing to grant the leasing power to Thornhill.
There is a point I should note. The majority opinion contains in the introductory paragraphs (p. 984) the statement that:
After Thornhill received his interest, both Thornhill and the McLeods executed numerous instruments conveying fractional interests in the mineral and oil and gas leases. None of these conveyances are [sic] important to the issue before us.
I suspect an experienced title attorney would raise an eyebrow at such a claim, especially in light of the fact that the McLeods executed oil and gas leases covering the subject property in 1949, 1959, 1971, 1974, 1976, 1977, and 1979, while Thornhill executed only one lease during 35 years of ownership of his interest, that being in 1979.
Of course, Thornhill was under no obligation to lease his interest or even, for that matter, to remember that he owned any interest in minerals in Jefferson Davis County. Nor, upon reflection, is it relevant that the McLeods may have thought they retained the so-called executive right to the minerals in, on or under their full forty acres. To be sure, seven lessees from 1949 to 1979 thought they ought deal with the McLeods, but this is hardly surprising as they certainly held legal power to lease the one-half mineral estate not conveyed to Thornhill. No doubt the McLeods picked from the streets bonuses and rentals with each post-1945 lease. The McLeods got what they had retained in their conveyance to Thornhill. And this is so whether Thornhill or the McLeods themselves did the leasing.
In the end, such matters give pause. They do not, however, change meaning.
But we must still answer a second objection to today's reading. This point would have us inquire into the law regarding the duty of the holder of the leasing power to *1013 one holding the right to bonus and delay rentals. If Thornhill takes unlawful advantage of the McLeods, the latter may have a remedy. Suffice it to say that rewriting the McLeods' conveyance to imply retention of the leasing power is not among those remedies.
I return to the idea of grammatical construction. The McLeods conveyed via typed wording "twenty (20) full mineral acres". The pre-printed language reflects a conveyance of
an undivided one-half (1/2) interest in and to all of the oil, gas and other minerals.
These two provisions may only be read as conveying to Thornhill all incidents of the minerals not reserved. The only reservations are bonuses and rentals.[36] I read the instrument as would an English teacher having before her a manual of oil and gas terms. I am satisfied she would read the May 14, 1945, conveyance as vesting in C.L. Thornhill the legal power to lease his one-half interest in the minerals. Nor can I imagine a prudent title lawyer failing to advise a prospective lessee/client that before drilling, he had jolly well better get a lease from Thornhill as well as the McLeods.
I see the reading the Court gives the McLeods' conveyance the best it may be given consistent with the ideal of principled integrity in our law and, at once, the practical needs of the individual and his lawyer searching the land records. I join in today's decision denying the petition for rehearing of System Fuels, Inc., et al.
NOTES
[1] The practitioner would be well advised that mineral ownership may have entirely different meanings in different states.
[2] (1) In a deed where there are two repugnant clauses, the first must prevail, and (2) an attempted reservation is voided when repugnant to the granting clause, (3) these two rules shall not apply where the intent of the parties is plain. Also, when contractual provisions could not be reconciled, if part of the contract is in writing and part printed, the written part will prevail. Finally, it is the duty of the court to construe an instrument as written.
[1] I have uttered on this subject before. See J.L. Teel Co., Inc. v. Houston United Sales, Inc., 491 So. 2d 851, 857-58 (Miss. 1986).
[2] See Hart & Sacks, The Legal Process: Basic Problems In The Making and Application of Law 373-75 (Tent.Ed. 1958); see also Frazier v. State By and Through Pittman, 504 So. 2d 675, 714-15 n. 7 (Miss. 1987) (Robertson, J., concurring in part, dissenting in part); Boardman v. United Services Automobile Association, 470 So. 2d 1024, 1029-30 (Miss. 1985).
[3] See White v. Malone Properties, Inc., 494 So. 2d 576, 579-83 (Miss. 1986) (Robertson, J., concurring).
[4] See Allgood v. Allgood, 473 So. 2d 416, 421-22 n. 1 (Miss. 1985).
[5] See Kisner v. Jackson, 159 Miss. 424, 427-28, 132 So. 90, 91 (1931).
[6] See Groseclose v. State, 440 So. 2d 297, 302-06 (Miss. 1983) (Robertson, J., concurring).
[7] See Mack v. State, 481 So. 2d 793, 796-97 (Miss. 1985) (Robertson, J., concurring).
[8] Jack H. Ewing has written a widely read and highly regarded article, Reservation and Exception Of Minerals In Mississippi Conveyancing, 39 Miss.L.J. 39, 50-58 (1967). That article has many merits. Still, the author submits without protest or seeming awareness to this instance of the tyranny of labels.
[9] The word "warrant" when used in an instrument of conveyance is a typical example. Miss. Code Ann. § 89-1-33 (1972); see generally Hart and Sacks, note 2, supra, at 17-26; Cardozo, The Paradoxes Of Legal Science 70-72 (1928).
[10] 1 Will. & Meyers, Oil and Gas Law § 301 at 433 (1987).
[11] This term is misnamed. It is not a "right" at all. Property rights refer to entitlements and protections the law affords one from the interference of others. American Tobacco Co. v. Evans, 508 So. 2d 1057, 1059 (Miss. 1987). The executive right is a legal power, not a right. One who possesses it has the authority to execute leases.
[12] The term "bonus" usually refers to the cash consideration paid by the lessee at the time of the execution of an oil and gas lease. The bonus is paid to the holder of the right to receive bonuses. This is usually the landowner (mineral owner), although there is no reason why the right to receive bonuses and the authority to execute leases need be in the same party, as this case will illustrate. Bonus for the execution of a lease may take other forms than cash. One form is called oil bonus or royalty bonus which is payable from production. 8 Will. & Meyers, Oil & Gas Law, Manual of Oil and Gas Terms 87 (1987); see also Ewing, note 8, supra, 39 Miss.L.J. at 51.
[13] term "delay rental" usually connotes a sum of money payable to the lessor by the lessee for the privilege of deferring the commencement of drilling operations or the commencement of production during the primary term of the lease.
8 Will. & Meyers, Oil & Gas Law, Manual of Oil and Gas Terms 230 (1987). Such payments are sometimes called lease rentals. See also Ewing, note 8, supra, 39 Miss.L.J. at 51.
[14] Here the term "royalty" is often used. One definition is "the landowner's (mineral owner's) share of production free of expenses of production." 8 Will. & Meyers, Oil & Gas Law, Manual of Oil and Gas Terms 856 (1987). Care is required to avoid confusion as there are many other types of royalties. See Williams & Meyers, supra, at 620, 633, 646, 674-80, 856-68.
[15] 1 Will. & Meyers, Oil & Gas Law § 301 at 434-39 (1987).
[16] Id.
[17] Even Harris v. Griffith, 210 So. 2d 629, 634 (Miss. 1968), acknowledges this premise. See Blass, et al., An Analysis Of The Rights and Duties Of The Holder Of The Executive Right, 41 Miss.L.J. 189, 202 (1970). I understand Appellees System Fuels, Inc., et al. similarly to concede the point. See, e.g., the statement in their Brief in Support of Petition for Rehearing to the effect that "the right to receive bonus and rentals can be separated from the executive rights." In the same sentence Appellees describe this notion as a "principle which no one disputes." See Brief of Appellees in Support of Petition for Rehearing, page 1, filed October 6, 1987. [Emphasis supplied]
[18] See footnote 14, supra.
[19] The McLeods retained the authority to lease their undivided one-half mineral interest. That authority is not at issue in this litigation, nor is it affected by our decision.
[20] See generally, 1 Will. & Meyers, Oil & Gas Laws § 302 at 446-48 (1987).
[21] This, of course, is a rephrasing of what is said at the beginning of Section II above.
[22] I confess, see, e.g., Dennis v. Searle, 457 So. 2d 941, 945-47 (Miss. 1984), and repent.
[23] See Holmes, The Path Of The Law, 10 Harv. L.Rev. 457, 464 (1897).
[24] Strunk & White, The Elements Of Style (3d ed. 1979). Compare Williams, Style (2d ed. 1981); U.S. Government Printing Office, A Manual Of Style (1986); and The Chicago Manual Of Style (13th ed. 1982).
[25] The Warranty Deed executed by Sarah Miller contained the following:
"subject to the reservation of all oil, gas and other minerals in, on and under the above described land by prior grantors."
468 So.2d at 866. Miller correctly held that this language merely protected the grantor's warranty and was insufficient to reserve mineral rights without a formal severance. At the time of the conveyance, there was no such reservation by prior grantors.
Miller presents an important nuance of the ordinary English rule of construction. The rest of the land records are readily available to the title searcher. One reading the Miller deed is charged by what he learned in junior high school to know that Sarah Miller did not reserve or sever any mineral estate. Sarah's language talks only of reservations by "prior grantors". If the title searcher wants to know what "prior grantors" have done, if anything, he may complete his examination of the land records, which, of course, he ought to do anyway. In a sense, this is going beyond the four corners of the Miller deed. Because the rest of the land records are readily accessible and because our interpretive effort remains in the objective world, the requirement is reasonable.
For a critique of Miller, see Comment, Oil and Gas: Use of the "Subject To" Clause In Mississippi Mineral Conveyancing, 55 Miss.L.J. 539 (1985) which, though thoroughly researched and carefully written, makes all of the mistakes noted here. In their concentration on the trees, the commentators have missed the forest. See also Note, Oil and Gas Can A "Subject To" Clause Be A Valid Exception In A Mineral Deed?, 7 Miss.Coll.L.Rev. 105 (1986).
[26] S.B. Daws, owner of the land and one-fourth of the minerals conveyed to B.C. Arrington, retaining all mineral rights for twelve years. Prior to the expiration of the twelve years, Arrington conveyed to Van H. West by warranty deed with the following clause:
"All oil, gas and minerals and all oil, gas and mineral rights belonging to or appurtenant to said land is [sic] hereby reserved and excepted from this conveyance, said oil, gas and minerals and mineral rights having heretofore been reserved and excepted, and are not owned by grantor."
183 So.2d at 825. The grantee claimed the one-fourth minerals and said that the language was merely a protection of warranty. West correctly held that no mineral interest passed to West. The dominant language "reserved and excepted" the minerals. Even if the explanatory "said ... minerals and ... rights having heretofore been reserved ..." had been in error, the result would have been the same. Though inartfully used, the king's English still tells one and all that minerals are "reserved and excepted."
[27] The conveyance stated:
There is also excepted from this conveyance all oil, gas and mineral deposits on said lands, which the grantors hereto have promised to convey to Aquilla B. Cook.
195 Miss. at 648, 15 So.2d at 354.
Cook correctly held that the exception was ineffective to convey any interest to Cook but that the invalid reservation or exception operated as an exception to the grant.
[28] The Warranty Deed contained the following language:
This conveyance and warranty herein are made subject to prior reservations and conveyances of all of the oil, gas and other minerals in, on and under said lands.
320 So.2d at 383. Pfisterer held erroneously that the mineral interest owned by the grantors at the time of conveyance was reserved and that the grantee acquired only the surface estate. The language employed excepts from the conveyance "prior reservations". Only those minerals as were theretofore vested in other parties were reserved.
[29] The clause in Oldham's deed to Bell excepted "all minerals and mineral rights, heretofore sold and conveyed," 221 Miss. at 736, 74 So.2d at 825. The problem, of course, was that no minerals or mineral rights had theretofore been sold.
The Court held that a recitation that the minerals had been previously sold or conveyed will amount to a valid exception although the recital is false or although the prior conveyance did not effectuate a transfer of the property described therein. The Oldham holding was wrong. The language leads only to the linguistic conclusion that the exception was limited to minerals and mineral rights which had in fact and in law theretofore been sold and conveyed.
[30] Wilson is close. The conveyance was made "subject to one-half interest in mineral and oil rights as conveyed to Wm. Henderson." 213 Miss. at 182, 56 So.2d at 471. But there had been no conveyance to any Wm. Henderson. The Court held that the one-half mineral interest did not pass to the grantee because the one who makes the reservation or exception does not part with his full title or dominion. I think Wilson is wrong and here is why. The word "conveyed" is in the past tense. The best reading of "as conveyed" is "which has heretofore been conveyed". The language contemplates a historical fact which we know had not occurred. The "subject to" clause thus makes the conveyance subject to a non-existent fact, i.e. the conveyance is subject to nothing, i.e. the conveyance is without exception or reservation.
[31] Seven such sayings are listed in Ewing, note 8, supra, 39 Miss.L.J. at 48-50. Each is an empty vessel into which one may pour any content. I would replace them all with the approach outlined in this opinion.
[32] Physical inspection of the land is within the title searcher's access. Rights of parties in possession, deficiencies in quantity of land, roadways, unrecorded easements and servitudes and other matters that might be disclosed by an accurate survey or competent inspection of the land are matters I regard within the "objective accessible world."
[33] See UHS-Qualicare, Inc. v. Gulf Coast Community Hospital, Inc., 525 So. 2d 746, 753 (Miss. 1987).
[34] If you think about it, the familiar MMRT form R-101 is misnamed. The word "Right" is out of place. The word "Deed" should appear in the title, for the same reason it appears in instruments called warranty deeds and deeds of trust.
[35] Harris is subjected to compelling critique in Blass, et al., note 17, supra, 41 Miss.L.J. at 201-05.
[36] The dissenting Justices make much of the fact that in 1948 Thornhill filed for ad valorem tax exemption on the oil and gas interest obtained from the McLeods describing the interest as "1/2 royalty." Whatever the interpretation of the McLeod-Thornhill conveyance, Thornhill in 1948 would have owned one-half the royalty to be produced from the forty acres. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/2985498/ | November 14, 2013
JUDGMENT
The Fourteenth Court of Appeals
RODOLFO RUIZ, Appellant
NO. 14-12-00659-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/1792790/ | 191 So. 2d 87 (1966)
J. William TIERNAN and Carl G. Gezelschap, Appellants,
v.
Florence C. SHELDON, Appellee.
No. 193.
District Court of Appeal of Florida. Fourth District.
October 3, 1966.
Rehearing Denied November 9, 1966.
C. Robert Burns, of Burns, Middleton, Rogers & Farrell, Palm Beach, for appellant-Tiernan.
Charles Byron, Delray Beach, and John Paul and Grover C. Herring, of Warwick, Paul & Herring, West Palm Beach, for appellee.
RAWLS, JOHN S., Associate Judge.
This is the second appeal of this cause. The previous decision rendered by the *88 Second District Court of Appeal is reported in 147 So. 2d 167 and sets out in detail the facts. This controversy between the parties arose out of a 99-year lease of certain property owned by Appellee-Sheldon and leased to Appellant-Tiernan and his silent partner, Gezelschap.
This lease required the lessee to (a) pay annual rental in the sum of $7,000.00, (b) pay the taxes, (c) construct on the leased property a building at a cost of not less than $175,000.00 commencing no later than January 31, 1961, and (d) pay court costs and attorney's fees incurred by the lessor in the event of lessee's default. Tiernan, the lessee, paid the rent for 1959 and 1960 and the taxes for the year 1959. The 1961 rent due January 1, 1961, and the city taxes were not paid. Tiernan immediately assigned the lease to East Atlantic, a corporation he had caused to be formed on February 20, 1961. It is this assignment which is the principal subject of the controversy between the parties. The lessor claims that the corporation was the alter ego of Tiernan and his silent partner, Appellant-Gezelschap, so the assignment amounted to nothing more than a transfer to themselves. The lessee contends that by the terms of the lease the same was freely assignable, that the formation of a corporation to escape future accruing obligations is not fraud, and thus, the chancellor erred in piercing the corporate veil.
In his first consideration of this cause, the chancellor entered a summary decree in favor of the lessee by which he construed Article X (c) of the lease to relieve the lessee of all liability which had previously accrued as well as all future liability by reason of the assignment of the lease to East Atlantic Corporation. The appellate court in reversing the chancellor's summary decree held inter alia that, "We are not in accord with [the chancellor's] * * interpretation insofar as it relates to the lessee's accrued liability to the lessor; nor can we agree with the implication that, assuming a valid assignment to the corporation, the corporation would not be liable for accrued defaults under the lease."
Upon remand the chancellor took extensive testimony, and in his decree found that Tiernan and Gezelschap (and Gezelschap's secretary who was issued one share) formed East Atlantic Corporation on February 20, 1961, the date the certificate of incorporation was filed with the Secretary of State, and on February 28, 1961,[1] Tiernan executed an agreement which purported to assign the lease to East Atlantic with the assignee assuming all the obligations thereof. The chancellor then noted that the corporation was not adequately capitalized to assume the obligations required to be performed by the lease covenants; that it failed to file annual reports due July 1, 1961, 1962, 1963 and 1964, and had failed to pay its corporate capital stock tax for said years; and the issues raised were "* * * whether or not there was any illegality in connection with the Assignment of Lease, the damages for breach of lease, and who was liable for such breach." After enumerating the foregoing factors, the chancellor found:
"* * * that [the] two individual defendants breached said lease, formed said corporation to escape personal obligation under the lease, and that the defendants have not paid the capital stock tax of the defendant corporation, nor filed annual reports, as required by law, for four years; that they had no intention of causing the defendant corporation to function, other than as a dumping ground for the lease; that the corporation is a fiction and, under the facts and circumstances of this case, is the `alter ego' of the individual defendants. The Court holds that the Assignment of the Lease to the corporation is void, being an Assignment by the individual defendants to themselves."
The chancellor's final decree held Tiernan and Gezelschap personally liable for annual rent of $7,000.00 together with interest *89 at eight percent for the years 1961, 1962, 1963 and 1964 and for taxes during the same period. He further found that damages claimed by plaintiff for failure to erect a building were speculative and not proven and that attorney's fees are not recoverable by reason of the contingent fee contract. Tiernan and Gezelschap question that portion of the chancellor's decree finding them personally liable for rent subsequent to the assignment of the lease on February 28, 1961, to East Atlantic Corporation. Appellee-Sheldon contends that the chancellor erred by not requiring appellants to pay attorney's fees as provided in the lease agreement and by not awarding damages claimed for appellants' failure to erect a building as provided in said lease. We affirm the chancellor's conclusions as to the speculative nature of damages for lessee's failure to start construction.
Florida decisions uniformly hold that courts will look through the screen of corporate entity to the individuals who compose it in cases in which the corporation was a mere device or sham to accomplish some ulterior purpose, or is a mere instrumentality or agent of another corporation or individual owning all or most of its stock, or where the purpose is to evade some statute or to accomplish some fraud or illegal purpose,[2] or where the corporation was employed by the stockholders for fraudulent or misleading purposes,[3] was organized or used to mislead creditors or to perpetuate a fraud upon them,[4] or to evade existing personal liability.[5]
In the case sub judice, what is the illegal purpose? Where does the fraud exist? How were creditors mislead?
The corporation was duly and properly formed. On February 20, 1961, East Atlantic Corporation was a legal entity and pursuant to the laws of Florida was entitled to transact business. The subject lease was duly and properly assigned to East Atlantic in accordance with the contract between the parties. The parties agreed that upon assignment "* * * the transferor or assignor shall be thenceforth released from any liability hereunder." (Emphasis added.) The lessor did not reserve unto herself any vestige of control as to an assignment, nor did she impose any conditions of financial responsibility as to a potential assignee of said lease, but to the contrary she agreed, "This lease is freely assignable * * *." By the terms of the contract the lessee could have assigned the lease to any sui juris indigent and freed himself of any future liability. An assignment to a corporate entity under these circumstances did not constitute a fraud upon anyone. This carefully worded thirty-four page lease fully expressed the agreement of the parties. Courts can and will set aside fraudulent schemes perpetrated upon innocent parties, but it is not a proper judicial function to relieve one from the consequences of a bad bargain. As stated in the prior opinion,[6] "* * * such liberal privilege of assignment would seem to be highly improvident from the standpoint of the lessor; but in the absence of fraud or other illegality the provision is valid. It may be construed but not evaded."
Great emphasis was placed by the chancellor upon the manner of conducting the affairs of East Atlantic Corporation subsequent to the date of the valid assignment of the subject lease. By reason of the *90 quoted provisions of said lease, the rights of the parties were fixed on February 20, 1961, and the facts relating to the corporation's affairs subsequent thereto were immaterial.
We next consider appellee's cross assignment of error pertaining to attorney's fees. Paragraph G, page 25, of the lease provides:
"If at any time by reason of the failure of the Lessee to keep and perform any covenant or agreement which under the terms of this lease the Lessee is bound and obligated to keep and perform, it becomes necessary for the Lessor to employ an attorney at law to protect the rights and interests of the Lessor in the property demised or to enforce the lease or proceed under it in any particular, then, in any of such events, the Lessee will owe and will pay unto the Lessor all costs of court and reasonable attorney's fees incurred or expended by the Lessor in taking such actions."
By the quoted provision of the lease instrument, the lessee agreed to pay reasonable attorney's fees incurred by lessor. The lessee failed to keep and perform certain terms of this lease prior to his assignment, and it became necessary for the lessor to employ an attorney to protect her rights. Although the lessee is not bound to pay a contingent fee, he is bound to pay a reasonable attorney's fee for the services of lessor's attorney in the trial of that cause for which lessor was successful. Therefore, in awarding attorney's fees the chancellor should take into consideration services rendered by appellee's attorney on the following occasions:
1. The two trials of this cause relative to appellants' personal liability for defaults in failing to perform the covenants of the lease prior to February 20, 1961.
2. Appellee's success in the prior appeal, and
3. That portion of the instant appeal which pertains to attorney's fees.
That portion of the chancellor's decree finding appellants personally liable for rent, interest and taxes subsequent to February 28, 1961, and the provisions of said decree finding appellants not liable for appellee's attorney's fee is reversed; otherwise, the decree is affirmed.
Affirmed, in part, and reversed, in part, with directions for further proceedings in accordance with this opinion.
ANDREWS, Acting C.J., and WALDEN, J., concur.
NOTES
[1] The record shows this date to be February 20, 1961.
[2] Mayer v. Eastwood, Smith & Co., 1935, 122 Fla. 34, 43, 164 So. 684, 687.
[3] Advertects, Inc. v. Sawyer Industries, Fla. 1955, 84 So. 2d 21, 23.
[4] Riley v. Fatt, Fla. 1950, 42 So. 2d 769, 773.
[5] Bellaire Securities Corporation v. Brown, 1936, 124 Fla. 47, 68, 168 So. 625, 633.
[6] Sheldon v. Tiernan, Fla.App. 1962, 147 So. 2d 167, 168. See also Ramey v. Koons, 5 C.A. 1956, 230 F.2d 802, 805, a case almost factually identical to this one, which held that the Florida parol evidence rule prevented the landlord from showing that he agreed to an assignment and release clause in the lease only because the lessee represented that the assignee would be a responsible corporation with substantial assets. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1851533/ | 685 So. 2d 618 (1996)
Louis E. BRUNETT
v.
DEPT. OF WILDLIFE AND FISHERIES, et al.
Robert A. BETER
v.
DEPT. OF WILDLIFE AND FISHERIES, et al.
Nos. 96 CA 0535, 96 CA 0536.
Court of Appeal of Louisiana, First Circuit.
December 20, 1996.
Writ Denied March 14, 1997.
*619 Dan M. Scheuermann, Baton Rouge, for Plaintiffs/Appellants Louis E. Brunett and Robert A. Beter.
Thomas D. Fazio and Keith C. Armstrong, Special Assistant Attorneys General, Baton Rouge, for Defendants/Appellees Louisiana Department of Wildlife and Fisheries, et al.
Robert R. Boland, Jr., Baton Rouge, for Defendant/Appellee Department of State Civil Service.
Before WATKINS and KUHN, JJ., and GUIDRY,[1] J. Pro Tem.
KUHN, Judge.
This is an appeal of a judgment dismissing plaintiffs' claims on a peremptory exception raising the objection of prescription. We affirm.
I. ISSUE
The issue raised in this appeal is whether plaintiffs' lawsuits, which allege age discrimination in employment, are timely.
II. FACTS AND PROCEDURAL BACKGROUND
Plaintiffs, Louis Brunett and Robert A. Beter, were classified employees of the State of Louisiana, Department of Wildlife and Fisheries ("DWF"). DWF notified plaintiffs in November, 1988 of a layoff, effective January 2, 1989. On the day of the layoff, Brunett, a Game Biologist, Development Program Manager in the Pittman-Robertson Wildlife Restoration Program with over 31 years of service with DWF, was 59 years old and had a civil service rating of GS-19. Beter, also 59 years old at the time of the layoff, was a Game Biologist District Supervisor with over 33 years of service and had a civil service rating of GS-17. Beter was offered a demotion with a cut in pay, which he accepted under protest. He continued to work for DWF an additional two years.
On November 13, 1991, Brunett filed a petition naming as defendants, DWF; Virginia Van Sickle, a former Secretary of DWF; Hugh Bateman, a DWF Game Division Administrator; Glenda Tarver, a DWF Human Resources Administrator; and Herbert Sumrall, a Director of Civil Service. Brunett's petition alleged DWF and Bateman had discriminated against him due to his age, and that the other defendants breached duties owed to him under the Civil Service rules. On December 4, 1991, Beter filed a similar lawsuit naming the same parties and essentially setting forth the same allegations.
Defendants filed peremptory exceptions raising the objections of prescription, no cause of action and lack of subject matter jurisdiction, which the trial court apparently overruled.[2] On July 1, 1992, the two lawsuits were consolidated. In February, 1995, defendants urged that the exceptions be reconsidered. After a hearing, the trial court concluded plaintiffs' claims were prescribed. A judgment dismissing plaintiffs' lawsuits was signed on August 24, 1995. Plaintiffs moved for a reconsideration of the trial *620 court's ruling. After a hearing on the motion for reconsideration, the trial court signed a judgment, upholding its earlier ruling which dismissed plaintiffs' lawsuits. From the October 23, 1995 judgment, plaintiffs appeal.
III. ANALYSIS
A. Applicable Liberative Prescription
Plaintiffs urge a three year prescriptive period applies to the provisions of La. R.S. 23:971 et seq., Louisiana Age Discrimination in Employment Act ("LADEA"). The LADEA does not expressly provide for a prescriptive period. Plaintiffs urge "the most applicable statute of limitations" is the three year period found under the provisions of 29 U.S.C.A. § 621 et seq., the federal Age Discrimination in Employment Act ("ADEA").[3]
In written reasons for judgment, the trial court stated, "The crux of the plaintiffs' cases involve allegations of intentional and willful neglect of duty and willful and intentional violation of law which claims are best characterized as delictual in nature." The trial court applied a one year liberative prescription and dismissed plaintiffs' lawsuits as untimely.
The liberative prescription for tort claims is contained in La. C.C. art. 3492, which provides in relevant part:
Delictual actions are subject to a liberative prescription of one year. This prescription commences to run from the day injury or damage is sustained.[4] (Footnote added.)
A cause of action based on age discrimination is subject to the one year prescriptive period in La. C.C. art. 3492. Harris v. Home Sav. and Loan Ass'n, 95-223, p. 3 (La.App. 3d Cir. 7/27/95); 663 So. 2d 92, 94, writ denied, 95-2190 (La.11/17/95); 664 So. 2d 405; see Jay v. Int'l Salt Co., 868 F.2d 179, 180 (5th Cir.1989) (wherein the court found no meaningful distinction exists between a claim of racial discrimination and a claim of age discrimination and concluded a claim under the LADEA constitutes a tort claim which is properly governed by the one year prescriptive period contained in La. C.C. art. 3492).
Although the LADEA is substantively similar to the ADEA in that a successful claimant must prove that he or she was discharged and that age was "a determinative influence on the outcome," Harris, 663 So.2d at 95, plaintiffs have cited no authority for the proposition that the federal statute of limitations applies to the LADEA. We agree with the trial court that plaintiffs' claims "are best characterized as delictual in nature." Accordingly, we find no error in the application of Louisiana's one year liberative prescription for delictual claims to the LADEA.
B. Application of One Year Liberative Prescription
Plaintiffs alternatively contend if the one year prescriptive period for delictual actions provided for in La. C.C. art. 3492 applies to the LADEA, the trial court erred in finding their claims had prescribed.
Brunett specifically asserts any delay in bringing his lawsuit was the result of fault and concealment on the part of defendants and suggests that we apply the doctrine of equitable tolling. Brunett contends he was lulled into inaction by representations of Burl Cain, a former personnel representative Commission member. The gist of Brunett's contention is that Cain misled him into believing that because Civil Service rules "change all the time," Brunett had a viable chance to have a reconsideration of the Commission's decision of his appeal.
At the hearing on the motion to reconsider, Louis Brunett testified that on November 14, 1988, he received notice his job with DWF was going to be abolished. Brunett filed an appeal with the Civil Service Commission ("Commission"). After a hearing on February 6, 1990, the Commission rejected Brunett's appeal. Brunett stated he did not appeal the Commission's decision because his attorney recommended he not do so. Instead, Brunett was advised by counsel that he should file an age discrimination suit for damages. Despite having been "absolutely *621 convinced" by January 2, 1989, (the effective date of the layoff) that he had been discriminated against on the basis of his age, Brunett acknowledged he had not presented any evidence of age discrimination at the February 6, 1990 hearing before the Commission. According to Brunett's testimony, this omission was because he had been advised by his attorney that the hearing was "just a matter of ... trying to get [his] job back."
Robert Beter also testified at the hearing on the motion to reconsider. He stated his appeal before the Commission, which was consolidated with Brunett's, had also been rejected. Beter appealed, and this court affirmed the Commission's decision.[5] Beter testified he felt as though discrimination had been practiced upon him by DWF as of the date of the notice advising him of the layoff.
Based on Brunett's testimony, we find prescription for his LADEA claim commenced on January 2, 1989, the effective date of termination, which was also the day Brunett "was absolutely convinced" he had been discriminated against by DWF on the basis of his age. See Harris, 95-233, p. 4; 663 So.2d at 94. Accordingly, the claim was prescribed as of January 2, 1990. Brunett did not file his lawsuit asserting claims under the LADEA until November 13, 1991, well after prescription had accrued. We note at the February 6, 1990 hearing, Brunett had an opportunity to present evidence of any alleged age discrimination by DWF and did not do so.
Beter's testimony establishes that he was aware he was a potential victim of alleged age discrimination on November 14, 1988, when he was given notice from DWF of the layoff. However, because Beter did not suffer any damages until the effective date of the layoff, January 2, 1989, he did not have a cause of action for his allegedly unlawful demotion/termination based on age until that occurrence. See Harris, 95-223 at p. 4; 663 So.2d at 94. Thus, like Brunett, prescription for Beter's injury commenced on January 2, 1989, and accrued one year from that date. Beter did not file his petition asserting LADEA claims until December 4, 1991, nearly two years after the accrual of prescription in this matter.
The principle of contra non valentem prevents the running of prescription where: (1) legal cause has prevented courts or its officers from acting on or taking cognizance of plaintiff's action; (2) a condition coupled with a contract or connected with a proceeding has prevented the creditor from acting; (3) an act of the debtor has effectively prevented a creditor from availing itself of his cause of action; or (4) a cause of action is neither known nor knowable by plaintiff even though plaintiff's ignorance is not induced by defendant. Zidan v. USAA Property and Cas. Ins. Co., 622 So. 2d 265, 267 (La.App. 1st Cir.1993), writ denied, 629 So. 2d 1138 (La. 1993).
In this case, Brunett testified the Commission decision was rendered on August 3, 1990, and he knew he had 30 days to appeal that determination. Brunett stated he had been advised by the Commission that the Civil Service Rules did not permit the Commission to rehear its decision.[6] Brunett explained that ultimately, he was hoping Civil Service would change the rules and rehear his case. These facts do not warrant the application of the doctrine of contra non valentem.[7]
IV. CONCLUSION
For the reasons herein expressed, the judgment dismissing plaintiffs' lawsuits *622 based on claims of age discrimination in employment is affirmed. The costs of this appeal are to be paid by appellants-plaintiffs, Louis Brunett and Robert Beter.
AFFIRMED.
NOTES
[1] Judge Carl A. Guidry, retired, is serving as judge pro tempore by special appointment of the Louisiana Supreme Court.
[2] The minutes of court show on April 10, 1992, the trial court overruled defendants' objections of prescription and subject matter jurisdiction; however, the record does not contain a signed judgment reflecting the trial court's ruling.
[3] The three year prescriptive period is codified at 29 U.S.C.A. § 626(e).
[4] C.C. art. 3492 was subsequently amended by La.Acts 1992, No. 621, § 1.
[5] Beter v. Dept. of Wildlife and Fisheries, 592 So. 2d 1359 (La.App. 1st Cir. 1991).
[6] Civil Service Rule 13.33(b) provided in relevant part, "No rehearing shall be granted from a final decision of the Commission or from a final decision of a referee."
[7] It is unclear from plaintiffs' brief whether Beter is contending that his appeal of the Commission's decision interrupted prescription, and therefore, because he filed this lawsuit alleging LADEA claims in November, 1991 prior to this court's affirmance in December, 1991 of the Commission's decision, his lawsuit is timely. The Commission could not have granted damages to Beter for alleged age discrimination by DWF. See Ubosi v. Sowela Technical Institute, 584 So. 2d 340, 342 (La.App. 3rd Cir.), writ denied, 589 So. 2d 1075 (La.1991). Thus, we find such a contention to be without merit. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/2398799/ | 642 F. Supp. 1339 (1986)
ALLIED TOWING CORPORATION, Plaintiff,
v.
GREAT EASTERN PETROLEUM CORPORATION, Allied Petroleum, Inc., and Petroferm U.S.A., Inc., Defendants,
and
PUBLICKER INDUSTRIES, INC., Defendant and Third-Party Plaintiff,
v.
SEALAND LTD. and Philadelphia Gas Works, Third-Party Defendants.
Civ. A. No. 85-808-N.
United States District Court, E.D. Virginia, Norfolk Division.
August 21, 1986.
*1340 *1341 Morton H. Clark, Carter T. Gunn, Vandeventer, Black, Meredith & Martin, Norfolk, Va., for plaintiff.
Daniel R. Warman, Williams, Worrell, Kelly & Greer, Norfolk, Va., for Allied Petroleum, Inc.
Waverley L. Berkley, III, Jett, Agelasto, Berkley, Furr & Price, Norfolk, Va., for Great Eastern Petroleum Corp.
F. Bradford Stillman, McGuire, Woods & Battle, Norfolk, Va., for Petroferm U.S.A., Inc.
Harvey Cohen, Joanne Alper, Cohen, Gettings, Alper & Dunham, Arlington, Va., for Publicker Industries.
William B. Eley, Walter D. Kelley, Jr., Marie L. Achtemeier, Willcox & Savage, *1342 Norfolk, Va., Tyler E. Wren, Obermayer, Rebmann, Maxwell & Hippel, Philadelphia, Pa., for Philadelphia Gas Works.
OPINION AND ORDER
DOUMAR, District Judge.
In this action, the plaintiff, Allied Towing Corporation, seeks damages and equitable relief from a number of defendants. These defendants have, in response, filed numerous third-party actions and counterclaims against the plaintiff and each other. Additionally, all the defendants, save two, have filed motions to dismiss the initial complaint and/or various derivative complaints. These matters have been exhaustively briefed. In order to simplify the Court's consideration of the issues presented therein, this opinion will begin with a brief recitation of the facts as alleged,[1] and the case's procedural history and then will proceed to consider the motions to dismiss Allied Towing's complaint, and then the motions to dismiss the pending third-party actions.
I.
1. FACTS
Philadelphia Gas Works (PGW) is a natural gas distribution company owned by the City of Philadelphia and operated by the Philadelphia Facilities Management Corporation. During the 1970's PGW obtained a portion of its gas supply from a manufacturing process that converted fuel oil into gas. PGW on occasion accepted bids for the sale of the oil-based by-product this process produced. In the fall of 1982, a representative of Sealand Ltd. (Sealand) visited PGW's Passyunk facility in Philadelphia to inspect a quantity of this liquid in anticipation of such a bid. In February of 1983, PGW accepted Sealand's ultimate bid of $.01 per gallon for the material. This price was F.O.B. Philadelphia at the Passyunk wharf on the Schuykill River. In June of that year, Sealand arranged for the by-product to be removed from PGW's facility and transported to a tank farm owned by Publicker Industries, Inc. (Publicker).
When Sealand failed to pay for the tank rental, Publicker, apparently exercising its warehouseman's lien, seized the material and attempted to sell it. In April of 1985, Publicker sold 1,000,000 gallons of the material to Great Eastern Petroleum Corp. (Great Eastern) for $1.00. Great Eastern and Petroferm USA, Inc. (Petroferm) subsequently formed a joint venture to resell the by-product. They found a buyer in Allied Petroleum, Inc. (Petroleum) who allegedly believed the liquid to be 60% No. 6 oil and 40% water.[2] To complete the sale, Great Eastern contacted Allied Towing (Towing) to arrange the transport of the No. 6 oil mixture from Publicker's Philadelphia facility to Norfolk, Virginia. Initially, Towing understood that Great Eastern was to pay freight, demurrage and cleanup costs, but subsequent correspondence indicated that Towing was to look to Petroleum for payment. From October 29 through 31 of 1985, approximately 25,000 barrels[3] of the by-product were loaded onto Towing's Barge ATC-3062 in Philadelphia. Towing never suspected that the liquid entering the hold of its barge was anything other than an oil-water mixture.
When the barge arrived in Virginia, Petroleum determined that the liquid was not No. 6 oil and water and rejected the shipment. Towing then contacted PGW, Publicker, Great Eastern, and Petroferm. All *1343 denied liability and refused to arrange for the product's removal.
Towing also contacted the Environmental Protection Agency (EPA) which, in turn, "deferred" to the Virginia Division of Solid and Hazardous Waste Management. Samples of the substance were analyzed by a variety of laboratories, including the EPA's. While the results of these tests conflict in many key respects, all those who have tested the substance have concluded that its "flashpoint" is extremely low. Towing contends that the flashpoint of individual samples ranged from 74 degrees to 80 degrees F. and that a subsequent test indicated a composite flashpoint of 118 degrees F.
This, Towing contends, makes the material a hazardous waste within the meaning of the Resource Conservation and Recovery Act (RCRA), 42 U.S.C. §§ 6901-6987. Barge ATC-3062 is neither equipped nor certified to carry hazardous substances. As a result, both the EPA and the Commonwealth of Virginia have allegedly threatened Towing with substantial civil penalties for operating an unlicensed hazardous waste facility. According to Towing, only three barges of this type exist on the East Coast; the other two are owned by competitors who have now taken Towing's once substantial lighterage business. Additionally, Towing contends it has received no payment for the use of its barge. Petroleum, the company to which Towing first turned for relief, has submitted an affidavit to the Court indicating that it is without funds, even to pay its legal counsel in this matter, and cannot pay for the use of Towing's barge. As a result, Towing now contends that it is potentially liable for civil penalties and for the removal of a substance placed at its doorstep much like a foundling, with no social or adoptive agency ready to assume responsibility for its appropriate disposition. If Towing is correct, the material's continued presence in its barge imminently and substantially endangers the health and the environment of Virginia and its citizens.
2. PROCEDURAL HISTORY
Towing filed its initial complaint in this case on November 25, 1985 against Great Eastern and Petroleum. The complaint invoked the admiralty jurisdiction of this Court and prayed for damages, costs and attorney's fees. On January 2, 1986, Towing amended the complaint to state new claims based on tort and warranty theories and one based on Great Eastern's "failure to properly identify the product as a dangerous and hazardous cargo pursuant to Title 46 of the Code of Federal Regulations." First Amended Complaint at ¶ 2. The amendment also added a prayer for declaratory and injunctive relief. On January 13, 1986, Petroleum filed a third-party complaint against Petroferm.
On January 27, 1986, Towing filed a motion for a preliminary injunction. The matter was heard on February 7, 1986. The Court reserved ruling on the motion and the parties entered into intensive efforts to resolve the most pressing disputes without a judicial decree. Representatives of each litigant then involved, the Virginia Attorney General's Office, the State's Waste Management Office and the Court attempted to reach an agreeable, interim, if not ultimate, resolution to the controversy. This was not possible.
On March 25, Towing filed its second amended complaint, adding Publicker as a defendant. This complaint reasserted the maritime, warranty and tort claims alleged in the first complaint as amended, and articulated for the first time claims expressly based on RCRA and on the Comprehensive Environmental Response, Compensation and Liability Act (CERCLA), 42 U.S.C. § 9607(a). On April 16, Petroleum's third-party claim against Petroferm was dismissed without prejudice.
On May 15, Publicker filed a motion to dismiss Towing's complaint, a cross-claim against Great Eastern, and third-party claims against Sealand and PGW. Great Eastern filed cross-claims against Petroleum, Petroferm, and Publicker. Petroferm filed cross-claims against Great Eastern and Publicker. Motions to dismiss various *1344 claims have been received from a number of parties; to these motions the Court now turns.
II.
1. Publicker's Motion to Dismiss Towing's Complaint
A. Count IRCRA and the defendant's right to notice
In Count I of its second amended complaint, Towing alleges a cause of action based on the "citizen suit" provisions of the Resources Conservation and Recovery Act, 42 U.S.C. § 6972. Publicker contends that Count I fails to state a claim upon which relief can be granted or, alternatively, that this Court is without subject matter jurisdiction to hear the RCRA claim.
In support of its motion, Publicker draws upon the RCRA "notice" provisions codified at 42 U.S.C. § 6972(b). That subsection provides that:
(1) No action may be commenced under subsection (a)(1)(A) of this section
(A) prior to 60 days after the plaintiff has given notice of the violation to
(i) the Administrator;
(ii) the State in which the alleged violation occurs; and
(iii) to any alleged violator of such permit, standard, regulation, condition, requirement, prohibition, or order, except that such action may be brought immediately after such notification in the case of an action under this section respecting a violation of subtitle C of this Act [42 USCS §§ 6921 et seq.]; or
(B) if the Administrator or State has commenced and is diligently prosecuting a civil or criminal action in a court of the United States or a State to require compliance with such permit, standard, regulation, condition, requirement, prohibition, or order.
In any such action under subsection (a)(1)(A) in a court of the United States, any person may intervene as a matter of right.
(2)(A) No action may be commenced under subsection (a)(1)(B) of this section prior to ninety days after the plaintiff has given notice of the endangerment to
(i) the Administrator;
(ii) the State in which the alleged endangerment may occur;
(iii) any person alleged to have contributed or to be contributing to the past or present handling, storage, treatment, transportation, or disposal of any solid or hazardous waste referred to in subsection (a)(1)(B),
except that such action may be brought immediately after such notification in the case of an action under this section respecting a violation of subtitle C of this Act [42 USCS §§ 6921 et seq.].
"In this case," claims Publicker, "plaintiff does not, and cannot, allege that it has given the requisite notice, and its Complaint therefore must be dismissed." Publicker's brief in support of its motion to dismiss at 5. Notice, Publicker continues, is a jurisdictional predicate to a citizen suit under RCRA. Publicker claims that this position has been adopted by the Sixth and First Circuit Courts of Appeals. See Walls v. Waste Resources Corp., 761 F.2d 311, 316 (6th Cir.1985); Garcia v. Cecos International Inc., 761 F.2d 76, 78-79 (1st Cir. 1985).
The plaintiff in Garcia instituted an action in the Superior Court of Puerto Rico against private and governmental defendants seeking injunctive relief to prevent the construction and operation of a waste disposal facility. The defendants removed the case to federal district court and the plaintiffs amended their complaint to include a claim under RCRA. The district court denied the injunction, and on appeal the First Circuit, sua sponte, addressed the jurisdictional issue. Garcia, 761 F.2d at 78.
The Garcia court, relying on some of its earlier cases, e.g., Commonwealth of Massachusetts v. United States Veterans Administration, 541 F.2d 119 (1st Cir.1976), noted that the notice requirement was not a "technical wrinkle," but an important legislatively established device that is "likely *1345 to trigger governmental action which would alleviate the need for judicial relief." Garcia, 761 F.2d at 80 (quoting City of Highland Park v. Train, 519 F.2d 681, 690 (7th Cir.1975), cert. denied, 424 U.S. 927, 96 S. Ct. 1141, 47 L. Ed. 2d 337 (1976)). Accordingly, the Court held that "[t]he failure to provide actual notice to the EPA, the state and the alleged violator at least sixty days before the commencement of the action forecloses the possibility of jurisdiction under RCRA". Garcia, 761 F.2d at 83 (emphasis added). Since the parties stipulated that no actual notice had been provided, the Court determined that the case had been improvidently removed.
In Walls, the Sixth Circuit also noted the crucial role notice serves in a citizen suit. "The citizen suit notice provisions were intended to give the EPA an opportunity to resolve issues regarding the interpretation of complex standards by negotiation, unhindered by the threat of an impending lawsuit." Walls, 761 F.2d at 317. The court found that "actual notice" was a "jurisdictional predicate" to a RCRA action and that the plaintiff's failure to "distinctly and affirmatively plead[] the facts forming the basis of subject matter jurisdiction" was fatal to this claim. Id.
At least two Circuit Courts of Appeals have expressly held that the notice provisions of 42 U.S.C. § 6972(b) are not jurisdictional. See Proffitt v. Commissioners of Bristol Township, 754 F.2d 504 (3d Cir. 1985); Hempstead County and Nevada County Project v. United States Environmental Protection Agency, 700 F.2d 459 (8th Cir.1983); Pymatuning Watershed Citizens for a Hygienic Environment v. Eaton, 644 F.2d 995 (3d Cir.1981); see also Fishel v. Westinghouse Electric Corp., 617 F. Supp. 1531 (M.D.Pa.1985); Dedham Water v. Cumberland Farms Dairy, Inc., 588 F. Supp. 515 (D.Mass.1983); O'Leary v. Moyer's Landfill, Inc., 523 F. Supp. 642 (D.Pa.1981); cf. Conservation Society of Southern Vermont, Inc. v. Secretary of Transportation, 508 F.2d 927 (2d Cir.1974), vacated on other grounds, 423 U.S. 809, 96 S. Ct. 19, 46 L. Ed. 2d 29 (1975) (Federal Water Pollution Control Act case). These Courts have adopted a more "pragmatic" approach, finding that "notice-in-fact [is] sufficient to defeat [a defendant's] contention that [the plaintiff's] failure to file sixty-day notices deprived the district court of subject matter jurisdiction over [a RCRA] claim." Proffitt, 754 F.2d at 506.
Although the parties to this action apparently read the Walls and Proffitt cases as polar extremes, see, e.g., Publicker's brief at p. 7 n. 9 (Proffitt "wrongly decided"), the Court finds the reasoning in these cases remarkably similar. Proffitt requires "notice-in-fact;" Walls and Garcia require "actual" notice. "Actual" notice is "notice expressly and actually given and brought home to the party directly." Black's Law Dictionary 957 (5th ed. 1979). Congress' rationale in requiring notice is clear; the E.P.A. must have the opportunity to resolve the dispute "unhindered by the threat of an impending lawsuit." Walls, 761 F.2d at 317. On this proposition, all of the reported cases agree. This Court, therefore, must determine what notice, if any, was, in fact, received.
On November 27, 1985, nearly four months before raising its RCRA claim, Towing's counsel dispatched a Telex to PGW, Publicker and the EPA. The full text of the document is set forth in the margin,[4] but its contents may be summarized as follows:
*1346 (1) We are counsel for Towing and Towing owns Barge ATC-3062
(2) In October this Barge was loaded at Publicker with material we believed to be 60% No. 6 oil and 40% water. It was not. Whatever it is, it has a flashpoint of between 74 degrees and 118 degrees F.
(3) Petroleum has refused the product and we're stuck with it here in Norfolk.
(4) We were advised that this liquid came from PGW and that EPA knew of this substance prior to the loading of the product on our barge. We received no warning from anyone as to its hazardous nature.
(5) We want Publicker or PGW to take this product back and we will hold you liable for all damages and costs involved.
Publicker contends that this notice was inadequate in light of the requirements of 40 C.F.R. § 254. Under this regulation, the required notice should "include sufficient information to permit the recipient to identify the specific permit, standard, regulation, condition, requirement or order which has allegedly been violated, the activity alleged to constitute a violation, the person or persons responsible for the alleged violation, the date or dates of the alleged violation and the full name, address and telephone number of the person giving notice." 40 C.F.R. § 254.3(a). This notice accomplishes this task. It identifies the dangerous flashpoint as at least one of the standards allegedly violated, indicates the role PGW and Publicker played in allegedly failing to warn Towing of the substance's nature, and gives the date of the alleged violation. It clearly indicates Towing's intent to hold both PGW and Publicker liable for its losses. While the standard assertedly violated might have been identified with greater specificity, the regulation merely requires that the notice provide sufficient detail for the recipient to identify the violated standard. This Court holds that the notice dispatched by Towing[5] and received by Publicker satisfied the notice requirements of § 6972(b).
*1347 Publicker claims, however, that because notice is jurisdictional, the plaintiff must affirmatively plead notice, i.e., that the source of the Court's jurisdiction must appear on the face of the plaintiff's complaint.
The plaintiff's complaint indicates that the Court's jurisdiction is based, in part, on RCRA, that following the barge's arrival in Norfolk, "[n]o instructions were given ... by the defendants as to the disposition of the cargo," Second Amended Complaint at ¶ 15, that the "defendants have refused to remove or dispose of the cargo...." Id. at ¶ 16, and that "[a]lthough demand has been made upon the defendants for directions ... no such directions have been forthcoming." Id. at ¶ 20.
The Court starts from the proposition that pleadings are to be construed so as to do substantial justice, Fed. R. Civ. P. 8(f), and when ruling on a Fed. R. Civ. P. 12(b) motion, in a light most favorable to the plaintiff, Scheuer v. Rhodes, 416 U.S. 232, 94 S. Ct. 1683, 40 L. Ed. 2d 90 (1974). A court most assuredly may not manufacture subject matter jurisdiction, but where the facts necessary to its jurisdiction are alleged, the recitation of some special incantation is unnecessary. See generally Wright, Law of Federal Courts § 69 (3d ed. 1976). The allegation that the defendants refused to allow Towing to return the product carries with it, by necessity, the unspoken assertion that the plaintiff asked them to take it. Any other reading of the facts actually alleged in the complaint is untenable. Even if the Court were to assume that notice is jurisdictional, granting Publicker's motion to dismiss on this ground would be to sacrifice substance on the altar of form. This the Court will not do.
Similarly, Publicker's assertion that this Court is deprived of its jurisdiction because the notice was addressed to the wrong individual, see 40 C.F.R. § 254.2, is without merit.[6] As noted supra, actual notice is all that is required. Because the "defendants have not been prejudiced by this [alleged defect and since actual notice was received] ... this Court will not refuse to proceed with this matter on that basis." South Carolina Wildlife Federation v. Alexander, 457 F. Supp. 118, 124 (D.S.C.1978) (F.W.P.C.A. case).
Finally, Publicker seeks to have the first count dismissed because Towing "may not collect a money judgment against [the defendants] for violations of RCRA." Apparently, Publicker reads Count I as a prayer only for legal, not equitable, relief. Indeed, the language of paragraph 11 of Count I only mentions the request for damages. At the conclusion of all the counts, however, the complaint prays for "such declaratory and injunctive relief as is necessary to bring about the proper removal, storage and/or disposal of the waste on Barge ATC-3062." Prayer for relief ¶ 2 at 6. While this specific language is not contained in Count I as such, the complaint must be read as a whole. A complaint cannot be dismissed for failure to state a claim unless it appears beyond doubt that plaintiff can prove no set of facts in support of his claim which would entitle him to relief. Conley v. Gibson, 355 U.S. 41, 78 S. Ct. 99, 2 L. Ed. 2d 80 (1957). This cannot be said of Count I of Towing's complaint when properly construed.
B. Count IIProper parties defendant to a CERCLA Claim
In Count II of its second amended complaint, Towing contends that all of the defendants *1348 collectively have caused "an imminent and substantial endangerment to health and environment in the Commonwealth of Virginia." Second amended complaint, at ¶ 21. Towing pursues a private right of action under CERCLA to recover the "costs" it has incurred.
In response, Publicker contends: (1) that Towing has incurred no recoverable costs, (2) that the "cleanup" Towing seeks is not consistent with the National Contingency Plan (NCP) and (3) that Publicker is not a "person" subject to suit within the meaning of CERCLA.
CERCLA was passed in 1980 to provide the nation with a comprehensive and workable solution to the growing problem of hazardous waste. Federal and state governmental authorities are each given responsibilities under the plan, as are private citizens. The Act requires the EPA to develop and periodically revise a National Contingency Plan (NCP) which includes a National Priorities List (NPL), listing the nation's hazardous waste dumps in order of priority. The Act also established the Hazardous Substance Response Trust Fund, generally known as "Superfund," to finance governmental cleanups of the sites listed on the NPL.
Section 107(a)(1)-(4) of the Act, codified at 42 U.S.C. § 9607(a)(1)-(4),[7] makes certain private entities liable for what are called "response" costs. Towing has invoked these provisions in this case. Publicker, however, contends that costs incurred in storing, testing, and attempting to dispose of the cargo are not "necessary costs of response." 42 U.S.C. § 9607(a)(4)(B). "`Respond' or `response' means remove, removal, remedy and remedial action" 42 U.S.C. § 9601(25). "Removal," in turn, is defined by § 9601(23) as the cleanup or removal of hazardous substances from the environment and "such actions as may be necessary to monitor, assess and evaluate the release of hazardous substances, the disposal of removed material or the taking of such other actions as may be necessary to prevent, minimize or mitigate damage to the public health or welfare or to the environment...." "Remedial" actions are those "consistent with permanent remedy taken ... to prevent or minimize the release of hazardous substances so that they do not migrate to cause [a] substantial danger." 42 U.S.C. § 9601(24).
In this case, Towing alleges "economic and consequential damage to its business, costs of storing, testing and attempting to dispose of the cargo, legal costs associated with these efforts plus future costs of removing and disposing of the cargo." Second Amended Complaint at ¶ 19. Clearly, CERCLA does not provide a remedy for the plaintiff to recoup his business losses. The question is whether CERCLA would allow Towing to recover its alleged costs in "storing, testing and attempting to dispose of the cargo."
*1349 This Court is persuaded by the language of the statute that Towing's complaint states a claim for cost recovery under CERCLA. The plain language of § 9601 brings within the scope of a § 9607 action those expenditures "necessary to monitor, assess and evaluate" what is required to protect the public health and actions taken "consistent with [a] permanent remedy" to prevent catastrophes. It would be sheer folly to move or dispose of this substance without careful analysis and inconsistent with CERCLA's purpose to require an innocent plaintiff to bear the necessary costs. Moreover, it is difficult to discern how attempts to find a permanent remedy are not, as a matter of law, actions taken "consistent with a permanent remedy." Accord Wickland Oil Terminals v. Asarco, Inc., 792 F.2d 887 (9th Cir.1986).
This, of course, does not mean that Towing has incurred "necessary costs of response", only that the allegations in its complaint survive Publicker's motion to dismiss as to this issue at this time. The nature of any costs Towing may have incurred is a factual matter to be resolved at trial.
Next, Publicker seeks to have Towing's CERCLA claim dismissed because the response costs Towing allegedly incurred were not "consistent with the NCP." Publicker's brief at 16. Specifically, Publicker contends that Towing cannot recover because its actions were not taken at the direction of the federal government, or following government approval. Further, Publicker contends that Towing's claim is not cognizable under CERCLA because its barge has not been listed by the EPA on the National Priorities List.
At least one court has held that a private litigant suing under § 9607 must first obtain governmental approval before commencing remedial actions. See, e.g., Bulk Distribution Centers, Inc. v. Monsanto, 589 F. Supp. 1437 (S.D.Fla.1984). The EPA administrator, however, disagrees. According to the administrator, it should be "absolutely clear that no Federal approval of any kind is a prerequisite to a cost recovery [action] under section (9607)." 50 Fed.Reg. 47,934 (1985). As the Honorable Judge Wallace of the Ninth Circuit noted in Wickland, "this reading [is] consistent with CERCLA's broad remedial purpose [and] promotes the effectiveness of private enforcement actions under (§ 9607) as a remedy independent of government actions financed by Superfund." Wickland Oil Terminals v. Asarco, Inc., 792 F.2d 887, 892 (9th Cir.1986).
Neither is this Court convinced that CERCLA requires an NPL listing as a precondition to the recovery of costs. Such a requirement would certainly render the citizen's suit provision less effective, would be inconsistent with the Act's reliance on "private attorneys general," cf. Chesapeake Bay Foundation v. Gwaltney of Smithfield, 791 F.2d 304, 311-12 (4th Cir.1986) and would conflict with the EPA's construction of § 9607. Accord New York v. General Electric Co., 592 F. Supp. 291 (N.D.N.Y.1984).
Finally, Publicker seeks to dismiss Count II of Towing's complaint because it is not a "person" within the meaning of the Act. Section 9607 delineates four classes of "persons" from whom costs may be recovered. They are:
(1) the owner and operator of a vessel (otherwise subject to the jurisdiction of the United States) or a facility,
(2) any person who at the time of disposal of any hazardous substance owned or operated any facility at which such hazardous substances were disposed of,
(3) any person who by contract, agreement, or otherwise arranged for disposal or treatment, or arranged with a transporter for transport for disposal or treatment, of hazardous substances owned or possessed by such person, by any other party or entity, at any facility owned or operated by another party or entity and containing such hazardous substances, and
(4) any person who accepts or accepted any hazardous substances for transport to disposal or treatment facilities or sites selected by such person, from which *1350 there is a release, or a threatened release which causes the incurrence of response costs, of a hazardous substance....
42 U.S.C. § 9607(a) (emphasis added).
Although the underscored language above appears, at first blush, to apply only to those persons covered by subsection (a)(4), a reading of the full text of the section clearly indicates that it was equally intended to modify subsections (a)(1)-(3). See New York v. Shore Realty Corp., 759 F.2d 1032, 1043 (2d Cir.1985).
Publicker owns a facility, but it doesn't appear from the complaint that there is a current threat of release of any toxic substance from that facility which may have caused Towing economic damage.
Neither could Publicker be liable under subsection (2). "Disposal" is defined as the "discharge, deposit, injection, dumping, spilling, leaking or placing of any solid waste or hazardous waste into or on any land or water so that such ... waste ... may enter the environment...." 42 U.S.C. § 6903(3) (incorporated into CERCLA by 42 U.S.C. § 9601(29)). If Towing's allegations are true, this material was "injected" into its barge, not the land or water. Accordingly, this provision is irrelevant to this case.
The analysis under subsection (3) is more difficult. Clearly, Publicker cannot escape liability by "contracting away" its responsibilities. See S.Rep. No. 96-848, 96th Cong., 2d Sess. 31 (1980), quoted in New York v. General Electric Co., 592 F. Supp. 291, 297 (N.D.N.Y.1984), see also United States v. A & F Materials Co., 582 F. Supp. 842 (S.D.Ill.1984). However, this Court finds persuasive the analysis used in A & F Materials. Construing the "otherwise arranged" language of subsection (3), the Court determined that "the relevant inquiry is who decided to place the waste into the hands of a particular facility that (now) contains the hazardous waste." Id. at 845 (emphasis in original). In this case Towing alleges that Great Eastern, and by implication perhaps Petroferm, determined where to place the substance. Accordingly, this subsection does not further Towing's CERCLA claim against Publicker.
The final subsection is applicable only to those who transport hazardous substances. Publicker clearly is not liable under this provision.
Under the facts as pleaded, Publicker is not a "person" liable under any of the four subsections found at 42 U.S.C. § 9607(a). For this reason, Count II of the plaintiff's second amended complaint, which seeks cost recovery under CERCLA, is DISMISSED as to Publicker Industries, Inc.
C. Counts III and IVCERCLA, RCRA, and Presumption
Count III of the plaintiff's complaint is based on principles of "general maritime law," and raises warranty claims. Count IV alleges a cause of action based on negligence and strict liability.
Publicker contends that the extensive legislative and regulatory framework surrounding RCRA and CERCLA "occupy the field." Relying in large part on Middlesex City Sewerage Authority v. National Sea Clammers, 453 U.S. 1, 101 S. Ct. 2615, 69 L. Ed. 2d 435 (1981) and Milwaukee v. Illinois, 451 U.S. 304, 101 S. Ct. 1784, 68 L. Ed. 2d 114 (1981) (Milwaukee II), Publicker contends that federal and state causes of action for damages arising from the disposition of hazardous substances are preempted by RCRA and CERCLA. Because the expressed Congressional intent is to the contrary, this Court disagrees.
Section 6972(f) of RCRA provides in pertinent part that:
Nothing in this section shall restrict any right which any person (or class of persons) may have under any statute or common law to seek enforcement of any standard or requirement relating to the management of solid waste or hazardous waste, or to seek any other relief....
CERCLA has its own "savings" statute, found at 42 U.S.C. § 9614(a):
*1351 Nothing in this Act shall be construed or interpreted as pre-empting any state from imposing any additional liability or requirements with respect to the release of hazardous substances within such state.
The plain language of these statutory provisions indicates a Congressional intent to leave untrammeled the right of an individual to invoke principles of statutory or common law in damage actions pendant to CERCLA or RCRA claims. Publicker points out, however, that in Sea Clammers and in Milwaukee II, the U.S. Supreme Court interpreted virtually identical language and concluded that the Federal Water Pollution Control Act (FWPCA) and Marine Protection, Research, and Sanctuaries Act of 1972 (MPRSA) preempt the federal common law of nuisance and claims under 42 U.S.C. § 1983. Further, Publicker notes that the First Circuit, in Conner v. Aerovox, 730 F.2d 835 (1st Cir.1984), cert. denied, ___ U.S. ___, 105 S. Ct. 1747, 84 L. Ed. 2d 812 (1985), has held that all such maritime claims have been preempted, and that the Seventh Circuit has held that all state tort law in this area has been preempted by the federal pollution acts, Illinois v. Milwaukee, 731 F.2d 403 (7th Cir.1984), cert. denied, ___ U.S. ___, 105 S. Ct. 979, 83 L. Ed. 2d 981 (1985) (Milwaukee III). One court presented with this same question found Milwaukee III to be wrongly decided, Ouellette v. International Paper Co., 602 F. Supp. 264, aff'd, 776 F.2d 55 (2d Cir.1985) and the Supreme Court has granted certiorari to resolve this split among the Circuits, ___ U.S. ___, 106 S. Ct. 1457, 89 L. Ed. 2d 715 (1986).
In the House Report on the Hazardous and Solid Waste Amendments of 1984, the Committee on Energy and Commerce noted that "[a]lthough [we have] not prohibited a citizen from raising claims under state law in a (§ 6972 RCRA) action, [we] expect courts to exercise their discretion concerning pendant jurisdiction in a way that will not frustrate or delay the primary goal of this provision, namely the prompt abatement of imminent and substantial endangerments." H.R.Rep. No. 98-198, 98th Cong., 2d Sess. 53, reprinted in 1984 U.S. Code Cong. & Ad. News 5576, 5612. In addressing RCRA's savings clause, the Committee noted that § 6972(f) "of RCRA was intended to preserve the rights of litigants under any statute of [sic] common law, notwithstanding the passage of RCRA." Id. at 49, reprinted at 5608. The Committee continued, quoting from the original Committee report accompanying RCRA: "Since the passage of RCRA, the Supreme Court overlooked language virtually identical to (§ 6972(f)) in ... the Clean Water Act and held that Congress did not intend to preserve the federal common law after passage of the Clean Water Act." Id. (citing Milwaukee II) (emphasis added).
The Court also finds instructive the following excerpt from the minority report the 1984 Amendments:
Our second objection to the (Amendments) arises from the Committee's refusal to adopt a clarifying amendment to Section 12(f), the citizen suit provision. That amendment stated that no district court before which an imminent and substantial endangerment action is brought is empowered to hear related state law claims. That amendment simply clarified what we had understood to be the intention of the citizen suit provision and that is to give citizens a federal cause of action to abate imminent and substantial endangerments created by hazardous waste disposal facilities.
Unfortunately, we believe the citizen suit provision goes much further than was intended because, under a legal doctrine called pendant jurisdiction, citizens will have the opportunity to try to bring all related state claims they may have into the federal court system when they sue to abate imminent hazards. In our opinion, this is an extremely troubling result for a number of reasons. First, there would be a potentially crushing new burden on the federal court system. This court system is a fraction of the size of the state court system and is not equipped to resolve complicated state law questions. Federal court judges would *1352 at times have to turn to state courts for guidance during the course of the suit. This could slow down the proceeding which, as we understand it, is intended to be an emergency type action to abate imminent hazards. Instead of ending the imminent hazard, federal judges will be trying to decide cumbersome questions of state law nuisance, trespass, and personal and property damage compensation.
We believe these types of state law claims should continue to be within the exclusive province of the state courts which have the background and experience necessary for proper decision-making. It is in state courts that citizens will get the most expeditious and well-founded decision for their state claims. Unfortunately, however, the full Committee refused to adopt the amendment which would have clarified this result.
Id.
Whatever this may portend for the vitality of Milwaukee II and Sea Clammers as those cases pertain to the Clean Water and FWPC Acts, this Court cannot simply ignore Congress' clearly expressed intent as it pertains to RCRA. Both the majority and minority reports read the language of § 6972(f) as confirming the right of an individual to bring other claims pendent to his RCRA claim, subject, of course, to the Court's discretion. Further, nothing in the legislative history of CERCLA or in the pertinent case law requires this Court to dismiss Towing's damage claims in Counts III and IV.
D. Summary
Publicker's motion to dismiss Towing's complaint for lack of subject matter jurisdiction and for failure to state a claim are DENIED, in all respects except the second count. Because Publicker Industries, Inc. is not a "person" subject to CERCLA liability under any view of the facts alleged in the amended complaint, this second count is DISMISSED as to that defendant.
2. Petroferm's Motion to Dismiss Towing's Complaint
Petroferm's brief in support of its motion to dismiss closely follows Publicker's in form and substance. For the reasons stated supra, the Court finds Petroferm's duplicative arguments no more persuasive. One unique issue is raised, however, in Petroferm's brief. Petroferm contends that "Count I fails to contain even a single description of conduct by Petroferm which allegedly violated any aspect of RCRA or its accompanying regulations." Petroferm's brief in support at 3. Indeed, while the complaint is replete with allegations concerning the conduct of Great Eastern and others, the only mention of Petroferm comes in ¶ 7 where Towing alleges that Petroferm is "organized and existing ... in a state other than Virginia" and has its principal place of business in Delaware.
During the hearings before the Court on this matter, Towing has consistently contended that Petroferm was Great Eastern's joint venturer. Petroferm has not seriously contested this assertion. Since all joint venturers share "responsibility ... for liability incurred within the scope of the enterprise," Rowe v. Brooks, 329 F.2d 35, 39 (4th Cir.1964), the allegations concerning Great Eastern might well have been sufficient to defeat Petroferm's motion to dismiss, had Towing alleged the joint venture relationship in its complaint. As it stands, however, Towing's complaint fails to state a cause of action against Petroferm as to any of the counts. Accordingly, the complaint must be DISMISSED as to Petroferm.
"In dismissing a complaint for failure to state a claim ... the court should heed the admonition of Rule 15 and allow amendment `freely' if it appears at all possible that the plaintiff can correct the defect." 3 Moore's Federal Practice ¶ 15.10 (2d ed. 1985). Since Towing has asserted the joint venture relationship informally in these proceedings, Petroferm cannot be prejudiced by allowing Towing to amend its pleadings to conform to this position and be allowed to prove the issue at trial. In light *1353 of the strong preference embodied in the Federal Rules for the resolution of controversies on the merits, see, e.g., U.S. v. E.B. Hougham, 364 U.S. 310, 317, 81 S. Ct. 13, 18, 5 L. Ed. 2d 8 (1960), and the absence of prejudice to Petroferm, this Court GRANTS Towing ten (10) days to amend its complaint to reflect the basis for Petroferm's alleged liability in this regard. Given the disposition of Towing's claim against Petroferm, the Court has no occasion to consider at length the other issues raised in the latter's motion to dismiss at this time.
III.
PGW's Motions to Dismiss Publicker's Third Party Complaint
PGW contends that Publicker's third-party complaint must be dismissed because this Court does not have in personam jurisdiction to hear the claim, because process was not validly served and because the complaint fails to state a claim.
PGW contends that it is not amenable to suit in Virginia, either because its alleged activities do not bring it within the ambit of the Virginia Long-Arm statute, Va. Code Ann. § 8.01-328.1 (1984 Repl.Vol.), or because the due process guarantees of the United States Constitution require dismissal.
The valid exercise of in personam jurisdiction by a federal district court over a nonresident defendant depends upon the proper service of process on the defendant and upon the defendant's amenability to suit in the forum state. Terry v. Raymond International, Inc., 658 F.2d 398, 401 (5th Cir.1981), cert. denied, 456 U.S. 928, 102 S. Ct. 1975, 72 L. Ed. 2d 443 (1982).
A. Service of Process
Service of process is the "physical means by which jurisdiction is asserted." Id. The pertinent federal rule, Fed.R. Civ.P. 4(e), authorizes a federal court to deliver a summons and complaint in any manner authorized by either federal law or by the law of the state in which it sits. Absent a federal statute expressly authorizing nationwide service of process, the validity of service on a nonresident defendant is controlled by the law of the forum state. Max Daetwyler Corp. v. R. Meyer, 762 F.2d 290, 295 (3d Cir.), cert. denied, ___ U.S. ___, 106 S. Ct. 383, 88 L. Ed. 2d 336 (1985).
Publicker argues that both CERCLA and RCRA impliedly authorize nationwide service of process. PGW vigorously disagrees. Both parties cite with approval the case of Violet v. Picillo, 613 F. Supp. 1563 (D.R.I.1985). Publicker urges this Court to adopt Violet's reasoning (nationwide service comports with CERCLA's purpose). PGW urges its holding (Congress did not authorize such service).
This Court need not reach this issue. The validity of the actual service of the complaint pursuant to Fed.R.Civ.P. 4(e) may also be determined by reference to state law. In this instance, the Court need go no further than Va. Code Ann. § 8.01-288 (1984 Repl.Vol.), which provides, in pertinent part, that "process which has reached the person to whom it is directed within the time prescribed by law, if any, shall be sufficient although not served or accepted as provided in this chapter." Since PGW does not dispute that it actually received the process in a timely manner, there is no defect as to the physical service of process.
B. PGW's Amenability to Suit
The amenability of a defendant to suit in a particular forum is determined by the "substantive reach of the forum's jurisdiction." Terry, 658 F.2d at 401. The reach of the forum's jurisdiction may be limited by the provisions of the state long-arm statute, as well as by the due process constraints of the Constitution.
(1) Applicability of Virginia long-arm statute
In diversity cases, the Fourth Circuit applies a twopart test to determine questions of personal jurisdiction: "First, whether there is statutory authority for the exercise *1354 of jurisdiction ... and second, whether the exercise of jurisdiction complies with federal constitutional standards of due process." Wolf v. Richmond County Hosp. Authority, 745 F.2d 904, 909 (4th Cir.1984), cert. denied, ___ U.S. ___, 106 S. Ct. 83, 88 L. Ed. 2d 68 (1985) (emphasis added, citation omitted).
While state long-arm statutes are central to the first inquiry in a diversity case, "[i]n a case brought under ... federal case jurisdiction, the defendant's amenability to process under state law, which would be critical in a pure diversity based action, is irrelevant." Terry, 658 F.2d at 402 (emphasis added). In an action within the original jurisdiction of the federal court, brought to enforce a federally-created right, the defendant's amenability to suit should be measured by the constraints of the International Shoe doctrine and not by the jurisdictional limitations imposed by a state legislature on its own courts. Where only federal rights are involved in a case, it would seem unnecessary to look to the jurisdictional limitations applicable to a state court adjudicating state law claims to determine whether a federal court may hear a federal claim.
This analysis has found considerable favor among commentators, see, e.g., A. von Mehren & D. Troutman, Jurisdiction to Adjudicate: A Suggested Analysis, 79 Harv.L.Rev. 1121 (1966); 4 Wright & Miller, Federal Practice and Procedure: Civil §§ 1075, 1127 (1969). It has been adopted by the Fifth Circuit, see, e.g., Lapeyrouse v. Texaco, Inc., 693 F.2d 581 (5th Cir.1982) and by courts in other circuits, see, e.g., Ideal Stencil Machine & Tape Co. v. Merchiori, 600 F. Supp. 185 (S.D.Ill.1985); Vest v. Waring, 565 F. Supp. 674 (N.D.Ga.1983).
In the present action, the Court's jurisdiction to hear the plaintiff's complaint, and by extension, Publicker's third-party complaint, rests on the presence of a federal question, and/or upon the admiralty jurisdiction of the federal courts.
Accordingly, this Court finds it unnecessary to consider PGW's contacts with Virginia in the context of the state long-arm statute, and will proceed directly to determine whether it is constitutionally permissible to require PGW to defend this suit in the Virginia federal court.
(2) Due process inquiry
A valid judgment may be rendered against a foreign defendant only if that defendant has such "minimum contacts" with the forum state as to make it fair and equitable to require the defendant to try the action there. International Shoe v. Washington, 326 U.S. 310, 66 S. Ct. 154, 90 L. Ed. 95 (1945). "The concept of minimum contacts, in turn, can be seen to perform two related, but distinguishable, functions. It protects the defendant against the burdens of litigating in a distant or inconvenient forum. And it acts to ensure that the States through their courts do not reach out beyond the limits imposed on them by their status as co-equal sovereigns in a federal system."[8]World-Wide Volkswagen Corp. v. Woodson, 444 U.S. 286, 291-92, 100 S. Ct. 559, 564, 62 L. Ed. 2d 490 (1980).
The "minimum contacts" analysis of International Shoe is based on "traditional notions of fair play and substantial justice." International Shoe, 326 U.S. at 316, 66 S. Ct. at 158. Determining what constitutes fair play and substantial justice requires a delicate balancing of the interests of all those involved in each case. While the burden that inconvenient litigation places on the defendant is always a primary concern, World-Wide Volkswagen, 444 U.S. at 292, 100 S. Ct. at 564, the Court must also consider "the forum State's interest in adjudicating the dispute, ... the plaintiff's interest in obtaining convenient and effective relief ... the interstate judicial *1355 system's interest in obtaining the most efficient resolution of controversies; and the shared interest of the several States in furthering fundamental substantive social policies." Id. (citations omitted).
(a) Desirability of a Unified Proceeding
No party to this litigation seriously disputes the very real interest this Court has in resolving this dispute quickly and completely. If the plaintiff's contentions are, in fact, true, a very large vessel filled with an extremely hazardous substance sits in one of the busiest harbors in the world, jeopardizing the health and safety of a significant portion of the more than one million people who reside in the Hampton Roads area. The more protracted this litigation becomes, the greater the potential for a mishap. This alleged danger, if true, facing innocent citizens cannot be permitted to continue in face of a statutory remedy designed to obviate the same.
It cannot reasonably be disputed that Towing, and by extension Publicker, deserves the most convenient and timely relief constitutionally permissible. Towing contends that its barge, allegedly unique in its construction and suitability for particular jobs, has been tied to a Norfolk dock since November of 1985 because no one will receive the product. Towing further alleges that it has not been paid even a token sum for the use of the barge, and that it has lost its market position because the barge has been out of service.
Clearly, a single judicial proceeding in Virginia which brings all the parties into one forum for a single action on the merits would be more efficient than piecemeal litigation of various claims, cross-claims, and third-party claims up and down the Eastern Seaboard. In addition, a unified proceeding is most likely to further the substantive social policies underlying the environmental acts that Congress sought to advance by including expansive citizen suit provisions in those acts. See discussion, supra, 1343-53.
(b) PGW's Contacts with Virginia
Against these weighty considerations, this Court must balance PGW's interest in avoiding litigation in Virginia.
Jurisdiction under the minimum contacts test exists when the defendant's relationship to the forum and to the litigation "are such that he should reasonably anticipate being haled into court" in that foreign jurisdiction. World-Wide Volkswagen, 444 U.S. at 297, 100 S. Ct. at 567. What, then, should PGW, a generator of volatile, hazardous substances, reasonably foresee in terms of its amenability to suit in a foreign jurisdiction?
PGW is a public utility owned by the City of Philadelphia and operated by the Philadelphia Facilities Management Corporation. Page 1342, supra. It provides natural gas solely to customers within the confines of Philadelphia's city limits. According to Thomas F. Bonner, Senior Vice President of PGW, "[a]t present, and for at least six years, PGW has neither directly or through any other entity done business ... in the Commonwealth of Virginia." Bonner Affidavit at 2. Indeed, it appears that PGW's sole contact with Virginia was the series of events by which the coal-gasification by-product at issue in this litigation made its way to Virginia. See pages 1342-43, supra. The minimum contacts analysis mandated by the due process clause is not merely a quantitative inquiry, however. In determining whether the defendant's contacts with the forum are such that the defendant should reasonably anticipate being haled into the courts of that forum, the courts consider the nature or quality of the contacts as well as their number. See, e.g., Velandra v. Regie Nationale des Usines Renault, 336 F.2d 292, 298 (6th Cir.1964); Securities and Exchange Commission v. Myers, 285 F. Supp. 743, 749 (D.Md.1968) ("The analysis of the court in International Shoe was directed toward the totality of circumstances in the particular case, which included an assessment, not only of the quantity of the contacts between the defendant *1356 and the forum, but also the quality of the nexus.").
When the nonresident defendant places an inherently dangerous substance, such as the hazardous waste at issue here, into the stream of commerce, there is a substantial likelihood that the defendant will be called upon to defend in the state whose citizens have been injured or endangered by that instrumentality. Thus, "the nature of the product may well have a bearing upon the issue of minimum contact, with a lesser volume of inherently dangerous products constituting a more significant contact with the state than would a larger volume of products offering little or no hazard to the inhabitants of the state." Velandra, 336 F.2d at 298. Accord Lichina v. Futura, Inc., 260 F. Supp. 252, 257 (D.Colo.1966) ("Because the safety of the public is at stake, the sale of a dangerous product is regarded as a more substantial contact than the sale of a harmless one."). See also Chattanooga Corp. v. Klingler, 528 F. Supp. 372, 378 (E.D.Tenn.1981) (court noted that "contacts might also be minimized if the claim involves the placing of a dangerous instrumentality in the stream of commerce") (citation omitted), reversed on other grounds, 704 F.2d 903 (6th Cir.1983).
Before PGW sold this substance, Sealand informed PGW that Sealand intended to use the by-product to make roofing materials. PGW sold one million gallons of this substance to an out-of-state concern with the knowledge and expectation that it would be further distributed in the stream of interstate commerce. "The forum state does not exceed its powers under the Due Process Clause if it asserts personal jurisdiction over a corporation that delivers its products into the stream of commerce with the expectation that they will be purchased by consumers in the forum state." World-Wide Volkswagen, 444 U.S. at 297-98, 100 S. Ct. at 567. It is immaterial that PGW itself did not sell the substance to a Virginia purchaser or deliver it to Virginia. It is sufficient that PGW placed the substance into the stream of commerce, enabling the waste to pose a threat to the citizens of any state in which it might come to rest. As Justice Brennan recognized, the placement of an article, particularly a hazardous one, in the stream of interstate commerce, makes it foreseeable that one will be called upon to defend in the courts of a state with which one would otherwise have had no direct contact:
"[In] Ohio v. Wyandotte Chemicals Corp., 401 U.S. 493 [91 S. Ct. 1005, 28 L. Ed. 2d 256] (1971) ... we indicated, in the course of denying leave to file an original-jurisdiction case, that corporations having no direct contact with Ohio could constitutionally be brought to trial in Ohio because they dumped pollutants into streams outside Ohio's limits which ultimately, through the action of the water, reached Lake Erie and affected Ohio. No corporate acts, only their consequences, occurred in Ohio. The stream of commerce is just as natural a force as a stream of water ..."
World-Wide Volkswagen, 444 U.S. at 306, 100 S. Ct. at 584, (Brennan, J., dissenting).
Having placed the substance in the stream of commerce, by selling it to an out-of-state manufacturer, PGW took no affirmative step to structure its conduct so as to limit its exposure to suit in foreign jurisdictions. World-Wide Volkswagen, supra. This might have been accomplished, for example, by restricting Sealand's use of the product or by specifying in the sales contract a limited geographic market for Sealand's final product. Violet v. Picillo, 613 F.Supp. at 1576-77. PGW's failure to exercise any control over the destination of the substance at issue made it possible for that substance to come to rest in any state. Id. at 1577.
PGW contends that this "expectation" is not enough, and cites as support World-Wide Volkswagen and Chung v. Nana Development Corp., 783 F.2d 1124 (4th Cir. 1986) (sale of reindeer antlers). Neither case, however, involved an inherently dangerous instrumentality. When an inherently dangerous instrumentality is released in commerce, and that instrument causes tortious injury in a foreign forum, the threshold *1357 for establishing jurisdiction is less demanding.[9]See, e.g., Poyner v. Erma Werke GMBH, 618 F.2d 1186 (6th Cir.1980), cert. denied, 449 U.S. 841, 101 S. Ct. 121, 66 L. Ed. 2d 49 (1980) (handgun manufacturer); Violet v. Picillo, 613 F.Supp. at 1577. Similarly, the scope of "foreseeability" broadens when the enterprise giving rise to the action is subject to pervasive federal regulation. See, e.g., GRM v. Equine Investment and Management Group, 596 F. Supp. 307 (S.D. Texas 1984) (securities regulations); Violet v. Picillo, 613 F.Supp. at 1578. Cf. Marshall v. Barlow's, Inc., 436 U.S. 307, 321, 98 S. Ct. 1816, 1824, 56 L. Ed. 2d 305 (1978) ("when an entrepreneur embarks upon ... [certain types of] business [activities], he has voluntarily chosen to subject himself to a full arsenal of governmental regulation." Id. at 313, 98 S. Ct. at 1821. "[B]usinessmen," the Court said, "engaged in such federally licensed and regulated enterprises accept the burdens as well as the benefits of their trade.... The businessman in a regulated industry in effect consents to the restrictions placed upon him." Id. (quoting Almeida-Sanchez v. United States, 413 U.S. 266, 271, 93 S. Ct. 2535, 2538, 37 L. Ed. 2d 596 (1973)).
Against this reduced standard, the Court must measure the actual burden foreign litigation would impose on PGW. The geographic distance separating the defendant in Philadelphia and the Virginia forum is not great. In this case, the Court cannot say that PGW will "`harshly feel' the `distances involved, [or] the time required for employees to be away from the office.'" GRM, 596 F.Supp. at 315. As in GRM, this Court notes that "if some of defendant's employees must eventually come to [Norfolk] for trial, the time they will be taken away from the office depends [more] upon the length of their testimony than upon this court's distant location." Id.
Given the very weighty considerations militating in favor of a single proceeding in this Court, particularly the alleged hazard facing the residents of this area, and the minimal burden imposed on PGW by requiring it to defend its liability here, the Court finds it both fair and reasonable to subject PGW to the in personam jurisdiction of this Court. For this reason, PGW's motion to dismiss pursuant to Fed.R.Civ.P. 12(b)(2) is DENIED.
IT IS SO ORDERED.
NOTES
[1] In ruling on the various motions to dismiss, Allied Towing's allegations must be taken as true, United States v. Mississippi, 380 U.S. 128, 85 S. Ct. 808, 13 L. Ed. 2d 717 (1965), and must be construed in a light most favorable to its cause of action. Scheuer v. Rhodes, 416 U.S. 232, 94 S. Ct. 1683, 40 L. Ed. 2d 90 (1974).
[2] Great Eastern and Petroferm each contend that they were without knowledge as to the material's true nature. They allegedly believed the material to be No. 6 oil and water as well. Resolution of this factual dispute is unnecessary at this time.
[3] A barrel of petroleum product is equivalent to 42 U.S. gallons. Webster's Third New International Dictionary 179 (1981).
[4] " Nov 27 1511
Allied Tow NFK
TO: Philadelphia Gas Works (XXX-XXX-XXXX) ATTN: Ms. Avant
(By Telecopy)
Publicker Terminal 131579 ATTN: Mr. Tierney
EPA Philadelphia (By telecopy) ATTN: Mr. Donovan
(5977906)
CC: Allied Towing Corporation 7108811238 ATTN: Mr. W.E. Law
FM: Vandeventer, Black 823671 ATTN: Mr. Gunn
RE: Barge ATC 3062Cargo of Hazardous Substance Loaded at Philadelphia
27 November 1985
1. We are counsel for Allied Towing Corporation of Norfolk, Virginia. Allied
Towing is the owner of the Barge ATC-3062.
2. From 29-31 October 1985, ATC-3062 Loaded approximately 25,000 barrels of
product at Publicker Terminal, Philadelphia pursuant to the instructions of the
charterer of the Barge (Great Eastern Petroleum Corporation). The product was
represented to be 40% water, 60% No. 6 oil. Upon arrival of the Barge at Norfolk,
samples were analyzed and we are advised flashpoint ranged between 74 degrees
and 80 degrees F. (Subsequent testing indicated a composite flashpoint of 118
Degrees F.)
3. As a result of dispute between charterer of Barge and buyer of product (Allied
Petroleum Corporation) as to its specifications, product remains aboard ATC-3062
with neither charterer nor buyer accepting responsibility for disposal.
4. We are advised that source of product was Philadelphia Gas Works and that EPA
Philadelphia was informed as to specifications of substance and its loading aboard
Barge ATC-3062 at Publiker Terminal. Allied Towing received no warning as to the
hazardous nature of the product.
5. As disposal at Norfolk impracticable, Allied Towing requests authorization to
discharge hazardous substance aboard ATC-3062 at Publiker Terminal or Philadelphia
Gas Works. Allied Towing will hold Philadelphia Gas Works and Publiker
Terminal responsible for all damages and costs incurred in the disposal of the
hazardous substance loaded aboard the ATC-3062 at Philadelphia.
Vandeventer, Black
Gunn
HUGHSVAN NFK"
[5] The notice was sent by Telex. The regulation cited by Publicker requires notice by registered mail. 40 C.F.R. § 254.2(1). As noted, supra, the cases require only actual notice. To dismiss Towing's claim because the method used to deliver the message varied from that prescribed by the regulation would be the ultimate folly. Because Publicker has not, and cannot, claim any real prejudice because of the method of service, the Court finds Publicker's complaint in this regard without merit. See South Carolina Wildlife Federation v. Alexander, 457 F. Supp. 118 (D.S.C.1978) (F.W.P.C.A. case).
[6] According to 40 C.F.R. § 254.2(a)(1), notice should have been sent to "the owner or site manager of the building, plant, installation or facility alleged to be in violation." The identity of Publicker's "owner or site manager" is not revealed in the submissions before the Court. The notice was actually sent to a Mr. Tierney at Publicker.
[7] This section provides in part that:
(a) Notwithstanding any other provision or rule of law, and subject only to the defenses set forth in subsection (b) of this section
(1) the owner and operator of a vessel (otherwise subject to the jurisdiction of the United States) or a facility,
(2) any person who at the time of disposal of any hazardous substances were disposed of,
(3) any person who by contract, agreement, or otherwise arranged for disposal or treatment, or arranged with a transporter for transport for disposal or treatment, of hazardous substances owned or possessed by such person, by any other party or entity, at any facility owned or operated by another party or entity, at any facility owned or operated by another party or entity and containing such hazardous substances, and
(4) any person who accepts or accepted any hazardous substances for transport to disposal or treatment facilities or sites selected by such person, from which there is a release, or a threatened release which causes the incurrence of response costs, of a hazardous substance, shall be liable for
(A) all costs of removal or remedial action incurred by the United States Government or a State not inconsistent with the national contingency plan;
(B) any other necessary costs of response incurred by any other person consistent with the national contingency plan; and
(C) damages for injury to, destruction of, or loss of natural resources, including the reasonable costs of assessing such injury, destruction, or loss resulting from such a release.
[8] The Supreme Court's subsequent opinion in Insurance Corp. of Ireland v. Compagnie es Bauxites, 456 U.S. 694, 703 n. 10, 102 S. Ct. 2099, 2104 n. 10, 72 L. Ed. 2d 492 (1982) draws into question the continued validity of this second "sovereignty" function. Because this case arises in federal court, this second function would obviously play no role in the Court's determination on this issue. Its continued validity is, therefore, irrelevant.
[9] The parties agree that Towing's allegations sound in tort. See, e.g., PGW's brief in support of its motion to dismiss at 15; see also United States v. Chem-Dyne Corp., 572 F. Supp. 802 (S.D.Ohio 1983). | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/2608783/ | 164 Ariz. 447 (1990)
793 P.2d 1114
Gus FOTINOS, an unmarried man, Furniture Distributors, Inc., an Arizona corporation, Plaintiffs/Appellees,
v.
Leslie N. BAKER and Joy Baker, husband and wife, Defendants/Appellants.
No. 2 CA-CV 89-0180.
Court of Appeals of Arizona, Division 2, Department A.
February 15, 1990.
Reconsideration Denied March 14, 1990.
Review Denied July 10, 1990.[*]
*448 Sacks, Tierney, Kasen & Kerrick by Marvin S. Cohen, Phoenix, for defendants/appellants.
Feulner & Cornelio by George J. Feulner, Tucson, for plaintiffs/appellees.
OPINION
LIVERMORE, Presiding Judge.
Taking the evidence in the light most favorable to sustaining the verdict it appears that on July 14, 1985, on the eve of trial of two cases brought by plaintiff Gus Fotinos against defendants Leslie and Joy Baker, the parties through their lawyers orally settled the cases and the trial court was so notified. Because of the settlement, the trial judge dismissed the cases. Essentially the settlement provided that in return for the dismissal the Bakers would pay Fotinos $510,000 with interest within 66 months. The debt would be secured by a collateral assignment of beneficial interest by Baker in a land trust jointly owned by him and Fotinos. Fotinos would grant Baker a one-year option on specified terms to purchase his interest in that trust. The agreement also provided that the Bakers would have to make payments to Fotinos of a specified percentage of the proceeds when sales of other land owned by them were made. The parties agreed that this settlement would be reduced to writing and the Bakers' lawyer drafted the necessary documents. Before they were signed, however, and after the original cases had been dismissed, the Bakers took the position that no binding settlement had been reached. This action to enforce the agreement followed. On appeal from a judgment in favor of Fotinos, the Bakers contend that the evidence does not support a finding that an oral contract was formed and that the trial judge erred in his instructions.
The main thrust of the Bakers' argument is that the oral agreement was not a binding contract because the parties contemplated that it be reduced to writing before it was enforceable. Lininger v. Sonenblick, 23 Ariz. App. 266, 532 P.2d 538 (1975). That issue, however, was submitted to the jury under appropriate instructions and was decided against the Bakers. There is evidence to support the conclusion that the parties intended to be bound by the oral agreement of their counsel. That it was later to be reduced to writing does not affect the enforceability of the contract. 1 S. Williston, Law of Contracts § 28 (3d ed. 1957).
The Bakers next contend that because the settlement involved an option to purchase the beneficial interest in a trust owning property and a security interest in another beneficial interest in that same trust, it was within the statute of frauds, A.R.S. § 44-101, that the only way to avoid *449 the bar of the statute is through the doctrine of equitable estoppel, and that the trial judge erred in permitting a finding of such estoppel by a preponderance of the evidence rather than by requiring a finding by clear and convincing evidence. We reject this argument for the following reasons:
(1) None of the Arizona cases discussing estoppel to assert the statute of frauds has imposed the higher evidentiary standard. See Custis v. Valley National Bank, 92 Ariz. 202, 375 P.2d 558 (1962); Waugh v. Lennard, 69 Ariz. 214, 211 P.2d 806 (1949); Cress v. Switzer, 61 Ariz. 405, 150 P.2d 86 (1944); Diamond v. Jacquith, 14 Ariz. 119, 125 P. 712 (1912); Del Rio Land, Inc. v. Haumont, 118 Ariz. 1,574 P.2d 469 (App. 1977). The references to "clear and satisfactory proof" in Desert Vista Apartments, Inc. v. O'Malley Lumber Co., 103 Ariz. 23, 436 P.2d 479 (1968), and Knight v. Rice, 83 Ariz. 379, 321 P.2d 1037 (1958), estoppels arising in different contexts, do not "clearly" require a higher evidentiary standard. Even if a higher standard is required, there is in this case clear and satisfactory proof, indeed it is undisputed, that Fotinos relied to his detriment and performed his obligation under the settlement agreement by allowing dismissal of the earlier claims.
(2) In any event the severable core of this agreement, dismissal of the claims in return for $510,000, was not within the statute. Fotinos did not sue to enforce his right to a security interest in the Bakers' beneficial interest in the trust. For that reason the statute of frauds is simply inapplicable to this case. Frantz v. Maher, 106 Ohio App. 465, 155 N.E.2d 471 (1957); 2 A. Corbin, Corbin on Contracts § 315 (1950); Restatement of Contracts (Second) § 147 (1981).
(3) There being no dispute that the Bakers' lawyer was authorized to act for them, the "settlement" documents prepared by him were a writing by the person to be charged. See Hunter, Modern Law of Contracts ¶ 19.04[4] (1987).
It is argued finally that because Fotinos did not sign the option it was unenforceable against him because of the statute of frauds and that, consequently, there being no mutuality, he cannot enforce the Bakers' promises against them. This is not a defense. By bringing this action by a verified complaint incorporating the option, Fotinos signed documents making the option enforceable. See 2 A. Corbin, Corbin on Contracts § 282 (1950).
The judgment is affirmed. Appellee is awarded his attorneys' fees on appeal in an amount to be determined upon filing the statement required by Rule 21, Ariz.R.Civ. App.P., 17B A.R.S.
HATHAWAY and HOWARD, JJ., concur.
NOTES
[*] Feldman, V.C.J., of the Supreme Court, recused himself and did not participate in the determination of this matter. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/2298561/ | 128 F. Supp. 2d 961 (2001)
CHEVRON USA, INC.
v.
VERMILLION PARISH SCHOOL BOARD
Texaco, Inc., et al
v.
Vermillion Parish School Board
Amerada Hess Corp.
v.
Vermillion Parish School Board
Union Oil Co. of California
v.
Vermillion Parish School Board
Mobil Oil Corp., et al
v.
Vermillion Parish School Board
Exxon Mobil Corp.
v.
Guidry
Exxon Mobil Corp.
v.
Vermilion Parish School Board
Civil Action Nos. 00-0279, 00-0280, 00-0281, 00-0282, 00-0295, 00-0296, 00-0297.
United States District Court, W.D. Louisiana, Lafayette-Opelousas Division.
January 29, 2001.
*962 John M. Wilson, Cheryl M. Kornick, Jonathan A. Hunter, Liskow & Lewis, New Orleans, LA, for Chevron USA, Inc.
Joe B. Norman, Stevia M. Walther, Endya E. Delpit, Liskow & Lewis, New Orleans, LA, David R Dugas, Jeffrey M Baudier, Caffery Oubre et al, Lafayette, LA, for Texaco, Inc.
*963 Lawrence P. Simon, Jr., Charles B. Griffis, Liskow & Lewis, Lafayette, LA, for Amerada Hess Corp.
Howell A. Dennis, Jr., Strain Dennis et al, Lafayette, LA, William Seay Strain, Thomas C. McKowen, IV, Strain Dennis et al, Baton Rouge, LA, Gerri M. Fore, Exxon Co U S A, Houston, TX, for Exxon Mobil Corp.
Bob Forrest Wright, Domengeaux Wright et al, Lafayette, LA, Calvin E. Woodruff, Jr., Abbeville, Jules B. LeBlanc, III, Charles S. Lambert, Jr., LeBlanc Maples & Waddell, Baton Rouge, LA, Spencer Hosie, John B. McArthur, Hosie Frost et al, San Francisco, CA, William F. Large, Hosie Frost et al, Anchorage, AK, Michael V. Ardoin, Robert K. Hammack, Lafayette, for School Board Vermilion Parish, Marshall W. Guidry.
MEMORANDUM RULING
MELANCON, District Judge.
Before the Court are Cross Motions For Partial Summary Judgment, filed by plaintiffs Chevron USA, Inc. [doc. no. 22]; Texaco, Inc. [doc. no. 22]; Amerada Hess Corporation [doc. no. 23]; Union Oil Company of California [doc. no. 23]; Mobil Oil Corporation [doc. no. 39]; and, Exxon Mobil Corporation [doc. no. 28] (hereinafter collectively referred to as "the Oil Companies") and the Vermilion Parish School Board [doc. no. 25]; [doc. no. 27]; [doc. no. 28]; [doc. no. 27]; [doc. no. 43]; and [doc. no. 34], respectively, as well as Cross Motions For Partial Summary Judgment filed by plaintiff Exxon Mobil Corporation [doc. no. 26] and Marshall W. Guidry [doc. no. 32] (the Vermilion Parish School Board and Marshall W. Guidry will hereinafter be referred to as "the Royalty Owners"). As the central issues in each of the foregoing motions are identical, the Court will address all of the motions in this ruling.[1] For the reasons that follow, the Oil Companies' motions will be granted and the Royalty Owners' motions will be denied.
I. Background
By individual letters, the Royalty Owners made demands upon the Oil Companies pursuant to the Louisiana Mineral Code, on behalf of the Royalty Owners and "all similarly situated royalty owners" for additional royalties on natural gas liquids which they alleged the Oil Companies had underpaid pursuant to mineral leases executed by the Royalty Owners and the Oil Companies (the "Liquids Demand"). By individual letters, the Oil Companies responded to the Liquids Demand. (Id. at ¶ 4). Subsequently, by individual letters, the Royalty Owners made demands upon the Oil Companies pursuant to the Louisiana Mineral Code, on behalf of the Royalty Owners and "all similarly situated royalty owners" for additional royalties on dry natural gas which they alleged the Oil Companies had underpaid pursuant to mineral leases executed by the Royalty Owners and the Oil Companies (the "Dry Gas Demand"). The Oil Companies responded to the Dry Gas Demand by individual letters. The Oil Companies filed the instant actions for declaratory judgment pursuant to Title 28 of the United States Code section 2201, et seq. based on the Liquids Demand, and amended their complaints to include the Dry Gas Demand. The Royalty Owners filed answers to the Oil Companies' complaints and amended complaints as well as counterclaims against the Oil Companies on behalf of the Royalty Owners individually and as representative of a class of all others similarity situated on the "Liquids Demand" and the "Dry Gas Demand."
II. Summary Judgment Standard
A motion for summary judgment shall be granted if the pleadings, depositions, and affidavits submitted show that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law. Fed. *964 R.Civ.P. 56. Once the movant produces such evidence, the burden shifts to the respondent to direct the attention of the court to evidence in the record sufficient to establish that there is a genuine issue of material fact requiring a trial. Celotex Corp. v. Catrett, 477 U.S. 317, 322-23, 106 S. Ct. 2548, 91 L. Ed. 2d 265 (1986). The responding party may not rest on mere allegations made in the pleadings as a means of establishing a genuine issue worthy of trial. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248-49, 106 S. Ct. 2505, 91 L. Ed. 2d 202 (1986). If no issue of fact is presented and if the mover is entitled to judgment as a matter of law, the court is required to render the judgment prayed for. Id. Before it can find that there are no genuine issues of material fact, however, the court must be satisfied that no reasonable trier of fact could have found for the non-moving party. Id.
III. Analysis
The issues before the Court are (1) whether the demand letters submitted by the Royalty Owners pursuant to the Louisiana Mineral Code constitute the required written notice for a class of complainants, the "putative class" and (2) whether the contents of the demand letters were adequate or sufficient to put the Oil Companies on notice of the claims of the Royalty Owners individually, as well as the putative class. The parties agree that these issues present no questions of fact, but rather are legal issues which are appropriate for determination by summary judgment at this stage of the proceedings.
A. The Notice Requirement of the Louisiana Mineral Code
The Oil Companies contend that because Louisiana Revised Statute 31:137 requires individual lessors to make an individual demand in the lessor's individual name, the use of a "class action" demand letter is insufficient to satisfy the requirements of 31:137.[2] The Oil Companies further contend that, to the extent that the rules governing class actions permit such an interpretation, they are in conflict with the Mineral Code. The Oil Companies assert, therefore, that the demand letters sent to the Oil Companies by the Royalty Owners individually and as representative of a class of similarly situated royalty owners, purporting to make demand for the underpayment of liquid gas and dry gas royalties on production in Louisiana were not an adequate pre-litigation demand as to the unnamed class members.
"The applicable law as to notice and demand is set forth in the Louisiana Mineral Code. Louisiana Revised Statute 31:137 et seq. establishes the procedure to be followed by a mineral lessor seeking the proper payment of royalties. Article 137 provides that, `[i]f a mineral lessor seeks relief for the failure of his lessee to make timely or proper payment of royalties, he must give his lessee written notice of such failure as a prerequisite to a judicial demand for damages or dissolution of the lease.' When the written notice has been given, the provisions of article 138 become applicable. This provision affords the mineral lessee thirty (30) days after receipt of the required notice within which to pay the royalties due or to respond, in writing, by stating a reasonable cause for non-payment. Under article 139, if the lessee pays the royalties demanded within thirty (30) days after receipt of the lessor's written notice, the remedy of dissolution becomes unavailable to the lessor, unless the lessee fraudulently withheld payment. Under article 140, if the lessee fails to pay *965 royalties due or fails to inform the lessor of a reasonable cause for failure to pay in response to the notice, the court may award as damages double the amount of royalties due, interest on that sum from the date due, and a reasonable attorney's fee, regardless of the cause for the original failure to pay royalties. The court may, in its discretion, dissolve the lease." Lewis v. Texaco Exploration and Production Co., Inc., 698 So. 2d 1001, 1008 (La.App. 1 Cir. 1997).
"The Official Comment to 31:137[3] states `[i]t is the intent of [Mineral Code] Articles 137 [through] 141 to provide lessors with a meaningful remedy while simultaneously giving operators who have made substantial investments in producing properties the security of title which the nature and size of their investment deserves.' These provisions provide lessors with some meaningful remedy, besides recovery of interest, to assure timely payment of the production royalties, and are balanced with the harshness of lease cancellation, which may involve the investment of millions of dollars. The Comment further notes that 31:137 does not intend that this notice be a demand for performance, as in the case of the traditional default under the Louisiana Civil Code, since the lessor may not desire performance. Rather, the device of notice is merely to inform the lessee he has not paid royalties deemed by the lessor to be due. The total effect of the articles is to provide an impetus to timely payment of royalties due, while giving lessees a reasonable way in which to avoid the harsh remedy of cancellation. It also affords the lessee an opportunity to evaluate a non-payment situation and to make a decision regarding whether the royalties allegedly due should be paid." Id. at 1009.
"This statutory scheme evidences a legislative determination that a mineral lessor does not have a right of action to judicially complain of the failure of his lessee to make timely or proper payments of royalties until he gives written notice of such failure to his lessee and allows the lessee thirty (30) days after receipt of the required notice to either pay the royalties due or state the reasonable cause for nonpayment. The notice requirements set forth in LSA-R.S. 31:137 are an indispensable prerequisite to a judicial demand for dissolution of the lease or damages. The 30 day notice period requirement affords the lessee an opportunity to evaluate the nonpayment problem and then to make an informed decision as to whether the accrued royalties should be paid." Rivers v. Sun Exploration and Production Co., 559 So. 2d 963, 969 (La.App. 2nd Cir.1990) (citations omitted). "[T]he intent of the Mineral Code is that the notice be of a more specific nature so as to reasonably alert the lessee and to allow for an appropriate investigation of the problem by the lessee." Rivers, 559 So.2d at 969. The written notice should be such that it gives "the lessee reasonable notice of a problem or deficiency with the payment of royalties and the opportunity to correct it." Id.
The Oil Companies assert that it is inherently unreasonable to subject a lessee to a class wide demand purportedly issued on behalf of "several thousand" unnamed royalty owners as in the cases at bar. The Oil Companies contend that such demand would require them as lessees, within a thirty day period, to investigate the specifics of every lease and every liquids processing and gas sale arrangement that they have ever undertaken in Louisiana in order to determine whether each and every royalty interest owner, even though having made no demand, has been satisfactorily paid pursuant to the lessee's royalty obligation under every lease. The Oil Companies cite the language in article 137, "[H]e must give his lessee written notice...", in maintaining that the reasonably *966 specific notice must be given by an individual lessor, in his or her individual name, through individual demand.
B. Whether class notice is available under the Mineral Code
The parties do not dispute that in this case the Court is to apply the substantive law of Louisiana, nor that the Mineral Code and the aforementioned articles apply. Rather, the parties are in dispute as to the application of the Louisiana jurisprudence applying the article 137 notice requirement. The Oil Companies contend that Willis v. Franklin, 420 So. 2d 1243 (La.App. 3d Cir.1982) supports their position in this case. The Royalty Owners argue that Willis stands for the "unremarkable propositions that verbal demand does not constitute `written notice' as required by article 137 and thirty days must elapse following written demand as a prerequisite to filing suit." (Defendants' opposition memoranda). In Willis, the court rejected the argument asserted by the plaintiff in his appeal that the oral and written demands of his co-lessor should serve as the required notice for the plaintiff under article 137. The court held that "the `written notice' requirement of Article 137 is clear and unambiguous" and because the plaintiff himself did not give the lessee the "written notice" required by LSA-R.S. 31:137, the plaintiff's suit was premature for lack of 30 days notice. Id. at 1245.
The Oil Companies cite Stoute v. Wagner & Brown, 637 So. 2d 1199 (La.App. 1st Cir.1994) and Lewis v. Texaco Exploration and Production Co., Inc., 698 So. 2d 1001 (La.App. 1st Cir.1997) as composing the sole jurisprudence in which article 137 notice in a class action has been addressed. The Oil Companies contend that while Stoute is in line with article 137 and strictly adheres to its terms, Lewis is arguably incorrect and is distinguishable from the instant case. In Stoute, the trial court denied class certification in an action brought by royalty owners on their own behalf and on behalf of all similarly situated persons in a single Louisiana producing field. The trial court ruled that any class could consist only of those royalty owners who had timely made individual written demand upon the lease. While the appellate court did not address the propriety of a class wide demand, the Oil Companies contend that the court "adopted the [trial] court's opinion as its own" and represent that the case supports its position that the Royalty Owners cannot maintain a class action where none of the absent putative class members has satisfied article 137's demand requirement. The issue on appeal in Stoute was the trial court's denial of the motion to certify the matter as a class action. In affirming the trial court's finding on the issue of certification of a class action, the court stated,
"because of the many different contracts involved ..., there are many different rights, remedies and defenses which are likewise involved. The [trial] court concluded that it would not be more efficient to try these disputes in a class action.
After reviewing the record, we cannot say the trial court committed manifest error in its holding. On the contrary, we are convinced that the reasons enunciated by the [trial] court are correct and we affirm, adopting the trial court's opinion as our own...."
Stoute, 637 So.2d at 1199.
In Lewis v. Texaco Exploration and Production Co., Inc., 698 So. 2d 1001 (La. App. 1st Cir.1997), the plaintiffs made demand on behalf of "all royalty owners in the Hollywood Field as a class, with respect to royalties owed by [Texaco] under certain mineral leases ... covering mineral interests in the Hollywood Field, Terrebonne Parish, Louisiana." Lewis, 698 so.2d at 1010. The court, a different panel of the same court that had previously decided Stoute[4], held that article 137 allows *967 a mineral lessor to give notice, as a potential class representative, on behalf of absent members of a proposed class action. The court stated,
"The Mineral Code does not contain any specific guidelines as to the precise requirements of the formal written demand set forth in 31:137, but requires only that the lessor `give his lessee written notice of such failure' to make timely and proper payment of royalties. Nowhere in the statute is there a requirement that a notice be given by each and every mineral lessor individually. The use of the word `he' in 31:137 is not indicative of any legislative intent that each individual lessor provide such notice. The use of the masculine term is equally applicable to the feminine, and the use of the singular is likewise applicable to the plural. LSA-R.S. 1:7 and 8. Nor has the jurisprudence established any specific requirements for the sufficiency of that notice."
Lewis at 1009.
In addition to citing Lewis in support of their position, the Royalty Owners contend that their position is further supported by Duhe, et al v. Texaco, Inc., et al., Parish of Iberia, 16th Judicial District Court, "D", No. 86-848 c/w No. 88707. In Duhe, six proposed class representatives made written demand on Texaco on behalf of four statewide classes of persons who owned royalty interests in hydrocarbon production from all fields located in Louisiana whose royalty was calculated and/or paid by Texaco. Texaco filed an exception of prematurity arguing that the class notice letter was not effective under article 137. The court denied Texaco's exception of prematurity and the Third Circuit denied Texaco's writ application. (R 28, Exh. C; D).
The Oil Companies assert that the Lewis court erred in its analysis when it placed the burden on the lessee to prove that it had been harmed by the individual royalty owners' failure to make the required demand, instead of reviewing the class wide demand letter to see if it strictly adhered to the requirements of article 137. While the Oil Companies assert that such a case-by-case analysis performed in Lewis removes the certainty of the notice requirement that the Mineral Code was intended to provide the lessee, they maintain that if the Court were to apply the case-by-case analysis of Lewis, the demand letters sub judice would be deemed ineffective under article 137.
In a diversity case such as this, "[i]n ascertaining the law of the forum state, a federal court `is bound to apply the law as interpreted by the state's highest court.'" Texas Department of Housing & Community Affairs v. Verex Assurance, 68 F.3d 922, 928 (5th Cir.1995) citing Ladue v. Chevron U.S.A., Inc., 920 F.2d 272, 274 (5th Cir.1991). When the state supreme court has not yet adjudicated the issue, as is the situation with the issue at bar, the court's "task is to determine, to the best of [its] ability, how that court would rule if the issue were before it." Ladue, 920 F.2d at 274. "When making an `Erie-guess' as to how a state's high court would decide an issue, it is proper to look to the decisions of lower state courts." Shanks v. Alliedsignal, Inc., 169 F.3d 988 (5th Cir.1999). While the intermediate state appellate court decisions clearly serve as guidelines, and "should be given some weight, ... they are not controlling." Rogers v. Corrosion Products, Inc., 42 F.3d 292, 295 (5th Cir.1995). Thus, in this case the Court must consider all authority relevant to what it concludes the Louisiana Supreme Court would look to in order to decide the issue at bar.
The Court finds that by its own terms, "[H]e must give his lessee written notice", the notice required by article 137 must be individualized. When a law is clear and unambiguous and its application *968 does not lead to absurd consequences, the law shall be applied as written and no further interpretation may be made in search of the intent of the legislature. La. Civ.Code art. 9. The Royalty Owners' Demand Letters are legally insufficient to serve as written notice on behalf of unnamed royalty owners under article 137 of the Louisiana Mineral Code, and therefore, class action relief is unavailable under such circumstances.
This Court is of the opinion that the Louisiana Court of Appeal for the First Circuit was correct in the Stoute case in its interpretation of the notice requirement of article 137 of the Louisiana Mineral Code rather than the position that the same court took in the Lewis case. As set out in Willis, the written notice requirement of article 137 is clear and unambiguous and a suit brought before giving a lessee the requisite individual written notice is premature. Even if this Court had considered the Louisiana First Circuit Court of Appeal's holding in Lewis to be a correct application of article 137, the case at bar is distinguishable from the facts of that case. First, the demands in Lewis affected royalty owners in only one field which was specifically identified as the "Hollywood Field [] located in Terrebonne Parish, Louisiana, and includes within its boundaries the City of Houma." Lewis, 698 So.2d at 1005. In the instant situation the Liquids and Dry Gas Demands purport to make claims on behalf of "all royalty and overriding royalty owners to whom you pay gas royalties in Louisiana." In other words, in every gas producing field owned by each the Royalty Owners in the entire state of Louisiana. Second, the Lewis class included only those "persons who, as of November 1, 1987, held a royalty interest in any Hollywood Field mineral lease." Id. at 1006. Here, the Liquids and Dry Gas Demands include everyone who has ever owned a royalty or overriding royalty interest in any of the Royalty Owners' leases in Louisiana, "A royalty owner of [Liquids and Dry Gas] to whom you are presently or have in the past been obligated to pay royalties under an oil and gas lease, and on behalf of all other royalty owners in leases in Louisiana to whom you directly or indirectly pay, have paid, or should pay [Liquids and Dry Gas] royalties." Third, in Lewis, the plaintiffs made a claim to royalties under a single take-or-pay settlement agreement. Id. at 1006-07. The Royalty Owners' demand in this case claims that the Oil Companies received a higher price for gas than the price used to pay royalties ("market value claim"), and would require the Oil Companies to address every gas sale agreement and royalty price in the state of Louisiana for an unlimited time period. Finally, in the Lewis case the demands did not cover multiple claims, but only addressed the royalties on gas sold under a limited number of contracts. Id. In the Liquid Demands at bar, the Royalty Owners allege that in calculating royalties the Oil Companies failed to use the "reasonable, and actual costs of processing [Liquids]", requiring the Oil Companies to address the processing charges and actual cost of processing at every processing plant in Louisiana in which that the Oil Companies has ever processed gas. Contrary to the Lewis court's determination that the notice "fully and completely notified of the demands of the named the Oil Companies, as well as the intention of those named the Oil Companies to demand royalty payments on behalf of all of the [] royalty owners", the Royalty Owners' demand letters extend far beyond the defined parameters of the single-field, single-settlement demand in Lewis. Accordingly, the Royalty Owners' demand letters fail to meet the sufficient notice interpretation of article 137 as set out by the Lewis court.
Conclusion
Because Louisiana's highest court has not yet adjudicated the issue which is before the Court in the case at bar, it is this Court's task to determine "to the best of its ability" how the Louisiana Supreme Court would rule if the issue were before *969 it. In making its "Erie-guess" the Court has considered the existing Louisiana jurisprudence concerning article 137 notice as set out above. This Court is of the firm conviction that the Louisiana Court of Appeal for the Third Circuit in Willis and the Louisiana Court of Appeal for the First Circuit in Stoute correctly interpreted the clear and unambiguous language of article 137 of the Louisiana Mineral Code. This Court believes that were the issue before the Louisiana Supreme Court, that Court would find the demand letters sent to the Oil Companies by the Royalty Owners did not constitute the required notice for the putative class and the contents of the letters did not give the Oil Companies sufficient notice of the nature of the claims of the putative class.
This is an important issue that could have far reaching effects not only on the parties before the Court but for potentially thousands of people across this state and beyond, as well as the oil and gas industry in Louisiana and beyond. The Court therefore expressly determines that there is no just reason for delay and will certify this ruling as a final judgment pursuant to Rule 54(b) of the Federal Rules of Civil Procedure for appeal to the United States Court of Appeals for the Fifth Circuit in order for that court to certify the issues raised herein to the Louisiana Supreme Court or for the Circuit Court to otherwise dispose of the issues as it deems appropriate.
JUDGMENT
In accordance with the Memorandum Ruling issued on this date,
IT IS ORDERED that the Motions for Partial Summary Judgment, filed by Chevron USA, Inc., CA00-0279 [doc. no. 22]; Texaco, Inc., CA00-0280 [doc. no. 22]; Amerada Hess Corporation, CA00-0281 [doc. no. 23]; Union Oil Company of California, CA00-0282 [doc. no. 23]; Mobil Oil Corporation, CA00-0295 [doc. no. 39]; and, Exxon Mobil Corporation, CA00-0297 [doc. no. 28] against Vermillion Parish School Board are GRANTED and the Motions for Partial Summary Judgment filed by Vermillion Parish School Board, CA00-0279 [doc. no. 25]; CA00-0280 [doc. no. 27]; CA00-0281 [doc. no. 28]; CA00-0282 [doc. no. 27]; CA00-0295 [doc. no. 43]; and CA00-0297 [doc. no. 34] are DENIED.
IT IS FURTHER ORDERED that the Motion for Partial Summary Judgment, filed by Exxon Mobil Corporation, CA00-0296 [doc. no. 26] against Marshall W. Guidry is GRANTED and the Motion for Partial Summary Judgment, filed by Marshall W. Guidry [doc. no. 32] is DENIED.
IT IS FURTHER ORDERED THAT the Court certifies this ruling as a final judgment pursuant to Rule 54(b) of the Federal Rules of Civil Procedure, and directs the entry of such judgment under the express determination that there is no just cause for delay.
NOTES
[1] These cases were consolidated by the Court's December 7, 2000 Order. (R. 41).
[2] The Oil Companies cite Bollinger v. Texas Co., 232 La. 637, 95 So. 2d 132 (1957) and Melançon v. Texas Co., 230 La. 593, 89 So. 2d 135 (1956) in support of their representation that "[b]efore the adoption of the Louisiana Mineral Code, Louisiana law permitted a mineral lessor to file suit on a royalty claim found to be an active breach of the lease without first making written demand upon the lessee and the result was described a `one of the most, if not the most confused and unsatisfactory areas of Louisiana mineral law.'" Plaintiffs' memoranda citing LSA-R.S. 31:137, Comment.
[3] The official comments do not constitute part of the law, but provide some aid in interpreting legislative intent. State on Behalf of Jones v. Mallet, 704 So. 2d 958, 960 (La.App. 3 Cir. 1997).
[4] As noted by the Oil Companies, Judge Parro was also a member of the panel in Stoute but dissented in the 2-1 Lewis decision on the grounds that article 137 requires that notice be given by each mineral lessor. Lewis, 698 So.2d at 1016 (Parro, J., dissenting). | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1322524/ | 634 S.E.2d 831 (2006)
ALLEN
v.
The STATE.
No. A06A1583.
Court of Appeals of Georgia.
July 25, 2006.
*832 Alan Begner, Begner & Begner, P.C., Tammi Long, Atlanta, for Appellant.
Scott Ballard, District Attorney, Josh Thacker, Assistant District Attorney, Griffin Judicial Circuit, for Appellee.
BLACKBURN, Presiding Judge.
Following a jury trial, Jesse Allen, Jr., was convicted on two counts of violating the Georgia Controlled Substances Act for selling marijuana and possessing marijuana with the intent to distribute.[1] On appeal, he contends that the trial court committed plain error in considering improperly presented evidence at sentencing and that he received ineffective assistance of counsel. For the reasons set forth below, we affirm.
Immediately following Allen's conviction for the sale of marijuana and the possession of marijuana with intent to distribute, the trial court dismissed the jury and began the sentencing hearing. The trial court inquired whether the State had any evidence in aggravation to offer, and the State responded that it did not. However, following defense counsel's offer of evidence in mitigation, the State responded that Allen did not qualify for the low end of the range of sentencing because of a prior conviction. Recognizing that the State had not filed notice of its intent to introduce Allen's prior conviction as evidence in aggravation of punishment, the trial court expressed doubt that such evidence could be considered. Shortly thereafter, the State conceded that due to its failure to file notice, the trial court could not consider Allen's prior conviction. At the conclusion of the hearing, Allen received the maximum ten-year sentence to be served in prison. See OCGA § 16-13-30(j)(2). This appeal followed.
1. Allen contends that the trial court committed plain error in considering his prior conviction in aggravation of punishment despite the State's failure to file notice of its intent to introduce such evidence. However, the record reflects that the trial court did not consider this evidence.
"In the absence of any affirmative showing to the contrary, the [trial] court is presumed to have exercised its discretion in imposing sentence." (Punctuation omitted.) Smith v. State.[2] With regard to sentencing procedures, "OCGA § 17-10-2(a) allows the State to introduce evidence in aggravation of punishment provided that only such evidence in aggravation as the state has made known to the defendant prior to the defendant's trial shall be admissible." (Punctuation omitted.) Turner v. State.[3]
*833 Here, it is undisputed that during the sentencing hearing, the State made reference to Allen's prior conviction despite not providing the pre-trial notice required by OCGA § 17-10-2(a). However, the record shows that the trial court did not consider Allen's prior conviction in imposing sentence. Upon being made aware of the prior conviction, the trial court admonished the State for failing to file notice of its intent to introduce such evidence and expressed that it could not consider the conviction. Shortly thereafter, the State conceded that the court could not consider the prior conviction. Furthermore, "there is a presumption, in the absence of a strong showing to the contrary, that the trial judge sifts the wheat from the chaff, ignoring illegal evidence and considering only legal evidence." (Punctuation omitted.) Tutton v. State.[4] Accordingly, Allen has failed to show that the trial court considered any improper evidence or erred in imposing sentence.
2. Allen further contends that he received ineffective assistance, arguing that his counsel's failure to object when the State referenced his prior conviction was deficient and prejudiced his defense. We disagree.
To establish ineffective assistance of counsel under Strickland v. Washington,[5] a criminal defendant must prove (1) that his trial counsel's performance was deficient, and (2) that counsel's deficiency so prejudiced his defense that a reasonable probability exists that the result of the trial would have been different but for the deficiency. See Mency v. State.[6] Furthermore, "a court need not determine whether trial counsel's performance was deficient before examining the prejudice suffered by the defendant as a result of the alleged deficiency." Walker v. State.[7]
Citing West v. Waters,[8] Allen contends that his counsel's failure to object, when the State referenced his prior conviction during the sentencing hearing without providing notice, constituted ineffective assistance of counsel and requires reversal of his sentence. However, Allen is also required to show that his counsel's failure to object resulted in prejudice. See id. at 591, 533 S.E.2d 88; see also Veal v. State.[9] As stated in Division 1, the record reflects that the trial court did not consider his prior conviction during sentencing. He therefore cannot establish prejudice. Accordingly, his claim of ineffective assistance of counsel presents no basis for the reversal of his sentence. See Autry v. State.[10]
Judgment affirmed.
MIKELL and ADAMS, JJ., concur.
NOTES
[1] OCGA § 16-13-30(j)(1).
[2] Smith v. State, 269 Ga.App. 506, 507(2), 604 S.E.2d 587 (2004).
[3] Turner v. State, 259 Ga.App. 902(1), 578 S.E.2d 570 (2003).
[4] Tutton v. State, 179 Ga.App. 462, 463(2), 346 S.E.2d 898 (1986).
[5] Strickland v. Washington, 466 U.S. 668, 687, 104 S. Ct. 2052, 80 L. Ed. 2d 674 (1984).
[6] Mency v. State, 228 Ga.App. 640, 642(2), 492 S.E.2d 692 (1997).
[7] Walker v. State, 268 Ga.App. 669, 673(4)(a), 602 S.E.2d 351 (2004).
[8] West v. Waters, 272 Ga. 591, 593(3), 533 S.E.2d 88 (2000).
[9] Veal v. State, 242 Ga.App. 873, 876(3), 531 S.E.2d 422 (2000).
[10] Autry v. State, 250 Ga.App. 107, 109(1), 549 S.E.2d 769 (2001). | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/3359604/ | Each of these actions is brought by the administrator of the deceased, claiming that the death of the deceased was caused as a result of failure to comply with the statutes of the State of Connecticut requiring that buildings be provided with more than one way of egress. Each action is against the owner of the property in question and the defendant George W. Hollman, building inspector and fire marshal in Meriden. The complaint in each case alleges failure of the defendant Hollman to comply with the statutory requirements providing for his inspecting all buildings, including the one owned by the defendant Lynch, at least once a year and also to see to it that the provisions of the statutes be complied with. The complaint in each case alleges that the defendant Hollman defaulted in his duties and failed and neglected to make the inspection and to enforce the requirements, thereby causing and permitting the tenement house to stand with only one egress from the third floor and to constitute a fire trap. It also alleges that he permitted the existence and continuance of a nuisance.
In each action the defendant Hollman has demurred to the complaint for the reason that the complaint does not state a cause of action against the defendant Hollman in that said complaint fails to show a duty owed to the plaintiff by this defendant upon which liability can be based against the defendant Hollman. Section 2613 of the General Statutes, Revision of 1930, does provide that each story above the first story of a building used as a tenement house occupied by more than two families shall be provided with more than one way of egress, by stairways on the inside or fire escapes on the outside of such building. This section further provides that such stairways and fire escapes shall be so constructed, in such number, of such size and in such location as to give, in the opinion of the officer charged with the enforcement of this section, safe, adequate and convenient means of exit, in view of the number of persons who may need to use such stairway or fire escape.
Section 2616 of the General Statutes, Revision of 1930, provides: "In any case in which any person shall suffer injury or in which the death of any person shall ensue in consequence of the failure of the owner of any building to provide the same with fire escapes or stairways as required by the provisions of *Page 320
sections 2613, 2614 and 2615 .... such owner shall be liable to any person so injured for damages for such injury; and, in case of death, such owner shall be liable in damages for the injury caused by the death of such person." This section also provides the penalty to be imposed in a criminal proceeding against the owner.
Section 2617 of the General Statutes, revision of 1930, provides that: "The building inspector of each city .... either by himself or some person appointed by him, shall inspect all the buildings specified in sections 2613 and 2615, at least once each year between April first and October first, and shall see that the provisions of sections 2613, 2615 and 2618 are complied with."
In 2 Cooley on Torts (4th ed. 1932) § 300, it is stated: "The rule of official responsibility, then, appears to be this: That if the duty which the official authority imposes upon an officer is a duty to the public, a failure to perform it, or an inadequate or erroneous performance, must be a public, not an individual injury, and must be redressed, if at all, in some form of public prosecution. On the other hand, if the duty is a duty to the individual, then a neglect to perform it, or to perform it properly, is an individual wrong, and may support an individual action for damages."
"But a public officer while performing duties imposed solely for the benefit of the public is not liable for the mere failure to do that which is required by the statute." 22 R.C.L. public Officers § 161.
"Before he [an officer] can be made liable for omitting to do something, the obligation to do it must be absolute, specific and imperative. The duty must also be one owing to the person injured by his nonfeasance." 2 Shearman Redfield, Negligence (6th ed. 1913) § 314. In footnote 33 at page 826 we find the following: "Whenever an action is brought for a breach of duty imposed by statute, the party bringing it must show that he had an interest in the performance of the duty, and that the duty was imposed for his benefit."
In the plaintiffs' brief it is stated that the complaint, in addition to charging against the defendant Hollman the violations of the provisions, also alleges that the defendants had permitted and maintained a situation which was inherently dangerous and a nuisance. *Page 321
In paragraph 7 of the complaint in No. 56402 (Estate of June Phyllis Budrow) it is alleged that the death of June Phyllis Budrow was caused by the failure of the defendant to provide said third floor apartment with more than one way of egress as required by the Connecticut statutes, and in permitting and maintaining a situation that was inherently dangerous and a menace to the safety of the third floor tenants, including deceased, and in permitting the existence and continuance of a nuisance, and which conditions had been permitted to continue and exist for a long period of time and by the failure, neglect and default of the defendant, Hollman, to inspect said building, and to discover its condition in the respects aforesaid, and in failing to require and compel said defendant owner of said tenement house, to provide and install more than one way of egress and in failing and neglecting to enforce said requirements with regard to said tenement house of said defendant Lynch."
In paragraph 7 in the other action, No. 56403 (Estate of Ida A. Budrow) it is alleged: "That the death of said deceased, Ida. A. Budrow, was caused by the failure of the defendant, Anna C. Lynch, to provide said third floor apartment with more than one way of egress as required by the Connecticut statutes, and in permitting and maintaining a situation that was inherently dangerous and a menace to the safety of the third floor tenants, including deceased, and in permitting the existence and continuance of a nuisance and which conditions had been permitted to continue and exist for a long period of time, and by the failure, neglect and default of the defendant Hollman, to inspect said building, and to discover its condition in the respects aforementioned, and in failing to require and compel said defendant owner of said tenement house, to provide and install more than one way of egress and in failing and neglecting to enforce said requirements with regard to the said tenement house of said defendant, Anna C. Lynch."
It will be noted then that in neither complaint is it alleged that the defendants maintained a situation inherently dangerous and a nuisance. the "maintenance" is charged to and against the defendant, Anna C. Lynch, and the defendant Hollman is alleged to have failed to perform his duty as required by statute.
In examining the statutes it is interesting to note that section 2616, making the owner of a building liable for failure to comply *Page 322
with section 2613 of the General Statutes, does not make the building inspector liable for failure to perform his duty.
The failure of the building inspector, if there was a failure on his part, must be redressed, if at all, in some form of public prosecution.
The demurrer of the defendant Hollman in each of the actions is sustained for the reasons stated therein. | 01-03-2023 | 07-05-2016 |
https://www.courtlistener.com/api/rest/v3/opinions/2176010/ | 159 Cal.App.3d 537 (1984)
205 Cal. Rptr. 600
FIRST FEDERAL SAVINGS AND LOAN ASSOCIATION OF PHOENIX, Plaintiff and Appellant,
v.
KENNETH A. LEHMAN et al., Defendants and Respondents.
Docket No. 31382.
Court of Appeals of California, Fourth District, Division One.
August 23, 1984.
*539 COUNSEL
Glenn, Wright, Jacobs & Schell, Kent H. Foster, Aaron M. Peck, Michael D. Berk and McKenna, Conner & Cuneo for Plaintiff and Appellant.
Duke, Gerstel, Shearer & Bregante and Richard D. Bregante for Defendants and Respondents.
OPINION
WIENER, J.
First Federal Savings and Loan Association of Phoenix (First Federal) appeals from the order of dismissal entered after the court sustained without leave to amend the demurrer to its complaint brought by defendants Kenneth A. Lehman, Carolyn Lehman and Peter F. Chkoski (collectively, the Lehmans). We conclude the court complaint seeks a deficiency judgment against the Lehmans following First Federal's nonjudicial foreclosure on real property security under a deed of trust. First Federal's right to obtain such a judgment under these circumstances is barred by Code of Civil Procedure section 580d.[1] Accordingly, we affirm the order of dismissal.
Factual and Procedural Background
Assuming the truth of First Federal's factual allegations (Alcorn v. Anbro Engineering, Inc. (1970) 2 Cal.3d 493, 496 [86 Cal. Rptr. 88, 468 P.2d 816]), the following chronology emerges.
In September 1979 the Lehmans applied to First Federal for a $150,000 loan to purchase a single family residence in San Diego for the price of $212,000. The Lehmans represented to First Federal that the $62,000 difference between the loan amount and the purchase price would be paid by their $37,000 down payment plus secondary financing which would not exceed $25,000. The Lehmans also represented the residence would be owner-occupied. First Federal relied on the Lehmans' representations in making the loan, which was secured by a first deed of trust on the residence.
On February 19, 1980, shortly after the close of escrow, the sellers returned the Lehmans' down payment to them and accepted a $40,000 promissory note secured by a third deed of trust on the residence. Although faithful in their payments on First Federal's loan, the Lehmans treated the residence as an investment property and never lived in it themselves.
*540 In December 1980 the Lehmans sold the residence. It is unclear from the complaint whether the new buyers assumed the Lehmans' loan from First Federal or obtained separate financing. In either event, payments continued to be made on First Federal's loan.
In December 1981 First Federal initiated nonjudicial foreclosure proceedings under its first deed of trust following the default of its loan. First Federal bought the residence at a public auction on July 15, 1982. The complaint does not state the amount of First Federal's successful bid. Presumably, however, that amount was less than the balance due under the Lehmans' promissory note. In August 1982 First Federal prosecuted an unlawful detainer action to obtain possession of the residence. Upon obtaining possession First Federal discovered numerous design and construction defects.
In February 1983 First Federal brought this action for damages for fraud, negligence, strict liability and breach of warranty. Along with the Lehmans, defendants include the original sellers, second buyers, architects and builders of the residence. In the first of seven causes of action First Federal alleges the Lehmans fraudulently induced it to loan them $150,000 for their purchase of the residence.[2] As damages for fraud First Federal seeks unspecified sums for its loss of use of the principal amount of $150,000 and for the possible loss of some or all of that principal amount. First Federal also seeks fraud damages for its costs, including attorney fees, for foreclosing on the residence, obtaining possession and clearing title and for anticipated costs of repair and resale. First Federal finally seeks $500,000 punitive damages.
The Lehmans demurred on the ground sections 580b, 580d and 726 barred First Federal from any recovery against them following its nonjudicial foreclosure on the residence. The lower court agreed, ruling "[t]he first cause of action amounts to an attempt to collect upon the secured debt and is an attempt to circumvent the anti-deficiency legislation of this State."
Discussion
A beneficiary under a deed of trust can foreclose on real property security judicially by suing for a judgment of foreclosure (§§ 725a, 726) or nonjudicially *541 by exercising a power of sale. (Civ. Code, §§ 2924, 2932.) Nonjudicial foreclosure allows for the expeditious recovery of amounts due from a debtor/trustor. However, if the security is insufficient, the beneficiary's right to a deficiency judgment against the debtor/trustor following nonjudicial foreclosure may be barred either by section 580b or 580d, or by both. (See Walker v. Community Bank (1974) 10 Cal.3d 729, 733 [111 Cal. Rptr. 897, 518 P.2d 329].)
Section 580b provides in part: "No deficiency judgment shall lie in any event after any sale of real property for failure of the purchaser to complete his contract of sale, or under a deed of trust, or mortgage, given to the vendor to secure payment of the balance of the purchase price of real property, or under a deed of trust, or mortgage, on a dwelling for not more than four families given to a lender to secure repayment of a loan which was in fact used to pay all or part of the purchase price of such dwelling occupied, entirely or in part, by the purchaser." (Italics supplied.)
First Federal argues it is not barred by section 580b because the Lehmans never occupied the residence. (See Kistler v. Vasi (1969) 71 Cal.2d 261, 263-264 [78 Cal. Rptr. 170, 455 P.2d 106]; Allstate Savings & Loan Assn. v. Murphy (1979) 98 Cal. App.3d 761, 763-764 [159 Cal. Rptr. 663].) (1, 2) We need not address that issue in light of our conclusion section 580d bars First Federal's fraud cause of action against the Lehmans.
Section 580d provides in part: "No judgment shall be rendered for any deficiency upon a note secured by a deed of trust or mortgage upon real property hereafter executed in any case in which the real property has been sold by the mortgagee or trustee under power of sale contained in such mortgage or deed of trust."
This section bars any deficiency judgment[3] for amounts due under a promissory note when, as occurred here, the trust deed beneficiary elects to *542 foreclose by exercising its power of sale. (Cornelison v. Kornbluth, supra, 15 Cal.3d at p. 602.)
To avoid the bar of section 580d, First Federal asserts it is seeking damages for fraud rather than a deficiency judgment on the Lehmans' promissory note. First Federal relies on broad language appearing in several cases to support its distinction between actions to recover fraud damages and to obtain deficiency judgments. For example, in Glendale Fed. Sav. & Loan Assn. v. Marina View Heights Dev. Co. (1977) 66 Cal. App.3d 101 [135 Cal. Rptr. 802] the court categorically states: "The defense of sections 580b and 580d proscribing deficiency judgments is not available to the trustor as a defense to an action by the beneficiary for fraud. [Citations.] The statutes only proscribe deficiency judgments; an action for damages for fraud is not one for a deficiency judgment." (Id., at p. 139.) Factual analysis reveals Glendale Federal and each of the cases it cites involved alleged misrepresentations regarding or adversely affecting the value of the real property security. (Id., at pp. 133-135; Kass v. Weber (1968) 261 Cal. App.2d 417, 418-419 [67 Cal. Rptr. 876]; Baumrucker v. American Mortgage Exchange, Inc. (1967) 250 Cal. App.2d 451, 452-455 [58 Cal. Rptr. 677]; Joanaco Projects, Inc. v. Nixon & Tierney Constr. Co. (1967) 248 Cal. App.2d 821, 825, 830-831 [57 Cal. Rptr. 48]; Pastor v. Younis (1965) 238 Cal. App.2d 259, 260 [47 Cal. Rptr. 684].)[4] Allowing fraud actions for damages resulting from such misrepresentations complements the ability of beneficiaries to recover damages from trustors or third persons who tortiously injure real property security or impair the value of that security by "bad faith" waste. (Cornelison v. Kornbluth, supra, 15 Cal.3d at p. 598, fn. 3; American Sav. & Loan Assn. v. Leeds, supra, 68 Cal.2d at p. 614, fn. 2; Glendale Fed. Sav. & Loan Assn. v. Marina View Heights Dev. Co., supra, 66 Cal. App.3d at p. 139.) However, because the Lehmans' alleged misrepresentations were totally unrelated to the value of First Federal's real property security, the rule allowing actions for fraud damages under the facts of Glendale Federal *543 and the cases on which it relies does not apply to this case. Phrased differently, since there is no causal relationship between the alleged fraud and the damages sustained, this case does not fall within the holdings of the foregoing authorities.
Lacking the essential causal nexus, we agree with the lower court's assessment that First Federal's fraud cause of action represents an improper attempt to obtain a deficiency judgment through circumvention of applicable antideficiency statutes. (3) "The general rule is that it is an abuse of discretion to sustain a demurrer without leave to amend unless the complaint shows that it is incapable of amendment. [Citation.] But it is also true that where the nature of plaintiff's claim is clear, but under substantive law no liability exists, leave to amend should be denied, for no amendment could change the result. [Citations.]" (Berkeley Police Assn. v. City of Berkeley (1977) 76 Cal. App.3d 931, 942-943 [143 Cal. Rptr. 255].) The lower court acted within its discretion in sustaining Lehman's demurrer without leave to amend.
Disposition
The order of dismissal is affirmed.
Staniforth, J., concurred.
COLOGNE, Acting P.J.
I must respectfully dissent.
The courts and commentators who have addressed the issue have been consistent in stating California's antideficiency statutes do not bar an action for fraud because the remedy is one in tort and not an action on the note and deed of trust.
Hetland, California Real Estate Secured Transactions (Cont.Ed.Bar 1970) section 6.41 at page 300, states "[n]either CCP 580b nor any other deficiency section offers the trustor any defense to an action by the mortgagee or beneficiary for fraud."
In Glendale Fed. Sav. & Loan Assn. v. Marina View Heights Dev. Co. (1977) 66 Cal. App.3d 101, at pages 138 to 140 [135 Cal. Rptr. 802], the court faced with an action by Glendale for fraud after a nonjudicial foreclosure, held: "The defense of sections 580b and 580d proscribing deficiency judgments is not available to the trustor as a defense to an action by the beneficiary for fraud. [Citations.] The statutes only proscribe deficiency judgments; an action for damages for fraud is not one for a deficiency judgment.
*544 "The statutory provisions barring deficiency judgments were not intended to immunize a trustor or a third person who tortiously injures the mortgagee's security interest. A mortgagee whose secured interest has been impaired by tortious conduct of a third person is not barred by the antideficiency statutes from recovering damages for such impairment of security. [Citations.]" (Id., at p. 139.)
Kass v. Weber (1968) 261 Cal. App.2d 417, at page 422 [67 Cal. Rptr. 876], reached the same legal conclusion, holding the vendor could rescind the promissory note secured by a deed of trust and recover in fraud. The court said: "It is clear that the purposes of sections 580a, 580d and 725a et seq., are in no way frustrated by allowing the creditor to rescind for fraud and to recover his damages resulting from that fraud. Plaintiff in the case at bench did not receive a double recovery since she was required to tender and did tender a quitclaim deed to the property. Further, the words of section 725a specifically refer to recovery on a debt and the words of section 580d specifically refer to judgments on a deficiency on a note; therefore there is nothing in the express language of those sections to preclude recovery for rescission which is not a recovery on a debt nor a deficiency judgment on a note.
"One or more of the above code sections has been held not a bar to various actions that were not for deficiency judgments. An unlawful detainer action was not barred by sections 726 or 580d. [Citation.] In Freedland v. Greco (1955) 45 Cal.2d 462 ..., held that Code of Civil Procedure sections 580b and 580d only refer to deficiency judgments on a principal obligation after sale under trust deed as distinguished from an endorser's liability." The court reached the same result in Baumrucker v. American Mortgage Exchange, Inc. (1967) 250 Cal. App.2d 451, at page 460 [58 Cal. Rptr. 677].
I cannot conceive the Legislature intended to immunize a party from fraudulent acts by the relief afforded in sections 580b, 580d and 726. We have long recognized these statutes were enacted during the depression years when foreclosures occurred and the property was marketed at a depressed price leaving the mortgagor liable to his vendor or lender for the deficiency. (See Brown v. Critchfield (1980) 100 Cal. App.3d 858, 869-870 [161 Cal. Rptr. 342]; Glendale Fed. Sav. & Loan Assn. v. Marina View Heights Dev. Co., supra, 66 Cal. App.3d 101, 139; Kass v. Weber, supra, 261 Cal. App.2d 417, 422.)
The action here is for damages resulting from the fraudulent acts in securing the loan, not the result of a depressed market price. The misrepresentations made to obtain a loan can have far-reaching effects not relating in the contract undertaking. The majority would turn its back on the fraudulent *545 representations used to secure a loan contract not otherwise acceptable to the lender. Company policy and government regulation requiring the loan be for habitation by the purchaser and that the buyer have a substantial amount of his own money in the venture are important considerations. These are terms designed to avoid the likelihood of default. No lender likes to be going through foreclosure sales even if it comes out whole. Such defaults impose burdens and ill will contrary to good business practice. Government requirements in its guaranteed loans in this area are intended as a protection to assure the buyer has the ability to complete his undertaking, thus avoiding default. I can foresee many kinds of damages to the lender flowing from the fraudulent avoidance of these requirements. The damages have been pleaded in general terms and, if anything more is desired, the plaintiff should be allowed to amend.
If we were to hold borrowers may lie with impunity to the lender to secure a loan secured by a deed of trust and avoid liability under the antideficiency statutes, we would undermine the effectiveness of the banking regulation practices which seek to protect depositors and the banking industry without consequent benefit to the public. The effect on the bank and its officers can have devastating effect on its reputation if the number of foreclosures mounts. Investors, depositors and the guarantors of notes will not view lightly the prospect of management's loan practices if defaults are not avoided.
Finally, I must respectfully point out, too, if the bank is bound by its "election of remedies," i.e., trustee's sale, there is no showing here it was aware of the existence of the fraudulent representation at the time of the "election." How can there be a proper election where one is not in possession of all the facts?
I would reverse and remand.
A petition for a rehearing was denied September 17, 1984, and the opinion was modified to read as printed above. Appellant's petition for a hearing by the Supreme Court was denied November 21, 1984. Mosk, J., and Grodin, J., were of the opinion that the petition should be granted.
NOTES
[1] All statutory references are to the Code of Civil Procedure unless otherwise indicated.
[2] The Lehmans are also named as defendants in the third and possibly the second causes of action. The court sustained the Lehmans' demurrer as to all three causes of action. First Federal stipulated below that the court's order sustaining the Lehmans' demurrer as to its first cause of action would apply equally to its second cause of action. In its briefs on appeal First Federal neither withdraws that stipulation nor challenges the court's order of dismissal as to its third cause of action. Therefore, we summarily affirm the court's order as to the second and third causes of action. (See Electronic Equipment Express, Inc. v. Donald H. Seiler & Co. (1981) 122 Cal. App.3d 834, 858-859, fn. 1 [176 Cal. Rptr. 239]; Henderson v. Security Nat. Bank (1977) 72 Cal. App.3d 764, 769 [140 Cal. Rptr. 388].)
[3] A deficiency judgment awards recovery of the unpaid principal and interest on the secured debt (see Brown v. Jensen (1953) 41 Cal.2d 193, 198 [259 P.2d 425]; Kish v. Bay Counties Title Guaranty Co. (1967) 254 Cal. App.2d 725, 733 [62 Cal. Rptr. 494]) plus the costs, fees and other expenses of foreclosure. (See Cornelison v. Kornbluth (1975) 15 Cal.3d 590, 606, fn. 10 [125 Cal. Rptr. 557, 542 P.2d 981]; see also § 726, subd. (b); 1 Miller & Starr, Current Law of Cal. Real Estate (rev. ed. 1975) § 3:145, p. 582.) Section 580d therefore bars First Federal from recovering fraud damages for the loss of use and unpaid balance of its loan funds and for costs incurred in foreclosing on and clearing title to the residence. As for the other damages First Federal seeks, those sums also are unrecoverable under its fraud cause of action. Costs incurred in connection with First Federal's unlawful detainer action were recoverable, if at all, in that action. (§ 1174, subd. (b).) Repair costs resulting from design and construction defects in the residence will be recoverable, if at all, from the architects and builders under First Federal's causes of action for negligence, strict liability and breach of warranty. Resale costs presumably will be factored into the price for which the residence is resold. Finally, punitive damages cannot be recovered absent an award of actual damages for fraud. (Civ. Code, § 3294, subd. (a).)
[4] First Federal also relies on Shepherd v. Robinson (1981) 128 Cal. App.3d 615 [180 Cal. Rptr. 342]. The trustor's alleged misrepresentations in Shepherd did not concern the value of the real property security. (Id., at pp. 621, 626.) Nonetheless, Shepherd states: "Finally, [the beneficiary] argues that [the trustor's] conduct in transferring his interest in the property to [his co-trustor] shortly after the refinancing was completed constitutes fraud, and that a deficiency judgment ought to be allowed on that basis. If [the beneficiary] can make out a case of fraud against [the trustor], his proper remedy is an action for fraud, and a deficiency judgment will not lie. [Citations.]" (Id., at p. 626.) Shepherd, however, relies for this statement on Glendale Federal and two other cases which would allow a beneficiary to recover fraud damages from third person vendors who misrepresent the value of the real property security. (American Sav. & Loan Assn. v. Leeds (1968) 68 Cal.2d 611, 614-615 [68 Cal. Rptr. 453, 440 P.2d 933]; Snelson v. Ondulando Highlands Corp. (1970) 5 Cal. App.3d 243, 257 [84 Cal. Rptr. 800]; see also Hetland, Cal. Real Estate Secured Transactions (Cont.Ed.Bar 1970) § 6.45, p. 307.) Because it is unsupported by the authority on which it relies, we respectfully decline to apply Shepherd's erroneous statement to the facts of this case. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/2235033/ | 929 N.E.2d 174 (2006)
367 Ill. App.3d 1104
RAUCH
v.
DAIMLERCHRYSLER CORP.
No. 2-06-0253.
Appellate Court of Illinois, Second District.
November 9, 2006.
Aff'd in pt., rev'd in pt. & rem. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1787572/ | 124 S.W.3d 283 (2003)
Robert RASMUSSON, Appellant,
v.
LBC PETROUNITED, INC., Appellee.
No. 14-02-01053-CV.
Court of Appeals of Texas, Houston (14th Dist.).
November 25, 2003.
Supplemental Opinion December 23, 2003.
*284 Kent M. Hanszen, Houston, for appellant.
Tracy C. Temple, Thomas M. Melo, Houston, for appellee.
Panel consists of Justices EDELMAN, FROST, and GUZMAN.
OPINION
RICHARD H. EDELMAN, Justice.
In this employment dispute, Robert Rasmusson appeals a judgment in favor of LBC PetroUnited, Inc. ("LBC") on the ground that the trial court erroneously awarded LBC attorney's fees. We affirm in part and reverse and remand in part.
Background
Rasmusson filed suit against LBC, his former employer, alleging fraud and breach of contract. LBC filed a counterclaim seeking specific performance of the arbitration provision of the parties' severance agreement (the "agreement") and recovery *285 of the attorney's fees and costs expended to compel arbitration. LBC then moved to compel arbitration, the trial court granted LBC's motion, and the resulting arbitration award denied Rasmusson's claims and referred the issue of attorney's fees and costs to compel arbitration back to the trial court. Rasmusson subsequently nonsuited the claims he had originally filed in the trial court, and LBC filed a motion for judgment (the "motion") on its claim for attorney's fees and costs. On September 6, 2002, the trial court signed a final judgment (the September judgment) awarding LBC those fees and costs.
Timeliness of Appeal
As a preliminary matter, LBC claims that Rasmusson's appeal should be dismissed because it was untimely. LBC contends that a February 19, 2002 order (the "February order"), granting LBC attorney's fees and costs, was a final judgment because it disposed of the only claim then remaining in the case and thus rendered Rasmusson's appeal, filed after the September judgment, untimely.
In a case, such as this, where only one final and appealable judgment can be rendered, a judgment issued without a conventional trial is final for purposes of appeal only if it either actually disposes of all claims and parties then before the court, or states with unmistakable clarity that it is a final judgment as to all claims and parties (even if it is not). Guajardo v. Conwell, 46 S.W.3d 862, 863-64 (Tex.2001); Lehmann v. Har-Con Corp., 39 S.W.3d 191, 192-3, 200 (Tex. 2001). Appellate timetables run from the date an order granting a nonsuit is signed, rather than the date a nonsuit is filed. In re Bennett, 960 S.W.2d 35, 38 (Tex.1997).
In this case, the record does not contain a signed order that had granted Rasmusson's motion for nonsuit at the time the February order was entered. Therefore, the record does not reflect that the February order actually disposed of all the claims remaining at that time. Nor did the February order contain language purporting to dispose of all remaining claims and parties or otherwise unequivocally express an intent to finally dispose of the case.[1] Therefore, it was not a final order that began the time period in which Rasmusson's appeal had to be filed and caused his appeal to be untimely.
Standard of Review
Although the motion does not contain the term, "summary judgment," it states that it was filed pursuant to Texas Rule of Civil Procedure 166a, which describes the procedure and requirements for summary judgment motions. Similarly, although *286 the statement of facts in Rasmusson's brief states that the September judgment was entered without a motion for summary judgment, the brief not only does not dispute that the motion was filed in accordance with Rule 166a, it recites the summary judgment standard of review as being applicable to the case. We will follow the same approach.
A traditional motion for summary judgment may be granted if the motion and summary judgment evidence show that there is no genuine issue of material fact and the moving party is entitled to judgment as a matter of law on the issues expressly set out in the motion or response. TEX.R. CIV. P. 166a. In reviewing a traditional summary judgment, we take all evidence favorable to the nonmovant as true and resolve every doubt, and indulge every reasonable inference, in the nonmovant's favor. Tex. Commerce Bank, N.A. v. Grizzle, 96 S.W.3d 240, 252 (Tex.2002).
Award of Attorney's Fees and Costs
Rasmusson's sole point of error challenges the trial court's award of attorney's fees and costs to LBC on the grounds that: (1) the law does not allow recovery of attorney's fees incurred in compelling arbitration; (2) the agreement unambiguously provides that each party will bear its own attorney's fees incurred in any agreement dispute; (3) LBC failed to prove any contract damages supporting an attorney's fees award; (4) LBC waived its claim for attorney's fees when it failed to present its breach of contract claim to the arbitrator, asking instead for fees incurred merely to compel arbitration; (5) the attorney's fees awarded were unreasonable and unnecessary; (6) LBC's breach of contract claim was never adjudicated, and Rasmusson never got his day in court to assert his defenses to it; and (7) LBC failed to provide any evidence in support of the costs awarded.
In support of his first argument, Rasmusson contends that section 171.092 of the Texas Civil Practice and Remedies Code ("CPRC") disallows recovery of attorney's fees for compelling arbitration. However, that section pertains to a judgment confirming, modifying, or correcting an award, not an order compelling arbitration, as in this case. See TEX. CIV. PRAC. & REM.CODE ANN. § 171.092(a) (Vernon Supp. 2004).[2] Therefore, Rasmusson has not demonstrated that the law precludes a recovery of attorney's fees in this case.
In support of his second argument, Rasmusson argues that the award of attorney's fees and costs directly contradicts the plain language of the agreement, which requires each party to bear his or its own costs incurred in any dispute arising from the agreement:
Any disputes arising under or in connection with this Agreement shall be resolved by arbitration to be held in Houston, Texas in accordance with the rules and procedures of the American Arbitration Association. All arbitration fees shall be borne equally by [the parties] and [each shall be] responsible for any attorneys' fees or other expenses incurred by either [of them].
(the "arbitration provision"). On the contrary, this provision applies only to fees and expenses incurred in resolving disputes by arbitration, i.e., in accordance with the agreement, not to costs necessitated by a party's opposition to resolving *287 disputes by arbitration, in contravention of the agreement. Therefore, Rasmusson has not demonstrated that the award of attorney's fees and costs is inconsistent with the agreement.
Rasmusson next contends that attorney's fees could not be recovered by LBC under section 38.001(8) of the CPRC because LBC recovered no other monetary contract damages besides the attorney's fees and associated costs. See Tex. CIV. PRAC. & REM.CODE ANN. § 38.001(8) (Vernon 1997) (allowing recovery of attorney's fees "in addition to the amount of a valid claim" for breach of contract). However, a "valid claim" for this purpose is not limited to one for monetary damages[3] and may include a claim for specific performance. See Jones v. Kelley, 614 S.W.2d 95, 96, 100-01 (Tex.1981) (reforming judgment to award attorney's fees, in accordance with jury verdict, under predecessor statute to section 38.001 in suit for specific performance of earnest money contract for sale of real estate). Because LBC sought attorney's fees in addition to its claim for specific performance of the arbitration provision of the agreement, its failure to recover other money damages did not preclude the award of attorney's fees.
Rasmusson next contends that LBC waived asserting its claim for attorney's fees as a claim for breach of contract by instead presenting it to the arbitrator as merely a claim for fees to compel arbitration.[4] The only portion of our record that reflects how LBC's attorney's fee claim was presented to the arbitrator is the following exchange:
ARBITRATOR: And [LBC] is seeking attorney's fees that it incurred in going to court and compelling arbitration pursuant to the arbitration clause of the [agreement].... Is that correct?
[LBC'S COUNSEL]: Correct.
The arbitration award similarly states:
[LBC] seeks $16,707.50 in attorney's fees and $403.71 in court costs,[[5]] both of which were incurred when compelling arbitration in this matter. However, pursuant to the District Court's order compelling arbitration, and its subsequent abatement pending the arbitration outcome, it appears that the merits of the case are to be determined by the Arbitrator while the award of attorney's fees and costs to compel arbitration should be determined by the District Court. Therefore, the Arbitrator refers the matter of attorney's fees and costs to the District Court for adjudication.
* * * *
The cost of arbitration is to be shared equally by the parties. The issue of attorney's fees incurred in court to compel arbitration is reserved for the District Court.
All other relief not expressly granted is denied.
(paragraph numbers omitted). While it is not clear on what basis the arbitrator was distinguishing the "merits of the case" from the award of attorney's fees, we cannot say from this record that LBC presented its claim for attorney's fees to the arbitrator as something other than a *288 breach of contract claim and thereby waived its claim as such.[6]
Rasmusson next contends that the amount of attorney's fees sought and recovered by LBC was unreasonable and unnecessary for preparing and arguing a three-page motion to compel arbitration at a fifteen-minute hearing. However, because Rasmusson filed neither a cross-motion for summary judgment[7] nor summary judgment evidence controverting that supporting LBC's motion on this issue,[8] we can neither render judgment in Rasmusson's favor nor conclude that a fact issue was raised on the reasonableness and necessity of the amount of attorney's fees awarded.
Rasmusson next argues that LBC never had its breach of contract claim formally adjudicated by the arbitrator or trial court and, accordingly, Rasmusson never got his day in court on his defenses to those claims. However, the motion plainly referred to the arbitration provision and argued that Rasmusson's filing of suit rather than submitting the dispute to arbitration was a breach of the agreement as a matter of law, causing LBC to incur expense in filing its motion to compel arbitration, as described in the attached affidavit of LBC's attorney. Rasmusson filed a response to the motion (the "response") in which he argued that: (1) LBC waived the claim by failing to ask the arbitrator to rule on whether Rasmusson had breached the contract; (2) LBC's request for relief from the court essentially sought to modify or vacate the arbitrator's award without satisfying the requisites for doing so; and (3) he disputed the reasonableness and necessity of the fees (but without supporting summary judgment evidence). Under these circumstances, it is not apparent how LBC's breach of contract claim was not formally adjudicated by summary judgment in its motion, Rasmusson's response, and the September judgment.
Rasmusson lastly asserts that the trial court erred in awarding costs against him because LBC failed to provide any evidence of those costs.[9] The only summary judgment evidence LBC provided regarding costs was a single sentence in its attorney's affidavit: "Further, reasonable costs of $403.71 have been incurred in performing the tasks cited above [to compel *289 arbitration]." Because there is no indication of what these costs consisted of, there is no basis to establish whether they were reasonable or necessary other than the conclusory statement of the attorney, which is insufficient to support a summary judgment.[10] Therefore, we sustain Rasmusson's challenge to the sufficiency of the evidence to support the trial court's award of costs to LBC, reverse the portion of the judgment making that award, remand that issue to the trial court for further proceedings, and affirm the remainder of the judgment.
SUPPLEMENTAL OPINION
Following the issuance of our original opinion, reversing the costs awarded by the trial court's judgment, appellee, LBC PetroUnited, Inc., timely filed a voluntary remittitur of those costs. See Tex.R.App. P. 46.5. We conclude that LBC's voluntary remittitur cures the reversible error and accept it. Accordingly, we reform the judgment to remove the award of costs and affirm the judgment in accordance with the remittitur. See id.
NOTES
[1] The entire body of the February order stated:
Having considered all of the pleadings and the evidence in this case, this Court finds that [LBC's] Motion for Judgment on Fees and Costs is GRANTED.
It is ordered that LBC is entitled to the sum of $16,707.50 in attorneys' fees and $403.71 in costs for a total of $17,111.21. By contrast, the September judgment is not only entitled "Final Judgment" but contains language unequivocally expressing an intent to finally dispose of the only remaining claim in the case (even though an order granting Rasmusson's nonsuit was apparently never entered):
This case came before the Court for final adjudication.... On September 24, 2001, [Rasmusson] non-suited its [sic] own claims leaving [LBC's] counter-claim the only remaining claim at issue in the case.
* * * *
It is therefore,
* * * *
ORDERED, ADJUDGED AND DECREED that this is a Final Judgment and that all relief sought in this case which is not specifically granted is hereby denied.
[2] Nor are we at liberty to extrapolate the effect of this statute to circumstances outside its scope. See City of Garland v. Dallas Morning News, 22 S.W.3d 351, 358 (Tex.2000) (noting that courts are not responsible for omissions in legislation, but must take statutes as they find them).
[3] Butler v. Arrow Mirror & Glass, Inc., 51 S.W.3d 787, 796 (Tex.App.-Houston [1st Dist.] 2001, no pet.).
[4] However, neither party has cited a basis to recover attorney's fees to compel arbitration other than under section 38.001 of the CPRC.
[5] The record does not reflect whether these costs were actually taxable court costs.
[6] Rasmusson's brief states that the issue presented in this case is whether the trial court had authority to award attorney's fees. However, to the extent the claim for attorney's fees was within the scope of the arbitration provision, Rasmusson's brief does not challenge the authority of the arbitrator to refer it back to the trial court or the trial court's authority to decide the issue based on that referral.
[7] See, e.g., Dow Chem. Co. v. Bright, 89 S.W.3d 602, 605 (Tex.2002) (reiterating that when both sides have moved for summary judgment, and one motion is granted and the other denied, the appeals court determines all questions presented and renders the judgment the trial court should have rendered).
[8] See, e.g., Centeq Realty, Inc. v. Siegler, 899 S.W.2d 195, 197 (Tex.1995) (reiterating that once a movant produces evidence sufficient to establish a right to summary judgment, the nonmovant must present evidence sufficient to raise a fact issue).
[9] LBC contends that Rasmusson waived this complaint by failing to raise it in his response and that a trial court's award of attorney's fees and costs is reviewed for abuse of discretion. However, a nonmovant need not respond to a motion for summary judgment to contend on appeal that the movant's summary judgment proof is insufficient as a matter of law to support summary judgment. M.D. Anderson Hosp. and Tumor Inst. v. Willrich, 28 S.W.3d 22, 23 (Tex.2000). Similarly, to whatever extent an award of attorney's fees and costs is reviewable for abuse of discretion in other contexts, LBC has not cited, and we have not found, any authority for doing so where such an award has been rendered by summary judgment.
[10] See Earle v. Ratliff, 998 S.W.2d 882, 890 (Tex.1999) (reversing summary judgment because expert's affidavit, stating that defendant met the applicable standard of care, did not explain its basis to link that conclusion to the facts or explain why the procedure was medically warranted); Burrow v. Arce, 997 S.W.2d 229, 235 (Tex.1999) (reiterating that conclusory statements made by an expert witness are insufficient to support summary judgment). | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1711284/ | 749 So.2d 1161 (1999)
TEMPLE-INLAND MORTGAGE CORPORATION, Appellant,
v.
Eddie JONES and Willie Mae Jones, Husband and Wife, Appellees.
No. 97-CA-01418-COA.
Court of Appeals of Mississippi.
August 3, 1999.
*1162 Lem G. Adams, III, Bradley P. Jones, Brandon, Attorneys for Appellant.
William F. Riley, L.H. Rosenthal, Wanda Alexander Williams, Natchez, Attorneys for Appellees.
BEFORE KING, P.J., BRIDGES, DIAZ, AND LEE, JJ.
DIAZ, Judge, for the Court:
¶ 1. This case arises from an October 8, 1997 order of the Adams County Chancery Court finding that Eddie and Willie Mae Jones were in default on their mortgage payments to the Temple-Inland Mortgage Corporation, but that the lender failed to clarify to the borrowers the amount of the arrearage as it accrued and acted with gross indifference to and reckless disregard of their rights in handling the threatened foreclosure. The Joneses were awarded $5,000 in actual damages and $15,000 in punitive damages. Temple-Inland now asserts that the Joneses were not entitled to actual damages because they failed to state a cause of action and provided no proof of damages; the award of punitive damages was contrary to the overwhelming weight of the evidence and unsupported by any proof of actual damages in the record; and that the chancellor erred in relying on Johnson v. Gore, 224 Miss. 600, 80 So.2d 731 (1955), as well as in finding that the lender failed to advise the Joneses of the actual amount of indebtedness and that its actions were "unconscionable and unfair and totally uncalled for," especially in light of his finding that the Joneses were in default. While we sympathize with the Joneses' plight, the record does not support the award of either actual or punitive damages. Accordingly, we affirm the chancellor's finding that the Joneses were in default on their obligation to Temple-Inland, but reverse and render the awards of actual and punitive damages.
*1163 FACTS
¶ 2. In September, 1994, Eddie and Willie Mae Jones refinanced their house in Natchez, Mississippi, by obtaining a loan from First Capital Mortgage Corporation, now Quality Mortgage USA, Inc., in the amount of $88,200. Monthly installments were payable to the servicing agent, Lomas Mortgage, USA. The Joneses apparently were delinquent in their first payment to Lomas, which should have been made in December, 1994. Their mortgage history at Lomas indicates that late charges were assessed every month between March, 1995 and January, 1996. Mr. Jones, however, testified that he only received one letter from Lomas during that time, no demand was made for the delinquent payment and his checks were accepted, regardless of whether the amount sent was adequate to cover the installment due.
¶ 3. The loan was acquired by Temple-Inland Mortgage Corporation in January, 1996. The Joneses had not yet made the $1,670.23 payment due to Lomas on January 1, 1996. Late fees in the amount of $219.90 also were carried over from Lomas to Temple-Inland. Mr. Jones indicated that he did not understand that the unpaid balance owed to Lomas was transferred to the amount owed at Temple-Inland.
¶ 4. Temple-Inland first received a check from the Joneses in the amount of $1,670.23 on February 7, 1996, which was applied to the past-due January balance. A late fee of $49.98 was posted to the account on January 15, 1996. Another late fee of $49.98 was posted on February 15, 1996 for the February payment, which was due on February 1, 1996. On February 20, 1996, Temple-Inland sent the Joneses a form letter notifying them that a late fee had been assessed because the February payment had not been received. The letter explained that a balance of $1991.81 was due, including late fees in the amount of $321.58.
¶ 5. On March 20, 1996, Temple Inland received a check from the Joneses in the amount of $1,670.23. That amount was credited to their account as the February payment. An additional late fee of $49.98 was posted on March 15, 1996, for the payment which had been due on March 1, 1996.
¶ 6. Because of adjustments in the escrow account, the April payment due was only $1,589.22. By this time, however, $3,629.29 was required to bring the Joneses' mortgage current. Temple-Inland received a payment of $1,400 from the Joneses on April 10, 1996. Because it was $270.23 short of the full payment still owed for March, the month to which it was to be credited, the monies received were placed in a suspense account. The suspense account generally is used to hold extra funds or partial payments while Temple-Inland contacts the borrower to determine where the balance is or how the additional funds are to be applied. The accrued late fee of $372.42 was paid from the suspense account on April, 16, 1996, but credited back to it on May 26, 1996.
¶ 7. The next installment of $1589.22 was due on May 1, 1996. Temple-Inland received a payment of $1,500 from the Joneses on May 15, 1996. Temple-Inland combined this with other monies in the suspense account and credited it to the Joneses' account as the March installment. At this point, the Jones had $1,178.93 in the suspense account, but were behind on their April and May installments. On May 2, 1996, Temple-Inland sent the Jones a notice of intent to foreclose, advising them that $5,828 (including the installment due June 1, 1996), was due on June 4, 1996 to make their account current. It was Temple-Inland's standard practice to send such a letter whenever a loan was between thirty and sixty days delinquent to inform the borrower of the default, advise him of the amount needed to make his account current and provide a telephone number for assistance. The notice arrived on Mrs. Jones' birthday, which, she claimed, caused her great distress.
*1164 ¶ 8. Because of a reduction in interest rates, the installment due June 1, 1996 was reduced to $1,567.69. A second notice of intent to foreclose was sent to the Joneses on June 6, 1996, advising them that $6,085.52 (including the installment due July 1, 1996) was due by July 8, 1996 to avoid foreclosure proceedings. Temple-Inland received a check from the Joneses for $1,500 on June 10, 1996. Because they were already two months in arrears and the check was less than amount of the installment owed, Temple-Inland returned that payment as well as the amount remaining in the suspense account on June 17, 1996. The note sent with the check explained that Temple-Inland was unable to accept less than the amount due and emphasized the importance of contacting the Foreclosure Department to determine the exact amount due. Once a loan was transferred from the Collections Department to the Foreclosure Department, Temple-Inland could no longer retain any partial payments for deposit into the suspense account.
¶ 9. By July 1, 1996, four installments now were due or past due, amounting to some $6,382.10, including late fees. Temple-Inland received $4,178.93 from the Joneses on July 9, 1996. From that amount, $3,178 was credited to the Joneses' account for the past-due April and May installments. Temple-Inland also deducted $473.24 in late fees as well as a $15 inspection fee. The remaining $512.25 was placed in the suspense account. The June and July installments remained unpaid.
¶ 10. When the next installment came due on August 1, 1996, the Joneses owed three installments, totaling $4,784.59. Temple-Inland received a payment of $1,567.69, which was returned to the Joneses because it was less than the amount due.
¶ 11. By September 1, 1996, the Joneses owed four installments of $1,567.69, totaling $6,270.76. Temple-Inland's attorney sent the Joneses a reinstatement quote of $6,828.45, if paid before September 30, 1996, breaking down the amounts owed for the installments owed, late fees, anticipated late fees, current as well as advanced foreclosure fees. The reinstatement quote included a credit for the $512.25 remaining in the suspense balance. Temple-Inland received payment of $3,342.92 from the Joneses on September 13, 1996, which again was returned since it was less than the total amount due. The record indicates that no payment was made in October.
¶ 12. On October 17, 1996, the Joneses filed a complaint in the Chancery Court of Adams County "in the nature of discovery and also for punitive damages" against Temple-Inland. They variously claimed that the lender had made false accusations against them, subjected them to harassment over payment of their note and other "mysterious charges" and "indicated a willful desire to take the home away from the Plaintiffs by whatever means they can concoct." Temple-Inland failed to respond, and a default judgment was entered on December 5, 1996. Finding that Temple-Inland had not received a copy of the complaint because of some clerical error, the chancellor granted the motion to set aside the default on January 7, 1997. He ordered Temple-Inland to provide the date and amount of the four payments it claimed were in arrears, enjoined it from taking any further foreclosure proceedings against the Joneses and ordered the lender to accept any payments made by them, regardless of the amount paid.
¶ 13. Pursuant to the court order, Temple-Inland produced an extremely detailed statement of the Joneses' arrearage on February 6, 1997. In its February 10, 1997, amended answer and counterclaim, Temple-Inland requested that the chancellor rule as to whether the Joneses were current on their obligations under the note and deed of trust and make a determination of the amount still owed to avoid foreclosure.
*1165 ¶ 14. A bench trial was held on April 7, 1997. The chancellor found that Joneses were currently in default and ordered a supplemental hearing to determine the arrearage. However, he found that there were "glaring defects" in Temple-Inland's accounting and that it was "inequitable and unjust for Temple to declare the entire indebtedness due and payable ... without furnishing Plaintiffs a correct statement of the amounts due...." The chancellor further found that Temple-Inland's actions were "unconscionable and unfair and totally uncalled for." He ordered Temple-Inland to pay actual damages in the amount of $5,000 and punitive damages of $15,000. Temple-Inland now appeals the chancellor's ruling.
DISCUSSION
I. WHETHER THE CHANCELLOR ERRED IN FINDING THAT TEMPLE-INLAND FAILED TO ADVISE THE JONESES OF THE AMOUNT DUE TO BRING THEIR ACCOUNT CURRENT AND PREVENT FORECLOSURE
II. WHETHER THE CHANCELLOR ERRED IN DETERMINING THAT TEMPLE-INLAND'S ACTIONS WERE "UNCONSCIONABLE AND UNFAIR AND TOTALLY UNCALLED FOR" IN LIGHT OF HIS FINDING THAT THE JONESES WERE IN DEFAULT OF THEIR OBLIGATIONS UNDER THE NOTE AND THE DEED OF TRUST
¶ 15. In these assignments of error, Temple-Inland challenges the chancellor's findings of fact, asserting that he erred in finding that the mortgage company failed to advise the Joneses of the amount due to make their account current and that its dealings with the Joneses were "unconscionable and unfair and totally uncalled for." The chancellor found that the Joneses were in default. He further found[1] that:
When Temple elected to declare the full amount of indebtedness due because of the alleged default in the payment of interest and taxes and otherwise, the Plaintiffs were entitled to know the amount they were in arrears, and Temple was the only person who could furnish that information. While the record disclosed no actual fraud in Temple's accounting (which, by the way, was finally done by Court order), there were glaring defects in the amount, and it was inequitable and unjust for Temple to attempt to declare the entire indebtedness due and payable because of default in the payment of the note without furnishing the Plaintiffs a correct statement of the amounts due so that they might know what amount they had to raise to prevent a foreclosure of their property.
* * *
The Court feels that the action of the mortgagee was unconscionable and unfair and totally uncalled for, which made the Plaintiffs go to the expense of filing a case in equity before they could receive an accounting of what Temple claimed was due.
¶ 16. On appeal, this Court will not overturn the findings of the chancery court if they are supported by substantial evidence "unless the chancellor abused his discretion, was manifestly wrong, clearly erroneous or an erroneous legal standard was applied." Griffin v. Armana, 687 So.2d 1188, 1192 (Miss.1996); Bowers Window and Door Co., Inc. v. Dearman, 549 So.2d 1309, 1312-13 (Miss.1989). Thus, we generally will affirm a trial court sitting without a jury on a question of fact unless, based on substantial evidence, the court is manifestly wrong. Brown v. Williams, et al., 504 So.2d 1188, 1192 (Miss.1987). Accordingly, we must examine the entire record and accept that evidence which supports or reasonably tends to support the *1166 findings of fact made below, together with all reasonable inferences which may be drawn therefrom and which favor the lower court's findings of fact. Cotton v. McConnell, 435 So.2d 683, 685 (Miss.1983).
¶ 17. There is substantial evidence in the record to support the chancellor's finding that the Joneses were in default. Having carefully reviewed the record now before us, however, we cannot say that the evidence, together with any inferences that may be drawn therefrom, supports or even reasonably tends to support the chancellor's finding that Temple-Inland failed to provide the Joneses with an accurate statement of the amount they owed to make their account current. To the contrary, our review of the record suggests that the chancellor's findings were manifestly wrong. As early as February, 1996, Temple-Inland advised the Joneses of the amount which they were in arrears. In all correspondence, the amount required to make their account current was clearly stated and the Joneses were encouraged to call a Temple-Inland representative for additional information and assistance in making their payments. Mr. Jones' testimony relates only a $20 discrepancy in the figures Temple-Inland presented to him. Moreover, he admitted that he did not understand the print-outs and other payment information he was sent.
¶ 18. We further find no basis in the record for the chancellor's finding that Temple-Inland's dealings with the Joneses were "unconscionable and unfair and totally uncalled for." The Joneses signed a promissory note and deed of trust acknowledging that they would be in default if their monthly mortgage installments were not timely paid in full, allowing the lender to accelerate the debt and initiate foreclosure proceedings. Indeed, the chancellor expressly found that the Joneses were in default. They appear to labor under the misapprehension, however, that because Lomas did not pursue foreclosure proceedings despite the fact the Joneses remained at least one month in arrears during the entire time the mortgage was serviced by that company and frequently sent payments of less than the amount of the installment due, Temple-Inland now has treated them unfairly by enforcing its rights under the terms of the promissory note and deed of trust. The record provides no evidence of harassment or unfair dealings by Temple-Inland. Rather, Temple-Inland's correspondence with the Joneses, form letters and notices as well as responses to specific requests for information, was politely phrased and non-threatening. There further is no evidence to infer that any Temple-Inland employees were rude to the Joneses beyond Mr. Jones' vague statement that "I talked to somebody; she talked to a bunch of people, because they would call and say, `You owe $6,000.'"
¶ 19. Based on the evidence in the record, the chancellor's findings that Temple-Inland failed to advise the Joneses of the amount due to bring their account current and handled the matter of their delinquency in a manner that was "unconscionable and unfair and totally uncalled for" are manifestly wrong. To the contrary, the fact that Temple-Inland tried to work with the Joneses for nearly six months to avoid foreclosure before the Joneses filed this action would seem to indicate that the lender's actions were neither unfair nor uncalled for. The record, however, does support the chancellor's finding that the Joneses were in default on their mortgage obligation.
III. WHETHER THE CHANCELLOR ERRED IN ITS APPLICATION OF JOHNSON v. GORE, 224 Miss. 600, 80 So.2d 731 (1955) TO THE FACTS OF THIS CASE AND ITS RELIANCE ON THE CASE LAW CITED IN THE FINAL DECREE
¶ 20. In his final decree, the chancellor found that the facts of this case were very close to those in National Mortgage Co. v. Williams, 357 So.2d 934 (Miss.1978). He thus relied on Williams and its discussion *1167 of Johnson v. Gore, 224 Miss. 600, 80 So.2d 731 (1955), quoting in his opinion the proposition that "equity will relieve the mortgagor from the consequence of a default if the mortgagee has done some act which makes it unconscionable for him to take advantage of it." Williams, 357 So.2d at 937. Temple-Inland now asserts that the chancellor erred in relying on these cases and applying them to the case sub judice. Both cases are factually distinguishable and because there is no evidence that Temple-Inland acted unconscionably or inequitably so as to cause the default, Johnson, 224 Miss. at 615, 80 So.2d at 736, they are of little relevance to the case now before this Court.
¶ 21. In Williams, the Mississippi Supreme Court was presented with the issues of wrongful foreclosure and the damages allowable. The lender had foreclosed on the borrower despite her protestations that she was not in default. It subsequently was determined, after the foreclosure sale and during trial of the lender's suit to dispossess Mrs. Williams, that the presumed delinquency arose as the result of the lender's failure to credit her account with payments she had made to the assignor from which the lender had acquired the note and mortgage. On the day the action was dismissed, the lender's attorney stated that although Mrs. Williams might not have been delinquent when the proceedings were initiated, she now was. A second foreclosure action promptly was filed. No accounting of the various trustees fees, costs and installments owed was provided to her. Finding that both foreclosure actions had been wrongful and invalid, and that the amount of the indebtedness probably was not known to either party, the Mississippi Supreme Court affirmed the lower court's decision which allowed the issues of actual and punitive damages to go to the jury.
¶ 22. As distinguished from Williams, there was no actual foreclosure of the Joneses' property. The damages at issue in Williams simply do not exist in the case sub judice. Moreover, unlike Mrs. Williams, the Joneses were in default at the time Temple-Inland acquired the mortgage from Lomas in January, 1996, and the deficiency was never remedied despite the lender's communications to the Joneses each month advising them of the amount past due. Temple-Inland did nothing to cause the default. As further distinguished from Williams, again because no foreclosure sale had occurred, the statements provided to the Joneses clearly indicated that they needed only to pay the past-due installments and late fees to bring their account current; they were not required to pay any unexplained and disputed trustee fees and other expenses of a wrongful foreclosure. Their problems arose from their failure to understand the standardized information they were provided by the lender, and not, as in Williams, from the lender's own actions.
¶ 23. In Johnson, the supreme court looked at the special circumstances existing between the mortgagee and the mortgagor to determine that "Gore [the mortgagee] was estopped from exercising the right conferred upon him in the mortgage contract to declare the entire amount of the indebtedness due prior to its maturity without first rendering to Johnson [the mortgagor] a true and correct account of the amounts received by him, and the balance due on the indebtedness, and giving Johnson a reasonable opportunity to pay the past due interest and taxes...." Johnson, 224 Miss. at 616-17, 80 So.2d at 737. Johnson was imprisoned at the time of the foreclosure. Gore apparently managed the property for Johnson while he was in the federal penitentiary, selling timber with Johnson's consent, advancing supplies to carry on farming operations. As the supreme court found, Johnson had reasonable cause to believe that Gore had collected enough from the sale of the timber, crop proceeds and rents paid by tenants on the land to cover the principal, interest and taxes due. He obtained a release from prison two days before the *1168 foreclosure sale and contacted Gore and the trustee, seeking an extension of time in which to pay the debt and avoid the sale of his property. Gore refused. Given Gore's role in managing Johnson's property and the financial aspects of the farming and timber operations conducted thereon, the supreme court disagreed with the chancellor's approval of the foreclosure and found both that Gore had a duty to provide Johnson with a correct accounting of the monies that had been credited and the amount still owed and that he was estopped from accelerating the debt owed. It was in this context that the court found that a mortgagor may be relieved from the consequences of an acceleration clause which is the result of "some unconscionable and inequitable conduct of the mortgagee." To the extent that Johnson imposes a duty to provide an accounting of the indebtedness necessary to avoid a foreclosure before the mortgagee can proceed with a foreclosure sale, Temple-Inland has complied. We note, however, that like Williams, the case is distinguishable from the case sub judice because the Joneses' property was not sold and there is no evidence that Temple-Inland acted unconscionably or inequitably to bring about the Joneses' default on the their mortgage obligation.
IV. WHETHER THE CHANCELLOR ERRED IN DETERMINING THAT THE JONESES WERE ENTITLED TO ACTUAL DAMAGES IN THE AMOUNT OF $5,000 WHEN THE COMPLAINT FAILED TO STATE A CAUSE OF ACTION FOR RECOVERY OF ACTUAL DAMAGES AND AT TRIAL, THEY FAILED TO PROVE ANY DAMAGES
V. WHETHER THE CHANCELOR'S AWARD OF $5,000 IN ACTUAL DAMAGES WAS CONTRARY TO THE OVERWHELMING WEIGHT OF THE EVIDENCE
¶ 24. Without providing any explanation for the basis of his award, the chancellor found that the Joneses were entitled to actual damages of $5,000. The Joneses did not seek any compensatory damages in their pleadings; rather, their complaint expressly limited the relief sought, stating that "[t]he suit is in the nature of discovery and also for punitive damages because of the false accusations made against the Plaintiffs relating to money claimed to be owed by the Plaintiffs to the Defendants." The failure to plead actual damages notwithstanding, Temple-Inland contends that the Joneses have proven neither injury nor damages and thus, there is nothing in the record to support the award of actual damages.
¶ 25. "Damages, whether arising out of contract or tort, must be the result of an actual injury." McDaniel Bros. Construction Co. v. Jordy, 195 So.2d 922, 925 (Miss.1967). The evidence in the record does not support the chancellor's finding of any wrongdoing on the part of Temple-Inland. Especially in light of the chancellor's finding that the Joneses were in default on their mortgage obligation, they have not proven any actual injury. They further have not met their burden of proof as to showing the amount of any damages suffered. Puckett Machinery Co. v. Edwards, 641 So.2d 29, 36 (Miss.1994); City of New Albany v. Barkley, 510 So.2d 805, 808 (Miss.1987).
¶ 26. The chancellor noted in his opinion that "[t]he Court feels that the action of the mortgagee was unconscionable and unfair and totally uncalled for, which made the Plaintiffs go to the expense of filing a case in equity before they could receive an accounting of what Temple claimed was due." Assuming arguendo that this language suggests that the chancellor awarded damages to compensate the Joneses for attorney fees they incurred, the general rule is that attorney fees are not a proper element of damages in a breach of contract suit unless the contract itself provides for them. Stokes v. Board of Directors of La Cav Improvement Co., 654 So.2d 524, 529 (Miss.1995). The security agreement provides only that, pursuant to the borrower's *1169 right to reinstate prior to implementation of its power of sale provisions, the borrower shall, among other obligations, be liable to the lender for any legal fees incurred in enforcing the terms of the agreement. No such provisions are made for the benefit of the borrower.
¶ 27. Especially in light of the chancellor's finding that the Joneses were in default, the evidence in the record does not support an award of actual damages. The Joneses put forth no evidence of actual injury or damages. Further, since there was no provision in the security agreement which could be construed as allowing attorney fees for the borrower, an award of damages as compensation for attorney fees would not be appropriate. We therefore reverse the award of actual damages.
VI. WHETHER THE CHANCELLOR ERRED IN AWARDING PUNITIVE DAMAGES IN LIGHT OF THE FACT THAT THERE IS NO EVIDENCE IN THE RECORD THAT THE JONESES SUFFERED ANY ACTUAL DAMAGES
VII. WHETHER THE CHANCELLOR'S AWARD OF PUNITIVE DAMAGES WAS CONTRARY TO THE OVERWHELMING WEIGHT OF THE EVIDENCE PRESENTED AT TRIAL AND IN THE RECORD
¶ 28. In their complaint, the Joneses stated that "[t]he suit is in the nature of discovery and also for punitive damages because of the false accusations made against the Plaintiffs relating to money claimed to be owed by the Plaintiffs to the Defendants." In addition to awarding $5,000 in actual damages, the chancellor further ordered Temple-Inland to pay $15,000 in punitive damages. Temple-Inland appeals the award, asserting that in absence of any actual damages, there can be no award for punitive damages and that the award was against the overwhelming weight of the evidence.
¶ 29. We note first that despite the language used in the pleadings, a claim for punitive damages is not "free-standing;" that is, "if there are no actual damages, then there is no right to sue for punitive damages." Kaplan v. Harco National Insurance Co., 716 So.2d 673, 680 (¶ 36)(Miss.Ct.App.1998). It is well-established that punitive damages are not intended to compensate a party for some injury; rather, they are given as punishment to the wrongdoer to serve as a deterrent to others who might be inclined to commit similar offenses. Mississippi Power Co. v. Jones, 369 So.2d 1381, 1387 (Miss.1979). Where, as in the case sub judice, there are no actual damages, punitive damages are not recoverable. Hopewell v. Trustmark National Bank, 680 So.2d 812, 820 (Miss.1996). Having found no basis for the chancellor's award of actual damages to the Joneses, we are required also to find that the award of punitive damages was inappropriate.
¶ 30. "A plaintiff is entitled to punitive damages only if he has demonstrated a willful or malicious wrong or the gross, reckless disregard for the rights of others." Valley Forge Insurance Co. v. Strickland, 620 So.2d 535, 540 (Miss.1993). The Joneses proved neither injury nor damages. The record further does not present any evidence of wrongdoing on the part of Temple-Inland. Rather, the lender was simply pursuing its lawful remedies against a borrower in default. As discussed supra, there was no evidentiary support for the chancellor's finding that Temple-Inland's actions were "unconscionable and unfair and totally uncalled for." Further, the Joneses presented no evidence that Temple-Inland had made false accusations against them as claimed in their pleadings. Since there was no basis for the chancellor's determination of actual damages and the Joneses made no showing that Temple-Inland acted willfully, maliciously or with reckless disregard for the rights of others, we must also reverse the award of punitive damages.
*1170 CONCLUSIONS
¶ 31. The chancellor was manifestly wrong in his findings that Temple-Inland failed to advise the Joneses of the amount due to avoid foreclosure and that the lender acted in a manner that was "unconscionable and unfair and totally uncalled for." We affirm, however, his finding that the Joneses were in default on their obligation to Temple-Inland. Because there is no evidence to support the awards of actual and punitive damages, we reverse and render the decision of the court below.
¶ 32. THE JUDGMENT OF THE ADAMS COUNTY CHANCERY COURT IS AFFIRMED IN PART AND REVERSED AND RENDERED IN PART CONSISTENT WITH THE TERMS OF THIS OPINION. COSTS ARE ASSESSED TO THE APPELLEES.
McMILLIN, C.J., KING AND SOUTHWICK, P.JJ., BRIDGES, IRVING, LEE, MOORE, PAYNE, AND THOMAS, JJ., CONCUR.
NOTES
[1] This paragraph of the chancellor's opinion was taken verbatim from Johnson v. Gore, 224 Miss. 600, 614, 80 So.2d 731, 736 (1955), discussed in Issue III. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1839944/ | 710 So.2d 573 (1998)
HOSPITAL CORPORATION OF AMERICA, and Tamarac Acquisition Corporation, Appellants/ Cross-Appellees,
v.
FLORIDA MEDICAL CENTER, INC., Appellee/ Cross-Appellant.
Nos. 96-3096, 96-4151 and 97-0851.
District Court of Appeal of Florida, Fourth District.
February 4, 1998.
Rehearing, Rehearing and Certification Denied March 30, 1998.
Alexander D. del Russo of Levy, Kneen, Mariani, Curtin, Wiener, Kornfeld & del Russo, P.A., West Palm Beach, for Appellants/Cross-Appellees.
Parker D. Thomson and Brian A. Hart of Thomson, Muraro, Razook & Hart, P.A., Miami, and Jack Stein and Caryn Carvo of Stein, Rosenberg & Winikoff, P.A., Fort Lauderdale, for Appellee/Cross-Appellant.
Rehearing, Rehearing En Banc and Certification Denied March 30, 1998.
PER CURIAM.
We reverse a judgment founded on a verdict in favor of Florida Medical Center (FMC) against Hospital Corporation of America (HCA) and its affiliate, Tamarac Acquisitions. The trial court erred in failing to direct a verdict for the defense on the sole claims of breach of an implied duty of good faith and Appellants' alleged failure to follow the law.
*574 FMC operated a medical complex, which had initially included a short term inpatient psychiatric facility. The facility held a Certificate of Need (CON) issued by HRS. At that time, HRS classified inpatient psychiatric facilities as either long term or short term, and issued separate CONs for the different categories. A hospital could not be built and could not operate without a CON, and a facility licensed to provide long term care was not allowed to provide any services beyond those specified in its license. § 395.033(5), Fla. Stat. (1987). In 1984, FMC acquired a CON from HRS to construct a 60 bed long term facility separate from their short term facility. FMC decided not to operate the new facility itself. Because CONs could not be sold for a profit, FMC negotiated a deal with HCA in which it would build the hospital and sell it to HCA along with the CON. FMC and HCA entered into a series of agreements under which FMC leased property on the grounds of an existing HCA hospital within the service area of FMC's short term care CON. FMC borrowed funds from HCA to build the hospital; hired an HCA affiliate to develop the hospital; retained an HCA affiliate to manage the hospital; and gave Tamarac Acquisition, a subsidiary of HCA, an option to purchase the hospital.
The hospital was built, opened, and sold to Tamarac in 1989. FMC's license to operate it was transferred to HCA, and HRS issued a new license to Tamarac for its operation of a long term psychiatric facility. At the time of the closing, the parties executed a termination of contracts document, a mutual waiver, and a release of all claims. The only agreement which survived the closing was an option agreement, which called for Tamarac to exercise an option within 30 days after the hospital was opened and called for the termination of all other agreements when the sale was closed. It also contained two sections which were titled "Covenant Not To Compete."
After the sale, FMC filed a written complaint with HRS that the hospital was violating its long term license by not meeting the 90-day minimum stay requirement. HRS issued a report which concluded that HCA was in violation of its license. However, in 1990, HRS abolished the distinction between long and short term categories, and the actions against HCA were dropped.
FMC alleged that HCA breached the covenant not to compete by operating as a short term facility and by actively supporting the amendment to the HRS rule abolishing the difference between short and long term facilities. FMC asserted a claim for fraud in the inducement, which was dismissed by the trial court. FMC also claimed a breach of an implied duty of good faith and fair dealing under the option agreement due to HCA's operating the hospital in violation of its license and circumventing the non-compete clause in the option contract.
Before trial, however, the trial court ruled that the contract provision in which HCA agreed not to pursue licensing as a short term in-patient facility was void as an unlawful restraint of trade. That left FMC's agreement not to seek long term licensing as the only remaining contractual obligation arguably enforceable against HCA. Other than the covenant not to compete, no express terms in the contract addressed how HCA was to conduct its business after taking ownership. Having ruled that the HCA covenant not to compete was void, the trial court, nonetheless, allowed FMC to proceed to trial on its third amended complaint which included a count I, titled "Breach of Contractual Obligations." This count alleged that HCA's operation of the hospital as a short term facility breached two duties which were implied by law in the option agreement: (1) the implied duty of good faith and fair dealing, and (2) the implied duty to obey the law touching on the subject matter of the agreement
FMC does not dispute that absent the covenant not to compete, HCA had no express obligations to perform under the agreement. Rather, FMC argues that, by signing the option agreement, HCA is bound to subsequently comply with Florida's laws governing the licensing and operation of psychiatric hospitals and that HCA's failure to do so prior to the change in the law constituted a breach of the requirements implied in the option to purchase. However, there is no *575 recognized independent cause of action for breach of a duty to obey laws other than as may be included in the terms of a contract. Wilcox v. Atkins, 213 So.2d 879 (Fla. 2d DCA 1968). Other than to resolve ambiguity or to assure that a change in the law did not make it impossible for the parties to reap the anticipated benefits of their bargain, courts do not utilize this principle to alter or add to negotiated obligations defined in contracts. The exception is where the law renders the contract illegal.
With respect to Appellee's claimed breach of an implied duty of good faith, a duty of good faith must relate to the performance of an express term of the contract and is not an abstract and independent term of a contract which may be asserted as a source of breach when all other terms have been performed pursuant to the contract requirements. See Bernstein v. True, 636 So.2d 1364 (Fla. 4th DCA 1994) (covenant of good faith not actionable where contract not enforceable); Hall v. Burger King Corp., 912 F.Supp. 1509, 1544 (S.D.Fla.1995); Burger King Corp. v. Weaver, 798 F.Supp. 684, 688 (S.D.Fla.1992) (implied covenant of good faith not actionable without breach of contractual provision). But see Scheck v. Burger King Corp., 798 F.Supp. 692 (S.D.Fla.1992); Scheck v. Burger King Corp., 756 F.Supp. 543 (S.D.Fla.1991) (duty of good faith and fair dealing found in franchise agreement where contractual relationship was ongoing). Before the duty of good faith attached, FMC was required to establish that there was a term of the contract which HCA was obligated to perform. Allowing FMC to pursue the claim for breach of duty of good faith where no enforceable executory contractual obligation on HCA's part remained would add an obligation to the contract which was not negotiated by the parties and not in the contract.
The other issues raised by Appellants are moot. As to the several arguments raised on cross-appeal, we affirm. Flatley v. Forbes, 483 So.2d 483, 484-85 (Fla. 2d DCA 1986); Weintraub v. Roth, 617 So.2d 1158 (Fla. 4th DCA 1993); Periera v. Florida Power & Light Co., 680 So.2d 617 (Fla. 4th DCA 1996); Fleming v. Peoples First Fin. Sav. and Loan Ass'n, 667 So.2d 273 (Fla. 1st DCA 1995). Therefore, we remand for entry of judgment for Appellants, HCA and Tamarac.
STONE, C.J., GROSS, J., and DAKAN, STEPHEN, Associate Judge, concur. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1765537/ | 534 So.2d 914 (1988)
Rene PEREZ, Appellant, and Marta Perez, and Rene Perez & Associates, Inc., a Florida Corporation, Cross-Appellees,
v.
Manuel RIVERO, Appellee/Cross-Appellant.
No. 87-2374.
District Court of Appeal of Florida, Third District.
December 13, 1988.
*915 Michael E. Anderson, Miami, for appellant and cross-appellees.
G. Frank Quesada, Coral Gables, for appellee/cross-appellant.
Before SCHWARTZ, C.J., and BASKIN[*] and FERGUSON, JJ.
PER CURIAM.
Rene Perez and Manuel Rivero were partners in an accounting and data processing firm. On February 5, 1982, by a contract terminating the partnership, it was agreed that Perez would retain the data processing clients and Rivero would continue to service the accounting customers. Perez further agreed to pay Rivero $90,000 for the purchase of Rivero's half interest in an office building owned by the partnership and to assume all the partnership's liabilities.
Perez paid Rivero $10,000 and executed two promissory notes, one for $5,000 and one unsecured note for $75,000, as part of the purchase agreement. The $75,000 note, made payable in monthly installments, is the subject of this lawsuit. When *916 Perez subsequently formed a new company, Rene Perez & Associates, Inc., the new company continued to make the monthly note payments to Rivero. However, in December 1985, the corporation stopped paying the note leaving an unpaid principal balance of $22,056.
Rivero commenced this action against Perez to collect the balance due on the promissory note and to establish an equitable lien on property of Rene Perez & Associates, Inc. Perez admitted that the nonpayment was purposeful. He asserts entitlement to the balance due on the note as a set-off for damages caused by Rivero's breach of the purchase agreement. Perez alleges that Rivero continued to perform data processing work for a client, AeroPeru, in violation of a promise that all data processing work done by the former partnership would be handled by Perez. Perez counterclaimed for $30,000 for the loss of the value of AeroPeru's business.
Perez appeals the final judgment entered in favor of Rivero for the balance due on the note and the denial of any set-off or damages for Perez. Rivero cross-appeals against Perez's wife, Marta, an alleged co-signor on the note, and the corporation. Perez contends that Rivero breached the dissolution agreement when he took on AeroPeru as a data-processing client, was unjustly enriched, and tortiously interfered with Perez's business relationship with AeroPeru.
We affirm because the trial judge's factual determinations are supported by competent and substantial record evidence. Raheb v. Di Battisto, 483 So.2d 475 (Fla. 3d DCA 1986). AeroPeru had been a long-time client of Perez & Rivero, without a contract, in a business relationship that was terminable at will by either party. Although the general rule is that an action will lie where a party tortiously interferes with a contract terminable at will, Unistar Corp. v. Child, 415 So.2d 733 (Fla. 3d DCA 1982), it is only direct and unjustified interference that is actionable. Ethyl Corp. v. Balter, 386 So.2d 1220 (Fla. 3d DCA 1980), rev. denied, 392 So.2d 1371 (Fla.), cert. denied, 452 U.S. 955, 101 S.Ct. 3099, 69 L.Ed.2d 965 (1981). If the defendant can prove that the interference was lawful competition a privilege which the courts recognize when a contract is terminable at will the defendant will not be found to have committed the tort of wrongful business interference. Unistar, 415 So.2d at 735. Cf. Insurance Field Servs., Inc. v. White & White Inspection and Audit Servs., Inc., 384 So.2d 303 (Fla. 5th DCA 1980).
The parties did not covenant that Perez would handle all the data processing business of former partnership clients as part of the consideration for the $90,000 purchase price paid by Perez. Neither did the parties agree, expressly or implicitly, not to compete. Moreover, testimony at the trial revealed that AeroPeru was not solicited by Rivero. Instead, AeroPeru executives sought Rivero's services because of dissatisfaction with Perez's work. So long as unlawful or improper means are not employed, activities in which one engages to safeguard or promote one's own financial interests are non-actionable. Knight Enters., Inc. v. Green, 509 So.2d 398 (Fla. 4th DCA 1987); Genet Co. v. Annheuser-Busch, Inc., 498 So.2d 683 (Fla. 3d DCA 1986); Ethyl Corp., 386 So.2d at 1225.
Addressing the cross-appeal, no reason is shown why a judgment should not have been entered against Marta Perez as co-signor on the sued upon note. Marta stated in her answer to the complaint that she did not sign the promissory note yet neither she nor Mr. Perez raised any objection to the introduction of the signed note into evidence. Mrs. Perez presented no evidence to support her affirmative defense, therefore, Rivero was entitled to recover. A promissory note admitted into evidence is sufficient, without other extrinsic proof, to establish a prima facie case in an action on the note. A defendant attacking the regularity of the note by an affirmative defense must prove irregularity. See Haycook v. Ostman, 397 So.2d 743 (Fla. *917 5th DCA 1981). On remand the judgment should be amended to include Marta Perez as a debtor.
The appeal is affirmed, the cross-appeal is reversed in part, and the cause is remanded for further consistent proceedings.
NOTES
[*] Judge Baskin participated in the decision but did not hear oral argument. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/2166269/ | 730 N.W.2d 150 (2007)
NELSON
v.
STALZER.
No. 24149.
Supreme Court of South Dakota.
February 20, 2007.
Affirmed (ALR). | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1164773/ | 174 Cal. App. 2d 406 (1959)
D. A. PARRISH AND SONS (a Corporation), Plaintiff and Respondent,
v.
COUNTY SANITATION DISTRICT NUMBER 4 OF SANTA CLARA COUNTY, Appellant; B. MILES THOMAS COMPANY (a Corporation) et al., Defendants and Respondents.
Civ. No. 18228.
California Court of Appeals. First Dist., Div. One.
Oct. 13, 1959.
David H. Adams for Appellant.
Forrest E. Macomber and Gordon J. Aulik for Plaintiff and Respondent.
Samuel C. Shenk and Ephraim Adams for Defendants and Respondents.
TOBRINER, J.
We find no merit in appellant's claim of error in the trial court's award to a contractor of damages for breach of contract covering installation of sewer pipe, upon any of the three suggested grounds: that the evidence does not support the judgment, that two subcontractors should not have been joined as plaintiffs, and that the findings and judgment should have been in the form urged by appellant.
The case arises from breach of contract. Respondent contracted to install main and lateral sewer pipe; appellant in turn promised to provide rights of way upon which the work was to be done. Indeed the standard practice in the industry is that easements be ready when a contractor is to lay pipe. Finding in the latter part of September, 1952, that matters beyond its control would prevent its meeting its deadline, respondent subcontracted, upon the written consent of appellant, portions of the job to Bryan B. Wall and B. Miles Thomas Company. On January 29, 1953, appellant's chief project engineer reported to its board of directors that respondent had diligently and satisfactorily prosecuted the work.
After a trial without a jury the court found appellant failed to perform its obligation to provide rights of way prerequisite to the performance of respondent's work, and, as a result of that failure, granted respondent D. A. Parrish and *410 Sons a judgment of $40,323.49 against appellant; Bryan B. Wall, a judgment of $4,080.22 against respondent; and B. Miles Thomas Company, a judgment of $3,304.67 against respondent. The court provided that the latter two judgments be conditional upon respondent's collecting its judgment from appellant.
We consider each of appellant's triple grounds of appeal under separate headings:
1. The sufficiency of the evidence.
Appellant urges five contentions in this respect: (1) the contract did not require appellant to provide easements; (2) appellant did not in any event breach such a duty, even if it existed; (3) respondent proved no damages; (4) respondent failed to give the notices required by the contract as to any claims for damages; and (5) appellant did not wrongfully deduct engineering or inspection fees. We proceed to point out why appellant's contentions cannot be upheld.
[1a] First. Was appellant's duty to provide easements sufficiently established? As we have stated, both appellant's contract and the standard practice in the industry so provided. Although the contract did not specify the precise time appellant was to have the rights of way ready, Civil Code, section 1657, cited by appellant, establishes that if the time of performance is not specified in a contract, the courts will imply a reasonable time. [2] A reasonable time must be determined by "the situation of the parties, the nature of the transaction and the circumstances of the particular case. ..." (Kersch v. Taber (1945), 67 Cal. App. 2d 499, 506 [154 P.2d 934].) [1b] Moreover, the contract carried a deadline of 120 days for completion of the job. Therefore, the court properly found that appellant faced the obligation of promptly obtaining easements in order that Parrish could expeditiously lay pipe.
Second. Did appellant breach its duty? Appellant analyzes in detail each item of damage found for the three respondents, and we are therefore compelled to a factual analysis to dispose of a plea that in substance asks this appellate court to retry the case.
Parrish Claim Number 1. (City Park-Raisch Easement.)
[3] Because it was the most difficult portion of the job, respondent informed appellant that respondent would first *411 start work here. After obtaining permission of appellant's engineer, respondent began benching operations, consisting of leveling the land for staking out the line for pipe, in the City Park area of the job. When appellant demanded wider benching than was originally undertaken, respondent sent out a bulldozer, only to be then told by appellant to cease operations totally because the city of Los Gatos objected.
When respondent found itself unable to do the work in City Park, which is the lower part of the canyon, it attempted to work the Raisch property and moved some equipment to this location. Upon commencing operations, respondent notified Raisch Company that the road used by its trucks was about to be cut. Immediately thereafter appellant's engineers ordered respondent to cease operations on the company's property.
Some two months later appellant cleared the easement across the property but directed respondent not to proceed for over one month because of the possibility of establishing a cheaper alternate route. When appellant finally told respondent to proceed on the City Park job, it was raining. The rain, besides slowing down construction, required respondent to use rock in the trench bottoms to stabilize the base for laying the pipe.
Respondent claimed damages of $28,179.79, attributable to this fiasco. Respondent adduced testimony as to damages based upon actual extra labor costs, equipment standing idle, supervision and overhead, plus inspection and engineering fees withheld by appellant.
Appellant merely reargues the evidence. It also alleges that the Health and Safety Code, section 4759, gave appellant a right of way across any public property, i.e., City Park of Los Gatos. However, appellant thus does no more than establish a conflict in the evidence since appellant was coincidentally negotiating with Los Gatos for an easement and respondent had actually been ordered from the park property. The point adds nothing to appellant's position.
Parrish Claim Number 2.
[4] Prior to starting work on San Tomas Road, respondent had obtained maps from the San Jose Water Works, but these maps did not indicate that there was a water main in the center of the street; nor did the engineering plans furnished by appellant indicate this pipe. *412
Upon digging along the center of San Tomas Road respondent hit the water main. Appellant's inspector then told respondent to halt operations; appellant's engineers informed respondent that a new course would have to be laid out, and meanwhile ordered respondent to move to another location to enable appellant to obtain an easement along the side of the road. From San Tomas Road respondent moved to Bruce Street, approximately one block away. Claim Number 2, for $426.77, was limited to the expenses incident to making this extra move. Ample testimony supported the costs involved in making such a move.
Appellant argues that the contract provided that the "Contractor shall notify the utility companies before proceeding with construction and should familiarize himself with the location of underground pipes, ducts or manholes. The location of the utilities where shown on the plans are approximate only and are not to be taken as final," and hence no allowance should be made for the move by Parrish. Appellant's claim is refuted by (1) the fact that appellant's engineers established the line and depth respondent was to dig, (2) the order of the engineers to respondent to move while they acquired a new easement, and (3) the theory explained in the summation of the trial judge: "I certainly have great difficulty accepting a theory ... that an engineer can lay out a course for the contractor to follow. [And if i]t turns out through the ignorance of the engineer ... this course has been laid out directly over some water lines ... that ... you [are] going to blame the contractor for hitting those pipes? The blame is in the man who laid out the course."
Parrish Claim Number 3.
Appellant's only contention is that since the move out of the job in Claim Number 2 should not have been allowed, the move back should likewise have been rejected. As indicated, the move out was properly charged to appellant.
Parrish Claims Numbers 4-9; Thomas Claims Numbers 1-3.
The Parrish claims involve damages found because of moves necessitated by appellant's failure to obtain easements prerequisite to respondent's performance of the work, with the exception of Claim Number 8 which involved damages for standby resulting from appellant's supplying respondent with erroneous cut sheets. *413
Thomas Claim Number 1 involved damages emanating from incorrect instructions and cut sheets of appellant's inspectors and engineers. Thomas Claim Number 2 again arose out of delay in obtaining a necessary easement. Appellant concedes Thomas Claim Number 3 is valid if the first claim stands.
Appellant again reargues the testimony; unquestionably, however, the judgment is supported by substantial evidence.
Wall's Claims Numbers 1-6.
These claims all arise from delays caused by failure of appellant to have obtained the required easements. Appellant again reargues the evidence; the evidence substantially supports the judgment.
Third. Did Parrish and the two subcontractors prove their damages? Appellant's claim as to failure of Parrish, Wall and Thomas to prove damages is clearly refuted by the evidence to which we have referred supra. [5] Appellant's present objection that testimony was improperly admitted as to Parrish Claim Number 3 falls in the void of the absence of such objection at the trial level.
[6] Fourth. Was Parrish required to give notice of any claims for damages within 10 days after discovering the basis therefor and if so was this condition satisfied? The contract provision upon which appellant relies for this forfeiture claim provides: "57. Extra, Additional or Omitted Work--Payment ... If the Contractor shall claim that any instruction, request, drawing, specification, action, condition, omission, default, or other situation obligated or may obligate the Owner to pay additional compensation ..., he shall notify the Owner in writing of such claim within ten (10) days from the date he has actual or constructive notice of the factual basis supporting the claim. The Contractor's failure to notify the Owner within such ten (10) day period shall be deemed a waiver and relinquishment of any such claim against the Owner." (Emphasis added.)
This clause refers to additional or extra work, not to damages incurred by appellant's frustration of respondent's ability to perform the prescribed work.
United States ex rel. Baltimore Brick Co. v. John A. Johnson & Sons (1945), 65 F. Supp. 514, thus construes a somewhat similar clause. The court stated: "Article VIII provides: 'The party of the second part shall make no claim for *414 additional work unless the same shall be done in pursuance of written order from the party of the first part, and notice of all such claims shall be made to the party of the first part in writing before the next ensuing payment, or shall be considered as abandoned by the party of the second part.' However, we do not think that this provision is intended to include, as 'additional work,' money expended in material and wages because of the general contractor's failure to construct temporary roads which he ... was required to do. We feel that this provision ... intends to refer to what would normally be treated as additional or extra work, as, for example, an enlargement or other change in some of the specifications thereby increasing the cost, and not to something which is already expressly covered by an obligation imposed upon one or the other party." (P. 527; emphasis added.)
[7] Moreover, a forfeiture clause, such as this, will not only be strictly construed (Milovich v. City of Los Angeles (1941), 42 Cal. App. 2d 364, 373 [108 P.2d 960]) but has been interpreted by this court not to apply to claims arising from breaches of the contract caused by the other party. In McGuire & Hester v. City etc. of San Francisco (1952), 113 Cal. App. 2d 186 [247 P.2d 934], the facts paralleled the instant ones to the extent that defendant had also failed to secure easements preliminarily required for plaintiff's performance of his work. Defendant claimed that it could not be held liable in damages because the contract provided that " '[a]part from granting the Contractor extensions of time for unavoidable delays, no payment or allowance of any kind shall be made to the Contractor by way of compensation or damages on account of any hindrance or delay from any cause in the progress of the work or any portion thereof, whether such delay be avoidable or unavoidable.' " (P. 189.) In an opinion by Justice Bray, this court held that the phrase "from any cause" did not include breaches of contract by the defendant.
[8] Fifth. Was the evidence sufficient for the trial court to conclude that appellant had wrongfully deducted engineering and inspection fees? The contract allowed appellant to withhold extra inspection and engineering fees which were incurred by appellant as the result of granting respondent extensions of time. Appellant claims that its own breach of contract in failing to provide easements gave respondent an excuse for nonperformance without requesting an extension *415 of time. But, since respondent did request, and obtained, extensions of time, respondent must pay these additional charges. We cannot adopt this tortuous self-serving reasoning.
2. The issues as to respondent's two subcontractors.
We probe each of appellant's four subordinate points but do not find them meritorious.
[9] First. Was the court correct in ordering plaintiff's two subcontractors to be joined? Code of Civil Procedure, section 389, provides: "[W]hen a complete determination of the controversy cannot be had without the presence of other parties, the court must then order them to be brought in. ..." Pursuant to this provision the Supreme Court has stated that "[t]he court may, of course, order proper parties to be brought in if expedient for a complete determination of the controversy." (Miller v. McKinnon (1942), 20 Cal. 2d 83, 99 [124 P.2d 34, 140 A.L.R. 570].)
Parrish claimed damages against appellant on the theory that appellant's breach of contract resulted in Parrish incurring liability to its subcontractors. Therefore, Wall and Thomas were certainly proper parties, since to the extent respondent was liable to them, appellant was liable to respondent. Moreover, as the trial court indicated, the joining of the subcontractors and determination of their damages in this action avoided collusion between the contractor and its subcontractors.
Appellant's reliance on Ambassador Petroleum Co. v. Superior Court (1930), 208 Cal. 667 [284 P. 445]; Hahn v. Walter (1943), 60 Cal. App. 2d 837 [141 P.2d 925]; and Goldsworthy v. Dobbins (1952), 110 Cal. App. 2d 802 [243 P.2d 883], is misplaced. These cases deal with a situation in which a court may proceed without a party, or may properly refuse to join a party, not with the situation in which a court may order a party joined.
[10] Second. Did respondent's amendment to its first amended complaint state a cause of action against appellant? Two cases illustrate the validity of inclusion in the complaint of the subcontractor's claims against respondent. Wiseman v. Sklar (1930), 104 Cal. App. 369 [285 P. 1081], involved a situation in which one Kass contracted with defendants to construct a home. Without the knowledge of defendants, Kass assigned the contract to Wiseman. Upon defendants' failure to pay the full contract price, Wiseman sued defendants for *416 the balance; at this point the trial judge ordered Kass brought in. The court found that defendants owed the balance, entered judgment for Kass against the defendants, granted judgment against Kass for Wiseman in the same amount, and further provided that Kass assign his judgment to Wiseman. In affirming the judgment, the appellate court held: "... Kass was at all times responsible to defendants under the contract. If Kass was responsible to defendants, then it must necessarily follow that defendants were responsible to said Kass (or his assignee) under the contract." (Pp. 374-375.)
In J. Harry McNally, Inc. v. State (1939), 170 Misc. 914 [11 N.Y.S.2d 577], the court held that a general contractor, on the basis of delays and interference with the work attributable to the state, could recover damages which included an allowance for claims made upon it by its subcontractors even though such claims were unliquidated. In that case the subcontractors even entered into a written agreement with the general contractor to withhold suit and abide the court's determination of the damages suffered by the subcontractors.
[11] Third. Did the statute of limitations bar the claims asserted in the amendment to respondent's first amended complaint, filed on February 5, 1957? Respondent filed its first amended complaint on July 18, 1955. The parties entered into the contract on August 15, 1952. Clearly the applicable four year statute of limitations had not run. (Code Civ. Proc., 337.) Respondent prayed for judgment of $51,076.61. In respondent's deposition taken shortly after the filing of the complaint, appellant learned this amount included the claims for damages suffered by the subcontractors. Thus, no new cause of action was stated in the amendment of February 5, 1957, which detailed these claims of the subcontractors. Its content should not have surprised appellant. The statute of limitations did not run on the amendment, which in effect merely made plaintiff's first amended complaint more specific as to damages. (2 Witkin, California Procedure, 592(b)(1), p. 1603.)
[12] Fourth. Should appellant's special demurrers for uncertainty and ambiguity have been sustained? Although respondent asked appellant at the trial if it claimed surprise as to the claims of the subcontractors contained in the amendments, it did not answer the query. Furthermore, at the time of the filing of these pleadings, at the end of the trial, the issues encompassed in the amendment to plaintiff's complaint *417 had already been tried. It is difficult to conceive of any "uncertainty" or "ambiguity" to which appellant could have been subjected. If any existed, it was waived by appellant's answer, which was filed after the demurrer was overruled. (2 Witkin, California Procedure, 503, p. 1493.)
3. The issue as to the form of the findings and judgment.
Appellant's two contentions in this regard cannot be sustained.
[13] First. Should the trial court have made separate findings of fact with respect to each claim? Although appellant states that it made a request for separate findings on each claim, the record does not substantiate the contention. In any event, a judge is not required to incorporate evidentiary facts in his findings. (Culjak v. Better Built Homes, Inc. (1943), 58 Cal. App. 2d 720, 723 [137 P.2d 492].)
[14] Second. Should the judgment have limited respondent's recovery to special assessment funds from Sanitation Sewerage Project Number 1952-1? Section 10425 of the Streets and Highways Code provides: "If the first assessment or the sale of bonds to represent assessments levied ... fails to raise sufficient money to pay all costs, damages, ... the legislative body may pay the deficit out of the general fund, or may order a supplemental assessment to pay the deficit." (Emphasis added.)
While section 10424 of the code indicates that loans may be made from the general fund to the special fund, section 10425 does not require that the general fund must first lend the money to the special fund for the payment of damages. Rather it gives the legislative body an option of paying damages out of the general or special supplemental assessments. This option should not be construed to afford a defendant the choice of deciding whether it will pay the judgment rendered against it.
Appellant cites McBean v. San Bernardino (1892), 96 Cal. 183 [31 P. 49], for its proposition that the judgment should run against only the special fund. That case involved a suit by the contractor against the city. The contract, for sewage construction, pursuant to a statute (Stats. 1885, p. 147) contained a clause " 'that in no case ... will the city, or any officer thereof, be liable for any portion of the expense, nor for any delinquency of persons or property assessed.' " (P. 185.) This was merely held to mean what it said. *418
Appellant's resubmission of arguments concerning evidence presented at the trial court cannot succeed upon appeal.
We affirm the judgment.
Bray, P. J., and Wood (Fred B.), J., concurred. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1723367/ | 649 So. 2d 297 (1995)
STATE of Florida, Appellant,
v.
David EARL, Appellee.
No. 94-836.
District Court of Appeal of Florida, Fifth District.
January 20, 1995.
Robert A. Butterworth, Atty. Gen., Tallahassee, and Steven J. Guardiano, Asst. Atty. Gen., Daytona Beach, for appellant.
David S. Morgan, Daytona Beach, for appellee.
GRIFFIN, Judge.
The State of Florida appeals an order dismissing criminal charges against defendant, David Earl, and declaring unconstitutional section 744.301(1), Florida Statutes (1993), the Florida statute that defines and identifies the natural guardians of children.[1]
On October 4, 1993, the state filed an information charging Earl with one count of *298 Interference With Custody, in violation of section 787.03, Florida Statutes (1993). The charging document states that Earl interfered with the custody of three children, ages six, five and three years. Earl is the biological father of the three children. Although they were born out of wedlock to Earl and to Elizabeth Adkins, Earl's name appears on two of the childrens' birth certificates and he claims to have raised all of the children, with Adkins, as a family. The interference charge stems from an event where Earl removed the children from their home in Daytona Beach and traveled with them to South Carolina without Adkins' permission.
The lower court's order of dismissal was based on an order from a court in another state relinquishing custody of the children to Adkins and Earl. The lower court concluded that because that court order existed determining Earl had a right to custody, he could not have violated section 787.03. This ruling has not been challenged on appeal and the state concedes the correctness of the dismissal. The state seeks in this appeal only to undo the ruling by the trial court declaring the guardianship statute unconstitutional. We agree with the state that the lower court's declaration that section 744.301(1), Florida Statutes is unconstitutional should be vacated.
There are several reasons for our decision. First, resolution of this case does not require a declaration that section 744.301 is unconstitutional. Section 787.03, Florida Statutes, under which Earl was charged, relates to interference with custody. Since the lower court ruled, and it is no longer disputed, that Earl had a right of custody by virtue of the prior order, the constitutional issue did not need to be reached.
Even if the lower court's ruling was an alternative one, it is still problematical for several reasons. It may have been made in response to this court's decision in State v. Badalich, 479 So. 2d 197 (Fla. 5th DCA 1985), where we held that a natural parent can be guilty of interference with custody if he has no right to custody. We explained in Badalich that under the 1983 version of section 744.301(1), as further defined in section 744.102(1), the mother of a child born out of wedlock had the right of custody. Since, absent a court order, the father of an illegitimate child had no right to custody, a natural father could be guilty of the crime of interference. 479 So.2d at 200.
We note, however, that the statutes on which Badalich was based have been amended. It appears that section 744.301(1), which previously defined guardianship in terms of custody, is no longer the key to an interference claim.[2] Although very poorly written, it appears that subsection (2) of section 787.03, added in 1987, is designed to govern the crime of interference with custody by a parent. Thus, the question whether section 744.301 may have some equal protection defect is now irrelevant to the issue of paternal interference with custody. Section 744.301(1) tells us that the unwed mother is the natural guardian but it does not say that the unwed father has no custodial rights. See Barnes v. Frazier, 509 So. 2d 401 (Fla. 5th DCA 1987).
Even if section 744.301 were to control the interference issue, it must be construed, if possible, to have a constitutional interpretation. The Fourth District has already done so, holding that when an "unwed father" demonstrates and carries out the requisite settled purpose to be a father, he comes within the first sentence of the statute, making him a natural guardian along with the unwed mother. DeCosta v. North Broward Hosp. Dist., 497 So. 2d 1282 (Fla. 4th DCA 1986). The last sentence of the section, identifying the mother as the natural guardian of a child born out of wedlock, applies to those cases where there is no "father" in the sense of a male who has come forward, declared his paternity and acted as a parent in providing emotional, physical and financial support to his child. Id.
AFFIRMED in part; REVERSED in part.
DIAMANTIS and THOMPSON, JJ., concur.
NOTES
[1] Section 744.301 reads:
744.301 Natural guardians.
(1) The mother and father jointly are natural guardians of their own children and of their adopted children, during minority. If one parent dies, the natural guardianship shall pass to the surviving parent, and the right shall continue even though the surviving parent remarries. If the marriage between the parties is dissolved, the natural guardianship shall belong to the parent to whom the custody of the child is awarded. If the parents are given joint custody, then both shall continue as natural guardians. If the marriage is dissolved and neither the father nor the mother is given custody of the child, neither shall act as natural guardian of the child. The mother of a child born out of wedlock is the natural guardian of the child.
[2] § 744.102(8), Fla. Stat. (1993). | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1828098/ | 42 Mich. App. 271 (1972)
201 N.W.2d 658
MICHIGAN CIVIL RIGHTS COMMISSION
v.
CLARK.
Docket Nos. 12003, 12004, 12294.
Michigan Court of Appeals.
Decided July 31, 1972.
Carl W. Huhn, for Mrs. Ralph G. Clark.
Robert J. Lord, Paul R. Vella, and Eugene R. Balanowski, for Frank Misko and Bernice Misko.
Frank J. Kelley, Attorney General, Robert A. Derengoski, Solicitor General, Michael A. Lockman, Assistant Attorney General, and William F. Bledsoe, Assistant Attorney General, for the Civil Rights Commission.
Before: V.J. BRENNAN, P.J. and QUINN and O'HARA,[*] JJ.
Leave to appeal granted, 389 Mich. 778.
QUINN, J.
In case 12003, Eleanor Hoffman filed a complaint with Michigan Civil Rights Commission (hereinafter CRC) alleging an unfair housing practice against Mrs. Clark. The CRC issued a "charge" and sent notice of hearing to Mrs. Clark. Pursuant to MCLA 564.401a; MSA 26.1300(401a), the latter petitioned circuit court for removal of *273 jurisdiction to the circuit court. This petition was granted and the CRC moved to set aside the order granting removal, claiming that the removal statute was unconstitutional. By written opinion, the trial court held the statute was constitutional and denied the motion. On leave granted, the CRC appeals.
Except for the name of the complainant and the dates involved, case No. 12004 is identical to case No. 12003.
In case No. 12294, a complaint was filed with the CRC alleging that the Miskos were guilty of unfair housing practice. The CRC issued a "charge" and sent notice of hearing to the Miskos. The latter petitioned a different circuit court for removal which was granted, and on leave granted, the CRC appeals.
Is MCLA 564.401a; MSA 26.1300(401a) constitutional?
We agree with the trial courts that the statute is constitutional and we affirm. The following analysis which leads us to this conclusion also indicates the various attacks by the CRC on the constitutionality of the statute.
Const 1963, art 5, § 29, provides:
"There is hereby established a civil rights commission which shall consist of eight persons, not more than four of whom shall be members of the same political party, who shall be appointed by the governor, by and with the advice and consent of the senate, for four-year terms not more than two of which shall expire in the same year. It shall be the duty of the commission in a manner which may be prescribed by law to investigate alleged discrimination against any person because of religion, race, color or national origin in the enjoyment of the civil rights guaranteed by law and by this constitution, and to secure the equal protection of such civil rights without such discrimination. The legislature *274 shall provide an annual appropriation for the effective operation of the commission.
"The commission shall have power, in accordance with the provisions of this constitution and of general laws governing administrative agencies, to promulgate rules and regulations for its own procedures, to hold hearings, administer oaths, through court authorization to require the attendance of witnesses and the submission of records, to take testimony, and to issue appropriate orders. The commission shall have other powers provided by law to carry out its purposes. Nothing contained in this section shall be construed to diminish the right of any party to direct and immediate legal or equitable remedies in the courts of this state.
"Appeals from final orders of the commission, including cease and desist orders and refusals to issue complaints, shall be tried de novo before the circuit court having jurisdiction provided by law."
The statute involved is part of the Fair Housing Act of 1968 and provides:
"Within 15 days of receiving the notice of hearing as provided in section 406, the respondent may file with the circuit court for the county in which the complaint is alleged to have taken place a petition for the removal of the proceedings to the circuit court. Upon payment of the required filing fee, the court shall immediately issue an order removing the complaint from the jurisdiction of the civil rights commission. The court shall assume jurisdiction of the proceedings and the civil rights commission shall take no further action in regard to the complaint upon receiving a copy of the court order. The circuit court shall have all the powers and duties in regard to the complaint as are provided in this act to the civil rights commission. The civil rights commission may represent the complainant in the proceedings before the circuit court. Upon a determination by the circuit court that the respondent has not been guilty of an unfair housing practice, the court may order all costs of the proceeding incurred by the respondent to be paid by the complainant."
*275 The italicized portion of the constitutional provision, supra, dealing with rules and regulations was adopted as an amendment to the original civil rights provision of the constitution. The debate on the amendment is found at 2 Official Record, Constitutional Convention 1961, pages 1999-2001, 2189-2196, 2756-2762. This debate confirms our opinion that the language involved means just what it says, namely: a party to a proceeding before the CRC is entitled to a court determination on the complaint in lieu of a commission determination, if he so desires. A delegate to the constitutional convention, who opposed the amendment which provided the language under discussion, appears to be of the same view. We refer to Dr. Nord's article on the 1963 Constitution, 10 Wayne L Rev 309, 337-338 (1964).
We accept the statement in the brief of the CRC, "The source of all commission powers, functions and responsibility is to be found in the language of the document which gives it life. The converse of this last proposition is also true, i.e., the source of all the constraints on commission powers, functions and responsibility is to be found in the language of that document". A constraint on commission powers, functions, and responsibility was written into the constitution by the language, "Nothing contained in this section shall be construed to diminish the right of any party to direct and immediate legal or equitable remedies in the courts of this state". This language does not restrict "legal or equitable remedies" to those existing at the time the constitution was adopted, and we decline to read such a restriction into it. The language permits legislative implementation as was done in MCLA 564.401a, supra.
This statute does not provide for a review of the administrative proceedings. It provides for a transfer *276 of the proceedings from the commission to the courts prior to hearing. The argument of the CRC that the statute violates the doctrine of exhaustion of administrative remedies before seeking judicial review is inapposite. No judicial review is involved. The trial of the complaint is before the court rather than the commission, and the CRC may represent the complainant in the court proceeding.
In view of the right of the CRC to represent the complainant in the court proceeding, the language found in MCLA 564.401a, "the civil rights commission shall take no further action in regard to the complaint upon receiving a copy of the court order", must be construed not to apply to the court proceedings, otherwise the right does not exist, Scott v Budd Co, 380 Mich. 29 (1968). Read thus, the language does not prohibit the CRC from performing any act that is pertinent to the hearing and disposition of the case. This obviates discussion of the CRC's argument relative to injunctions.
The CRC argues that since MCLA 564.401a gives the circuit court "all the powers and duties in regard to the complaint as are provided in this act to the civil rights commission", it confers nonjudicial powers on the court in violation of the separation of powers doctrine. Courts are required to construe statutes in such a manner as to render them constitutional rather than unconstitutional, Bohn Lumber Products Co v Michigan Public Service Commission, 317 Mich. 174 (1947). The statute before us is subject to constitutional construction by restricting the powers and duties of the CRC which pass to the court on grant of removal to judicial powers and duties, namely: to conduct the hearing, decide the complaint, and implement the decision. In context with the entire statute, we *277 find that that is all the language under consideration does.
Having determined that the statute does not offend Const 1963, art 5, § 29, we find further constitutional basis for the statute in Const 1963, art 1, § 2.
Affirmed but without costs.
All concurred.
NOTES
[*] Former Supreme Court Justice, sitting on the Court of Appeals by assignment pursuant to Const 1963, art 6, § 23 as amended in 1968. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/3359606/ | [EDITOR'S NOTE: This case is unpublished as indicated by the issuing court.]
MEMORANDUM OF DECISION
This is an appeal from a decision of the Inland Wetland and Watercourse Commission of the Town of Orange (hereafter called the Commission) which granted a regulated activities permit for filling of land and related construction activities in inland wetlands on a 2.88 acre lot in Orange. The plaintiffs are owners of properties in the general area of the lot involved in the application. The appeal claims that the application did not conform to the Inland Wetlands Regulations, that the map submitted with it was inaccurate, and that the Commission gave no reasons for its decision and failed to consider alternative uses for the property as required by statute and its own regulations. These claims go to the merits of the appeal and cannot be decided until the plaintiffs meet the jurisdictional requirement of proving aggrievement. Another claim in the appeal is that one of the two required legal notices of the public hearing was defective and that this was a jurisdictional defect which invalidated the entire proceeding before the Commission. Technically this issue also does not have to be decided until at least one plaintiff proves aggrievement, but in the interest of judicial economy it will be decided by the Court since it has been briefed and can be raised in later proceedings to challenge the permit issued by the Commission even if this Court dismisses this appeal. Defects in publication of the legal notice are jurisdictional and several cases have held that this issue can be raised in subsequent proceedings, and even if no timely appeal was taken. Smith v. F. W. Woolworth Co., 142 Conn. 88, 93, 94
(declaratory judgment action); Hutchison v. Zoning Board of CT Page 3308 Appeals, 138 Conn. 247, 251 (subsequent appeal) DiCamillo v. Clomiro, 174 Conn. 351, 352, 353.
The statutory requirements for notice of public hearings on applications to inland wetlands agencies under section22a-42a of the General Statutes are similar to those for zoning commissions and zoning boards of appeals under Chapter 124 and planning commissions under Chapter 126 of the General Statutes. Section 22a-42a(c) C.G.S. contains the notice requirements for a public hearing on an application to an inland wetlands agency for a regulated activities permit. It provides: "notice of the hearing shall be published at least twice at intervals of not less than 2 days, the first not more than 15 days and the second not fewer than 10 days, and the last not less than 2 days before the date set for the hearing in a newspaper having a general circulation in each town where the affected wetland and watercourse, or any part thereof is located." In this case the first of the two legal notices was published on Monday, October 29, 1990 for a public hearing on Tuesday, November 13, 1990. The plaintiffs claim that this does not comply with the requirement in the statute that the first legal notice must be published "not more than 15 days" before the hearing date, and that publication here was one day too early.
There are apparently no reported decisions on how the statutory time limits are computed to set the earliest date for publication of the first of the two required legal notices under section 22a-42a(c) C.G.S. or similar provisions with comparable phrasing in the other land use notice statutes, sections 8-3(a), 8-3c(b), 8-7 and 8-26 of the General Statutes. The reported decisions under those statutes cover claims that the first or second legal notice was published too close to the public hearing date, a different issue.
It is well established that compliance with the notice requirements is a prerequisite to any valid action by the municipality and that failure to give proper notice is a jurisdictional defect rendering the action of the municipality null and void. Aurora v. Zoning Board of Appeals, 153 Conn. 623, 625; Slagle v. Zoning Board of Appeals, 144 Conn. 690, 693; Smith v. F.W. Woolworth Co., supra, 94; Lunt v. Zoning Board of Appeals, 150 Conn. 532,536; Jarvis Acres, Inc. v. Zoning Commission, 163 Conn. 41,44; Cocivi v. Plan Zoning Commission, 20 Conn. App. 705,707. In Aurora v. Zoning Board of Appeals, supra, 625, the notice was defective because the two publications did not comply with mandated publication intervals. Where publication of the legal notice must occur "not less than 10 CT Page 3309 days. . . before such hearing" it was held in Treat v. Town Plan Zoning Commission, 145 Conn. 136, 139, that the statute required that there be ten full or clear days before the hearing. The requirement at the first publication be "not fewer than 10 days" before the public hearing is similar to the requirement that publication occur "at least" or "not less than" ten days before the public hearing which requires that ten days must intervene and both terminal days are excluded. DiCamillo v. Clomiro, supra, 353; Lunt v. Zoning Board of Appeals, supra, 536; Treat v. Town Plan Zoning Commission, supra, 139, citing Austin Nichols Co. v. Gillman, 100 Conn. 81, 85. This follows the concept that the day of the act from which a future time is to be ascertained is to be excluded from the computation. Lamberti v. Stamford,131 Conn. 396, 397, 398. This means that the last possible day for publication of the first legal notice would have been the 11th day prior to the date of the hearing, namely November 2nd. The first legal notice also could be published not more than 15 days before the hearing date of November 13. Accordingly, if the hearing date is excluded, the 15th day before November 13th, namely October 29, would be the first date on which the first legal notice could be published. Otherwise the 5 day window for publication given in the statute would be compressed into 4 days.
Section 22a-42a(c) itself also supports the defendants' argument that the date of the public hearing is excluded in making the 15 day computation since the statute provides for the first publication "not more than 15 days. . . before the date set for the hearing." (emphasis added). Where a statute has such a requirement requiring certain action to be taken before a date, then the time period does not include that day. Atwater Co. v. Bowers, 74 F.2d 253, 255 (2nd Cir. 1934). See also Brooklyn Trust Co. v. Town of Hebron,51 Conn. 22, 27, 28, holding that when a statute required notice of a town meeting to be given at least "5 days inclusive before the meeting is to be held" that this phrase meant 5 days inclusive of the day on which the notice is posted but exclusive of the date on which the meeting was to be held; the phrase "before the meeting is to be held" meant before the day on which the meeting was to be held. Here publication of the legal notice on October 29 was the fifteenth day before the date of the public hearing, November 13, 1990, and was the earliest date on which the first legal notice could be published. Fourteen days intervened between the date of publication and the date of the public hearing and the 15 day period is met if the terminal day, the date of the public hearing, is excluded. The notice was timely.
In order to have standing to appeal from a decision of CT Page 3310 an inland wetlands agency the appellant must prove aggrievement or ownership or occupation of land which abuts any portion of the land or is within a radius of 90 feet of the wetland or watercourse involved in the order, decision or action of the inland wetlands agency. Section 22a-43 (a) C.G.S. Four of the five plaintiffs testified and deeds to their properties introduced at the trial proved ownership of land in the general vicinity of the property involved in the application. However, none of the plaintiffs' properties abut or are within a radius of 90 feet of the subject property. Neil Hathaway owns land at 675 Orange Center Road which is 240 feet from the subject property. Timothy and Susan Riordan own land at 675 Ridge Road, 450 feet from the subject property on Old Grassy Hill Road. Louis Savenelli lives on the same road, but his property is 275 feet away, and Eleanor White owns land 575 feet from the subject property. Since none of the plaintiffs have proven statutory aggrievement, at least one plaintiff must prove classical aggrievement in order to maintain the appeal. Nowicki v. Planning and Zoning Board, 148 Conn. 492, 495.
Unless plaintiffs own land abutting or within the separation distances in the appeal statute, mere proximity to land involved in the Agency's decision does not prove classical aggrievement, and an appellant has to meet the two part aggrievement test. Olsen v. Inland Wetlands Commission,6 Conn. App. 715, 718; Walls v. Planning and Zoning Commission, 176 Conn. 475, 476; Hughes v. Town Planning and Zoning Commission, 156 Conn. 505, 508; Vose v. Planning and Zoning Commission, 171 Conn. 480, 484.
Proof of classical aggrievement requires compliance with a two part test: first, the party claiming aggrievement must successfully demonstrate a specific, personal and legal interest in the subject matter of the decision as distinguished from a general interest, such as is the concern of all members of the community as a whole; second, the party claiming aggrievement must successfully establish that this specific personal and legal interest has been specially and injurious affected by the decision. Walls v. Planning and Zoning Commission, supra, 478; Olsen v. Inland Wetlands Commission, supra, 718; Sheridan v. Planning and Zoning Board, 159 Conn. 1, 10; Schwartz v. Town Plan and Zoning Commission, 168 Conn. 20, 25; Mystic Marinelife Aquarium, Inc. v. Gill, 175 Conn. 483, 493. The fact that the plaintiffs appeared before the defendant Commission does not prove aggrievement for purposes of an appeal in the Superior Court. Olsen v. Inland Wetlands Commission, supra, 718; Bakelaar v. West Haven, 193 Conn. 59, 66. Aggrievement is a question of fact and the plaintiff has the burden of proving CT Page 3311 that fact. Olsen v. Inland Wetlands Commission, supra, 718; Hartford Distributors, Inc. v. Liquor Control Commission,177 Conn. 616, 622. Aggrievement is established if there is a possibility as distinguished from a certainty, that some legally protected interest has been adversely affected. Hall v. Planning Commission, 181 Conn. 442, 445; Huck v. Inland Wetlands Watercourses Agency, 203 Conn. 525, 530; Glendinning v. Conservation Commission, 12 Conn. App. 47, 53. However, mere generalizations and fears of the effects of the Agency's decision do not establish aggrievement. Walls v. Planning and Zoning Commission, supra, 478; Mystic Marinelife Aquarium, Inc. v. Gill, supra, 497; Sheridan v. Planning Board, supra, 14; Hughes v. Town Planning and Zoning Commission, supra, 508.
Evidence at the trial amounted to nothing more than this. Aside from the fact that the plaintiffs live in the general vicinity of the subject property and have trespassed on it occasionally, it is questionable whether they have an interest in the subject matter of the decision different from other property owners in the area of Old Grassy Hill Road. Even if they do, they have not met their burden of proof that there is a realistic possibility that development of the subject property in accordance with the inland wetlands permit approved by the Commission would specially and injuriously affect the plaintiffs or their property rights. There was evidence of occasional flooding on the Riordan property from a stream that flows across it, and that the high water table in the area may have some effect on the leaching fields or septic systems on properties of some of the plaintiffs. There is no evidence however that improvements on the subject property would increase the drainage problems on the plaintiffs' properties. In fact evidence in the record from the public hearing shows that the grading and related improvements would actually reduce runoff. A two and one half foot high earth berm and a temporary storm water impoundment area is proposed.
Maps in the record do not show the brook crossing the subject property, and in fact show a relocated brook on adjacent land. There is no reliable engineering testimony that drainage, water runoff or other conditions on the subject property would affect the properties of any of the plaintiffs. There was also no evidence showing depreciation of their property values if construction proceeds in accordance with the regulated activities permit issued by the Commission. The situation here is similar to Walls v. Planning and Zoning Commission, supra, where there were unsubstantiated fears and mere generalizations that a drainage system in a proposed subdivision might affect the CT Page 3312 property of nearby plaintiffs. None of the plaintiffs have proven aggrievement and they are not entitled to review of the merits of their appeal.
The appeal is dismissed.
Robert A. Fuller, Judge | 01-03-2023 | 07-05-2016 |
https://www.courtlistener.com/api/rest/v3/opinions/1681428/ | 966 So. 2d 398 (2007)
WATSON
v.
STATE.
No. 2D06-5304.
District Court of Appeal of Florida, Second District.
October 5, 2007.
Decision without published opinion. Affirmed. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1748661/ | 713 N.W.2d 269 (2005)
269 Mich. App. 233
DETROIT LEASING COMPANY, Plaintiff-Appellant,
v.
CITY OF DETROIT, Defendant-Appellee.
Docket No. 261006.
Court of Appeals of Michigan.
Submitted September 7, 2005, at Detroit.
Decided December 13, 2005, at 9:20 a.m.
Released for Publication March 2, 2006.
*271 Brad B. Aldrich, PLLC (by Brad B. Aldrich), Detroit, for the plaintiff.
Ruth C. Carter, Corporation Counsel, and Joanne D. Stafford, Supervising Assistant Corporation Counsel, Detroit, for the defendant.
Before: HOEKSTRA, P.J., and GAGE and WILDER, JJ.
PER CURIAM.
Plaintiff appeals as of right an order denying its motion for summary disposition and granting summary disposition in favor of defendant in this quiet title action. We affirm.
Plaintiff argues that the trial court erred by denying its motion for summary disposition based on plaintiff's failure to comply with MCL 211.79a, and erred further by granting defendant's motion for summary disposition on the basis of the court's holding that the property was not "abandoned." We disagree.
The trial court based its ruling on MCR 2.116(C)(10). We review de novo the trial court's decision regarding summary disposition. Roberts v. Mecosta Co. Gen. Hosp., 466 Mich. 57, 62, 642 N.W.2d 663 (2002). This case involves questions of statutory interpretation, which are also reviewed de novo. Id. A motion for summary disposition under MCR 2.116(C)(10) tests the factual support of a plaintiff's claim. MacDonald v. PKT, Inc., 464 Mich. 322, 332, 628 N.W.2d 33 (2001). "In reviewing a motion for summary disposition brought under MCR 2.116(C)(10), we consider the affidavits, pleadings, depositions, admissions, or any other documentary evidence submitted in [the] light most favorable to the nonmoving party to decide whether a genuine issue of material fact exists." Singer v. American States Ins., 245 Mich. App. 370, 374, 631 N.W.2d 34 (2001). Summary disposition is appropriate only if there is no genuine issue of material fact and the moving party is entitled to judgment as a matter of law. MacDonald, supra at 332, 628 N.W.2d 33.
Plaintiff's argument, that it complied with MCL 211.79a, is without merit. An action to quiet title to abandoned property is governed by MCL 211.79a. Taken together, MCL 211.79a(1) and MCL 211.79a(4) require a tax deed holder to perform numerous steps in order to obtain quiet title to abandoned property, one of which is providing the circuit court with "[a]n affidavit from the county treasurer certifying to [sic] the lack of payment within the 90-day redemption period." MCL 211.79a(1)(f)(iv). Here, plaintiff attempted to satisfy this requirement by attaching to its complaint a document entitled "Wayne County Treasurer Certificate of Forfeiture of Real Property," dated April 15, 2002, and signed by "Raymond J. Wojtowicz, *272 Wayne County Treasurer." The document was not notarized. Defendant argues that the certificate does not constitute a valid affidavit sufficient to satisfy MCL 211.79a(1)(f)(iv).
This Court's interpretation of MCL 211.79a is an issue of first impression. However, this Court interpreted a similar section of the statute, MCL 211.140, in Equivest Ltd. Partnership v. Foster, 253 Mich.App. 450, 454, 656 N.W.2d 369 (2002). In Equivest Ltd. Partnership, this Court concluded that "`strict compliance with the tax sale notice provisions [of MCL 211.140] is required,'" and that "`[a]ctual notice is not enough to satisfy the statute's notice requirements'" "`because[, in part,] the effect of proceedings under the tax law is to divest the true owners of their title to property....'" Id. at 454-455, 656 N.W.2d 369, quoting Brandon Twp. v. Tomkow, 211 Mich.App. 275, 284, 535 N.W.2d 268 (1995), and Andre v. Fink, 180 Mich.App. 403, 407-408, 447 N.W.2d 808 (1989). This Court further noted that "within the realm of tax sales of real property, strict compliance with statutory requirements is an overriding policy." Equivest Ltd. Partnership at 457, 656 N.W.2d 369, citing Andre, supra at 407-408, 447 N.W.2d 808. We adopt this reasoning and hold that strict compliance with MCL 211.79a is also required.
For a document to constitute a "valid affidavit," it must be: "(1) a written or printed declaration or statement of facts, (2) made voluntarily, and (3) confirmed by the oath or affirmation of the party making it, taken before a person having authority to administer such oath or affirmation." Holmes v. Michigan Capital Medical Ctr., 242 Mich.App. 703, 711, 620 N.W.2d 319 (2000). Thus, pursuant to Holmes, a document that is not notarized is not a "valid affidavit." Here, the certificate at issue was not notarized. Therefore, it was not an affidavit sufficient to satisfy MCL 211.79a(1)(f)(iv).
Plaintiff, for the first time on appeal, attaches a notarized "Wayne County Treasurer Affidavit of Non-Payment of Taxes," dated March 2, 2005, and signed by a supervisor at the Wayne County Treasurer's office. Plaintiff's attempt to provide the requisite affidavit for the first time to this Court constitutes an expansion of the record, and a party may not expand the record on appeal. Sherman v. Sea Ray Boats, Inc., 251 Mich.App. 41, 56, 649 N.W.2d 783 (2002). Moreover, plaintiff fails to cite any legal authority in support of its argument in this respect. Although plaintiff, without analysis or citation of legal authority, argues that manifest injustice would result if this Court refuses to consider the affidavit, "[a] party may not simply announce a position and leave it to this Court to discover and rationalize the basis for the party's claim." Conlin v. Scio Twp., 262 Mich.App. 379, 384, 686 N.W.2d 16 (2004). The trial court correctly denied plaintiff's motion for summary disposition and granted defendant's motion for summary disposition. MCR 2.116(C)(10).
Plaintiff's argument that the trial court erred by granting defendant's motion for summary disposition also fails. Plaintiff argues that MCL 211.79a(4)(d) provides defendant with an "escape clause" that is unfair to tax deed holders. Specifically, plaintiff challenges the fairness of this section's provision that allows parties with an interest in the property to stop the foreclosure process through the simple use of an affidavit showing that the property is not abandoned.
Defendant contends that this argument is not preserved for appeal because plaintiff did not raise the argument in the trial court and the trial court did not decide *273 the issue. Generally, to preserve an issue for appellate review, the issue must be raised before and decided by the trial court. Fast Air, Inc. v. Knight, 235 Mich. App. 541, 549, 599 N.W.2d 489 (1999). Defendant correctly observes that plaintiff did not make this argument in the trial court and that the trial court did not decide the issue. However, this Court may disregard the preservation requirement for issues of law where all necessary facts have been presented. Steward v. Panek, 251 Mich.App. 546, 554, 652 N.W.2d 232 (2002). The interpretation of a statute is a question of law. Eggleston v. Bio-Medical Applications of Detroit, Inc., 468 Mich. 29, 32, 658 N.W.2d 139 (2003). Further, all the necessary facts have been presented because this Court need only examine the procedural steps taken by the parties pursuant to MCL 211.79a, which are well documented in the record before this Court. Thus, we will review this issue.
The plain language of the MCL 211.79a(4) provides that property will not be deemed "abandoned" if a party with a legal interest in the property, before the judgment of foreclosure is entered, provides an affidavit stating its intention to occupy the property. That section provides, in pertinent parts:
(4) For purposes of this section, property shall be considered abandoned if all of the following requirements are satisfied:
* * *
(d) The owner or any person with a legal interest in the abandoned property, before the judgment of foreclosure is entered, does not give a written affidavit to the tax deed holder and record a duplicate original in the office of the register of deeds of the county in which the abandoned property is located stating that the owner or person with a legal interest in the abandoned property is occupying or intends to occupy the abandoned property. [MCL 211.79a.]
In this case, defendant provided an affidavit under this subsection that was recorded with the register of deeds and that stated defendant's intention to occupy the property for the upcoming expansion of City Airport. Therefore, the property cannot be deemed "abandoned" under MCL 211.79a(4)(d) as a matter of law. Plaintiff's claim fails as a matter of law under the clear wording of the statute.
Plaintiff challenges the fairness of this provision to tax deed holders. The courts are not empowered to rework the statute; rather, it is our responsibility to interpret the statute as written. Elezovic v. Ford Motor Co., 472 Mich. 408, 425, 697 N.W.2d 851 (2005). The wisdom of a statute is for the determination of the Legislature and the law must be enforced as written. Smith v. Cliffs on the Bay Condo. Ass'n, 463 Mich. 420, 430, 617 N.W.2d 536 (2000). A court may not inquire into the knowledge, motives, or methods of the Legislature, Fowler v. Doan, 261 Mich. App. 595, 599, 683 N.W.2d 682 (2004), and may not impose a construction of a statute that is based on a policy decision different from that chosen by the Legislature, Robertson v. DaimlerChrysler Corp., 465 Mich. 732, 752, 641 N.W.2d 567 (2002).
Plaintiff further argues that the time frames set forth in MCL 211.79a(4)(d) are contradictory to the time frames and the intent of MCL 211.79a(1). We disagree. MCL 211.79a(1)(f) provides that "if the abandoned property is not redeemed... within 90 days of service of the notice," the party with a tax deed interest may "bring an action in the circuit court...." MCL 211.79a(4)(d) provides that a party with an interest in the property may provide an affidavit anytime "before *274 the judgment of foreclosure is entered...." Rather than conflicting with MCL 211.79a(1)(f), MCL 211.79a(4)(d) instead simply provides defendant a final opportunity to demonstrate that the property is not abandoned, thereby avoiding foreclosure before a judgment is entered. The trial court correctly granted summary disposition in defendant's favor. MCR 2.116(C)(10).
Affirmed. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/2557715/ | 8 N.Y.3d 996 (2007)
THE PEOPLE OF THE STATE OF NEW YORK, Respondent,
v.
WINSTON GAJADHAR, Appellant.
Court of Appeals of the State of New York.
Submitted May 21, 2007.
Decided June 5, 2007.
Motion for assignment of counsel granted and Steven Banks, Esq., the Legal Aid Society, 199 Water Street, New York, NY 10038 assigned as counsel to the appellant on the appeal herein. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1321963/ | 254 Ga. 637 (1985)
332 S.E.2d 654
BUTLER
v.
THE STATE.
41735.
Supreme Court of Georgia.
Decided July 24, 1985.
Alden W. Snead, for appellant.
Robert E. Wilson, District Attorney, John H. Petrey, Robert E. Statham III, Robert G. Morton, Assistant District Attorneys, Michael J. Bowers, Attorney General, Dennis R. Dunn, Senior Attorney, for appellee.
MARSHALL, Presiding Justice.
The appellant, Ronald David Butler, and two co-defendants, Bruce Edward Gurvin and Anthony Terrell Head, were indicted for the murder and armed robbery of Henry Ballard. The jury returned a verdict finding the appellant guilty of both charges. At the sentencing phase, the jury returned the death sentence, finding that the murder was committed while the offender was engaged in the commission of another capital felony. OCGA § 17-10-30 (b) (2). The jury also found that the offenses of murder and armed robbery were outrageously and wantonly vile, horrible and inhuman in that they involved torture and an aggravated battery to the victim. OCGA § 17-10-30 (b) (7). Subsequently the appellant was given the death penalty for the murder conviction, and he was sentenced to life imprisonment for the armed robbery conviction. This case is here on direct appeal, for review under the Unified Appeal Procedure (252 Ga. A-13 et seq.), and for mandatory review of the death penalty imposed. For reasons which follow, we reverse the convictions and sentences, and we remand for further proceedings.[1]
In the early morning hours of October 18, 1983, the victim, Henry Ballard, who was the service station attendant at a Thoni service station on Candler Road in Decatur, Georgia, was found in a chair inside the back portion of the service station. This portion of the service station had been converted into a residence for Henry Ballard and Phyllis Humble, who was his girl friend. The victim, Ballard, was found bleeding profusely from the head and neck area, and he was pronounced dead. A large stick and a broken pot, both of which had blood stains on them, were recovered near the victim's body. The following day, a $300 loss from the robbery was reported.
On October 24, a man named Stephen Tiller called the DeKalb County Police Department and gave the police officer with whom he spoke the name of Russell O'Neal Thomas. Tiller and Thomas both came to the police department, and Investigator John Cunningham interviewed both of them. Thomas stated that on October 22 he had been speaking with the appellant, and the appellant told Thomas in a bragging fashion that he, Head, and Gurvin had committed the murder at the Thoni station. Thomas related a number of details the appellant had told him concerning the crimes. According to Investigator Cunningham, these details were so precise that the information had *638 to have come from a person who was present at the scene of the crimes. Investigator Cunningham checked the backgrounds of Tiller and Thomas and determined that they had no arrest records. He then obtained arrest warrants for the appellant, Gurvin, and Head.
The appellant was arrested at 11:00 p. m. on October 24, 1983, and he was taken to police headquarters for questioning. After being informed of a statement from co-defendant Gurvin implicating the appellant in the crimes, the appellant gave a statement to the police admitting that he, Gurvin, and Head had robbed the Thoni station and killed the victim Ballard.
More specifically, the appellant stated that: He approached the victim, asked him for a pack of Kool cigarettes, and then hit him in the stomach with his fist. Head and Gurvin then pulled the victim into the back room and put him in a chair. Gurvin then picked up the stick and began hitting the victim in the head with it. The appellant got the keys to the safe, opened the safe, and took out two envelopes containing money. The appellant had a metal object from a telephone pole, i.e., a telephone spike, in his pocket. Head took the spike, and he and Gurvin began hitting the victim in the head with it. The appellant then got a knife and stabbed the victim in the chest with it. The appellant and the two co-defendants left the station and split the money, which was over $90 each. The appellant further stated that he knew that what he had done was wrong, that it had been on his conscience, and that he was sorry for what he had done.
After being questioned by police, co-defendant Gurvin had pointed out a vacant lot to police investigators near the scene of the crime. Gurvin told the police that he and his accomplices had disposed of the knife, telephone spike, and safe keys in this lot after the crimes had been committed. The knife, telephone spike, and keys were recovered by the police from this vacant lot. Type A blood was found on the butcher knife, which was the same type blood as the victim's. A small quantity of what could have been a blood stain was found on the telephone spike. Dr. Larry Peterson, a microanalyst from the State Crime Laboratory, testified that hair found on the knife had the same microscopic characteristics as hair of the victim.
Charles Dukes, whose residence is near the Thoni station in Decatur, testified that on the day before the homicide, the appellant and the two co-defendants were at the witness' house, and he overheard them talking about robbing somebody and beating him to death.
Gurvin pleaded guilty to the charges of armed robbery and murder, and he received two consecutive life sentences.[2] He testified reluctantly *639 on behalf of the state. He testified that the appellant suggested to him and Head that they rob the Thoni station, and that the appellant stated that he might have to kill the victim because the victim knew the appellant. Gurvin testified that he did not know the victim. Gurvin further testified that it was the appellant who had hit the victim with the telephone spike and the stick. In material part, Gurvin's remaining testimony was consistent with Charles Dukes' testimony concerning the appellant's, Gurvin's and Head's conversation at Duke's house; and Gurvin's remaining testimony was also consistent with the appellant's statement as to the facts of the criminal spree, including the fact that the appellant had stabbed the victim in the chest.
The victim's girl friend, Phyllis Humble, was initially a suspect because of her violent relationship with the victim, which included a prior incident in which she had stabbed the victim in the abdomen. The evidence as to Humble showed that during the nine months prior to the victim's death, he and Humble had engaged in two violent confrontations. In January of 1983, Humble stabbed the victim while he was reclining on a couch at the Thoni station after they had had an argument. In September of 1983, during the course of an argument Ballard had threatened to kill Humble and he threw a hammer through the rear window of her car. There was also testimony by Humble that the victim had beaten her "quite a while prior to [the homicide]." The evidence as to Humble further shows that she had been with the victim during the days immediately preceding the murder/armed robbery, although at the time these crimes took place she was at work. Following commission of the crimes, Humble turned over to the police the victim's wallet and $260 in cash.
One of the defense witnesses was Michael Miller, who testified that on October 3, 1983, 10 days before the crimes in issue in this case, he and Larry West had robbed the Thoni station pursuant to a plan devised by the victim to defraud the station by staging the robbery. Both Miller and West were convicted of armed robbery for this offense.
During the course of the trial, the trial judge struck the evidence concerning Phyllis Humble, the evidence showing the prior robbery of the victim at the Thoni station, and other evidence showing that the victim had been on probation for a criminal offense prior to his death. The appellant complains of the action of the trial judge in striking this evidence.[3] We conclude that the trial judge did err in striking the *640 evidence as to Humble, but not the remaining evidence.
The question presented is whether the evidence as to Humble was inadmissible on the ground that it was irrelevant. In resolving the question of whether this evidence was relevant, we must determine whether it tended to establish the possibility that Humble was responsible for the commission of the crimes and thereby tended to establish the appellant's innocence. Although the question is close, we conclude that the evidence as to Humble did tend to establish the possibility that Humble was responsible for committing the crimes. Therefore, this evidence was relevant and admissible.
As to the question concerning the admissibility of the evidence that the victim was on probation, the general rule in Georgia is that the character of the victim is irrelevant and inadmissible in a murder trial. OCGA § 24-2-2; Wiseman v. State, 249 Ga. 559 (6) (292 SE2d 670) (1982) and cits.; Bryant v. State, 249 Ga. 242 (2) (290 SE2d 75) (1982) and cits. Thus, the fact that the victim was on probation for a criminal offense was irrelevant and inadmissible.
The fact that the victim staged a robbery of the station on a prior occasion was not admissible, because, under the facts here, it did not tend to establish the appellant's innocence, and because, as previously stated, the character of the victim is generally inadmissible.
Because the evidence concerning Humble was ordered stricken, the appellant's convictions and sentences must be reversed. However, we do note that, viewing the record as a whole, a rational trier of fact could have found the appellant guilty beyond a reasonable doubt. *641 Jackson v. Virginia, 443 U. S. 307 (99 SC 2781, 61 LE2d 560) (1979). The evidence also supports the jury's findings of the statutory aggravating circumstances beyond a reasonable doubt. See Bullington v. Missouri, 451 U. S. 430 (101 SC 1852, 68 LE2d 270) (1981); Jackson v. Virginia, supra.
Judgment reversed. All the Justices concur.
NOTES
[1] The murder occurred on October 18, 1983. The date of conviction was May 4, 1984. The notice of appeal was filed on October 12, 1984. The transcript was filed on November 16, 1984. The appeal was docketed in this court on January 7, 1985. The case was argued on February 5, 1985.
[2] Charges against co-defendant Head have been dismissed, because the only evidence against him consists of co-defendant Gurvin's testimony.
[3] In addition to this complaint, the appellant has filed 30 other enumerations of error. As to these, we conclude as follows: (1) The trial judge did not err in ruling that there existed probable cause for the appellant's arrest. In determining whether probable cause for the arrest existed the issuing magistrate was authorized to rely on oral testimony of the police officer as well as written information in the affidavit for the arrest warrant. Devier v. State, 253 Ga. 604 (5) (323 SE2d 150) (1984) and cits. The informant's tip was of sufficient reliability to satisfy the totality-of-the-circumstances test of Illinois v. Gates, 462 U. S. 213 (103 SC 2317, 76 LE2d 527) (1983). (2) A trial judge is not required to have a Jackson v. Denno hearing prior to trial. Jarrell v. State, 234 Ga. 410 (3) (216 SE2d 258) (1975). Accord James v. State, 223 Ga. 677 (1) (157 SE2d 471) (1967). The trial court's ruling here that the appellant's statement to police was freely and voluntarily given was not clearly erroneous. Moon v. State, 253 Ga. 74 (2) (316 SE2d 464) (1984) and cit. (3) It cannot be said that the trial court abused its discretion in denying appellant's motions for funds to hire an investigator and expert witnesses. Patterson v. State, 239 Ga. 409 (3) (238 SE2d 2) (1977). Cf. Patterson v. State, 238 Ga. 204 (232 SE2d 233) (1977). (4) The trial court did not err in ruling that since the evidence indicated that the appellant was not indigent, he was not entitled to funds to secure the attendance at trial of an out-of-state witness. Cf. United States v. Barker, 553 F2d 1013 (6th Cir. 1977) and cits. At the time of this ruling, the appellant was represented by appointed counsel. However, the Public Defender was subsequently appointed to represent him. (5) The photographs showing the mutilation of the victim taken prior to performance of the autopsy were properly admitted. (6) The trial judge lacked the authority to order the nolle prosequi of the charges against co-defendant Head. See OCGA § 17-8-3; Williams v. State, 126 Ga. App. 302 (1) (190 SE2d 807) (1972); Price v. Cobb, 60 Ga. App. 59, 61 (3 SE2d 131) (1939). (7) The enumerations of error addressed to the post-trial proceedings conducted before various judges in the DeKalb Superior Court are moot. (8) We find no merit in the remaining enumerations of error, which consist for the most part of evidentiary rulings of the trial court. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1657510/ | 13 Neb.App. 495
LESLIE K. WILD, APPELLEE,
v.
BRIAN P. WILD, APPELLANT.
No. A-04-954.
Nebraska Court of Appeals.
Filed May 10, 2005.
Stephanie Weber Milone for appellant.
Carll J. Kretsinger, P.C., for appellee.
IRWIN, CARLSON, and MOORE, Judges.
IRWIN, Judge.
I. INTRODUCTION
Brian P. Wild appeals from an order of the district court for Sarpy County which granted his ex-wife Leslie K. Wild's complaint for removal of the parties' minor child, Amber Lynn Wild, from Nebraska to Ohio. On appeal, Brian challenges the district court's findings that Leslie demonstrated a legitimate reason for removal and that removal is in Amber's best interests and contests the district court's failure to change custody or to award Brian attorney fees. Upon our de novo review of the record, we find that the district court abused its discretion in finding that Leslie satisfied her burden of proof with respect to both demonstrating a legitimate reason for removal and showing that removal is in Amber's best interests. As such, we reverse that finding of the district court. We find no abuse of discretion by the district court concerning either Brian's request for a change of custody or his request for attorney fees. As such, we affirm those rulings of the district court.
II. BACKGROUND
Brian and Leslie were married on April 3, 1993, in Florida. The record indicates that Brian was a member of the U.S. Air Force during the marriage and continues to be at this time, stationed at Offutt Air Force Base in Bellevue, Nebraska (Offutt). Leslie was employed as a civil service employee working at Offutt during the latter portion of the marriage. Amber was the only child born to the parties during the marriage, and her date of birth is October 12, 1994. The marriage was dissolved by a decree entered on February 20, 2003. The record indicates that the decree incorporated a "settlement agreement to all issues presented to include custody, visitation and support."
In the dissolution decree, the district court found that both Brian and Leslie were fit and proper persons to be awarded custody of Amber, but that it was in Amber's best interests for custody to be awarded to Leslie. Brian was awarded visitation rights. Brian was also ordered to pay child support. In addition, the decree contained the following provision, which contemplates the possibility of either Brian's or Leslie's being relocated by the military because of their employment:
28. CHANGE OF CIRCUMSTANCES: That [Leslie] is a civil service employee of the United States Air Force; and, [Brian] is a military member of the United States Air Force; and, both parties acknowledge that they are both subject to being reassigned by the Air Force to another military location outside of the State of Nebraska; and, as such, both parties agree that if either party should be so reassigned by the United States Air Force outside of the State of Nebraska, that such reassignment will constitute a change of circumstance upon which either party may seek a modification of the provisions of this decree as same would pertain [to] the visitation rights of [Brian] with [Amber].
On October 7, 2003, Brian filed an application and affidavit for citation in contempt. In the filing, Brian alleged that Leslie had taken Amber to Idaho on vacation from "June 21-29, 2003, and [from] July 23-August 3, 2003," that those dates conflicted with dates on which Brian was to have had visitation in accordance with the decree, that Brian had notified Leslie that he was opposed to her taking Amber on vacation on those dates, and that Leslie's nonetheless taking Amber on vacation on those dates was "in defiance of the provisions" of the decree. On October 7, the district court issued an order commanding Leslie to appear and show cause why she should not be held in contempt. The record does not reflect any further disposition of Brian's application.
On November 7, 2003, Leslie filed a motion for leave to remove Amber from Nebraska. In the motion, Leslie alleged that there was uncertainty about her future employment at Offutt, that she had obtained a position with a company located at Wright-Patterson Air Force Base in Ohio, that the new position would pay less than her existing position but would provide for upward mobility, that the housing available in Ohio would be an improvement over her housing in Nebraska, that the schools would be "equal to or better than" Amber's school in Nebraska, that Amber had stated a desire to move to Ohio, and that removal would be in Amber's best interests. On November 19, Leslie filed a notice of withdrawal of the motion to remove, indicating that the position to which she had been hired in Ohio had been eliminated "due to funding."
On April 23, 2004, Leslie filed a complaint again requesting leave to remove Amber from Nebraska to Ohio. Leslie alleged that she had "been offered and ha[d] accepted a position of employment to begin June 1, 2004," with a company located in Dayton, Ohio. Leslie alleged that the new position would provide a "substantial increase in salary" over her position in Nebraska. Leslie made no allegations concerning "upward mobility" as in her previous request to remove Amber to Ohio. Leslie sought modification of child support and visitation as well as permission to remove Amber to Ohio. On May 25, Brian filed an answer and counterclaim. Brian sought to have the court deny the request to remove Amber to Ohio, alleged that Leslie should be equitably estopped from removing Amber to Ohio, and sought a change in custody.
On June 30, 2004, the district court heard testimony and received evidence on Leslie's complaint and Brian's answer and counterclaim. Leslie testified that she had already moved to Ohio, although the record indicates that Amber had remained in Nebraska with Brian pending resolution of the case. When asked why she "ch[o]se to go to Ohio," Leslie responded:
I chose I made a decision about last June or July [2003] that my relationship with [my fiance] was getting serious. My job [at Offutt], there w[ere] a lot of changes coming down, rumor has it that [my employer] here in Omaha will close within the next two to three years. There was a lot of uncertainty with whether or not it was going to be open. My career progression was at its highest level as a GS-9, and I wanted to to be able to progress in the career that I've chosen in security.
Leslie acknowledged that it was "basically a rumor" that her position at Offutt might be eliminated or moved, and she testified that her office "was going to go through a restructure." Leslie testified that the staff of the office she worked in at Offutt was "slowly but surely shrinking" and that "[t]here was a lot of work going away." However, she further testified that the job she did at Offutt was, as of the date of the hearing, still being done at Offutt, although her position had been filled by somebody else.
Leslie indicated that her new job in Ohio provided a pay increase of approximately $7,000 per year, before taxes, over the position she had in Nebraska. Leslie testified, however, that if she were allowed to remove Amber to Ohio, she would be willing to be responsible for paying to transport Amber back to Nebraska for visitation with Brian "eight to ten" times per year. Leslie testified that she would accompany Amber on flights back to Nebraska, at a likely cost of $269 to $325 per ticket, those 8 to 10 times per year. The cost to Leslie of such transportation would thus be approximately between $4,300 and $6,500 per year, depending on the cost of the tickets and the number of trips.
Leslie testified that her former job in Nebraska was "part of civil service," that she received vacation time each pay period, that she received support toward medical and dental expenses, that she had flexibility with regard to hours, and that she had the opportunity to work overtime. Leslie testified that her new job in Ohio was an entry-level position with a security company working at Wright-Patterson Air Force Base and that her new job was a position from which she could be terminated at any time.
Leslie testified that she and Amber lived in a "rather big apartment" in Nebraska and that the apartment complex had no playground, although there was a school playground located down the street for Amber. In Ohio, Leslie had moved in with her fiance, and she testified that he has a three-bedroom home with a "good-sized backyard [and] a small front yard for Amber to play in."
The record indicates that Amber has some special education needs associated with a "serious reading problem." Amber's school in Nebraska had placed her in a special education program to address the reading problem. Leslie testified that she had not checked into the availability of any special reading programs for Amber in Ohio. Leslie testified that she did not know of any educational advantages that would be made available to Amber by removing her to Ohio and that Leslie "ha[d] not had a chance to look at [such advantages] yet." Leslie did not know what school Amber would attend in Ohio, although one school was located near Leslie and her fiance's home, and she did not know whether Amber's school would utilize a "year-round" calendar or a "traditional" calendar; the record indicates that both calendars are available in the area Leslie proposed to remove Amber to.
Brian has another daughter, from a prior relationship Amber's 15-year-old half sister, Andrea Wild. Brian has had sole custody of Andrea since 1999. In addition, one of Leslie's brothers, his wife, and their children live in Omaha. Most of the rest of Leslie's extended family lives in Idaho or Washington, and Brian's extended family lives in Colorado or Arizona. The record does not indicate any extended family in Ohio.
On July 21, 2004, the district court entered an opinion and order. The court held as follows:
The first question to be answered by the Court is: does [Leslie] have a legitimate reason for the move.
The evidence presented to the Court was that [Leslie's] job prospects for advancement as a civilian employee of the Air Force at Offutt Air Force [B]ase were at a dead end, and if she were to advance she would be required to move in any case if she remained with the Air Force.
Had [Leslie] elected to continue with her [former] employment she would in all likelihood have had to [be] relocated in the near future, and had she been required to do so the provision of the Decree, with reference to reassignment[,] would have been automatic. However, in this case it is the opinion of the Court that the automatic provision of the Decree is not operative as to change of circumstance and [Farnsworth v. Farnsworth, 257 Neb. 242, 597 N.W.2d 592 (1999),] and [its progeny] are controlling.
[Leslie] obtained a position in Ohio at a substantial increase in pay, and with what appears to be a job with a future and not subject to reassignment. Thus, it is the opinion of the Court that [Leslie] has [met] the threshold [test] of having a legitimate reason for moving.
The Court now must make a determination on the issue of the best interest of the child. The case law in this State sets out several areas to be used by the trial Court in determining whether the move would be in the best interest of the child.
The Court having considered these finds that the move to Ohio would be in [Amber's] best interest and grants [Leslie's] Motion to Remove [Amber].
The court entered a new visitation order, ordered Leslie to pay all costs of transportation, and ordered both parties to pay their respective attorney fees and costs. This timely appeal followed.
III. ASSIGNMENTS OF ERROR
Brian has assigned, inter alia, that the district court erred in granting Leslie's request to remove Amber to Ohio, in denying his request for a change of custody, and in denying his request for attorney fees. In light of our resolution of these assignments of error, we need not discuss Brian's other assignments of error.
IV. ANALYSIS
1. Standard of Review
[1,2] Child custody determinations, and visitation determinations, are matters initially entrusted to the discretion of the trial court, and although reviewed de novo on the record, the trial court's determination will normally be affirmed absent an abuse of discretion. Tremain v. Tremain, 264 Neb. 328, 646 N.W.2d 661 (2002); McLaughlin v. McLaughlin, 264 Neb. 232, 647 N.W.2d 577 (2002); Vogel v. Vogel, 262 Neb. 1030, 637 N.W.2d 611 (2002); Brown v. Brown, 260 Neb. 954, 621 N.W.2d 70 (2000); Jack v. Clinton, 259 Neb. 198, 609 N.W.2d 328 (2000); Farnsworth v. Farnsworth, 257 Neb. 242, 597 N.W.2d 592 (1999). A judicial abuse of discretion exists when a judge, within the effective limits of authorized judicial power, elects to act or refrains from acting, and the selected option results in a decision which is untenable and unfairly deprives a litigant of a substantial right or a just result in matters submitted for disposition through a judicial system. McLaughlin v. McLaughlin, supra; Vogel v. Vogel, supra; Brown v. Brown, supra. See, Jack v. Clinton, supra; Farnsworth v. Farnsworth, supra.
2. Removal of Amber to Ohio
Brian first asserts that the district court erred in granting Leslie's request to remove Amber to Ohio. We find that Leslie failed to carry her burden to demonstrate a legitimate reason for removing Amber to Ohio, because the record fails to demonstrate that the employment opportunity taken by Leslie provided a reasonable improvement in her career or an opportunity for career advancement. We further find that Leslie failed to carry her burden to demonstrate that allowing removal would be in Amber's best interests, because the record fails to demonstrate that Ohio provides any benefits to Amber under the various factors considered in the best interests analysis. As a result, we conclude that on the record provided, the district court abused its discretion in allowing Leslie to remove Amber to Ohio.
[3,4] The relevant test to be applied in cases where a custodial parent seeks court permission to remove a minor child from the state has been set forth by the Nebraska Supreme Court on numerous occasions. See, Tremain v. Tremain, supra; McLaughlin v. McLaughlin, supra; Vogel v. Vogel, supra; Brown v. Brown, supra; Jack v. Clinton, supra; Farnsworth v. Farnsworth, supra. In order to prevail on a motion to remove a minor child to another jurisdiction, the custodial parent must first satisfy the court that he or she has a legitimate reason for leaving the state. After clearing that threshold, the custodial parent must next demonstrate that it is in the child's best interests to continue living with him or her. Id. Under Nebraska law, the burden has been placed on the custodial parent to satisfy this test. See Brown v. Brown, supra.
(a) Legitimate Reason to Leave State
Leslie has asserted, and the district court found, that she had a legitimate reason to leave Nebraska and take Amber to Ohio because of a career opportunity. At the time of the trial in this case, Leslie had already accepted a job in Ohio and moved from Nebraska. We conclude, however, that Leslie failed to carry her burden to demonstrate that the employment in Ohio was a legitimate reason to leave Nebraska and take Amber to Ohio, because Leslie failed to demonstrate that the employment opportunity provided a reasonable improvement in her career or an opportunity for career advancement.
[5-7] Previous cases in Nebraska have recognized that legitimate employment opportunities for the custodial parent may constitute a legitimate reason for leaving the state. See, Brown v. Brown, 260 Neb. 954, 621 N.W.2d 70 (2000); Jack v. Clinton, 259 Neb. 198, 609 N.W.2d 328 (2000); Farnsworth v. Farnsworth, 257 Neb. 242, 597 N.W.2d 592 (1999); Carraher v. Carraher, 9 Neb. App. 23, 607 N.W.2d 547 (2000). However, the Nebraska Supreme Court has specifically held that such legitimate employment opportunities may constitute a legitimate reason "where there is a `reasonable expectation of improvement in the career or occupation of the custodial parent.'" Farnsworth v. Farnsworth, 257 Neb. at 252, 597 N.W.2d at 600, quoting Gerber v. Gerber, 225 Neb. 611, 407 N.W.2d 497 (1987). See, also, Jack v. Clinton, supra. Similarly, such legitimate employment opportunities may constitute a legitimate reason "where the custodial parent's new job included increased potential for salary advancement." Jack v. Clinton, 259 Neb. at 205, 609 N.W.2d at 333. See, also, Farnsworth v. Farnsworth, supra.
In Jack v. Clinton, supra, the Nebraska Supreme Court found that the custodial parent had met the threshold requirement of proving a legitimate reason for leaving Nebraska and removing the minor children to Pennsylvania. The evidence in that case included testimony from the custodial parent that her employment opportunity in Pennsylvania "offered greater potential for salary advancement than the job she had held" in Nebraska. Id. at 205, 609 N.W.2d at 334. In addition, the custodial parent had testified that her employment opportunity in Pennsylvania required less overtime and allowed her to spend more time with the minor children. On the basis of that evidence, the Supreme Court held that the district court had sufficient evidence to conclude that the custodial parent "had a reasonable expectation for improvement in her career." Id.
Similarly, in Farnsworth v. Farnsworth, supra, the Nebraska Supreme Court found that the custodial parent had met the threshold requirement of proving a legitimate reason for leaving Nebraska and removing the minor child to Colorado. The evidence in that case indicated that the custodial parent had conducted an unsuccessful search for better employment in Nebraska and, having failed to uncover such opportunities, obtained a job in Colorado "with greater income, benefits, and career-advancement potential" than her employment in Nebraska. Farnsworth v. Farnsworth, 257 Neb. at 252, 597 N.W.2d at 600. On the basis of that evidence, the Supreme Court held that "significant career enrichment is a legitimate motive in and of itself." Id. at 253, 597 N.W.2d at 600.
The present case is distinguishable from both Jack v. Clinton, supra, and Farnsworth v. Farnsworth, supra, because Leslie failed to adduce evidence comparable to the evidence adduced by the custodial parent in those cases. Leslie failed to present any evidence that her new employment in Ohio provided any opportunity for career advancement. Leslie testified that the position was an "entry level" security position and acknowledged that the position was one from which she could be terminated at any time. She did not testify or opine that there would be any opportunity for either career advancement or income increases. She did not testify that the job provided any benefits or any advantageous schedule. By comparison, the record indicates that Leslie's employment in Nebraska was a civil service position with the military that offered job security and benefits. Although the district court concluded that the position in Nebraska was a "dead end" position, there was no evidence to indicate that the position in Ohio offered any greater opportunity for advancement.
The record does indicate that the employment in Ohio was at a greater present salary, even without evidence of any kind of salary advancement opportunities. However, the record clearly indicates that this increase in salary is not of any benefit to Leslie or, more importantly, to the interests of Amber. Leslie indicated that her new position in Ohio paid approximately $7,000 per year more than her position in Nebraska. However, Leslie failed to produce any evidence indicating the cost-of-living differences between Nebraska and Ohio, and further, Leslie testified that she would be responsible for paying all transportation costs associated with bringing Amber back to Nebraska to visit with Brian. The record indicates that those additional transportation costs may total as much as $6,500 per year or more.
Leslie failed to demonstrate that the employment opportunity in Ohio constitutes a reasonable expectation of improvement in her career or occupation or that it includes increased potential for salary advancement. To the extent the new position does offer an increase in Leslie's income, Leslie presented no evidence concerning the cost-of-living differences between Nebraska and Ohio, and the entire increase will be consumed just to pay for the costs of transporting Amber back to Nebraska for visitation with Brian.
We further note that the record in the present case does not indicate any other legitimate reason for Leslie to leave Nebraska and remove Amber to Ohio. Unlike the record regarding the custodial parent in Jack v. Clinton, 259 Neb. 198, 609 N.W.2d 328 (2000), the record in the present case does not indicate that Leslie's new employment opportunity offers any close proximity to extended family. Rather, the record in the present case indicates that there was some extended family in Nebraska, including one of Leslie's brothers, his wife, their children, and Amber's half sister, Andrea, who lives with Brian, but that there is no such extended family at all in Ohio. See, also, Brown v. Brown, 260 Neb. 954, 621 N.W.2d 70 (2000) (legitimate reason to leave state shown by evidence of firm offer of employment that would enhance career and evidence of extended family in area of new employment). Additionally, although the record indicates that Leslie was motivated to move to Ohio to be nearer to her fiance, this is not a case concerning legitimate potential for the career advancement of a custodial parent's spouse occurring after a remarriage, or concerning a move to reside with a custodial parent's new spouse who is employed and resides in another state. Compare, McLaughlin v. McLaughlin, 264 Neb. 232, 647 N.W.2d 577 (2002); Vogel v. Vogel, 262 Neb. 1030, 637 N.W.2d 611 (2002).
It is apparent that the district court placed significant emphasis on the fact that Leslie's position in Nebraska was subject to potential reassignment or relocation. The district court noted that Leslie's "job prospects for advancement as a civilian employee of the Air Force at Offutt Air Force [B]ase were at a dead end," that "if she were to advance she would be required to move in any case if she remained with the Air Force," that "[h]ad [Leslie] elected to continue with her [former] employment she would in all likelihood have had to [be] relocated in the near future," and that "had she been required to do so the provision of the Decree, with reference to reassignment[,] would have been automatic."
[8] The evidence, however, indicated merely a "rumor" that Leslie's position might be eliminated in Nebraska and a possibility that she could be reassigned or relocated by the military to a different location. There was no evidence that "in all likelihood" such relocation would happen. Rather, the parties jointly recognized that the possibility of relocation by the military was a reality of their respective employments, and the district court provided for such possibility in the dissolution decree. Speculation about rumors and possibilities cannot be sufficient to warrant allowing a custodial parent to voluntarily terminate employment in Nebraska and pursue a different job outside of Nebraska. Although custody is not to be interpreted as a sentence to immobility, the foregoing discussion demonstrates that the custodial parent must prove a legitimate reason for removing the minor child from the jurisdiction. See Vogel v. Vogel, supra.
As indicated above, we conclude that Leslie failed to satisfy her burden to demonstrate a legitimate reason for leaving Nebraska and removing Amber to Ohio. Unlike the evidence in every other case in Nebraska which has sustained a custodial parent's request to leave Nebraska for a new employment opportunity, the evidence in this case fails to indicate that the new position offers any opportunity for career advancement or salary advancement, and the actual immediate increase in salary does not afford a legitimate reason because none of the increase will benefit Leslie or the best interests of Amber because of Leslie's increased transportation costs to bring Amber back to Nebraska for visitation with Brian. Rather, the evidence adduced by Leslie in this case indicates that she wanted to move to Ohio to be nearer her fiance and to accept an entry-level position with a security company. Leslie presented no evidence that would indicate that the new position afforded any opportunities for stability, benefits, or advancement superior to those of the position she had in Nebraska. As such, we conclude that the district court abused its discretion in finding that "[Leslie] obtained a position in Ohio at a substantial increase in pay, and with what appears to be a job with a future and not subject to reassignment."
(b) Amber's Best Interests
As noted, we conclude that the district court abused its discretion in finding that Leslie met her burden to prove a legitimate reason for leaving Nebraska and removing Amber to Ohio. We further conclude, however, that even if Leslie's entry-level security job in Ohio could be considered a significant career advancement opportunity, Leslie further failed to meet her burden to prove that removal to Ohio is in Amber's best interests, because the evidence adduced by Leslie indicates no benefit to Amber of being removed to Ohio. The district court abused its discretion in finding to the contrary.
[9,10] After clearing the threshold of demonstrating a legitimate reason for leaving the state and removing the minor child to another state, the custodial parent must demonstrate that it is in the child's best interests to continue living with him or her. Tremain v. Tremain, 264 Neb. 328, 646 N.W.2d 661 (2002); McLaughlin v. McLaughlin, 264 Neb. 232, 647 N.W.2d 577 (2002); Vogel v. Vogel, 262 Neb. 1030, 637 N.W.2d 611 (2002); Brown v. Brown, 260 Neb. 954, 621 N.W.2d 70 (2000); Jack v. Clinton, 259 Neb. 198, 609 N.W.2d 328 (2000); Farnsworth v. Farnsworth, 257 Neb. 242, 597 N.W.2d 592 (1999). In determining whether removal to another jurisdiction is in the child's best interests, the trial court considers (1) each parent's motives for seeking or opposing the move; (2) the potential that the move holds for enhancing the quality of life for the child and the custodial parent; and (3) the impact such a move will have on contact between the child and the noncustodial parent, when viewed in the light of reasonable visitation. Id.
In the present case, the district court did not elaborate on any of the best interests factors or give an indication of why the court determined that it was in Amber's best interests to be removed from Nebraska to Ohio. Nonetheless, the court specifically found that "the move to Ohio would be in [Amber's] best interest[s]." We find that the evidence does not support this conclusion.
(i) Each Parent's Motives
The first factor that must be considered is each parent's motives for seeking or opposing the removal of the minor child from the jurisdiction. We conclude that at most, the evidence demonstrates that the parties' motives are balanced; this factor does not weigh in favor of a finding that removal is in Amber's best interests.
[11,12] The ultimate question in evaluating the parties' motives in seeking removal of a child to another jurisdiction is whether either party has elected or resisted a removal in an effort to frustrate or manipulate the other party. McLaughlin v. McLaughlin, supra. See, also, Vogel v. Vogel, supra; Brown v. Brown, supra; Jack v. Clinton, supra; Farnsworth v. Farnsworth, supra. Further, "while some legitimate explanations `might seem less compelling than others . . . none should be summarily rejected at this stage of the analysis without weighing the other considerations and how they all come to bear on the overall impact on the child.'" Jack v. Clinton, 259 Neb. at 207, 609 N.W.2d at 334-35, quoting Farnsworth v. Farnsworth, supra.
The evidence in the present case indicates that Brian is an involved noncustodial father who regularly exercises his visitation and is concerned about the impact Leslie's removal of Amber from Nebraska to Ohio will have on that visitation. On the other hand, the evidence indicates that Leslie was motivated to seek removal to be nearer her fiance and to explore a different employment opportunity. As is true of the other cases decided by the appellate courts of Nebraska concerning this factor, we do not find that either party was acting in bad faith or with ill motives, and we conclude that the motives of the parties are balanced. See, Tremain v. Tremain, 264 Neb. 328, 646 N.W.2d 661 (2002); McLaughlin v. McLaughlin, 264 Neb. 232, 647 N.W.2d 577 (2002); Vogel v. Vogel, 262 Neb. 1030, 637 N.W.2d 611 (2002); Brown v. Brown, 260 Neb. 954, 621 N.W.2d 70 (2000); Jack v. Clinton, 259 Neb. 198, 609 N.W.2d 328 (2000); Farnsworth v. Farnsworth, 257 Neb. 242, 597 N.W.2d 592 (1999). As such, this factor does not weigh in favor of a finding that it is in Amber's best interests to be removed to Ohio.
(ii) Quality of Life
The second factor that must be considered is the potential that the move holds for enhancing the quality of life for the child and the custodial parent. This factor requires an analysis of a number of other considerations which bear upon the potential enhancement of the child's quality of life. The evidence in the record in this case fails to demonstrate that the proposed removal to Ohio will significantly enhance Amber's quality of life. Leslie failed to adduce sufficient evidence to support a finding that this factor weighs in favor of removal.
[13,14] In determining the potential that the removal to another jurisdiction holds for enhancing the quality of life of the child and the custodial parent, a court should evaluate the following considerations: (1) the emotional, physical, and developmental needs of the child; (2) the child's opinion or preference as to where to live; (3) the extent to which the relocating parent's income or employment will be enhanced; (4) the degree to which housing or living conditions would be improved; (5) the existence of educational advantages; (6) the quality of the relationship between the child and each parent; (7) the strength of the child's ties to the present community and extended family there; and (8) the likelihood that allowing or denying the removal would antagonize hostilities between the two parties. See, McLaughlin v. McLaughlin, supra; Vogel v. Vogel, supra; Brown v. Brown, supra; Jack v. Clinton, supra; Farnsworth v. Farnsworth, supra. This list should not be misconstrued as setting out a hierarchy of considerations, and depending on the circumstances of a particular case, any one consideration or combination of considerations may be variously weighted. See id.
a. Emotional, Physical, and Developmental Needs
The record indicates that both parties in this case are capable of providing for the emotional, physical, and developmental needs of Amber. The record suggests that both are loving parents genuinely concerned about Amber's needs. There was no evidence presented to suggest that either party is incapable or deficient in any way in providing for Amber's emotional, physical, and developmental needs. As such, this consideration is equally balanced and does not weigh in favor of removal.
b. Amber's Opinion or Preference
At the time of the trial in this matter, Amber was 9 years old. Leslie's attorney made an offer of proof at trial that if called, Amber would testify that she wants to go to Ohio, wants to try new things and see new places, and wants to remain with Leslie. This offer of proof was not made in response to any ruling by the court refusing proffered evidence, and when Brian's attorney objected to the offer of proof, the court overruled the objection, sustained the offer, and received Amber's deposition as evidence. In Amber's deposition, she testified that she was comfortable with moving to Ohio with Leslie, although Amber acknowledged that she would miss Brian. As such, the limited evidence in the record indicates that Amber is willing to move to Ohio, and this consideration may be seen as weighing in favor of allowing the removal.
c. Enhancement of Income or Employment
As fully addressed above in our discussion of Leslie's failure to prove that the new employment opportunity constitutes a legitimate reason for removing Amber to Ohio, the record in this case does not demonstrate that the move will result in an enhancement of Leslie's income or employment. Leslie failed to demonstrate that the new position offers any greater opportunity for advancement or salary increases or any greater benefits or working hours than her position in Nebraska. Further, although Leslie testified that the new position would pay a higher salary, as discussed above, Leslie failed to present any evidence about the cost-of-living difference, and virtually the entire increase in pay will be consumed to pay for Leslie's obligation to transport Amber back to Nebraska for visitation with Brian. Leslie did not present any evidence concerning her fiance's income or employment. Compare McLaughlin v. McLaughlin, 264 Neb. 232, 647 N.W.2d 577 (2002) (custodial parent's new spouse's income properly considered in this factor).
The result is that the record does not support a finding that Leslie's income or employment will be enhanced in any way beneficial to Amber's best interests. This consideration does not weigh in favor of removal.
d. Housing or Living Conditions
Leslie testified that her housing in Nebraska was in a large apartment. Leslie testified that her housing in Ohio would be in her fiance's home. There was no evidence presented concerning the quality of the neighborhoods for either housing, and there was no evidence presented to indicate that the housing in Ohio will, other than by offering a backyard, provide any benefit to Amber's best interests. There was no evidence presented to indicate that the available housing in Nebraska was in any way deficient. This consideration does not weigh in favor of removal.
e. Educational Advantages
The record indicates that Amber has a learning deficiency and that she requires special education opportunities to benefit her reading difficulties. The record indicates that Amber's school in Nebraska had a specific program in place which was addressing Amber's needs. Leslie testified that she had not had an opportunity to look into the availability of any special education opportunities in Ohio. Leslie did not know what school Amber would attend in Ohio and did not know whether the school would employ a year-round calendar or a more traditional school calendar. Leslie did not provide any evidence about the relative quality of the schools in Nebraska or Ohio. Leslie failed to adduce any evidence which would suggest that removal to Ohio would afford Amber any educational advantage. This consideration does not weigh in favor of removal.
f. Quality of Relationship Between Child and Parents
With regard to this consideration, the record indicates only that Amber has a good relationship with both parties and that by necessity, removal will impact her relationship with Brian and the amount of time she is able to spend with Brian. There was no evidence presented to indicate that Amber has a stronger relationship with either parent. There was no expert evidence produced indicating that removal should be allowed because of such a stronger bond with Leslie. Compare McLaughlin v. McLaughlin, supra (expert recommended granting removal because of bond with custodial parent).
[15] The effect of the removal of a child to another jurisdiction must be evaluated in light of the child's relationship with each parent. Id. See, also, Brown v. Brown, 260 Neb. 954, 621 N.W.2d 70 (2000). In this case, evaluating the effect of the removal in light of the child's relationship with each parent indicates that Amber's relationship with Brian will suffer, at least to the extent of a reduction in time spent together and in the frequency and ease of Amber's and Brian's contact with each other. There was no evidence presented to indicate that removal will have any impact on Amber's relationship with Leslie. This consideration, then, also does not weigh in favor of removal.
g. Ties to Community and Extended Family
There was little evidence presented concerning Amber's ties to the community in Nebraska; she was only 9 years old at the time of the trial. Amber indicated in her deposition that she did have friends in Nebraska, and the record indicates that Amber does have some extended family in Nebraska. Specifically, one of Leslie's brothers, his wife, and their children are in the community in Nebraska. The record does not indicate what kind of relationship Amber has with those relatives. See McLaughlin v. McLaughlin, 264 Neb. 232, 647 N.W.2d 577 (2002). The record indicates that there is no such extended family in Ohio.
[16] Of importance, Amber's half sister, Andrea, is also in the community in Nebraska; as noted above, Andrea is in Brian's sole custody. The record does indicate that Amber has a close relationship with Andrea. The Nebraska Supreme Court has specifically noted that the relationship of a child to siblings is entitled to consideration and weight. See Brown v. Brown, supra (court would be remiss not to consider relationship of children to younger siblings). As such, this consideration does not weigh in favor of removal.
h. Hostilities Between Parties
The record indicates that the parties have experienced some disagreements and some communication problems, although both parties testified that they have been able to resolve their communication problems and work together concerning Amber. Nonetheless, Leslie herself specifically testified that she believed that her communication with Brian would be adversely impacted if the court granted her request to remove Amber to Ohio. This consideration does not weigh in favor of removal.
i. Conclusion on Quality of Life
As noted, the district court did not make specific findings concerning any of the best interests factors and did not make specific findings concerning any of the quality of life considerations. Our de novo review of the record, however, leads us to conclude that the quality of life considerations do not weigh in favor of allowing Leslie to remove Amber to Ohio. Even though there is no hierarchy of the considerations and no particular weight that must be given to any individual consideration in a given case, in the present case, the considerations almost uniformly fail to weigh in favor of removal. Leslie failed to prove an enhancement in the quality of life for Amber or herself from leaving Nebraska and going to Ohio. Because Leslie failed to adduce sufficient evidence to support a finding that Amber's quality of life would be enhanced, we find that this factor weighs against removal.
(iii) Impact of Move on Contact Between
Child and Noncustodial Parent
The third factor that must be considered is the effect of allowing Leslie to remove Amber to Ohio upon Brian's ability to maintain a meaningful parent-child relationship with Amber. As is true with most applications for removal, the frequency of the noncustodial parent's visitation will necessarily be diminished by distance. See McLaughlin v. McLaughlin, 264 Neb. 232, 647 N.W.2d 577 (2002). Instead of being in the same community as Brian, Amber would be living in Dayton. We conclude that the evidence presented in this case fails to support a finding that Brian's parent-child relationship with Amber will not be adversely impacted by granting the removal.
[17] The effect on the parent-child relationship must be viewed in light of the court's ability to devise reasonable visitation arrangements. McLaughlin v. McLaughlin, supra. See, also, Vogel v. Vogel, 262 Neb. 1030, 637 N.W.2d 611 (2002). A significant difficulty in assessing the court's ability to fashion such a reasonable visitation arrangement in the present case exists because of Leslie's lack of knowledge concerning what school Amber would attend and what calendar that school utilizes. The record indicates that Dayton has schools which utilize a year-round calendar and schools which utilize a traditional calendar. Leslie did not know how many of either were in the area she intended to move to, and, as noted, she did not know what school Amber would attend or what calendar the school would use.
Although Leslie testified that she would be willing to pay the transportation costs to bring Amber back to Nebraska to visit with Brian, and although she was affirmatively ordered to do so, the inadequacies concerning Leslie's evidence about Amber's potential school schedule bring into question the reasonableness of the district court's visitation plan. In McLaughlin v. McLaughlin, 264 Neb. at 246, 647 N.W.2d at 590, for example, the custodial parent was willing to drive halfway to help the noncustodial parent maintain visitation and was willing to provide "extended summer visitation." The Nebraska Supreme Court specifically found that the noncustodial parent could still maintain a meaningful relationship with the child "through a reasonable visitation schedule, which included extended visitation in the summer." Id. See, also, Vogel v. Vogel, supra (diminished contact resulting from move from Nebraska to Virginia mitigated by award of liberal visitation including almost entire summer school break); Jack v. Clinton, 259 Neb. 198, 609 N.W.2d 328 (2000) (diminished contact resulting from move from Nebraska to Pennsylvania mitigated by reasonable visitation order including 6 consecutive weeks in summer). Compare Brown v. Brown, 260 Neb. 954, 621 N.W.2d 70 (2000) (despite substantial and commendable concessions on visitation by custodial parent, it could not be reasonably questioned that move from Nebraska to New York would make existing relationship almost impossible to maintain). In the present case, however, Leslie failed to adduce evidence that Amber would even have an extended period of time in the summer during which Brian could exercise extended visitation. As such, the reasonableness of the district court's visitation order, which specifically awarded Brian extended summer visitation, is not apparent on the basis of the evidence adduced by Leslie.
Although this case is similar to previous Nebraska removal cases, wherein it is almost always true that the noncustodial parent's visitation and contact with the child will necessarily be less than it would have been had the custodial parent and the child remained in Nebraska, this case is also different from such previous cases because of Leslie's failure to adduce sufficient evidence allowing us to determine the reasonableness of the district court's visitation order. The record presented is inadequate for us to determine that a reasonable visitation order can be entered which will mitigate the necessary reduction in time spent together by Brian and Amber. As such, it is impossible to determine that Brian's relationship with Amber will not be seriously damaged by allowing Leslie's removal of Amber to Ohio. As such, we conclude that this factor also does not weigh in favor of allowing removal.
(iv) Conclusion on Best Interests
The record does not demonstrate sufficient support for the district court's conclusion that it is in Amber's best interests to be removed from Nebraska to Ohio. None of the factors to be considered in evaluating Amber's best interests weighs in favor of allowing removal. Leslie failed to adduce sufficient evidence to demonstrate how allowing removal of Amber to Ohio would serve Amber's best interests. Because Leslie failed to meet her burden of proof on this issue, we conclude that the district court abused its discretion in summarily finding that allowing the removal would be in Amber's best interests.
(c) Conclusion on Removal
This is another in the growing line of difficult cases in Nebraska courts where a custodial parent seeks the opportunity to leave the state and relocate with a minor child. Like many of the previous cases, this one involves a noncustodial parent for whom the record does not contain negative evidence. The record reveals Brian to be a capable and loving father who vigorously exercises his visitation rights; has sole custody of Amber's half sister, Andrea; and desires to prevent the potential damage to his relationship with Amber that would arise from Amber's removal to Ohio. In this case, the parties were divorced by a decree dated February 20, 2003, which was the result of a settlement agreement by the parties in which they agreed on all issues, including custody and visitation of Amber. Fewer than 10 months later, Leslie sought to remove Amber to Ohio, where Leslie's fiance lived and where she believed she had obtained new employment. When that employment did not come to fruition, Leslie withdrew her initial request. Approximately 5 months later, Leslie made a second request to remove Amber to Ohio. At trial, Leslie failed to adduce sufficient evidence to support her request for removal.
We conclude that Leslie failed to meet her burden of proving a legitimate reason for leaving Nebraska and removing Amber to Ohio. The record does not contain sufficient evidence to support a finding that Leslie's new employment opportunity in Ohio provides any opportunity for career or salary advancement greater than that of her employment in Nebraska. The record does not contain any evidence concerning the cost-of-living differences between Nebraska and Ohio, and the pay increase which Leslie did receive by taking the new employment will be almost entirely consumed merely by paying for transportation costs associated with bringing Amber to Nebraska to visit with Brian. As such, Leslie failed to meet her burden of proof on the threshold issue of establishing a legitimate reason for the move.
Additionally, Leslie failed to meet her burden of proof to demonstrate that removing Amber to Ohio would be in Amber's best interests. Although the motives of the parties in either seeking or opposing removal are equally balanced, the remaining factors to be considered in evaluating Amber's best intereststhe potential for enhancement of Amber's quality of life and potential impact on the relationship between Amber and Briando not weigh in favor of allowing removal. Leslie failed to adduce sufficient evidence to demonstrate that removal to Ohio would be in Amber's best interests.
The district court abused its discretion in finding that Leslie had satisfied her burden of proof with respect to her request to remove Amber to Ohio. As such, we find merit to Brian's assignment of error, and we reverse the district court's order granting Leslie's request to remove Amber to Ohio.
3. Change in Custody
Brian next asserts that the district court erred in denying his counterclaim seeking a change in custody. We conclude that Brian has not proven a material change of circumstances showing that Leslie is unfit or that the best interests of Amber require such action. As such, we find no merit to this assignment of error.
[18-22] The issue of a change in custody must be considered separately and apart from the custodial parent's request to remove the child to another state. See Tremain v. Tremain, 264 Neb. 328, 646 N.W.2d 661 (2002). Ordinarily, custody of a minor child will not be modified unless there has been a material change in circumstances showing that the custodial parent is unfit or that the best interests of the child require such action. Id.; Vogel v. Vogel, 262 Neb. 1030, 637 N.W.2d 611 (2002). An appellate court conducts a de novo review on the record in child custody determinations. See id. The party seeking modification of child custody bears the burden of showing a material change in circumstances. Id. The Nebraska Supreme Court has previously stated that a request to remove a child from the state, without more, does not amount to a material change in circumstances warranting a change of custody. See id.
In the present case, Leslie testified that if the court denied her request to remove Amber to Ohio, she would return to Nebraska. Brian presented no evidence sufficient to demonstrate any material change in circumstances warranting a change of custody. Although we have concluded that it is in Amber's best interests to remain in Nebraska, we are not persuaded that Brian has sustained his burden of showing a material change in circumstances that would justify a change of custody. See Tremain v. Tremain, supra. As such, we find this assignment of error to be without merit.
4. Attorney Fees
Finally, Brian asserts that the district court erred in denying his request for attorney fees. The district court ordered each party to pay his or her own fees and costs. We do not find such a determination by the district court to be an abuse of discretion.
[23] The district court's decision on a request for attorney fees is reviewed de novo on the record and will be affirmed in the absence of an abuse of discretion. See Gangwish v. Gangwish, 267 Neb. 901, 678 N.W.2d 503 (2004). As noted above, we do not find sufficient evidence to attribute bad faith or ill motives to either party in this case, and the record does not establish any reason to conclude that the district court abused its discretion in ordering Brian and Leslie to pay their respective attorney fees. We find this assignment of error to be without merit.
V. CONCLUSION
We find that the district court abused its discretion in granting Leslie's request to remove Amber to Ohio. We find that Leslie failed to meet her burden of proof to demonstrate a legitimate reason for the move and to demonstrate that removal to Ohio would be in Amber's best interests. Accordingly, we reverse the district court's order granting removal.
We find no abuse of discretion by the district court with respect to Brian's requests for a change of custody and for attorney fees. Accordingly, we affirm those findings of the district court.
AFFIRMED IN PART, AND IN PART REVERSED. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/2051104/ | 592 N.W.2d 794 (1999)
233 Mich. App. 652
PEOPLE of the State of Michigan, Plaintiff-Appellant,
v.
Wilmor ADAMS, Defendant-Appellee.
Docket No. 203740.
Court of Appeals of Michigan.
February 2, 1999.
Submitted September 1, 1998, at Detroit.
Decided February 2, 1999, at 9:20 a.m.
Released for Publication April 21, 1999.
*795 Frank J. Kelley, Attorney General, Thomas L. Casey, Solicitor General, John D. O'Hair, Prosecuting Attorney, Timothy A. Baughman, Chief of Research, Training, and Appeals, and Janet A. Napp, Assistant Prosecuting Attorney, for the people.
Orlans, Sherbow & Mitchell (by William Mitchell, III), Troy, for the defendant.
Before: HOLBROOK, JR., P.J., and MARKEY and WHITBECK, JJ.
MARKEY, J.
The prosecution appeals by right the trial court's order dismissing the charges of assault with intent to commit murder, M.C.L. § 750.83; MSA 28.278, possession of a firearm during the commission of a felony, M.C.L. § 750.227b; MSA 28.424(2), felon in possession of a firearm, M.C.L. § 750.224f; MSA 28.421(6), and fourth-offense habitual offender, M.C.L. § 769.12; MSA 28.1084, because the complaining witness left the courthouse before testifying at trial and the trial court determined that she was not unavailable pursuant to MRE 804(a)(2). We reverse and remand.
The complainant appeared for the preliminary examination but was reluctant to testify should the examination be postponed again in the event that defense counsel failed to show. Apparently, after a prior preliminary examination date was adjourned and rescheduled, the complainant was shot at by the mother of defendant's new girlfriend. The district court asked defendant about this shooting, and he denied any knowledge. The court told defendant to alert his friends and family that they must leave the complainant alone or pay the consequences. Once defense counsel appeared in court, the complainant took the stand and testified at the preliminary examination that defendant was her ex-boyfriend and the two of them were involved in an altercation on April 27, 1996. She testified on direct examination and cross-examination that defendant choked her while she was lying on her couch, chased her when she got away from him, and shot at her four times with a twelve-gauge shotgun as he chased her around the house. Pellets from two of the shots hit her, first in her wrist,[1] then in her neck and breast. At the preliminary examination, the court understood that the complainant was very reluctant and fearful about testifying because of some threats, but complainant did testify.[2] At the conclusion of the preliminary examination, the district court bound defendant over for trial.
The complainant appeared at court on the day of trial to testify against defendant, but she abruptly left without warning or notice before proceedings began. An assistant prosecuting attorney informed the court that he had met with the complainant that morning and that she was nervous about testifying, but she gave no indication before trial that she was going to leave.[3] Although the trial court gave the prosecution approximately *796 two hours to locate the complainant, the prosecution's search was unsuccessful. The prosecution then asked the court to declare the complainant unavailable and to admit into evidence her preliminary examination testimony pursuant to MRE 804(b)(1) or to adjourn the trial for a day or two so that the complainant could be located.
The trial court stated that, having reviewed the complainant's prior testimony, it found that the complainant was willing to testify at the preliminary examination despite her fears and any threats she may have received. The court was therefore unconvinced that the complainant was refusing to testify and that she may have simply changed her mind about pursuing the charges:
And again I think probably because she had minimal injuries in this case [i.e., a few of the shotgun pellets hit her in the neck, wrist and breast,[[4]] and she was only hospitalized for a day], maybe she really doesn't want to prosecute the matter and left for that reason. I don't know. And if there were some real serious injuries, I might go ahead and use the transcript or postpone the matter. [Emphasis added.]
The court also noted that defendant had been in custody for almost six months on these charges, so it granted defendant's motion to dismiss without prejudice, thereby allowing the prosecution to reinstate the charges at a later date.
On appeal, the prosecution argues that the trial court abused its discretion by excluding the complainant's preliminary examination testimony from evidence. We agree.
We review the trial court's decision to admit evidence for an abuse of discretion. People v. Briseno, 211 Mich.App. 11, 14, 535 N.W.2d 559 (1995). MRE 804(a)(2) states that a witness is "unavailable" where the declarant "persists in refusing to testify concerning the subject matter of the declarant's statement despite an order of the court to do so." MRE 804(b)(1) further states that where the declarant is unavailable as a witness, the hearsay rule does not exclude
[t]estimony given as a witness at another hearing of the same or a different proceeding, if the party against whom the testimony is now offered, or, in a civil action or proceeding, a predecessor in interest, had an opportunity and similar motive to develop the testimony by direct, cross, or redirect examination.
Recently, in People v. Meredith, 459 Mich. 62, 63, 65-66, 586 N.W.2d 538 (1998), our Supreme Court held that a witness in a drug conspiracy case who asserted her Fifth Amendment right to silence at trial was an "unavailable" witness and her preliminary examination testimony was admissible at trial. The Supreme Court found that although invocation of the Fifth Amendment is not expressly mentioned under the five categories of "unavailability" set forth in MRE 804(a), "it is of the same character as the other situations outlined in the subrule. Further, while unavailability is a term of art under MRE 804(a), it also bears a close nexus to the ordinary meaning of the word." Id. at 66, 586 N.W.2d 538 (emphasis added).
Once it determined that the witness was unavailable, our Supreme Court further explained that the defendants in Meredith had an opportunity and similar motive to develop the witness' testimony through cross-examination, as required under MRE 804(b)(1). It is also necessary to establish that preliminary examination testimony of an unavailable witness bears satisfactory indicia of reliability, in accordance with People v. Bean, 457 Mich. 677, 682-683, 580 N.W.2d 390 (1998), and People v. Dye, 431 Mich. 58, 93, 427 N.W.2d 501 (1988). Meredith, supra at 68, 586 N.W.2d 538. On finding that MRE 804(b)(1) is a firmly rooted hearsay exception, our Supreme Court held that the witness' prior testimony bore a satisfactory indicia of reliability, thereby satisfying the federal and state Confrontation Clauses and supporting the admission of the preliminary *797 examination testimony at trial. Meredith, supra at 67-71, 586 N.W.2d 538.
Here, we also find that while a complainant's eleventh-hour decision to leave the courthouse rather than testify at trial is not expressly addressed under MRE 804(a), it is also of the same character as other situations outlined in that rule of evidence. Meredith, supra at 65-66, 586 N.W.2d 538. Although neither this Court nor the trial court has a statement or affidavit from the complainant explaining why she left the courthouse, her absence coupled with the type of crimes with which defendant was charged and her statements during the preliminary examination regarding the threats to her by others connected to defendant paint a fairly vivid picture. They do not, as the trial court surmised, equally support the conclusion that she wanted to "drop the charges." We are cognizant that all too often, the victims of domestic assault and abuse are fearful and reluctant to assist in the prosecution of their assailants, often as a result of a defendant's or his family's intimidation tactics or out of fear of future reprisals. These fears are too often justified. We cannot simply conclude that the complainant's last-minute decision to silently leave the courthouse was motivated by her belief that defendant would not be prosecuted without her testimony or that by leaving she would not face his wrath in the future. To the contrary, our experience in these matters makes us more likely to believe that her departure was motivated by self-preservation rather than a change of heart.
The complainant's abrupt departure, without a word to the prosecuting attorney, and her evasion from detection thereafter also made her unavailable under the "ordinary meaning of the word." Id. When someone is not available, that person is not "at hand," "readily obtainable; accessible," or "free or ready to be seen, spoken to." Random House Webster's College Dictionary (1992), p 94.[5] In light of the totality of the circumstances surrounding this case and the decision in Meredith, supra, we conclude that the complainant was "unavailable" for purposes of MRE 804(a)(2).[6]
In light of the complainant's unavailability, MRE 804(b)(1) permits the trial court to admit into evidence her former testimony from the preliminary examination because defense counsel had an opportunity and similar motivation to develop her testimony on cross-examination. Meredith, supra at 66-67, 586 N.W.2d 538. We also believe that use of the preliminary examination testimony does not violate defendant's constitutional right to confront prosecutorial witnesses, U.S. Const, Am VI; Const 1963, art 1, § 20. Because MRE 804(b)(1) is a hearsay exception firmly rooted in American jurisprudence, the Confrontation Clause is satisfied when the complainant's prior testimony is admitted because that testimony bears satisfactory indicia of reliability, without more. Meredith, supra at 67-71, 586 N.W.2d 538.
Accordingly, we find that the trial court abused its discretion in denying the prosecution's motion to admit into evidence the unavailable complainant's preliminary examination testimony and in dismissing the case without prejudice. In light of our finding, we need not reach the other issue raised by the prosecution on appeal.
*798 Reversed and remanded for further proceedings consistent with this opinion. We do not retain jurisdiction.
NOTES
[1] The complainant testified that she told defendant he had shot her in the wrist, but he responded with "so what" and fired another shotgun blast that struck her in the neck and breast.
[2] Defendant does not challenge the fact that someone shot at the complainant before she testified at the preliminary examination or that the event made the complainant feel threatened before trial began.
[3] The assistant prosecuting attorney in the case informed the court that he met with the complainant the morning of trial. She reviewed her preliminary examination transcript, and he spoke to her. The prosecutor observed that the complainant was "very nervous about being here, and when I asked her why, she said that she had been shot at by the family of the defendant and that she didn't want to be here and that she was very upset and nervous." She also asked the prosecutor whether she would have to testify, and he told her yes, it would be necessary for her to do so. The court stated that it was unsure whether" she is persisting in refusing to testify. If you say she was here this morning, then apparently she's ready, able and willing to testify." The prosecutor also spoke with the victim's advocate at the court, and she had the same experiences and impressions from speaking with the complainant that morning.
[4] The record reveals that the complainant escaped the brunt of the multiple shotgun blasts aimed at her while she attempted to flee from defendant, but the shotgun pellets that hit and lodged in her neck and breast could not be removed surgically. Rather, the pellets would have to work their way out of her body on their own.
[5] Because the prosecution procured the complainant's presence on the day of trial by means of a subpoena but she left before testifying, we do not conclude that the prosecution must establish her unavailability under MRE 804(a)(5), which requires that the witness be "absent from the hearing and the proponent of a statement has been unable to procure the declarant's attendance... by process or other reasonable means, and in a criminal case, due diligence is shown." We can find no cases, and the parties present none, where the due diligence requirement has been applied to witnesses who appear to testify and then disappear before testifying. See People v. James (After Remand), 192 Mich.App. 568, 571-573, 481 N.W.2d 715 (1992) (efforts made on the eve of trial to secure the presence of a witness who testified at the preliminary examination over three years before trial were not sufficiently reasonable to satisfy the due diligence standard).
[6] We also note that because the complainant initially appeared at the courthouse on the day of trial pursuant to a subpoena, her departure constituted refusal to testify "despite an order of the court to do so" (emphasis added). MRE 804(a)(2). | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/2758706/ | COURT OF APPEALS
SECOND DISTRICT OF TEXAS
FORT WORTH
NO. 02-13-00544-CR
Jose Alcala § From Criminal District Court No. 1
§ of Tarrant County (1316190D)
v. § December 4, 2014
§ Opinion by Justice Gardner
The State of Texas § (nfp)
JUDGMENT
This court has considered the record on appeal in this case and holds that
there was no error in the trial court’s judgment. It is ordered that the judgment of
the trial court is affirmed.
SECOND DISTRICT COURT OF APPEALS
By /s/ Anne Gardner_______
Justice Anne Gardner | 01-03-2023 | 12-09-2014 |
https://www.courtlistener.com/api/rest/v3/opinions/1209303/ | 94 Ga. App. 761 (1956)
96 S.E.2d 332
RICH'S, INC.
v.
TOWNSEND.
36336.
Court of Appeals of Georgia.
Decided November 19, 1956.
Rehearing Denied December 5, 1956.
*765 W. Neal Baird, Hurt, Gaines & Baird, for plaintiff in error.
Howard & Hyatt, Eugene L. Tiller, contra.
GARDNER, P. J.
We wish to commend counsel for both parties for their diligence in calling to the attention of this court over one hundred citations, including Code sections and decisions of the appellate courts concerning the sufficiency and deficiency as to whether or not a petition for damages based on negligence or lack of negligence is subject to demurrer. We will not attempt to discuss all of these cases brought to our attention. We think only a few cases are necessary in order for us to arrive at a decision. We are aware that a petition must be construed most strongly against the pleader. We call attention to Macon Academy Music Co. v. Carter, 78 Ga. App. 37, 39 (50 S.E.2d 626) wherein this court held: "We will first consider whether the court erred in overruling the demurrer. It is conceded by all that ordinarily questions of ordinary care are for the jury to determine, but where defective conditions of floors are obvious under ordinary circumstances, if ordinary care is employed in using the sense of sight and where such conditions are so obviously dangerous that no person of ordinary prudence while in the exercise *766 of ordinary care would use the floor, then the courts have held that the issue will be resolved against the plaintiff on demurrer. There is a long line of decisions where our courts have held uniformly that where the defect is hidden and would not be obvious to the plaintiff in the exercise of ordinary care, the question is for the jury. As illustrative of this line of decisions, see Mattox v. Lambright, 31 Ga. App. 441 (120 S.E. 685); Moore v. Sears, Roebuck & Co., 42 Ga. App. 658 (157 S.E. 106); Wynne v. Southern Bell Tel. &c. Co., 159 Ga. 623 (126 S.E. 388); Firestone Service Stores v. Gillen, 58 Ga. App. 782 (199 S.E. 853); Scott v. Rich's, Inc., 47 Ga. App. 548 (171 S.E. 201); Woolworth Company v. Wood, 32 Ga. App. 575 (124 S.E. 110); Parsons v. Sears, Roebuck & Co., 69 Ga. App. 11 (24 S.E.2d 717); Colonial Stores v. Scholz, 73 Ga. App. 268 (36 S.E. 2d, 189); Rothschild v. First National Bank of Atlanta, 54 Ga. App. 486 (188 S.E. 301); Holloman v. Henry Grady Hotel Co., 42 Ga. App. 347 (156 S.E. 275); Southern Grocery Stores v. Braun, 57 Ga. App. 31 (194 S.E. 219); Southern Grocery Stores v. Greer, 68 Ga. App. 583 (23 S.E.2d 484); Mandeville Mills v. Dale, 2 Ga. App. 607 (58 S.E. 1060). There are other decisions to the same effect." We call attention also to Townley v. Rich's, Inc., 84 Ga. App. 772, 775 (67 S.E.2d 403), which reads as follows: "As was said by Powell, J., in Mandeville Mills v. Dale, 2 Ga. App. 607, 612 (58 S.E. 1060), `Ordinary care and diligence, as applied to the keeping of premises in safe condition, is a very elastic term, varying the quantum of actual caution to be exercised, according to the nature of the use to which the property is devoted.'. . . To paraphrase this court's language in Firestone Service Stores v. Gillen, 58 Ga. App. 782, 786 (199 S.E. 853), if knowledge of the worn-down, smooth condition of the metal strip was knowledge of specific defects, and the plaintiff had knowledge of these particular defects, and yet had no knowledge of the particular, unapparent, dangerous condition connected therewith which occasioned the injury (Samples v. City of Atlanta, 95 Ga. 110, 22 S.E. 135), knowledge of such defects does not necessarily import knowledge of a dangerous condition of such stairway. We again say that `knowledge of defect' should not be confused with `knowledge of danger.' Mathis v. Gazan, 51 Ga. App. 805, 808 (181 S.E. 503), and *767 whether or not the plaintiff in the instant case had knowledge of the danger present in using the stairway is a question for the jury." We think this principle of law applies in the instant case.
We have studied all of the contentions of the defendant with reference to the inconsistencies and the contentions as to wilful and wanton negligence and other questions made by the general and special demurrers. We cannot reach any conclusion but that the petition set out a cause of action based on ordinary negligence to be determined by a jury. It must be kept in mind that it may be conceded, but this court does not decide, that the plaintiff was in some degree negligent, but under the same comparative negligence rule of this State if the plaintiff was less negligent than the defendant, the plaintiff would be entitled to recover some amount. All of these are jury questions.
Judgment affirmed. Townsend and Carlisle, JJ., concur. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1617966/ | 615 So. 2d 41 (1993)
PREMIER BANK, NATIONAL ASSOCIATION, Plaintiff-Appellee,
v.
PERCOMEX, INC., and Harold Davenport, Defendants-Appellants, and
Ronald Shaw and Eduardo Candia, Defendants.
No. 92-243.
Court of Appeal of Louisiana, Third Circuit.
March 3, 1993.
*42 Joseph C. Giglio Jr., Joseph Patrick Hebert, for Premier Bank, Nat. Ass'n.
Robert A. Lecky, for Percomex, Inc. et al.
Gregory Karl Klein, for Shaw.
Eduardo Candia, pro se.
Before DOMENGEAUX, C.J., and KNOLL and SAUNDERS, JJ.
DOMENGEAUX, Chief Judge.
Premier Bank, National Association, filed suit against a borrower, Percomex, Inc., and three guarantors, Harold Davenport, Ronald Shaw, and Eduardo Candia, seeking a money judgment on two promissory notes. Premier Bank also prayed for judgment recognizing and maintaining various security interests granted by Percomex and Harold Davenport to secure repayment of the notes. Percomex, Davenport, and Shaw reconvened against Premier Bank for damages. Summary judgment on the principal demand was granted in favor of the Bank and against Percomex, Davenport, and Shaw, and the claims asserted in the reconventional demand were preserved for trial, as were the claims made by the Bank against Eduardo Candia, a nonresident defendant. Percomex and Davenport have appealed the summary judgment and we affirm.
FACTS
In 1984, Percomex borrowed approximately $1.7 million from Guaranty Bank and Trust Co. Davenport, Shaw, and Candia personally guaranteed the note, and a collateral chattel mortgage was granted in favor of the Bank on the inventory and assets of Percomex. Guaranty Bank and its successor, Premier Bank, renewed the note annually until 1989 when a new agreement was entered into by the parties. At that time, two notes were executed, one representing the principal sum due of $1,782,500.00 and the other representing accrued interest totalling $77,819.60. The notes provided that principal and interest would be payable in full 90 days from April 1, 1989. As additional security, Davenport granted a mortgage on his residence in favor of the Bank. Proceeds from a lease of Percomex's equipment were assigned to the Bank.
When Percomex and its guarantors failed to pay the amounts due on the notes, Premier Bank filed this suit in September of 1989. In their answers to the Bank's petition, Percomex and Davenport made several allegations: first, that the Bank negligently damaged the inventory of Percomex; second, that the Bank breached its implied obligation of good faith by requesting additional security from Davenport with the promise that the loans would be extended beyond the 90 day period evidenced in writing; and third, that but for the actions of the Bank, there would have been adequate security to pay the full amounts due. Percomex, Davenport, and Shaw filed a reconventional demand against the Bank, wherein they made the same allegations as were asserted in their answers.
Premier Bank filed a motion for partial summary judgment seeking only the relief requested in its petition, exclusive of attorney's fees which were subsequently waived by the Bank. The basis for the Bank's motion was that the defenses raised by the defendants were actually unliquidated tort claims, none of which had anything to do with liability on the notes at issue. In opposition to the motion for summary judgment, *43 the defendants filed affidavits by Davenport and Shaw and argued that genuine issues of material fact exist as to whether the Bank negligently damaged the collateral pledged to secure the $1.7 million note and whether the Bank orally agreed to extend the notes beyond the 90 day period. The trial court granted the relief requested by the Bank and preserved the reconventional demand and the claims against Eduardo Candia for trial or other disposition.
LAW
In American Bank v. Saxena, 553 So. 2d 836 (La.1989), the Supreme Court held that summary judgment is the appropriate procedural device to enforce a negotiable instrument when the defendant establishes no defense against enforcement. Once the plaintiff, the holder of a promissory note, proves the maker's signature, or the maker admits it, the holder has made out his case by mere production of the note and is entitled to recover in the absence of any further evidence. Thomas v. Bryant, 597 So. 2d 1065 (La.App.2d Cir.1992).
Once the plaintiff has met his burden of proof, the burden shifts to the defendant to prove the existence of a triable issue of fact. Saxena, 553 So.2d at 846. Such proof can be established through parol evidence. Scafidi v. Johnson, 420 So. 2d 1113 (La.1982); Thomas, 597 So.2d at 1068. However, the evidence must be admissible as a matter of law and must consist of specific factual details. Equipment, Inc. v. Anderson Petroleum, Inc., 471 So. 2d 1068 (La.App. 3d Cir.1985) [defendant disputed the amount claimed by plaintiff, but offered no specific facts in support of his allegation]; Louisiana National Bank v. Jumonville, 563 So. 2d 965 (La.App. 1st Cir. 1990) [parol evidence is not admissible to vary the terms of an instrument].
In order to defeat summary judgment, the defendant must assert a valid defense to liability on the note, not separate and distinct claims that are unrelated to the question of liability. Saxena, 553 So.2d at 844 [defendant admitted his debt to the plaintiff, but attempted to avoid liability by seeking tort damages from the plaintiff]; Gulf Federal Savings and Loan Association v. Nugent, 528 So. 2d 782 (La. App. 3d Cir.1988), writ denied, 533 So. 2d 19 (La.1988) [factual dispute existed concerning substitution of collateral, but there was no dispute regarding the note and guaranty]. Both the Saxena and Nugent courts granted summary judgment and held that a defendant cannot plead, as a defense, unliquidated claims for damages as compensation or setoff against a liquidated amount due on a promissory note.
By contrast, in both Malcombe v. LeBlanc, 539 So. 2d 665 (La.App. 3d Cir.1989), and Ouachita National Bank v. Gulf States Land and Development, Inc., 579 So. 2d 1115 (La.App. 2d Cir.1991), writ denied, 587 So. 2d 695 (La.1991), summary judgment in favor of the holder of a promissory note was defeated because the debtor asserted a viable defense to liability on the note. In Malcombe, the debtor offered the deposition testimony of the creditor to prove an agreement that monthly payments could be made on the note, which evidence created an issue of fact as to whether the debtor was in default or whether the note was due at the time alleged. In Ouachita National Bank, the defendant's allegation that the plaintiff breached an overall agreement, of which the notes were only a part, raised a genuine issue of material fact as to the question of liability on the note itself. Similarly, in Commercial National Bank in Shreveport v. Pipe Sales of Shreveport, Inc., 600 So. 2d 130 (La.App. 2d Cir.1992), writ denied, 604 So. 2d 1006 (La.1992), the court reversed summary judgment in favor of the creditor because the defendant, a guarantor, raised an issue of fact as to whether the debt was legitimately contracted. See also Scafidi, supra.
ANALYSIS
In the instant case, the defendants have not denied their signatures on the notes sued upon by the plaintiff. They have not denied that the loans were made and the money received, nor that they pledged collateral to secure the debts. As *44 noted by the Saxena court, "[w]hen signatures are admitted or established, production of the instrument entitles the holder to recover on it unless the defendant establishes a defense. R.S. 10:3-307(2)." 553 So.2d at 842.
We reject as a valid defense the defendants' claim that Premier Bank negligently damaged the inventory of Percomex which was subject to a collateral chattel mortgage to secure the debt at issue. First, defendants pled no specific facts in support of this claim. Equipment, Inc., supra. Second, damage for the failure to secure collateral is an unliquidated claim which cannot be pled as compensation or setoff against a liquidated sum on a promissory note. Nugent, supra.
We also reject as a valid defense the defendants' assertion, via affidavit, that Premier Bank orally agreed to extend the notes beyond the clear and specific 90 day period evidenced in the notes. Again, defendants pled no specific facts in support of this allegation such as the terms, conditions, or date of such agreement. Equipment, Inc., supra. The debtors offered only their own affidavits which consisted of unsubstantiated, nonspecific parol evidence that the notes would be renewed indefinitely. Second, the parol evidence offered by the defendants is not admissible to prove a variance with the terms of an instrument. Jumonville, supra; Thomas, supra. Accordingly, the allegation of an oral agreement to extend the due date of the notes does not fulfill the burden of proof requirement articulated by the Supreme Court in Saxena, supra.
Finally, we also reject the defendants' argument that Davenport was wrongfully induced to mortgage his home as security for the notes by the Bank's oral promise to extend the due date beyond 90 days. Even assuming that such an oral promise did take place, the defendants' claim is a contested, unliquidated debt not presently due and cannot be pled as compensation for the sums due on the notes. Nugent, supra.
The defendants herein have not asserted any defenses to liability on the notes and have thereby failed to raise a genuine issue of material fact sufficient to defeat summary judgment. The claims asserted by the defendants are separate, unliquidated claims which are not related to the question of liability. These claims have been preserved for trial and will be considered and resolved at that time.
The allegations and evidence presented herein by Percomex and Davenport are not comparable to that offered by the debtors in Scafidi, Malcombe, Pipe Sales, and Ouachita National Bank. In those cases, the debtors defeated summary judgment by presenting proof of a question of fact as to whether liability on a note existed. No such proof was presented in the case before us, and accordingly, we find the trial judge properly granted partial summary judgment in favor of the Bank.
For the foregoing reasons, the judgment of the trial court is affirmed. Costs of this appeal are assessed to Percomex, Inc. and Harold Davenport.
AFFIRMED. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1623926/ | 126 S.W.3d 623 (2004)
E.H. "Harvey" STEINHAGEN, III, and Petrotex Fuels, Inc., Appellants,
v.
Bob A. EHL, Appellee.
No. 09-01-515 CV.
Court of Appeals of Texas, Beaumont.
Submitted October 16, 2003.
Decided January 22, 2004.
*624 Roger S. McCabe, Mehaffy & Weber, Beaumont, for appellants.
Barbara J. Gardner, The Gardner Law Firm, Houston, for appellee.
Before STEVE McKEITHEN, C.J., DON BURGESS and HILL[*], JJ.
OPINION
STEVE McKEITHEN, Chief Justice.
E.H. "Harvey" Steinhagen, III, and PetroTex Fuels, Inc., appeal an adverse judgment awarding Bob A. Ehl actual and exemplary damages for conversion of fuel dispensing equipment. The appellants raise four issues. In answer to their second issue, we find that the discovery rule did not defer accrual of Ehl's cause of action for conversion. Accordingly, we reverse the trial court's judgment and render judgment that Ehl take nothing.
Ehl owns a convenience store with underground storage tanks for motor fuel. Effective February 1, 1997, Ehl leased the property to Damon V. Webb. Their commercial lease agreement included equipment described in an exhibit that listed gasoline dispensing equipment that included "4 Gilbarco MPD Six Hose Dispensers." There were actually two, rather than four, *625 Gilbarco dispensers, and these are the fuel pumps converted by the appellants.[1] Steinhagen is the president and sole shareholder of PetroTex. On January 31, 1997, PetroTex and Webb entered into a Fuel Consignment Agreement through which Webb sold PetroTex's fuel from the convenience store. Webb wanted to upgrade the property, so Steinhagen and Webb negotiated an arrangement where Ehl's Gilbarco pumps would be replaced with newer Gilbarco pumps equipped with credit card readers and a hose configuration that enabled use of the third underground storage tank for diesel fuel instead of medium grade gasoline.[2] Steinhagen negotiated the sale of the old pumps with Jim White, who installed the new pumps. PetroTex paid for the new, card-reading Gilbarco pumps that were installed on August 8, 1997. On August 18, 1997, White paid PetroTex $9,000 for the pumps. The proceeds were credited by PetroTex to the purchase of the new pumps.
It is undisputed that Ehl's pumps were removed from the premises and sold to a third party in August 1997. The controverted facts litigated at trial were whether Ehl consented to the replacement and whether Ehl personally visited the premises after the installation of the new pumps. Webb testified that he discussed changing the pumps with Ehl and obtained Ehl's approval for selling or trading in the old pumps before they were removed. Webb also claimed that he discussed the new pumps with Ehl when Ehl fueled at the station in 1997. Ehl testified that when he went by the store after Webb leased it, there were never any new pumps, and that he did not discover that his pumps had been removed until May 1999. Ehl testified that he and Webb never discussed new fuel pumps and denied having consented to the change.
Webb defaulted on the commercial lease agreement in March 1999 and abandoned the premises early in 1999. Months later, Steinhagen noticed that vandals had cut the pump hoses and he had Jim White remove the new pumps from Ehl's premises. Kim Chavez took over the convenience store in April 2000 and arranged with PetroTex for the June 2000 installation of Tokheim brand pumps at the convenience store. The Tokheim pumps were installed at the convenience store at the time of trial.[3] Chavez, too, defaulted and in November 2000 closed the business she operated on the premises.
This litigation commenced July 13, 2000. The claims alleged in the original petition were also alleged in the amended pleading on which trial was held. Ehl sued Steinhagen and PetroTex for conversion. Those claims were ultimately reduced to the judgment now on appeal. Ehl sued Webb for violation of bailment duties, conversion, and breach of lease. Ehl's claims against Webb were reduced to a default judgment, which the trial court severed from the main action, and are not at issue in this appeal. Ehl also sued Kimberly Chavez and her husband, Alex Chavez, for breach of lease. The Chavezes failed to answer the suit, although Kim Chavez testified *626 during the trial. After trial but before judgment, the trial court granted Ehl's motion to non-suit the Chavezes. PetroTex filed a counterclaim against Ehl for conversion of equipment listed in Kim Chavez's contract with PetroTex and for filing groundless pleadings in bad faith. PetroTex's conversion claim was based upon Ehl's refusal to allow PetroTex onto Ehl's premises for the purpose of removing the Tokheim pumps.[4]
The jury found that both Steinhagen and PetroTex converted property owned by Ehl and that $35,431 would compensate Ehl for his damages, then found that either Steinhagen or PetroTex acted with malice or fraud in the conversion. The jury found that Ehl, through reasonable diligence, discovered or could have discovered that his fuel pumps were missing in "Fall to Winter '98", then found Ehl's action or inaction to be a waiver of his right to claim conversion. The jury failed to find that Ehl converted fuel dispensing equipment of PetroTex. The jury then assessed exemplary damages of $50,000 against Steinhagen and $30,000 against PetroTex. The trial court disregarded the jury's waiver finding and entered a judgment in the amount of $115,431.00 for Ehl.
The appellants' brief asks, "Did the trial court commit reversible error in applying the discovery rule to extend limitations on a cause of action clearly barred by the statute of limitations?" A cause of action for conversion must be commenced no later than two years after its accrual. TEX. CIV. PRAC. & REM.CODE ANN. § 16.003 (Vernon 2002). When it applies, the "discovery rule" defers the accrual of a cause of action until the plaintiff discovers or, in the exercise of reasonable diligence, should discover the "nature of his injury." Childs v. Haussecker, 974 S.W.2d 31, 40 (Tex. 1998). The discovery rule only defers accrual of a cause of action until the plaintiff discovers, or should have discovered through reasonable diligence, "the injury and that it was likely caused by the wrongful acts of another." Id. Once these requirements are satisfied, "limitations commences, even if the plaintiff does not know the exact identity of the wrongdoer." Id. The appellants contend that Ehl's cause of action against them for conversion accrued on the date that the conversion occurred; that is, when White took possession of the pumps and paid PetroTex for them. The appellee contends that his cause of action for conversion accrued when he acquired knowledge that his pumps and the replacement pumps had been removed.
"[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." S.V. v. R.V., 933 S.W.2d 1, 4 (Tex.1996). However, two deferred accrual exceptions to the "legal injury rule" exist in limited circumstances. Id. at 4-5. The "discovery rule" rule has been applied where the nature of the injury incurred is inherently undiscoverable and the evidence of injury is objectively verifiable. Computer Assocs. Int'l, Inc. v. Altai, Inc., 918 S.W.2d 453, 456 (Tex.1996). But the discovery rule is applied to categories of cases where the nature of the injury is inherently undiscoverable, not to particular cases. HECI Exploration Co. v. Neel, 982 S.W.2d 881, 886 (Tex.1998). Thus, the Supreme Court declined *627 to apply the discovery rule to cases where the injury in that particular case may well have been inherently undiscoverable, because the nature of the injury was not inherently undiscoverable for the category of cases at issue. See Wagner & Brown, Ltd. v. Horwood, 58 S.W.3d 732, 737 (Tex.2001)(excessive or improper charges resulting in the underpayment of royalties); HECI Exploration Co. v. Neel, 982 S.W.2d at 886 (damage to common oil and gas reservoir from illegal production); Computer Assocs. Int'l, Inc. v. Altai, Inc., 918 S.W.2d at 457 (trade secret misappropriation).
In conversion cases, the general rule is that the statute of limitations begins to run at the time of the unlawful taking, when the legal injury occurs. Rogers v. Ricane Enters., Inc., 930 S.W.2d 157, 166 (Tex.App.-Amarillo 1996, writ denied). The appellee cites Hofland v. Elgin-Butler Brick Co., 834 S.W.2d 409, 414 (Tex.App.-Corpus Christi 1992, no writ), for the proposition that the discovery rule applies to his case. We find the case to be inapposite. Hofland applied the discovery rule to "the class of conversion cases composed of initial lawful possession, discovery of unequivocal acts of conversion, and no effective demand and refusal...." Id.[5] Although Webb's initial possession of the property was lawfully obtained pursuant to the lease agreement, only Steinhagen's and PetroTex's conversion removal and sale of Ehl's pumps to White is at issue in this case. The class of cases to which this case belongs is the "unlawful possession" class of conversion cases. See Sunwest Bank of El Paso v. Basil Smith Eng'g Co., Inc., 939 S.W.2d 671, 674 (Tex.App.-El Paso 1996, writ denied) (embezzlement); Autry v. Dearman, 933 S.W.2d 182, 192-93 (Tex.App.-Houston [14th Dist.] 1996, writ denied) (conversion of lawsuit proceeds subject to subrogation); Rogers v. Ricane Enters., Inc., 930 S.W.2d at 166 (conversion of oil and gas produced under void lease). The fact that a tenant was in possession of the pumps at the time the conversion was committed would not, in and of itself, trigger the application of the discovery rule. The case that articulated the legal injury rule, Houston Water-Works Co. v. Kennedy, 70 Tex. 233, 8 S.W. 36 (1888), involved damage to the interior of a structure held by a tenant. The cause of action accrued when the defendant cut an arch through an interior supporting beam not open to view by the landlord, who did not discover the injury until the exterior walls cracked. Id. at 37. We hold that the discovery rule does not apply in this case as an avoidance of the limitations defense.
Next, we consider whether accrual of Ehl's cause of action for conversion is deferred under the "fraudulent concealment doctrine." The discovery rule and the fraudulent concealment doctrine are distinct concepts that exist for different reasons. Wagner & Brown, Ltd. v. Horwood, 58 S.W.3d 732, 736 (Tex.2001). Ehl did not plead fraudulent concealment as an avoidance of accrual of his cause of action. He did, however, allege that the conversion was "fraudulent and malicious." These pleadings are quite specific, and allege as follows:
The conversion of the fuel dispensing equipment by Defendants Steinhagen and PetroTex was fraudulent and malicious in that Defendants specifically intended to cause and knowingly did cause *628 substantial injury to Mr. Ehl. Defendants knew that the fuel dispensing equipment was the property of Mr. Ehl, but Defendants nevertheless converted the equipment to their own use. Moreover, when Mr. Ehl was attempting to locate his fuel dispensing equipment, Defendant Steinhagen stated that he did not take it and that he did not know anything about the equipment. Such statement was contrary to his admission in this lawsuit that he did in fact take the equipment and retain the proceeds. Accordingly, Mr. Ehl asks that exemplary or punitive damages be awarded against Defendants Steinhagen and PetroTex.
At trial, the attorney who formerly represented Ehl testified that on March 2, 2000, Steinhagen stated that Webb had taken Ehl's pumps. Concealment for the purposes of deferring accrual of a cause of action is concealment of the right of action. Nichols v. Smith, 507 S.W.2d 518 (Tex.1974). The tortfeasor's fraudulent concealment of his identity does not defer accrual. Otis v. Scientific Atlanta, Inc., 612 S.W.2d 665 (Tex.Civ.App.-Dallas 1981, writ ref'd n.r.e.). Since May 1999, Ehl had known that his equipment was missing, and on August 9, 1999, a letter from Webb's attorney informed Ehl's counsel that "Mr. Harvey Steinhagen III, d/b/a PetroTex Fuels sold the two pumps for $9,000.00...." A statement by Steinhagen some nine months after the latest possible discovery date and almost seven months after the latest date on which he learned the appellants were possibly involved in the conversion is not evidence of fraudulent concealment of the conversion. Furthermore, it appears that Steinhagen's denial did not deter Ehl from suing Steinhagen and PetroTex, as the original petition was filed four months later joined both as original defendants to the suit. We conclude that fraudulent concealment is not available as an alternate, unpleaded ground for avoidance of the bar of limitations.
Issue Two is sustained. Because our holding disposes of the appeal, we do not address the remaining issues. We reverse the judgment of the trial court and render judgment that Bob A. Ehl take nothing against E.H. "Harvey" Steinhagen, III, and PetroTex Fuels, Inc.
REVERSED AND RENDERED.
DON BURGESS, Justice, concurring.
I concur. While I do not agree with the majority on the non-applicability of the discovery rule, I would affirm based on the jury finding of waiver. The jury found Mr. Ehl's actions or inactions constituted a waiver of his right to claim conversion. The trial judge disregarded this jury question finding there was no evidence to support it. There was evidence that Damon Webb, Mr. Ehl's lessee, discussed a "trade-out" of the old pumps in the Spring of 1997. There was also evidence that in the Fall of 1997, Mr. Ehl actually used the new pumps and discussed them with Webb. There was additional evidence that Mr. Ehl was told in August of 1999 that the two pumps had been sold for $9,000 and the money had been retained by Mr. Steinhagen. In May of 2000, Kim Chavez assumed the Webb lease and pumps were reinstalled. All of this is some evidence of waiver as it was defined for the jury. Consequently, I would hold the trial judge erred in disregarding the jury finding, sustain issue one, and reverse and render a take-nothing judgment.
NOTES
[*] The Honorable John Hill, sitting by assignment pursuant to TEX. GOV'T CODE ANN. § 74.003(b) (Vernon 1998).
[1] The fuel delivery system changed several times over a period of about five years. In this opinion, we refer to the dispensers at issue in this appeal as "Ehl's pumps" or "the old pumps."
[2] The installation and removal of the newer, credit-ready pumps is pertinent to this litigation only for its effect on the accrual of the cause of action for converting the pumps referred to in the Webb lease. The ownership and disposition of what we call "the replacement pumps" or "the new pumps" is not at issue in this case.
[3] These pumps were part of the matter in controversy of the counterclaim submitted to the jury.
[4] As the trial court reminded the parties when the issue of entry onto the property to remove the pumps was raised in a post-trial hearing, ownership of these pumps was not at issue in the trial. None of the appellants' issues relate to this counterclaim, which the judgment did not refer to but which was disposed of by implication in the final judgment for the plaintiffs.
[5] The discovery rule does not apply to all conversion cases in which possession was initially lawful. See Conoco, Inc. v. Amarillo Nat'l Bank, 14 S.W.3d 325, 328 (Tex.App.-Amarillo 2000, no pet.) (The discovery rule does not apply to cases of conversion of collateral). | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1663665/ | 795 So. 2d 1176 (2001)
Gloria SCOTT, et al.,
v.
THE AMERICAN TOBACCO COMPANY, et al.
No. 2001-CC-2498.
Supreme Court of Louisiana.
September 25, 2001.
Rehearing Denied October 15, 2001.
*1179 William P. Barnette, Charles M. Shaffer, Jr., Jack Williams, William L. Durham, II, King & Spalding; Carmelite M. Bertaut, William F. Grace, Jr., Peter J. Rotolo, III, Chaffe, McCall, Phillips, Toler & Sarpy; Scott E. Delacroix, Deborah B. Rouen, Charles F. Gay, Jr., Ronald J. Sholes, Jeffrey E. Richardson, Adams & Reese; Stephen H. Kupperman, Phillip A. Wittmann, Dorothy H. Wimberly, Stone, Pigman, Wather, Wittmann & Hutchinson; Steven W. Copley, Ernest E. Svenson, Gordon, Arata, McCollam, Duplantis & Eagan, New Orleans; Mark A. Belasic, Kevin D. Boyce, Jones, Day, Reavis & Pogue; Gary R. Long, James P. Muehlberger, Jennifer L. Brown, Shreveport, Tammy B. Coker, Shock, Hardy & Bacon; Robert C. Williams, Baton Rouge, Counsel for Applicant.
Wendell H. Gauthier, Bruce C. Dean, Deborah M. Sulzer, Gauthier, Downing, Labarre, Beiser & Dean, Matairie; Russ M. Herman, Stephen J. Herman, Herman, Herman, Katz & Cotlar; Robert L. Redrearn, Simon, Peragine, Smith & Redfearn, New Orleans; William B. Baggett, Jr., Baggett, McCall & Burgess, Lake Charles; Kenneth M. Carter, Carter & Cates, New Orleans; Michael X. St. Martin, St. Martin & Williams, Houma; Calvin C. Fayard, Jr., Fayard & Honeycutt, Denham Springs; Donald G. Kelly, Kelly, Townsend & Thomas; Melvin L. Holden, W. James Singleton, Shreveport, Holden, Harig, & Guidry; Edwin R. Murray, Dominic J. Gianna, Middleberg, Riddle & Gianna; Joseph M. Bruno, Christine L. DeSue, Stephen B. Murray, David S. Scalia, Walter J. Leger, Jr., New Orleans, Counsel for Respondent.
PER CURIAM[*]
We granted certiorari in this class action case to review the rulings of the district court on challenges for cause made by defendants as to certain prospective jurors with immediate family members who were also prospective members of the class. For the reasons that follow, we affirm the district court's judgment in part and reverse it in part.
FACTS AND PROCEDURAL HISTORY
This litigation arises from a class action filed by plaintiffs against various tobacco defendants. Essentially, plaintiffs allege defendants manufactured, promoted and sold cigarettes to them while fraudulently concealing and denying that the cigarettes contained the drug nicotine. Among the remedies sought by plaintiffs was the establishment *1180 of a medical monitoring program. The plaintiff class consists of all Louisiana residents who are or were smokers on or before May 24, 1996 and who desire to participate in medical monitoring and/or cessation assistance programs.
During jury selection, defendants challenged for cause several prospective jurors with immediate family members who smoked. Some of these same jurors indicated they would like to see their relatives receive free medical monitoring and smoking cessation assistance.[1] The district court denied these challenges.
At the conclusion of jury selection, defendants sought supervisory review in the court of appeal of the trial court's rulings denying their challenges for cause as to these jurors. Defendants also sought review of the district court's rulings denying challenges for cause alleging bias against other jurors.
A five-judge panel of the court of appeal, in a split decision, granted the writ in part and denied it in part. The majority found one juror and one alternate juror revealed bias toward defendants in their answers to questions during voir dire. As a result, the court of appeal found the district court erred in failing to grant defendants' challenges for cause as to these jurors.
However, the majority of the court of appeal rejected defendants' argument that those prospective jurors with family members who also could be potential class members should be excluded. The court found that merely because the prospective juror's family member was a potential class member does not automatically mean the prospective juror cannot be fair and impartial. Finding no abuse of discretion in the district court's conclusion that these prospective jurors could be fair and impartial, the majority of the court of appeal denied the writ on this issue.
Two judges dissented on this point. They observed that while the prospective jurors indicated they could be fair and impartial, such a statement failed the "psychological burdens of credibility" when the prospective juror potentially had immediate family members in the class. Because of the high profile nature of this case and its ability to affect thousands of Louisiana residents for the next twenty-five years, the dissenting judges felt it was imperative that the jury selected avoid even the appearance of impropriety which would inevitably result if a juror was deciding remedies affecting his or her immediate family.
Following the court of appeal's ruling, defendants sought relief in this court. Defendants assigned two errors in their application to this court. First, they complained the district court erred in failing to grant their challenges for cause as to the prospective jurors with immediate family members who were potential members of the class. Secondly, they argued the district court erred in failing to grant their challenges for cause alleging bias on the part of other jurors. We granted the writ to address the first assignment of error, and denied the writ in all other respects.
The issues presented for our consideration are: (1) whether there is a per se prohibition against seating jurors whose immediate family members are potential members of the class, and (2) if no per se prohibition exists, whether the district court abused its discretion under the facts of this case in denying defendants' challenges for cause as to these jurors.
*1181 At the outset, we note it is unusual for this court to exercise its supervisory jurisdiction to review a district court's rulings during voir dire, especially when the case is presented in a pre-trial posture. However, this case involves unique circumstances due to the broad scope of the potential class, which may include a large percentage of Louisiana residents. Given the far-reaching consequences of this action, as well as the complexity and the length of trial, concerns of judicial economy motivate us to address these issues at this time.
DISCUSSION
Per Se Exclusion of Jurors with Immediate Family Members Who are Potential Class Members
Defendants argue in favor of a per se rule excluding any prospective jurors who have immediate family members who are potential class members. Defendants reason that if the jury finds in favor of plaintiffs, such a finding will result in the availability of medical monitoring and smoking cessation assistance for these jurors' relatives. Under such circumstances, defendants suggest it is impossible for the district court not to reasonably believe that the juror's relationship with the immediate family member would not influence the juror in coming to a verdict, mandating that the challenge for cause be granted under La.Code Civ. P. art. 1765(3).
Despite defendants' argument to the contrary, there is nothing in La.Code Civ. P. art. 1765(3) which would suggest the legislature intended a "bright line" rule which would automatically exclude a prospective juror for cause merely because that prospective juror may be influenced by a family relation. Rather, that article, which is phrased in permissive language, provides that a juror may be challenged for cause if the juror's blood relations are such that it must be reasonably believed that they would influence the juror in coming to a verdict:
A juror may be challenged for cause based upon any of the following:
* * *
(3) When the relations whether by blood, marriage, employment, friendship, or enmity between the juror and any party or his attorney are such that it must be reasonably believed that they would influence the juror in coming to a verdict....
While this court has never addressed the precise issue presented in this case, we have never held that a juror should be automatically disqualified because of a relationship. For example, in State v. Gray, 351 So. 2d 448, 455 (La.1977), the defendant argued the trial court should have excused three jurors because one juror was acquainted with the prosecuting and defense attorneys and was in business with the relative of a prosecuting attorney, one juror was a social friend of the prosecuting attorney and the third juror was the nephew of the sheriff of the parish where the prosecution was taking place. We found no error in the trial court's refusal to excuse these jurors, stating:
A trial judge is granted much discretion in determining the composition of the jury. The mere existence of personal acquaintances between a prospective juror and the trial participants does not, without more, demonstrate a lack of fitness to serve as a juror. In the present case all three of the prospective jurors stated on voir dire that the relationship involved would not prevent their impartial service on the jury. We cannot say that the failure to excuse these jurors was an abuse of the trial judge's discretion.
Similarly, courts have held the existence of a physician-patient relationship between a juror and the defendant was not sufficient *1182 to create a presumption that the juror could not render a fair verdict. Cobb v. Kleinpeter, 95-271 (La.App. 3rd Cir.10/4/95), 663 So. 2d 236, writ denied, 95-2683 (La.1/12/96), 666 So. 2d 323; Seals v. Pittman, 499 So. 2d 114 (La.App. 1st Cir.1986). In Savoie v. McCall's Boat Rentals, Inc., 491 So. 2d 94 (La.App. 3rd Cir.), writ denied, 494 So. 2d 334 (La.1986), the defendant argued there should be an automatic prohibition against a husband and wife serving together on the same jury. The court of appeal rejected this argument, finding the trial court inquired as to whether they could exercise independent judgment, and was satisfied they could do so.
In sum, we are convinced there is no legislative or jurisprudential support for defendants' position that all jurors with family members who are potential class members must be excluded from the jury on a per se basis. Accordingly, we find the trial court did not err in refusing to excuse such persons from serving on the jury on this basis alone.
Whether the District Court Abused its Discretion under the Facts of this Case in Denying Defendants' Challenges for Cause
Having determined there is no per se prohibition against jurors serving on the jury merely because they have immediate family members who are potential members of the class, we now determine whether the district court abused its discretion in denying defendants' challenges for cause as to these jurors. In doing so, we begin from the well-settled proposition that if a prospective juror is able to declare to the district court's reasonable satisfaction that he could render an impartial verdict according to the law and evidence, a challenge for cause to that juror is properly denied. State v. Claiborne, 397 So. 2d 486 (La.1981); State v. McIntyre, 381 So. 2d 408 (La.1980). The trial court is vested with broad discretion in ruling on challenges for cause and such rulings will not be disturbed on appeal absent an abuse of discretion. State v. Benoit, 440 So. 2d 129 (La.1983). However, while the trial court is accorded broad discretion in ruling on challenges for cause, this court has cautioned that "[a] challenge for cause should be granted, even when a prospective juror declares his ability to remain impartial, if the juror's responses as a whole reveal facts from which bias, prejudice or inability to render judgment accordingly may be reasonably implied." State v. Hallal, 557 So. 2d 1388, 1390 (La. 1990) (citing State v. Jones, 474 So. 2d 919, 926 (La.1985)). With these principles in mind, we now turn to an examination of the transcript of the voir dire of the twelve jurors with immediate family members who are prospective class members to determine whether there is any basis for a reasonable belief under La.Code Civ. P. art. 1765(3) that these jurors' family relations would influence them in reaching a verdict.[2]
Juror No. 1 is a thirty-four year old male, whose father is a former smoker and whose mother and brother are current smokers. During voir dire, when asked if he would want any of his relatives to participate in a smoking program, he responded that he had asked them if they wanted to quit, but they declined. Juror No. 1 also testified that he had briefly smoked in the past.[3] When asked whether he would *1183 consider participating in a smoking cessation program, he indicated he was not sure.
Juror No. 1's responses, when taken as a whole, indicate a basis for a reasonable belief that the juror's family relations may influence him in coming to a verdict. Juror No. 1's statement that he had specifically asked his mother and brother if they wanted to quit smoking, coupled with his failure to rule out his own participation in a smoking cessation program, suggest that Juror No. 1's verdict could be influenced by the availability of such programs.[4] Under these circumstances, we find the district court abused its discretion in denying defendants' challenge for cause as to Juror No. 1.
Juror No. 2 is a forty-four year old female, whose father is a former smoker. During voir dire, she indicated her father stopped smoking over forty years ago. When asked if she would like to see her father receive any medical monitoring, she stated, "I don't have an opinion on that." She indicated she did not know what his view is on medical monitoring.
Nothing in Juror No. 2's responses indicates a basis for a reasonable belief the juror's family relations are such that they would influence her in coming to a verdict. This juror's responses taken as a whole demonstrate she has no strong belief regarding medical monitoring, making it unlikely that the potential availability of such monitoring to her father would affect her ability to be impartial. Accordingly, we do not find the district court abused its discretion in denying defendants' challenge for cause as to Juror No. 2.
Juror No. 5 is a thirty-two year old female, whose father is a former smoker. During voir dire, she indicated her father stopped smoking over twenty years ago. Also, she stated her father had triple bypass surgery about five years ago; however, she did not feel the surgery was related to his smoking. Rather, his heart condition could have resulted from his eating habits. Juror No. 5 affirmatively stated she could listen to the evidence and could be fair.
While Juror No. 5 was not examined extensively during voir dire regarding the potential availability of medical monitoring to her father, her testimony as a whole indicates that her judgment would not be adversely affected because of her father's condition and that she could be fair. Under these circumstances, we cannot say the district court abused its discretion in denying defendants' challenge for cause as to Juror No. 5.
Juror No. 7 is a thirty-five year old female. Her mother is a long-time smoker who recently quit and her two brothers are current smokers. During voir dire, she indicated she would want her mother to participate in a medical monitoring program. She stated she did not know whether her mother would participate, but would recommend that she participate.
The responses of Juror No. 7, taken as a whole, present the basis for a reasonable belief that she may be influenced by the potential availability of medical monitoring to her mother. Juror No. 7 obviously perceived a strong benefit to her mother from medical monitoring, as demonstrated by the fact she would recommend it to her mother, even though she was not sure her *1184 mother would accept it. While we recognize Juror No. 7 indicated she could be fair, we nonetheless conclude the district court abused its discretion in failing to sustain defendants' challenge for cause as to this juror.
Juror No. 10 is a fifty-seven year old female, whose husband is a former smoker and whose four sons are current smokers.[5] During voir dire, she indicated she did not think her sons would like to quit smoking. She stated she would like her sons to get medical tests to determine if smoking is harming their health, although she expressed some skepticism regarding whether the tests would "make sense" in light of their continued smoking.
Juror No. 10's responses as a whole demonstrate that she would like her sons to have the benefit of medical monitoring, even though she questioned its effectiveness. In applying the reasonable belief test of La.Code Civ. P. art. 1765(3), we find ordinary experience suggests that as a mother, Juror No. 10's love for her children could influence her verdict. Under these circumstances, we conclude the district court abused its discretion in denying defendants' challenge for cause as to Juror No. 10.
Juror No. 11 is a forty-two year old female, whose sister is a current smoker. During voir dire, she indicated her sister has been smoking for a long time, but her sister's smoking does not bother her one way or the other. She stated that her sister really does not care about developing smoking related diseases. She also stated she felt her sister should get medical monitoring, but probably would not. She was expressly questioned as to whether she would be more likely to rule in favor of plaintiffs because of the potential availability of medical monitoring to her sister. In her response, she stated she would have to weigh the evidence.
Juror No. 11's initial response suggests a possibility that she could be influenced by the availability of monitoring for her sister. However, when asked specifically by plaintiffs' counsel whether the availability of monitoring would influence her decision, she essentially responded in the negative, indicating her decision would be based on the evidence. Under these circumstances, we find that while Juror No. 11's preliminary response was suspect, plaintiffs' counsel successfully rehabilitated her by demonstrating her verdict would not be influenced by the potential availability of medical monitoring to her sister. Accordingly, we find no abuse of discretion in the district court's ruling denying defendants' challenge for cause as to this juror.
Juror No. 12 is a fifty-four year old male, whose father is a former smoker. During voir dire, he indicated that he is not concerned with his father possibly developing lung cancer, because his father goes to the doctor quite often. When asked whether he wanted to see his father get medical monitoring, he responded that his father goes to the doctor regardless. In addition, he stated that his "father wouldn't want nothing free anyway." He indicated that regardless of what his father may or may not want, he could be fair in deciding the case.
Juror No. 12's responses indicated he saw little benefit to medical monitoring for his father, because his father already received regular check-ups. Taken as a whole, Juror No. 12's responses support his statement that he could be fair in deciding the case. The district court did *1185 not abuse its discretion in denying defendants' challenge for cause as to Juror No. 12.
Alternate Juror No. 13 is a fifty-two year old female, whose husband is a former smoker and whose brother is a current smoker.[6] During voir dire, she indicated she would like to see her brother quit smoking and would probably like to see him participate in a free smoking cessation program and receive free medical monitoring, although she had some doubt as to whether he would participate.
Alternate Juror No. 13's responses indicate that she perceived a benefit from the potential availability of medical monitoring for her brother. Although she indicated she could be fair, her responses taken as a whole disclose a basis for a reasonable belief that the availability of medical monitoring for her brother could influence her verdict. Accordingly, we find the district court abused its discretion in denying defendants' challenge for cause as to Alternate Juror No. 13.
Alternate Juror No. 14 is a thirty-six year old male, whose mother and father are former smokers. During voir dire, he admitted his parents smoked for a short period of time and quit over twenty years ago. In addition, he stated that his father recently had a stroke and is ill. When asked if he would be interested in seeing his father receive free medical monitoring, he initially stated that he would be interested. However, when asked the question again, he stated he changed his mind and would not like to see his father participate in a free medical monitoring program.
Although Alternate Juror No. 14 initially indicated that he would like to see his father receive medical monitoring, his subsequent response clearly and unequivocally demonstrated that he changed his mind on this issue and would not want his father to participate in medical monitoring. In ruling on defendants' challenge for cause, the district court observed that Alternate Juror No. 14's subsequent response negated any inference that he would be favorable to plaintiffs because of the availability of monitoring to his father. We cannot say the district court's ruling represents an abuse of discretion.
Alternate Juror No. 17 is a forty-one year old female, whose father is a current smoker. During voir dire, she stated her father did not opt out of the class in this case. She indicated she would like to see her father receive medical monitoring and participate in a smoking cessation program, although she questioned whether he would do so.
Despite her assertions that she could be fair, Alternate Juror No. 17's responses taken as a whole form the basis for a reasonable belief that the potential availability of medical monitoring for her father could influence her decision. She acknowledged her father is a potential class member who has not opted out of the class, and stated she would like to see him receive medical monitoring and smoking cessation assistance. Under these circumstances, we conclude the district court erred in denying defendants' challenge for cause as to Alternate Juror No. 17.
Alternate Juror No. 21 is a forty year old female, whose mother is a former smoker and whose husband is a current smoker who has not opted out of the class. During voir dire, she stated her husband has high blood pressure and his doctor wanted him to quit smoking. She indicated she is close to her mother and would like to have the best medical treatment *1186 and medical detection facilities available to her mother. She would like her mother to have an opportunity to receive free medical monitoring. In addition, when asked about her husband and his receiving free medical monitoring, she admitted she was "biased" and that she would want him to receive medical monitoring. She further indicated she was worried about his health and his smoking.
Alternate Juror No. 21's responses conclusively demonstrate a basis for a reasonable belief that the availability of monitoring to her relatives would influence her verdict. She clearly expressed a desire for her mother and husband to receive medical monitoring. She candidly admitted that she was biased with regard to the availability of monitoring to her husband. Although Alternate Juror No. 21 later testified she could be fair, we find this testimony is insufficient to rehabilitate her. The district court erred in denying defendants' challenge for cause as to Alternate Juror No. 21.
Alternate Juror No. 22 is a thirty-eight year old female, whose mother is a current smoker. During voir dire, she stated her mother has asthma and that doctors opined smoking was the cause of her mother's asthma. She also indicated she would like to see her mother quit smoking and would encourage her mother to participate in a smoking cessation program. She has strong beliefs regarding cigarettes and their addictiveness and their harmfulness.
Alternate Juror No. 22's responses demonstrate a basis for a reasonable belief that the availability of monitoring to her mother would influence her verdict. She indicated she wanted her mother to quit smoking and would encourage her to participate in a smoking cessation program. While she indicated she would not decide the case in favor of plaintiffs just to help her mother, we find her responses as a whole suggest otherwise. The district court erred in denying defendants' challenge for cause as to Alternate Juror No. 22.
CONCLUSION
In sum, we find that La.Code Civ. P. art. 1765(3) does not set forth a per se rule which requires automatic disqualification of a prospective juror with a family member who is a potential class member. Rather, such determinations must be made upon review of the voir dire testimony of each juror, and upon consideration of the juror's testimony as a whole.
Reviewing the record in this case, we find the district court abused its discretion in failing to excuse for cause Jurors Nos. 1, 7 and 10 and Alternate Jurors Nos. 13, 17, 21 and 22. As to all other jurors, we find no abuse of discretion in the district court's rulings.
On remand, we direct the district court to replace the excused jurors with the previously-selected alternate jurors who have not been disqualified. The district court should then perform new jury selection for purposes of replenishing the pool of alternate jurors.[7]
DECREE
For the reasons assigned, the judgment of the district court is reversed insofar as it denied defendants' challenges for cause as to Jurors Nos. 1, 7 and 10 and Alternate Jurors Nos. 13, 17, 21 and 22. In all other respects, the judgment of the district court is affirmed. The case is remanded to the *1187 district court for further proceedings consistent with this opinion.
CALOGERO, C.J., concurs and assigns additional reasons.
KIMBALL, J., concurring in part, dissenting in part, and assigning reasons.
JOHNSON, J., dissenting and assigning reasons.
VICTORY, J., concurring in part, dissenting in part, and assigning reasons.
KNOLL, J., concurring in part, dissenting in part, and assigning reasons.
CALOGERO, Chief Justice, concurring.
I am in full accord with the opinion of this court. Seven of the twelve prospective jurors should be excluded from service for the reasons stated in the per curiam opinion. As to the other five, they will be allowed to serve on the jury as it cannot be reasonably believed that these individuals would be influenced in coming to a verdict, or so the trial judge with wide discretion so concluded.
The law does not compel the exclusion of jurors because they are related to a party unless the circumstances shown are such that it is reasonable to believe the relationship would influence the juror in coming to a verdict. See Louisiana Code of Civil Procedure article 1765.
I would conclude, and assume that those signing the per curiam opinion would agree, that an individual should not sit on a jury in the trial of a close family member charged with a crime and facing punishment, nor in a civil case where a close family member is a party seeking to assert or defend against a substantial monetary claim or a similarly important litigious matter.
But this is not the case here. The five jurors who have not been excused do not have family members who are parties in this litigation, nor do they have close relatives with serious monetary or liberty interests at stake. Therefore, the trial judge had to consider all the facts before him in determining whether these individuals could be fair and unbiased in rendering a verdict. He considered questionnaire response as well as answers upon live interrogation and was not convinced that the defendants had met their burden of proving that these jurors should be excused for cause. Based upon the record, the trial judge did not err in his decision regarding these five jurors.
KIMBALL, J., concurring in part, dissenting in part.
I agree with the majority that La.Code Civ. P. art. 1765(3) does not set forth a per se rule which requires automatic disqualification of a prospective juror with a family member who is a potential class member. However, I dissent from the finding that the trial judge abused his discretion in this matter. While some of the answers may cause question from the cold record before us, I believe that the trial judge who has the ability to observe the mannerisms, tone of voice and body language of each juror is in a better position to make those judgments than this Court. Additionally, I do not believe it is the function of this Court to micro-manage the selection of a jury in this manner. Therefore, I would uphold the trial court's findings on these jurors.
JOHNSON, J., dissenting.
I would deny this writ application. In the past, we have respected the vast discretion exercised by district trial judges in the course of jury selection. We have depended on them to see prospective jurors, listen to their answers, and make determinations as to whether jurors could be fair.
*1188 The defendants describe this litigation to provide medical monitoring programs for smokers and former smokers as "the largest class action in Louisiana history." They argue that a different set of rules should apply because of the potential for money damages.
I disagree. We still must rely on trial judges, not cold transcripts, for making credibility determinations.
Moreover, I believe that it is completely unrealistic to attempt to draw a bright line based on the potential for bias when, in fact, the class is so broad. When you look at the parameters of the class, every citizen in Louisiana, including judges, are potential members of the class, as virtually everyone is connected in some fashion to a smoker or former smoker.
VICTORY, J., concurring in part, dissenting in part.
La.Code Civ. P. art 1765 provides in pertinent part:
A juror may be challenged for cause based on any of the following:
(2) When the juror has formed an opinion in the case or is not otherwise impartial, the cause of his bias being immaterial;
(3) When the relations whether by blood, marriage, employment, friendship, or enmity between the juror and any party or his attorney are such that it must be reasonably believed that they would influence the juror in coming to a verdict. [Emphasis added.]
Fundamental to our system of justice is the rule of law providing that jury trials must be tried before an impartial jury. At issue in this case is whether parents, children, and siblings of persons who qualify to participate as plaintiffs in a class action lawsuit should be allowed to sit as jurors to determine whether judgment is rendered in favor of their relatives. While the Per Curiam of the Court has reversed the decision of the trial court in part and has ordered Jurors Nos. 1, 7 and 10 and Alternate Jurors Nos. 13, 17, 21 and 22 to be excused and replaced, it declares as acceptable jurors Nos. 2, 5, 11, 12 and Alternate Juror No. 14. Incredibly, a plurality of the Court finds no problem with allowing parents, children, and siblings of eligible class action plaintiffs to decide the fate of the class action claims. I believe that allowing such individuals to sit as jurors strikes at the very heart of the jury system. None of the cases cited in the Court's Per Curiam stands for the proposition that immediate family members of parties to a lawsuit should be seated as members of the jury panel. I have been unable to locate a single reported Louisiana decision in which such closely related family members have been allowed to decide the fate of their relatives' cases.
In my view, the Court falls into error because it confuses the tests applicable to excusing jurors under two distinct subsections of Code Civ. P. art. 1765. The jurors excused by the plurality all demonstrated in response to voir dire questioning that they were not impartial. They indicated an interest in the medical monitoring program sought by the plaintiff class and some even admitted that they would want their close relatives to participate in it. These jurors were clearly due to be excused under La.Code Civil P. art 1765(2), which deals with jurors who can be shown on the evidence presented to harbor actual subjective bias and who cannot be impartial. All prospective jurors who cannot be impartial are excused under article 1765(2), whether or not there is any relationship between the prospective juror and a party to the litigation.
La.Code Civ. P. art 1765(3), on the other hand, embodies a separate and different rule for excusing jurors. Under this provision, when the relationship between a *1189 prospective juror and a party to the suit is such that a reasonable person would expect the juror to be influenced by that relationship, the juror should be excused. That is the case regardless of whether actual subjective bias or impartiality can be demonstrated and even where it is denied from the subjective point of view of the individual prospective juror. Unless article 1765(3) is understood in this way, there would be no purpose to the provision, since a demonstration of actual bias would always prompt dismissal of the prospective juror pursuant to article 1765(2). Article 1765(3) utilizes an objective test to determine whether a reasonable person would believe that the demonstrated relationship is such that the relationship would influence the juror's verdict. The use of this objective reasonableness test is common in our law. See e.g., State v. Dumas, XXXX-XXXX (La.5/4/2001), 786 So. 2d 80; State v. Guinn, 319 So. 2d 407 (La.1975).
Not all relationships justify excusing a potential juror pursuant to Code Civ. P. art. 1765(3). The trial judge must examine the facts regarding the closeness and the nature of the relationship to determine whether a reasonable person would conclude that the prospective juror might be influenced by it. However, an immediate family member should never be allowed to sit on his or her relations' case. Such a close familial relationship is sufficient for any reasonable person to conclude that the juror's views might be influenced by that relationship. If we were to adopt the rationale suggested in the Court's Per Curiam, husbands and wives would be eligible to sit in judgment of their spouses' claims. All such potential jurors would have to do to survive a challenge for cause is to testify that they could be "fair" and refrain from saying anything that would prove actual bias.
The Per Curiam of the Court espouses the correct test under article 1765(3) when it considers Juror 10 and finds "ordinary experience suggests that as a mother, Juror No. 10's love for her children could influence her verdict." It also uses the correct test in dealing with the challenge to Juror No. 13 when it finds that even though the juror insists that she can be "fair", her love for her brother could influence her verdict. Regrettably, the Court does not apply the same test consistently to all of the challenged jurors. Had it done so, it would have excused the remaining jurors as well.
Juror Nos. 2, 5, 11, 12 and Alternate Juror No. 14 all have immediate family members who are eligible members of the defined class. They could not reasonably be expected to put aside their personal feelings and render a decision that is fair and impartial without regard to the health or welfare of their immediate family members. Just as in the case of Jurors No. 10 and alternate Juror No. 13, ordinary experience dictates that a mother, father, sister, brother, son or daughter's love would influence their verdicts. As to Jurors Nos. 5, 11, 12 and Alternate Juror No. 14, the Court errs primarily because it deviates into a subjective consideration of whether these particular jurors could overcome their familial relationships and be "fair." The majority concludes that there is no evidence that these Jurors would actually be influenced in making their decisions. This is the wrong standard. This inquiry might be relevant to a determination of whether the jurors should be disqualified for actual bias under 1765(2) but it is not determinative of whether a juror should be excused under article 1765(3). Moreover, even under the reasoning employed in the Per Curiam, the emphasis is on the wrong consideration. The Court deems it important that jurors doubt their family members would opt to participate in free medical *1190 monitoring if it were available, that the family members are already seen regularly by a physician, or that the health problems of the family members are not related to smoking. The Court ignores the fact that if these jurors render a verdict adverse to the plaintiffs, their family members will forever be precluded from making the decision to participate in free medical monitoring for cancer. Thus, whether they believe that their close relatives actually will or should participate in such a program, they will nevertheless be placed in a position as jurors of deciding whether or not that option will be available. It is this dilemma, inherent in the immediate family tie, that calls into question the integrity of any verdict these jurors might render. It is just such a situation that article 1765(3) was designed to avoid by focusing on the nature of the relationship itself, rather than demanding evidence of actual bias.
Moreover, in my view, prospective Juror No. 11 and Alternate Juror No. 14 should have been excused under both article 1765(2) and (3). Juror No. 11 has a sister who is a current smoker with a long history of smoking. The prospective juror indicated that she thought her sister should get medical monitoring. Alternate Juror No. 14 indicated on initial voir dire questioning that he would like to see his father, who recently had a stroke, receive free medical monitoring. While he said he changed his mind on that issue in response to a subsequent question, in my view his initial answer indicated a clear preference that his father have the benefit of the remedy sought by the class. These jurors demonstrated lack of impartiality in their responses during voir dire examination by indicating that they would like their family members who currently smoke or who have smoked in the past to get the benefit of medical monitoring and/or programs designed to help smokers quit smoking. These jurors were due to be excused pursuant to both La.Code Civ. P. arts. 1765(2) and 1765(3).
For the reasons indicated, I respectfully concur in the result reached by a plurality as to those jurors who have been excused. However, I dissent as to the other jurors at issue in this application who have not been excused.
KNOLL, Justice, concurring in part and dissenting in part.
For the following reasons, I respectfully concur in part and dissent in part.
The inherent weakness in the plurality opinion of the court fails to recognize the low threshold for challenging a juror for cause under LA.CODE CIV. PROC. art. 1765(3). Only a reasonable belief that an immediate family relationship to a party litigant might influence the juror is required, not actual bias. Although the statute does not specifically exclude these close family members, clearly the burden to exclude the family member of a party litigant from the jury is so low that this type of juror should easily be challenged for cause. Indeed, this court does not know of one case where a parent, sibling or spouse sat on a jury in a trial of another close family member, nor have plaintiffs cited any cases allowing such.
In my view, it is an absurdity to allow an immediate family member to sit on the jury in a trial of another close family member when the challenge has been made to excuse this juror for cause based on this relationship. Common sense dictates this conclusion. Indeed, this basic rationale and conclusion is so fundamental to our jury system, it hardly needs explanation. The party litigants are entitled to be tried by a jury composed of their peers and not a jury composed of their close family members, lest we have a mockery of the trial by jury system.
*1191 I concur only to the extent that seven of the twelve challenged immediate family jurors were excused for cause. In all other respects, I strongly and respectfully dissent.
NOTES
[*] Retired Judge Robert L. Lobrano participating in this decision as Associate Justice Pro Tempore.
[1] Defendants challenged several prospective jurors for cause on this ground contemporaneously. At the end of jury selection, pursuant to La.Code Civ. P. art. 1767, defendants made a blanket challenge for cause as to all jurors with immediate family members who were potential members of the class.
[2] Out of the twenty-two jurors and alternates, there were actually thirteen jurors with immediate family members who were potential class members. One of these, Juror No. 3, was removed by the court of appeal on different grounds. Accordingly, this juror will not be discussed.
[3] Juror No. 1 stated he was not a regular smoker, but only smoked for "about a month or so" when he was in the military.
[4] We acknowledge that the question of whether the juror himself would be influenced by the availability of class remedies is outside the scope of our writ grant, and our opinion should not be interpreted as directly addressing this issue. We merely observe that Juror No. 1's refusal to rule out the possibility his own participation in a smoking cessation program certainly implies that he may wish for his relatives to participate in such a program.
[5] The exact ages of Juror No. 10's four sons are unclear from her testimony, but she indicated they ranged from 34 to 41.
[6] Alternate Juror No. 13 actually has two brothers who smoke, but one of her brothers lives outside of the state and is therefore not a potential class member.
[7] We recognize that the court of appeal's judgment previously removed Juror No. 3 and Alternate Juror No. 18. These jurors should be replaced by the district court using the procedures we have outlined. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1209302/ | 96 S.E.2d 72 (1956)
STATE ex rel. James E. PINSON et al.
v.
Riley VARNEY et al.
No. 10848.
Supreme Court of Appeals of West Virginia.
Submitted September 27, 1956.
Decided October 9, 1956.
Opinion Filed October 23, 1956.
Dissenting Opinion January 10, 1957.
Bias & Bias, E. Gaujot Bias, W. Graham Smith, Jr., Slaven & Staker, Lant R.
*73 Slaven, Robert J. Staker, J. Brooks Lawson, Williamson, for relators.
John J. Justice, John F. Bronson, Williamson, for respondents.
GIVEN, Judge.
The State, at the relation of James E. Pinson, Sid A. Ferrell, Mingo P. Keadle, Frank Allara and Howard S. Coleman, in a petition filed herein on the 11th day of September, 1956, prayed a peremptory writ of mandamus requiring the defendants Riley Varney, A. Wayne Hatfield and Leslie E. Phillips, as members of the Board of Ballot Commissioners of Mingo County, to honor and accept a certificate of announcement of the candidacy of Pinson for the office of member of the Board of Education of Mingo County, at the election to be held in that county on November 6, 1956. The certificate of announcement, in usual form, was presented to the board of ballot commissioners, which certificate the board summarily refused to accept or honor. Defendants William Adair, Charles Perry and Andrew Herald filed a demurrer to the petition, based on the premise that the facts alleged in the petition disclosed that no vacancy existed on the Board of Education of Mingo County to be filled at the election to be held November 6, 1956. No question of fact is in dispute. The case was heard on the petition, the demurrer thereto, briefs and oral arguments. An order was previously entered denying the writ prayed for, and stating that the reasons for denying the writ would be later announced in an opinion.
At the time of the holding of the primary election in Mingo County in May, 1956, Okey B. Glenn and C. Fred Shewey were elected members of the Board of Education of Mingo County to fill terms expiring December 31, 1956. Subsequent to the primary election, B. J. Webb resigned as a member of the board and Charles Perry was appointed by the board to fill the vacancy created by the Webb resignation. The regular term of Webb would have expired December 31, 1956, and the appointment of Perry was attempted to be made effective until that date.
On August 21, 1956, C. J. Hamilton and William Adair resigned as members of the board. On the same day, the board appointed William Adair to fill the vacancy created by the resignation of Hamilton. The regular term of Hamilton would have expired December 31, 1960, and the appointment of Adair to fill that vacancy was attempted to be made effective until that date. Also, on August 21, 1956, the board appointed C. Fred Shewey to fill the vacancy created by the resignation of William Adair. Shewey declined to accept the appointment. The board then appointed the defendant Andrew Herald to that vacancy. The regular term of Adair, terminated by his resignation, would have ended December 31, 1956, and the appointment of Herald to fill such vacancy was attempted to be made effective until that date.
It is the contention of petitioners that the appointments to fill the several vacancies are valid no longer than the date of the general election to be held in Mingo County November 6, 1956, and that candidates to fill such vacancies may be elected at that time. Defendants contend that the appointments to fill the vacancies are valid for the remainder of the regular terms for which the respective members were elected, except they concede, as we believe they must, that the appointment of William Adair cannot, in any circumstance, be valid subsequent to the time of the holding of the primary election in Mingo County in 1958, if a person then be elected and qualified to fill the unexpired term of C. J. Hamilton. Thus it appears that the problem before the Court is to determine whether the vacancies occurring in the membership of the board of education subsequent to the primary election held in May, 1956, are such as may be filled by the electorate at the election to be held in November of the same year.
*74 Petitioners rely, primarily, at least, on the following statutory provisions: Code, 18-5-2, as amended, relating to vacancies in offices of members of boards of education, which, in so far as pertinent, reads: "The board shall, by appointment, fill within thirty days any vacancy that occurs in its membership. Such appointments shall continue until the next general election, when the voters shall elect a successor for the unexpired term * * *"; Code, 3-1-8, which reads: "Any vacancy in any elective office may be filled at a general election"; and Code, 3-10-1, which reads: "Elections to fill vacancies shall be for the unexpired term, and shall be held at the same places, and superintended, conducted and returned, and the result ascertained, certified and declared, in the same manner, and by the same officers, as in general elections; and the persons elected, having first duly qualified, shall enter upon the duties of their respective offices".
These statutory provisions, however, were enacted prior to the enactment of Chapter 86 of the 1951 Acts of the Legislature. Section 5b of that chapter, 3-4-5b, Michie's 1955 Code, in so far as deemed material, reads: "An election for the purpose of electing members of the county board of education shall be held on the same date as the primary elections as now provided by law, but upon a non-partisan ballot printed for the purpose. In such non-partisan election the person receiving the highest number of votes shall be elected for a long term, and if more than one is to be elected for a long term, the one receiving the next highest shall be elected; and if more than two are to be elected the candidate or candidates receiving the next highest votes shall be declared elected for any short term or terms, as the case may be, to fill vacancies * * *". It may be noticed that the quoted provision specifically provides for elections to fill any "long term", or "any short term or terms, as the case may be, to fill vacancies".
Chapter 86 of the 1951 Acts of the Legislature, Section 5a, 3-4-5a, Michie's 1955 Code, also specifically provides the method of "Announcement of Candidacy for Membership on Board of Education". In so far as deemed pertinent, it reads: "Any person who is eligible to hold office as a member of a county board of education may, at least thirty days prior to the day fixed for the primary election, file a certificate with the clerk of the circuit court of the county, declaring himself a candidate for election to such office * * *". It is significant, we think, that the only statutory provision relating to announcements of candidates for offices of members of boards of education requires that such announcements be filed "thirty days prior to the day fixed for the primary election".
Chapter 86 of the 1951 Acts contained only three sections. One section related to the nomination of candidates, other than candidates for offices of members of boards of education; the next section dealt only with the announcement of candidates for election to offices of members of boards of education; and the last section, 5b, dealt with the election of members of boards of education. It seems clear, therefore, that in the enactment of those sections the Legislature observed clearly the distinction between a primary election for the nomination of candidates, and a general election for the purpose of electing to office. This necessarily seems so, since pertinent statutes eliminated any method of nominating candidates for members of boards of education, but required that such members be elected, not nominated, at "an election" then authorized.
If the several statutory provisions cannot be harmonized, controlling effect must be given to the last enactment of the Legislature. "2. And where two distinct statutes stand in pari materia, and sections thereof are in irreconcilable conflict, that section must prevail which can properly be considered as the last expression of the law making power, this without regard to the relative position of such sections in the Code." Board of Education v. County *75 Court of Tyler County, 77 W.Va. 523, 87 S.E. 870. "Consistency in statutes is of prime importance, and, in the absence of a showing to the contrary, all laws are presumed to be consistent with each other. Where it is possible to do so, it is the duty of the courts, in the construction of statutes, to harmonize and reconcile laws, and to adopt that construction of a statutory provision which harmonizes and reconciles it with other statutory provisions * * *". 50 Am.Jur., Statutes, Section 363. See 82 C.J.S., Statutes, § 365; State ex rel. Revercomb v. O'Brien, W.Va., 91 S.E.2d 865; State ex rel. Thompson v. Morton, W.Va., 84 S.E.2d 791; State v. Snyder, 89 W.Va. 96, 108 S.E. 588; Farmers & Merchants Bank of Reedsville v. Kingwood National Bank, 85 W.Va. 371, 101 S.E. 734.
The basis of petitioners' position rests strongly, if not solely, on the use of the words "general election" in the statutes quoted above. From that basis, they conclude that the election to be held in November, 1956, is the "general election" referred to in the statutes quoted. We believe, however, that the election provided for in section 5b is constituted the general election for the purpose of electing persons to membership on boards of education, whether the election be for a "long term", for a "short term", or "to fill vacancies". The language seems to exclude any other possible meaning. Notice that the statute commands: "An election for the purpose of electing members of the county board of education shall be held on the same date as the primary"clearly, in legal contemplation, a general election, not a special or a primary election, "an election" separate and distinct from a "primary election", but to be "held on the same date". See McCoy v. Fisher, 136 W.Va. 447, 67 S.E.2d 543. Moreover, the provision of Section 5a, quoted above, is the only provision relating to "Announcement of Candidacy", whether such candidacy be for a "long term", a "short term", or to "fill vacancies"; and that section definitely requires that such a certificate be filed "at least thirty days prior to the day fixed for the primary election". Is it not certain that had the Legislature intended that such vacancies be filled at general elections held in November, it would not have specifically required that the announcements be filed thirty days before the "primary election"? Giving the language of Section 5b the only meaning which we believe it can be accorded, it is brought into harmony with the other statutory provisions quoted and has the effect of authorizing "an election", a general election, to be held at the date of any "primary election", for the purpose of electing members of boards of education, whether the terms for which elected be regular terms or for the filling of vacancies. No other election for such purposes is either expressly or by implication provided for or mentioned in any statute referred to or found by us.
Petitioners point out that Section 7 of Article IV of the State Constitution provides: "* * * When vacancies occur prior to any general election, they shall be filled by appointments, in such manner as may be prescribed herein, or by general law, which appointments shall expire at such time after the next general election as the person so elected to fill such vacancy shall be qualified". They contend that the term "general election", as used in the constitutional provision, necessarily refers only to the general election held in November, since "primary elections were unheard of" at the time of the adoption of the constitutional provision. We think, however, that the 1951 Legislature was not required to use the words "general election" in order to authorize "an election" for the purpose of electing members of boards of education. The clear wording of the Act, Chapter 86, as above pointed out, discloses the intent to do so. This being true, the statutory provision authorizing "an election", a general election for the purpose of electing members of boards of education, does not conflict with the constitutional provision, but is in accord therewith, *76 the effect thereof being that the next general election for members of boards of education, after the election for such members held in May, 1956, will be "an election" to be held on the "date" of the next primary election after that time.
Petitioners further point out that it is "the policy of the lawmakers of this State to permit the voters generally to participate in the selection of candidates for all offices in primary elections whenever possible * * *". State ex rel. Revercomb v. O'Brien, W.Va., 91 S.E.2d 865, 872. That policy, however, can be helpful only in the interpretation or application of legislative enactments, and not for the purpose of avoiding the clear meaning of an enactment. The policy is one for legislative concern. In 72 C.J.S., Policy, p. 213, we find this statement: "Primarily it is for the lawmakers to determine the public policy of the state, for the public policy of a state is a law of the state, and is a legislative and not a judicial function, and it is not the function of the judiciary to declare what is the public policy of the state respecting matters on which the legislature has spoken or to create or announce a public policy of its own." Where the Legislature has acted, within constitutional limitations, this Court is, and should be, firmly bound.
It is argued that such a result as herein announced would thwart the will and command of the electorate, expressed at the election at which Glenn and Shewey were elected. We think there is no basis for such a premise. Glenn and Shewey were elected for definite terms, commencing and ending at definite times. Those terms will be served precisely as if no subsequent vacancies had occurred or subsequent appointments made to fill such vacancies. The conclusion reached accords with the will of the electorate as expressed at that election, and also as expressed by the people, through their legislative representatives, in Chapter 86 of the 1951 Acts of the Legislature.
For the reasons indicated herein, the order denying the peremptory writ prayed for by petitioners was heretofore entered herein.
Writ denied.
LOVINS, Judge (dissenting).
I respectfully dissent from the Court's opinion in denying a peremptory writ of mandamus. I think there are sufficient reasons to justify the award of a peremptory writ in this proceeding.
The provisions of the Constitution of this State touching the subject of elections to fill vacancies reads in part as follows:
"The general elections of State and county officers, and of members of the Legislature, shall be held on the Tuesday next after the first Monday in November, until otherwise provided by law. * * * Elections to fill vacancies, shall be for the unexpired term."
Article IV, Section 7, Constitution of West Virginia.
Code 18-5, as amended by Chapter 56, Acts of the Legislature, 1945, Regular Session, provides that members of boards of education shall be elected at the general election and prescribes the terms of such members. By Code 18-5, as amended by Chapter 42, Acts of the Legislature, 1941, Regular Session, a vacancy existing in a board of education is authorized to be filled by appointment, the appointment continuing until the next general election at which time the voters shall elect a successor for the unexpired term.
In dealing with vacancies in elective offices, Code, 3-1-8, reads as follows:
"Any vacancy in any elective office may be filled at a general election."
Elections to fill vacancies shall be held at the same places and shall be superintended by the same officers as general elections. Code, 3-10-1.
*77 The public policy of this State is to fill vacancies in elective offices by appointment until the next general election. Code, 3-10-4. See Code, 3-10-8, as amended by Chapter 65, Acts of the Legislature, 1955, Regular Session. As to the creation of vacancies of elective offices, see Code, 6-5-1, as amended by Chapter 149, Acts of the Legislature, 1939, Regular Session; Code, 6-5-2. With respect to the expiration of the term of a member of a board of education of a county school district, see Code 18-5-2, as amended by Chapter 42, Acts of the Legislature, 1941, Regular Session and Code, 18-5, as amended by Chapter 56, Acts of the Legislature, 1945, Regular Session.
An examination of the constitution and statutes just cited shows that in this state vacancies existing in elective offices are to be filled at general elections. It is true that by Code, 3-4, as amended by Chapter 86, Acts of the Legislature, 1951, Regular Session, an election for members of the county board of education is held on the same day as the primary election. It may, from a casual consideration, appear that this last enactment of the legislature conflicts with the above mentioned statute, but as hereinafter stated, statutes which are apparently repugnant to each other should be reconciled.
The public policy of this state, as evidenced by numerous statutes and judicial decisions, is tersely stated by Judge Lively in the following language:
"The general policy of representative government, where the officers, the servants of the people, are selected by election, is that the electorate shall have the right and opportunity of selecting officers to fill vacancies in elective offices. At least that is the policy of this state as evidenced by its Constitution and general laws. * *". This is true "* * * generally in all of the county offices, including justices of the peace and constables."
State ex rel. Napier v. Board of Canvassers, 87 W.Va. 472, 476, 105 S.E. 695, 697. See State ex rel. Revercomb v. O'Brien, 141 W.Va. , 91 S.E.2d 865.
It is a rule of general application that statutes are presumed to be constitutional. Duncan v. Baltimore & Ohio R. R. Co., 68 W.Va. 293, 69 S.E. 1004; Swearingen v. Bond, 96 W.Va. 193, 196, 122 S.E. 539, 136 A.L.R. 1500; State v. Page, Adm'r, 100 W.Va. 166, 168, 130 S.E. 426, 44 A.L.R. 501; Central Realty Co. v. Martin, 126 W.Va. 915, 924, 30 S.E.2d 720. Bearing that principle in mind, I think that all of the foregoing statutes, including the statute providing for the election of members of boards of education, are constitutional.
It is contrary to established principles of statutory construction to hold that the various statutes providing for elections to fill vacancies were repealed by implication by Code, 3-4-, as amended by Chapter 86, Acts of the Legislature, 1951, Regular Session. Repeals by implication are not favored. Coal & Coke Ry. Co. v. Conley and Avis, 67 W.Va. 129, 67 S.E. 613; Kimball v. Loughney, 70 W.Va. 765, 74 S.E. 953; Belknap v. Shock, 125 W.Va. 385, 24 S.E.2d 457; United States Coal & Coke Co. v. Turk, 127 W.Va. 368, 33 S.E.2d 463; Harbert v. Harrison County Court, 129 W.Va. 54, 39 S.E.2d 177, 179; State ex rel. Thompson v. Morton, 140 W.Va. , 84 S.E.2d 791. Section 5-b, idem, is part of a general system of law relating to the election of officers and the filling of vacancies, and should be construed so as to operate harmoniously with that system but should not be construed so as to innovate upon or alter the general system. Reeves v. Ross, 62 W.Va. 7, 57 S.E. 284. Moreover, it is to be presumed that the legislature did not intend Section 5-b, idem to repeal or modify general laws relating to the filling of vacancies unless the legislative intent to do so is plainly set forth in the act. Reeves v. Ross, supra.
"In determining the meaning of a statute, it will be presumed, in the absence *78 of words therein, specifically indicating the contrary, that the Legislature did not intend to innovate upon, unsettle, disregard, alter or violate (1) the common law; (2) a general statute or system of statutory provisions, the entire subject-matter of which is not directly or necessarily involved in the act; (3) a right or exception based upon settled public policy; (4) the Constitution of the state; nor (5) the Constitution of the United States."
Pt. 27, syllabus, Coal & Coke Railway Co. v. Conley and Avis, 67 W.Va. 129, 67 S.E. 613, 615. See Spedden v. Board of Education, 74 W.Va. 181, 185, 81 S.E. 724, 52 L.R.A.,N.S., 163; State ex rel. v. Davis, 74 W.Va. 261, 268, 82 S.E. 207; Raleigh County Bank v. Poteet, 74 W.Va. 511, 521, 82 S.E. 332, L.R.A.1915B, 928; Crockett v. Black Wolf Coal & Coke Co., 75 W.Va. 325, 329, 83 S.E. 987; Baker v. O'Brien, 79 W.Va. 101, 108, 90 S.E. 543; Crookshanks v. Ransbarger, 80 W.Va. 21, 23, 92 S.E. 78; Ex parte Anderson, 81 W.Va. 171, 175, 94 S.E. 31; Cook v. Continental Casualty Co., 82 W.Va. 250, 257, 95 S.E. 835; First National Bank v. De Berriz, 87 W.Va. 477, 482, 105 S.E. 900.
Applying the principles laid down in the cases immediately preceding, I think that section 5-b of Chapter 86, idem, does not set forth an exclusive time so as to preclude the election of members of boards of education of a county to fill an existing vacancy at a regular general election.
The pertinent statutes may seem to be repugnant, but they can easily be reconciled and the statutes should be so treated. 50 Am.Jur., Statutes, Section 363. See 82 C.J.S., Statutes, § 365; State ex rel. Revercomb v. O'Brien, supra; State ex rel. Thompson v. Morton, 140 W.Va. , 84 S.E.2d 791; State v. Snyder, 89 W.Va. 96, 108 S.E. 588; Farmers & Merchants Bank of Reedsville v. Kingwood National Bank, 85 W.Va. 371, 101 S.E. 734.
Every part of the statute should be given effect, if possible so to do. 25 R.C.L., 1004, section 246; Building & Loan Association v. Sohn, 54 W.Va. 101, 112, 46 S.E. 222; State ex rel. Churchman v. Hall, 86 W.Va. 1, 7, 102 S.E. 694; Long Flame Coal Co. v. State Compensation Commissioner, 111 W.Va. 409, 414, 163 S.E. 16; State v. Jackson, 120 W.Va. 521, 199 S.E. 876.
The statute providing for election of school board members at the primary election underwent a strange, unusual and unwarranted metamorphosis at the hands of this Court. An election held at the same time as a primary election is changed by judicial construction to mean a general election insofar as the election of school board members is concerned.
Notwithstanding the language of Article IV, Section 7, Constitution of this State, hereinabove quoted, which designates that general elections shall be held "on the Tuesday next after the first Monday in November, until otherwise provided by law"; there is no general law providing otherwise. True, Section 5-b, Chapter 86, Acts of the Legislature, 1951, Regular Session, here considered, may by a strained application be said to be in part a general election as to members of a county board of education.
The apparently inconsistent statutes relating to the filling of vacancies as members of boards of education at a general election and at an election held on the same day as the primary would be reconciled in the following manner: Any vacancy existing in a county board of education before the date of the primary election should be filled at an election held on that date. Any vacancy in such board occurring after the primary election and before the general election should be filled by the election of a person to fill such vacancy at the subsequent general election. In that way, the *79 statutes seemingly repugnant and inconsistent should, and would be reconciled, thus giving every part of such statutes effect.
Moreover, the settled public policy of this state which is characterized as salutary by Judge Lively would be carried out and given force and effect. The citizens of a county or other subdivision would have the right and privilege given them by representative form of government of selecting their own officers. I would have awarded the peremptory writ prayed for.
I am authorized to say that Judge HAYMOND concurs in this dissent. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1297704/ | 468 S.E.2d 435 (1996)
121 N.C. App. 530
METRIC CONSTRUCTORS, INC., Plaintiff,
v.
HAWKER SIDDELEY POWER ENGINEERING, INC., d/b/a Hawker Siddeley Power Eng., Inc. and Panda Rosemary Corporation, Defendants.
No. COA95-250.
Court of Appeals of North Carolina.
February 20, 1996.
*436 Womble Carlyle Sandridge & Rice, P.L.L.C. by Dewey W. Wells, Timothy G. Barber, and Steven D. Gardner, Charlotte, for plaintiff-appellee.
Erwin and Bernhardt, P.A. by Fenton T. Erwin, Jr., Charlotte, and J. Neal Rodgers; and Kleinberg, Kaplan, Wolff & Cohen, P.C. by Norris D. Wolff, for defendants-appellants.
WALKER, Judge.
Defendant-appellant Panda Rosemary Corporation (Panda) owns a leasehold interest in certain real property in Roanoke Rapids, North Carolina. The lessor and record owner of the property is The Bibb Company (Bibb). Panda hired defendant-appellant Hawker Siddeley Power Engineering, Inc. (HSPE), a British company, to design and build a cogeneration power plant on the property. After completion, Panda was to own and operate the plant pursuant to its lease with Bibb. HSPE, the general contractor, subcontracted with plaintiff-appellee Metric Constructors, Inc. (Metric) for construction of the plant. Metric subcontracted with a wholly-owned subsidiary, Electrical & Special Systems, Inc. (ESSI), for specialized electrical work.
The project was "design build" or "fast track," meaning that HSPE had not completed all the designs for the plant prior to the commencement of construction. Pursuant to its contract with Metric, HSPE was responsible for engineering design drawings and procurement of major equipment items. Due to commitments made by Panda, Metric was informed that the project had an inflexible completion date of 30 October 1990. In contract negotiations and in the contract, HSPE promised to issue drawings at a pace that would allow Metric to finish its work on time. The contract provided that Metric would receive a bonus of $9,000 a day for early completion.
*437 According to Metric's evidence, HSPE failed to deliver its promised performance from the outset of the project, issuing drawings weeks or even months after the issue dates it had given Metric. Some drawings were issued and then revised, requiring Metric to demolish its work and begin anew. HSPE's conduct forced Metric to expend considerable sums to complete the project on schedule. However, HSPE refused to pay Metric for the cost overruns and extra work caused by the late performance.
In an effort to recover its expenses and losses incurred as a result of HSPE's conduct, Metric filed a lien on the plant owned by Panda and brought suit to enforce the lien. Defendants answered, and HSPE counterclaimed alleging that Metric had breached its obligations under the contract between those parties. The case was tried before a jury. Metric's evidence consisted of the testimony of nine people who were actively involved in the Panda project and an expert in construction scheduling. Through these witnesses and voluminous documentation, Metric asserted that it had suffered damages in the amount of $6,615,863. HSPE's evidence consisted of the testimony of four witnesses, only one of whom was directly involved with the Panda project. The jury awarded Metric $6,615,863 in damages against HSPE for breach of contract and denied HSPE's counterclaim. Thereafter, the trial court entered judgment in accordance with the verdict and awarded interest on the judgment. Defendants filed motions for judgment notwithstanding the verdict (JNOV), amendment of the order, and a new trial. The trial court denied the motions.
I.
HSPE first assigns as error the trial court's denial of its motions for directed verdict and JNOV as to Metric's claims made on behalf of ESSI. The question presented by a defendant's motion for a directed verdict is whether all the evidence supporting the plaintiff's claim, taken as true, considered in the light most favorable to the plaintiff, and given the benefit of every reasonable inference in the plaintiff's favor, is sufficient for submission to the jury. Tripp v. Pate, 49 N.C.App. 329, 332-33, 271 S.E.2d 407, 409 (1980). If there is more than a scintilla of evidence supporting each element of the plaintiff's claim, the motion should be denied. Broyhill v. Coppage, 79 N.C.App. 221, 226, 339 S.E.2d 32, 36 (1986). A motion for JNOV is in effect a renewal of a previous motion for directed verdict, and the same rules regarding sufficiency of the evidence apply. Henderson v. Traditional Log Homes, 70 N.C.App. 303, 306, 319 S.E.2d 290, 292, review denied, 312 N.C. 622, 323 S.E.2d 923 (1984).
HSPE argues that Metric lacks standing to assert a claim on behalf of ESSI, relying on the provisions of Article 4 of the contract between HSPE and Metric:
4.1 All proposed Lower Tier Subcontracts must be submitted to HSPE for written approval. If so approved, Subcontractor shall bind all Lower Tier Subcontractors to the provisions of the Subcontract Documents.
4.2 Neither this Subcontract nor any Lower Tier Subcontract shall create any contractual relationship between any Lower Tier Subcontractor and HSPE nor any obligation of HSPE to Lower Tier Subcontractor.
4.3 Notwithstanding the existence of any Lower Tier Subcontract, Subcontractor shall be liable to HSPE for performance hereunder as if no Lower Tier Subcontractor exists.
Defendants assert that under the terms of section 4.2, HSPE had no contractual obligations to ESSI, a lower tier subcontractor, and therefore cannot be liable to ESSI for damages to ESSI caused by breach of HSPE's contract with Metric. In support of this assertion, defendants cite the rule enunciated in Warren Brothers Co. v. N.C. Dept. of Transportation, 64 N.C.App. 598, 307 S.E.2d 836 (1983) that a subcontractor may not do indirectly through a plaintiff higher tier contractor what it cannot do directly by a suit against the defendant. Id. at 600, 307 S.E.2d at 838. Defendants argue that since ESSI cannot bring a claim directly against HSPE, it cannot present a claim indirectly through Metric. We agree that the contract *438 between HSPE and Metric does not create any privity between HSPE and ESSI and that ESSI may not sue HSPE directly. Nonetheless, we hold that Metric may recover ESSI's losses on the Panda project as part of Metric's contract damages.
In Bolton Corp. v. T.A. Loving Co., 94 N.C.App. 392, 380 S.E.2d 796 (1989) (Bolton I), review denied, 325 N.C. 545, 385 S.E.2d 496, this Court allowed the plaintiff, a prime contractor in the construction of a building on a state university campus, to recover from another prime contractor the damages incurred by the plaintiff's subcontractor. Id. at 409, 380 S.E.2d at 807. Although the contract between the plaintiff and its subcontractor provided that no contractual relationship existed between the subcontractor and the owner, the Court nonetheless stated that "[a] contractor may recover from an owner its subcontractor's `extra costs and services wrongfully demanded' when the subcontractor is not in privity with the owner and could not recover directly." Id. at 407, 380 S.E.2d at 806 (quoting United States v. Blair, 321 U.S. 730, 737, 64 S. Ct. 820, 823-24, 88 L. Ed. 1039, 1045 (1944)). The Court explained the rationale for this rule:
"The government [owner] did not have, and did not by any implication recognize, any contractual relations whatever with [subcontractor], and if he had failed in performing it would not have had any right of action against him.... [Contractor] was the only person legally bound to perform the original contract; it was from him that the government demanded the extra service, and ... the obligation to pay for that service was to him, whether he performed it personally or through another."
Bolton I, 94 N.C.App. at 407-08, 380 S.E.2d at 806 (quoting Hunt v. United States, 257 U.S. 125, 128-29, 42 S. Ct. 5, 6, 66 L. Ed. 163, 165 (1921)).
The Bolton I court recognized the general validity of the Warren rule that a subcontractor cannot do indirectly through a higher tier contractor what it cannot do directly against the owner. However, the Court found the Warren rule was inapplicable to the circumstances in Bolton I because the contract in Bolton I made each contractor financially responsible for undue delay caused by him to other contractors and because each contractor was fully responsible for the acts of its subcontractors. Thus, "[i]f a subcontractor were to cause injury to a contractor other than its prime, the other contractor would have an action in contract against the subcontractor's prime." Id. at 408-09, 380 S.E.2d at 806-07. The Court concluded, "The logic set out in Hunt is applicable here, and we hold that the contract intends for any damages to a subcontractor to be a subset of its prime's damages." Id. at 409, 380 S.E.2d at 807.
We acknowledge that Bolton I is factually different from the present case in that it involved a government contract with multiple primes rather than a private contract between a general contractor and a first tier subcontractor. However, the rationale for the holding in Bolton I is applicable to the present case. In Bolton I, the subcontractor was not a named plaintiff, nor was the contractor presenting a claim on behalf of the subcontractor. Rather, the prime contractor was including the subcontractor's damages as a subset of its own damages. Obviously, the Bolton I court recognized that unless the contractor was permitted to include the subcontractor's claim as part of its own, there would be no means of recovering the damages incurred by the subcontractor.
In the present case, HSPE's conduct required extra work from ESSI. ESSI, which had no direct claim against HSPE for damages caused by HSPE's delays, presented its claim for damages to Metric. Under Hunt and Bolton I, Metric had standing to recover ESSI's damages as a subset of its own contract damages against HSPE. The record reveals that ESSI was not a party to the action, and no issue was presented to the jury regarding any claim by ESSI.
Defendants nonetheless urge us to deny Metric standing to recover ESSI's damages, relying on APAC-Carolina, Inc. v. Greensboro-High Point Airport Authority, 110 N.C.App. 664, 431 S.E.2d 508, review denied, 335 N.C. 171, 438 S.E.2d 197 (1993). The Court in APAC, relying on Warren, supra, held that APAC, a prime contractor, did not have standing to bring the claims of its subcontractor *439 against the owner since the subcontractor, by the terms of the contract, had no direct claim against the owner. Id. at 671, 431 S.E.2d at 512. The APAC court characterized as dicta the portion of Bolton I which cited United States v. Blair for the proposition that a contractor could recover its subcontractor's extra costs from the owner when the subcontractor was not in privity with the owner and could not recover directly. Id. at 671, 431 S.E.2d at 511.
APAC is readily distinguishable from the present case. In APAC, the subcontractor, United Sprinkler, Inc., was a party plaintiff and was essentially trying to append to APAC's claim against the owner its own separate claim which it could not bring directly. As we have noted, ESSI was never a plaintiff in the instant case and is not now trying to bring its own claim against HSPE. Rather, ESSI sought to recover its damages caused by HSPE's conduct through a well-documented claim against Metric itself, and Metric, faced with liability for that claim under its contract with ESSI, included the amount of the claim as a subset of its damages against HSPE. Therefore, Metric's actions are not prohibited by APAC.
We must point out that the result urged by defendants would work a manifest injustice to Metric, ESSI, and other similarly situated subcontractors. In effect, a general contractor could, by including contract provisions similar to Article 4 here, shield itself from any liability for payment to a subcontractor for its lower tier subcontractor's damages while retaining the right to sue the subcontractor for the lower tier subcontractor's work. Such a result is illogical. Moreover, even if we were to require a lower tier subcontractor like ESSI to sue its immediate higher tier subcontractor, there is no basis in law that we know of for the higher tier subcontractor to then sue the general contractor to recoup any amounts paid in satisfaction of those claims. We refuse to adopt a position that would, in effect, leave a lower tier subcontractor with virtually no remedy for the type of damages suffered by ESSI here at the hands of HSPE. We therefore hold that under the circumstances of this case, Metric is not precluded from recovering as part of its damages the duration damages sustained by ESSI as a result of HSPE's conduct, and the trial court did not err in denying HSPE's motions for directed verdict and JNOV on the ESSI portion of Metric's claim.
II.
Defendants next argue that the trial court committed reversible error by failing to issue requested instructions on special damages and on compromise and settlement. When a party properly tenders a written request for a special instruction which is correct in itself and supported by the evidence, the failure of the court to give the instruction, at least in substance, is reversible error. Indiana Lumbermen's Mutual Ins. Co. v. Champion, 80 N.C.App. 370, 379, 343 S.E.2d 15, 20-21 (1986) (emphasis added). For the reasons stated below, we hold that the trial court did not err by failing to give the requested instructions.
A. Damages
Metric's claims against HSPE included claims for overtime premium costs, loss of productivity, extended overhead, and loss of bonus. Defendants argued at trial that these "duration-related damages" constituted special damages, while plaintiffs claimed that they constituted general damages. After considering both parties' arguments, the trial court declined to give an instruction on special damages, instructing the jury on general damages only. On appeal, HSPE does not challenge Metric's right to recover damages for breach of contract, but only challenges the characterization of those damages as general damages.
Contract damages are defined as either general damages, "damages that courts believe `generally' flow from the kind of substantive wrong done by defendant," or special damages, those "peculiar to the particular plaintiff."
Bolton I, 94 N.C.App. at 405, 380 S.E.2d at 804 (quoting Dan B. Dobbs, Remedies § 3.2 (1973)). Defendants argue that under Bolton I, all duration-related damages are special damages. We disagree.
*440 In Bolton I, the plaintiff argued that the trial court erred by excluding specific evidence of its delay damages, including the cost of keeping tools and equipment on the site for the extended period, labor inefficiencies, invoice and actual cost records, subcontractor's damages, and cost of delay in payment of retainage. Id. at 404, 380 S.E.2d at 804. The defendant argued the evidence was properly excluded because the plaintiff failed to tie its claimed damages to any act or omission of the defendant. Id. The Court awarded a new trial to the plaintiff but declined to characterize the plaintiff's duration-related damages as general or special, stating only that duration-related damages are often difficult to prove and that proof of such damages must be "as specific as the circumstances will allow." Id. at 405-06, 380 S.E.2d at 805.
In the instant case, plaintiff presented specific evidence, through extensive documentation and witnesses including a construction expert, of the nature and amount of damages it suffered as a result of HSPE's delay. This evidence did not support an instruction for special damages. HSPE is a sophisticated corporation with extensive experience on projects of this nature. It obviously contemplated that delays on its part would result in the damages claimed by Metric, as is evidenced by the contract between HSPE and Metric. Article 9 of the contract specified the date upon which construction on the project was to begin and required Metric to complete its work to meet certain "milestone dates" and to prepare a schedule showing completion dates for major elements of its work. Article 9 further provided that the subcontract had to be completed on schedule and that if Metric was delayed in completing its work due to acts or omissions of other contractors or the owner, the time for completion could be extended and delay costs could be recovered from HSPE in certain circumstances. Article 20 of the contract provided for liquidated damages of $12,600 per day if Metric failed to complete its subcontract on schedule and a bonus of $9,000 per day if Metric completed its subcontract early. These contract provisions are a clear indication that HSPE recognized that delay damages might be incurred by one or more of the parties involved in constructing the plant, and HSPE cannot now be heard to argue that such damages are special damages. Indeed, if HSPE had been delayed by other contractors or the owner, it would be asserting these same types of damages, because they are common to the industry and naturally flow from such delays. Thus, Metric's damages were appropriately characterized as general damages, and we find no error in the trial court's instructions on this issue.
B. Compromise and Settlement
The evidence at trial showed that in the spring of 1990, HSPE admitted to Metric that it was experiencing delays in designing the plant and that Metric was entitled to additional compensation for its extra work caused by these delays. By May 1990, HSPE told Metric that the problems had been resolved and the designs would be completed by 16 July 1990. Based on these representations, the parties attempted to negotiate a single comprehensive change order which would address all problems that had arisen prior to July 1990. There followed a series of proposals and meetings through which the parties attempted to resolve Metric's claims. These negotiations concluded on 27 August 1990 with a proposal from HSPE to pay Metric $600,000 "[t]o resolve all outstanding claims and future engineering errors and omissions...." HSPE stated that the terms of the offer would be spelled out in a change order which would be forthcoming by the end of August and that Metric could invoice HSPE for $300,000 at that time.
In anticipation of this change order, Metric invoiced HSPE $300,000 for items for which HSPE had already admitted it was liable. By the end of September, Metric had not received the promised change order from HSPE, and invoiced HSPE for another $150,000 in costs for which HSPE had admitted responsibility. On 4 October 1990, Metric received a change order from HSPE. Metric contended that certain terms of the change order were different than those previously agreed upon and that it contained a provision shielding HSPE from liability for future errors and omissions on the project, a *441 term to which Metric had consistently refused to agree during negotiations. Metric refused to sign the change order, instead revising it to reflect what it considered the agreement to have been. Metric sent the change order back to HSPE, but HSPE never responded and no change order was ever signed between the parties. By February 1991, HSPE had paid both invoices Metric had issued the previous September. Defendants contend that the above facts resulted in a compromise and settlement and supported their requested special instruction on this issue and that the trial court's failure to give the instruction was error.
We need not discuss at length the differences between the defense of compromise and settlement and that of accord and satisfaction. Indeed, defendants' counsel acknowledged to the trial court that the two defenses, in the context of this case, are "really about one and the same." The trial court instructed the jury on accord and satisfaction as follows:
On this issue the burden of proof is on [HSPE]. This means that [HSPE] must prove by the greater weight of the evidence the following two things.
First, that there was an agreement made by Metric accepting the offer contained in the August 27, 1990 letter, whereby the terms of that letter would be substituted for [HSPE's] then existing and future obligations to Metric. And second, that there has been a satisfaction or performance of such substituted agreement.
If you find by the greater weight of the evidence that there was an agreement upon or a meeting of the minds on the terms of that August 27, 1990 letter and if you further find that the agreement so made was performed then you will answer that issue yes.
We have carefully reviewed defendants' proposed instruction on compromise and settlement, and since the trial court's instruction centered on the 27 August 1990 letter which defendants contend represented a compromise and settlement of plaintiff's claim, we find the instruction given by the court conveyed the substance of defendants' requested instruction.
We note that even if there had been further instructions on the issue of compromise and settlement, it is unlikely a different result would have been reached. Compromise and settlement, like accord and satisfaction, turns on a central factual issue: whether there was a meeting of the minds and therefore an agreement between Metric and HSPE as a result of the negotiations in August 1990. The amounts invoiced by Metric were for items for which HSPE had already admitted liability, and the invoices preceded HSPE's proposed change order. Moreover, there was evidence that the change order ultimately proposed by HSPE contained terms materially different from those discussed by the parties previously. We believe the chronology of events described above supports a jury finding that there was no meeting of the minds between the parties as to any "substitute agreement." Therefore, the court's failure to instruct the jury on compromise and settlement was harmless. We find no reversible error in the court's instructions.
We have carefully examined defendants' remaining assignments of error and plaintiff's cross-assignment of error, and we find them to be without merit. The judgment of the trial court is therefore
Affirmed.
JOHNSON, J., concurs.
WYNN, J., concurs in part and dissents in part.
WYNN, Judge, concurring in part and dissenting in part.
I respectfully disagree with the majority's conclusion that the trial court did not err in allowing Metric to recover ESSI's damages from HSPE.
In Warren Bros. Co. v. North Carolina Dept. of Transport., 64 N.C.App. 598, 307 S.E.2d 836 (1983), a provision in the contract between the owner and general contractor provided that a subcontractor may not sue *442 the owner for damages.[1] This Court held that the contractor may not assert against the owner any damages alleged to have been suffered by the subcontractor. Id. at 600, 307 S.E.2d at 838. The Court in Warren Brothers further stated: "[T]he subcontractor may not do indirectly through plaintiff what it could not do directly by suit against the defendant." Id.
However, the majority cites Bolton Corp. v. T.A. Loving Co., 94 N.C.App. 392, 380 S.E.2d 796, disc. rev. denied, 325 N.C. 545, 385 S.E.2d 496 (1989) for the proposition that the Warren Brothers rule is inapplicable in the instant case. As the majority acknowledges, the instant case is clearly distinguishable from Bolton. In Bolton, this Court held that in a suit between two contractors, a contractor may assert damages suffered by its subcontractor as part of the contractor's damages. Id. at 408-09, 380 S.E.2d at 806-07.
In contrast, the case before us turns on whether Metric, a first-tier subcontractor may assert the damages of its subcontractor, ESSI, a second-tier subcontractor, in a suit against HSPE, the general contractor. I believe the instant case is closely analogous to APAC-Carolina v. Greensboro-High Point Air., 110 N.C.App. 664, 431 S.E.2d 508, disc. rev. denied, 335 N.C. 171, 438 S.E.2d 197 (1993). In APAC-Carolina, this Court declined an opportunity to apply Bolton to the facts before it. In that case, a contractor attempted to assert the damages of its subcontractor in a suit against the owner. This Court stated:
We conclude that APAC [the contractor] did not have standing to assert any claims on behalf of Sprinkler [the subcontractor]. Sprinkler had no claim against defendants [the general contractor] on its own behalf. In both Warren and Bolton II [Bolton Corp. v. State of North Carolina, 95 N.C.App. 596, 383 S.E.2d 671 (1989), disc. rev. denied, 326 N.C. 47, 389 S.E.2d 85 (1990) ], the Court clearly stated that a general contractor may not assert a claim on behalf of a subcontractor if that subcontractor could not assert the claim itself. Thus, APAC may not bring its claim of $226,000 on behalf of Sprinkler.
Id. at 671-72, 431 S.E.2d at 512.
Similarly, I believe that in the case sub judice, Metric, the first-tier subcontractor, cannot assert the damages of ESSI, the second-tier subcontractor. It is true that in the case before us a first-tier subcontractor wishes to assert the damages of its second-tier subcontractor, whereas APAC-Carolina involved the attempted assertion of damages by a contractor on behalf of its subcontractor. However, the language and rationale of Warren Brothers apply equally to both APAC-Carolina and the instant case. In both cases, a party unable to assert damages on its own behalf attempted to assert damages through another party which contracted with the wrongdoer. Such an assertion of the damages of another is precisely what Warren Brothers forbids. In addition, the fact that the subcontractor in APAC-Carolina was a named plaintiff whereas ESSI is not a named plaintiff in the instant case is not a persuasive distinction for me. The title of the action cannot be allowed to determine its outcome. Under the majority's rationale, a lower-tier subcontractor could simply take a voluntary dismissal of its suit and thus easily evade the strictures of APAC-Carolina.
I believe we are bound by APAC-Carolina and Warren Brothers. Were this a case of first impression, the majority's position would be more persuasive. However, only our Supreme Court or, in appropriate instances, the legislature may change a prior decision of this Court.
I respectfully dissent.
NOTES
[1] There is a similar provision in the contract relevant to the case sub judice. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1716146/ | 663 So. 2d 458 (1995)
In re Henry Earl BRIDGES
v.
CARL E. WOODWARD, INCORPORATED, DEF Insurance Company, XYZ Manufacturer, and XYZ Insurance Company.
No. 94-CA-2675.
Court of Appeal of Louisiana, Fourth Circuit.
October 12, 1995.
Writ Denied January 26, 1996.
*459 Pete Lewis, Michelle K. Buford, Lewis & Caplan, New Orleans, for Plaintiff/Appellant.
Joseph G. Gallagher, Jr., Hulse, Nelson & Wanek, New Orleans, for Defendant/Appellee.
Lance S. Ostendorf, Charles E. Sutton, Jr., Campbell, McCranie, Sistrunk, Anzelmo & Hardy, New Orleans, for Intervenor/Appellant.
Before BARRY, BYRNES, PLOTKIN, WALTZER and MURRAY, JJ.
PLOTKIN, Judge.
Once again, we are called upon to decide whether an employer's failure to install a safety warning device constitutes an intentional act entitling an injured employee to bring a tort action. If the employer's omission does not constitute an intentional tort, the employee's remedy is limited to worker's compensation and his tort action should be dismissed.
O.C. Peters, curator for employee Henry Earl Bridges (Bridges), brought this tort suit against Bridges' employer, Carl E. Woodward *460 Inc. (Woodward), alleging that Woodward failed to procure and install and/or alternatively intentionally removed the warning system on a crane which injured Bridges, which constituted an intentional act. American Casualty Co. of Reading, Pennsylvania (American) intervened, seeking recovery of worker's compensation paid to Bridges. Woodward moved for a summary judgment, asserting the statutory employer immunity defense. The trial court granted summary judgment dismissing Bridges' claim and the claims of American. We affirm.
Facts
The following facts are undisputed by the parties. Woodward is a general construction contractor which has been in business in New Orleans for many years. In 1982, Woodward purchased a Grove model RT 522 crane from Wehring-Goss, a Grove distributor. The crane had a telescoping boom, and was rigged with one line for lifting a load. The crane was also equipped with the Kruger anti-two-block warning system.
"Two-blocking" is a phenomenon which occurs when the line is drawn up so the load pulls against the sheave at the end of the boom. Tension develops in the line, which can cause it to break. If the line breaks, the load will fall to the ground. An anti-two-block warning system, such as the Kruger device on this crane, warns the operator when the load nears the end of the boom. Specifically, a warning light flashes, and a horn sounds.
Charles Fuchs, the crane operator, testified that shortly after the crane was purchased, an auxiliary line was installed on the crane. An anti-two-block warning system was not installed on the auxiliary line. In 1985, the crane was being used on a construction site in Baton Rouge. During this job, the anti-two-block warning system on the main line was damaged. This system was not repaired before Bridges' accident. Therefore, at the time of the accident, an anti-two-block warning system was not functioning on either the main line (because it was broken) or the auxiliary line (because it had not been installed).
In 1989, Woodward had a contract with Alton Ochsner Medical Foundation to construct a new facility at its site in Jefferson Parish. The details of this agreement were set forth in the contract and specifications, which are part of the record. Bridges was employed by Woodward as a general laborer. He was working on the Ochsner project at the time of the accident.
Thomas Stengle, Bridges' foreman, and Robert Cummings, another Woodward laborer at the scene, testified by deposition that on December 4, 1989, Bridges was standing in an excavated pit, preparing to spread shells. The shells were being lowered into the pit by a crane operated by Fuchs, who was using a concrete buck attached to the main line to lower the shells. A "headache ball" was attached to the auxiliary, but it was not being used in this operation.
Moments before the accident, Fuchs began to extend, or telescope the boom of the crane. He then perceived the crane beginning to tilt, and he looked in the direction of his right out-rigger. Fuchs continued to extend the boom of the crane. This caused the slack in the auxiliary line to be drawn up so the headache ball attached to this line was pulled against the end of the boom. The auxiliary line broke, and the headache ball fell, striking Bridges on the head. The main line was not involved in the accident. It was the auxiliary line, which never had an anti-two-block warning system on it, which broke, allowing the headache ball to fall.
Fuchs testified that he was an experienced crane operator, having operated cranes since 1970, and had been employed as a crane operator for 19 years at the time of this accident. He had been licensed as a crane operator since 1987. He had operated numerous different cranes during his career. He had never operated a crane with a functioning anti-two-block warning system at any time prior to the accident. He testified by deposition that such warning systems were not common devices, and that he had never had a "two-blocking" accident before the one in this case.
Bridges provided the affidavit of Adm. Ben J. Lehman, USN (Ret.), a professional engineer and certified safety professional. Lehman studied the depositions of Fuchs, Cummings *461 and Stengle, invoices and pamphlets concerning the Grove crane and Kruger anti-two-block device, and photographs of the block, control panel and warning signs. In addition to these documents, Mr. Lehman based his opinion on his education and experience as a professional engineer and certified safety professional. In his opinion, the anti-two-block device should have been mandatory, not optional. The lack of the device on the auxiliary hoist was an immediate cause of Bridges' injury. Lehman issued the following opinion:
It is my considered professional opinion... [that] it is nearly inevitable that a two block situation will occur, having the potential of causing severe damage to the crane itself, to other property, and to persons working near it. Further, it is also my professional opinion that it was virtually certain that damage to the crane and to persons such as [Bridges] would be sustained if the Grove crane involved here were regularly operated without a properly installed, fully functioning and actively engaged anti-two-block device.
Standard for Summary Judgment
Plaintiff contends that summary judgment is not the appropriate procedural device for determining the question of intent.
As a general rule, appellate courts review summary judgments de novo, using the same criteria applied by trial courts to determine whether summary judgment is appropriate. Reynolds v. Select Properties, Ltd., 93-1480 (La. 4/11/94), 634 So. 2d 1180, 1183; Schroeder v. Board of Supervisors, 591 So. 2d 342, 345 (La.1991). "A summary judgment shall be granted if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue of material fact, and that the mover is entitled to judgment as a matter of law." La.C.C.P. art. 966(B).
A motion for summary judgment is not designed to be a substitute for a trial on the merits. Oller v. Sharp Electric, Inc., 451 So. 2d 1235, 1237 (La.App. 4th Cir), writ denied, 457 So. 2d 1194 (La.1984). Further, summary judgment may not be used to dispense with a case that is difficult to prove. Holmes v. Pottharst, 557 So. 2d 1024, 1026 (La.App. 4th Cir.1990).
When a motion for summary judgment is made and supported with affidavits, depositions, and/or answer to interrogatories, the adverse party may not rest merely on the allegations or denials contained in the pleadings. Poydras Square Associates v. Suzette's Artique, Inc., 614 So. 2d 131, 132 (La.App. 4th Cir.1993). Argument of counsel and briefs, no matter how artful, are not sufficient to raise a genuine issue of material fact. Allegations without substance will not support a summary judgment. Despite the presence of disputed facts, summary judgment will be granted as a matter of law if the contested facts present no legal issues. Davenport v. Amax Nickel, Inc., 569 So. 2d 23, 27 (La.App. 4th Cir.1990), writ denied, 572 So. 2d 68 (La. 1991).
In determining whether the party moving for summary judgment has satisfied his burden, the papers supporting his position must be closely scrutinized, while the opposing papers are to be indulgently treated. Dibos v. Bill Watson Ford, Inc., 622 So. 2d 677, 680 (La.App. 4th Cir.1993). All evidence and inferences drawn from the evidence must be construed in the light most favorable to the party opposing the motion. Carr v. City of New Orleans, 622 So. 2d 819, 822 (La.App. 4th Cir.), writ denied, 629 So. 2d 404 (La.1993).
Summary judgment is the appropriate procedural device when the issue of intent is raised. In Mayer v. Valentine Sugars, 444 So. 2d 618 (La.1984), the Louisiana Supreme Court held that the exception of no cause of action is not the appropriate procedural device to dispose of a LSA-R.S. 23:1032(B) case when the lack of intent is raised, stating as follows:
Defendant argues that it should be permitted by the exception of no cause of action to penetrate the plaintiff's general allegation of intent to demonstrate that plaintiff's injuries did not in fact result from an intentional act. This is the function of a motion for summary judgment, *462 however, and not that of an exception of no cause of action.
444 So.2d at 620 (emphasis added).
The Louisiana Supreme Court reaffirmed this position in Carey v. UMC, 553 So. 2d 472 (La.1989). In that case, the court reversed a dismissal of a LSA-R.S. 23:1032(B) case on an exception of no cause of action, stating that "[t]he merit of plaintiff's claim is to be determined by the finder of fact on motion for summary judgment or trial on the merits." 553 So.2d at 472 (emphasis added). Our courts have consistently concluded that summary judgment is the appropriate procedural method for this type of case. See Landry v. Uniroyal Chemical Co., 94-1274 (La.App. 1st Cir. 3/3/95), 653 So. 2d 1199; McKee v. Inspectorale America Corp., 93-1253 (La.App. 4th Cir. 4/14/94) 636 So. 2d 305 (Byrnes & Plotkin, JJ. dissenting), writ denied 94-1269 (La. 9/2/94), 643 So. 2d 144; Gallon v. Vaughan Contractors, 619 So. 2d 746, 748 (La.App. 4th Cir.), writ denied, 625 So. 2d 1035 (La.1993); Williams v. Gervais F. Favrot Co., 573 So. 2d 533, 541-42 (La.App. 4th Cir.), writ denied 576 So. 2d 49 (La.1991) (summarizing some of the many opinions affirming summary judgment on this issue).[1] We hold that summary judgment is the correct procedural device to resolve this issue.
Intentional tort exception
Plaintiff admitted that the defendant was the decedent's statutory employer under the provisions of LSA-R.S. 23:1032(A), which provides that worker's compensation is the exclusive remedy of an employee against his employer or co-employees. However, LSA-R.S. 23:1032(B) provides an exception to this rule as follows: "Nothing in this Chapter shall affect the liability of the employer ... or employee of such employer ... to liability, civil or criminal, resulting from an intentional act." Plaintiff relies on this exception, claiming Woodward intentionally caused his injuries.
In order to prevail at trial, the plaintiff must show that the defendant's failure to install a safety device on the crane was an intentional action which was "substantially certain" to result in injury to the plaintiff. The plaintiff contends that the facts of this case demonstrate that a genuine material issue of fact exists concerning "whether or not [the defendant] knew that by choosing not to repair the damaged system, or install a new one, it was substantially certain, or nearly inevitable that a two-blocking incident would occur, causing injury such as that sustained by the plaintiff."
Jurisprudence interpreting "intentional act" exception
In Bazley v. Tortorich, 397 So. 2d 475, 480 (La.1981), the Supreme Court held that the words "intentional act" mean the same as "intentional tort" in reference to civil liability. The court defined the meaning of intent as follows:
The meaning of "intent" is that the person who acts either (1) consciously desires the physical result of his act, whatever the likelihood of that result happening from his conduct; or (2) knows that that result is substantially certain to follow from his conduct, whatever his desire may be as to that result.
Id. at 481.
In White v. Monsanto Co., 585 So. 2d 1205 (La.1991), the Louisiana Supreme Court further explained the meaning of "intentional act" under LSA-R.S. 23:1032(B) as above, then added the following statement:
Thus, intent has reference to the consequences of an act rather than to the act itself. Only where the actor entertained a desire to bring about the consequences that followed or where the actor believed that the result was substantially certain to follow has an act been characterized as intentional.
Id. at 1208, citing Bazley, 397 So.2d at 481.
The "intentional act" loophole in the exclusive remedy provision is a narrow one. *463 Louisiana courts have narrowly interpreted the intentional act exception to the worker's compensation exclusivity provisions. A review of all the jurisprudence reveals that an overwhelming majority of the reported cases have resulted in summary judgment in favor of the defendant. See W.S. Malone & H.A. Johnson, Workers' Compensation Law & Practice, § 365.
The term "substantially certain" has been subjected to intense review. It has been held to mean "nearly inevitable," "virtually sure," and "incapable of failing." Jasmin v. HNV Central Riverfront Corp., 94-1497 (La.App. 4th Cir. 8/30/94) 642 So. 2d 311, 312-313, writ denied, 94-2445 (La. 12/9/94), 647 So. 2d 1110; Tapia v. Schwegmann Giant Supermarkets, Inc., 590 So. 2d 806, 807 (La. App. 4th Cir.1991); King v. Schuylkill Metals Corp., 581 So. 2d 300, 302 (La.App. 1st Cir.), writ denied, 584 So. 2d 1163 (La.1991); Brown v. Diversified Hospitality Group, 600 So. 2d 902 (La.App. 4th Cir.1992). It requires more than a reasonable probability, even more than a high probability, that an accident or injury will occur. Mahfouz v. J.A.C.E. Oilfield Sales & Service, 569 So. 2d 1074, 1077 (La.App. 3d Cir.1990); Landry, 653 So.2d at 1203.
Mere knowledge and appreciation of risk does not constitute intent, nor does reckless or wanton conduct or gross negligence. Tapia, 590 So.2d at 807-08; Williams v. Gervais F. Favrot Co., 573 So.2d at 540. Terms such as "reasonably foreseeable," "likely to occur," and "should have known" may raise issues of negligence or gross negligence, but do not amount to "intentional act." Adams v. Time Saver Stores, Inc., 615 So. 2d 460, 461-62 (La.App. 4th Cir.), writ denied, 617 So. 2d 910 (La.1993). Phrases using the words "intentional" or "with specific knowledge" are not magical; their mere recitation does not transform the plaintiff's allegations into intentional acts. Gallon, 619 So.2d at 748; Williams v. Charity Hospital, 499 So. 2d 1260, 1261 (La.App. 4th Cir.1986).
Application to the instant case
In this case the plaintiff's broadest allegations of intentional conduct by Woodward, as set forth in his Second Supplemental and Amending Petition, were as follows:
1) Its failure to procure and install a "two block warning system" of which it had knowledge, and of which it knew would have prevented the accident in question, and, alternatively,
2) Its intentional removal of the "two block warning system" from the crane,
The above acts and/or omissions constituting an intentional tort and/or gross negligence, for which the defendant, WOODWARD, INC., is liable unto your petitioner.
3) As well as any and all other acts and/or omissions which may be proved at the trial of this matter.
The embodiment of plaintiff's intentional tort cases against his employer is based on the employer's failure to procure and install an anti-two-block warning system and, alternatively, its removal of the warning device. In support of these allegations, plaintiff relies upon Mr. Lehman's affidavit, stating his opinion that a two-block situation was nearly inevitable and that the injuries were "virtually certain" to result in the absence of an anti-two-block warning system. Finally, the plaintiff claims that Woodward executives intentionally elected not to repair the original warning system.
In response to these allegations, the defendant avers that it was not required, either at the time of purchase or at the time of the accident, by any law, rule, or standard to install any anti-two-block warning system on the auxiliary line. Woodward used the crane for many years without an anti-two-block warning system on the auxiliary line; such warning devices were not common in the industry. Further, the crane operator had never used a crane with a functioning anti-two-block warning system.
Since at least 1982, this Court has consistently held that the failure to supply safety devices and the failure to adhere to safety regulations such as those promulgated by OSHA do not constitute "intentional acts" so as to strip the employer of the protection of the worker's compensation law. For example, in Jacobsen v. Southeast Distributors, *464 Inc., 413 So. 2d 995 (La.App. 4th Cir.), writ denied, 415 So. 2d 953 (La.1982), this Court held that an employer's refusal to provide its employee with a requested safety device was not an intentional tort because it could not be said that such refusal created a "substantial certainty" that injury would result. Id. at 997-98. We specifically noted the Louisiana Supreme Court's observation in Bazley that "in most states, intentional misconduct `require[s] a commission of a genuine intentional tort and have refused to stretch liability to include negligence, recklessness or constructive intent.'" Id. at 998.
Likewise, in Dycus v. Martin Marietta Corp., 568 So. 2d 592 (La.App. 4th Cir.), writ denied, 571 So. 2d 649 (La.1990), we observed that "[e]ven proof that a worker was told by his employer to work in an unsafe place was considered insufficient to prove an intentional tort." Id. at 594 (citing Jacobsen, 413 So.2d at 998). And, in Williams, 573 So. 2d 533, we cautioned that "[a]llegations of deficiently designed machinery and disregarding OSHA safety provisions are insufficient" to state an intentional tort. Id. at 541. Significantly, in each of these cases, the Louisiana Supreme Court denied writs, thereby eschewing the opportunity to correct what the dissent now apparently deems to be an erroneous rule of law.
In a case very much on point, the First Circuit held that an employer's failure to remedy a known dangerous condition was not an intentional tort. Erwin v. Excello Corp., 387 So. 2d 1288 (La.App. 1st Cir.), writs denied, 396 So. 2d 1242, 397 So. 2d 1363 (La. 1981). In that case, the employee, Erwin, brought suit against his employer, the Great Atlantic and Pacific Tea Company ("A & P"), after his arm was injured in a milk bottling machine that unexpectedly started as he was trying to dislodge a milk carton that had become stuck in the machine. Erwin alleged that A & P had engaged in an intentional tort by intentionally failing "to repair and make operative a known defective safety cut-off switch" and by intentionally requiring him to operate the machine after having notice that it "would suddenly begin operating without being activated on the control panel." Id. at 1289. The court rejected these claims, explaining as follows:
We find no merit in the appellant's contention that by merely alleging "intentional injury" as we have set out above, he has avoided the mandatory effect of LSA-R.S. 23:1032. There is also no merit in appellant's contention that certain conduct of the A & P employees must be construed as satisfying the "intentional act" requirement of the statute. The record reflects that this was not an "intentional act" that caused the accident and resulting injury to the plaintiff. There is nothing to indicate that any of these defendants entertained a desire to bring about the result obtained, or could possibly have believed that the result was substantially certain to follow anything they did or did not do. No serious argument can be made that anyone employed by the A & P connected with this work or accident had any active desire that the accident with resulting injury should happen. On the contrary, the affidavits of the plaintiff and his co-employee, John Jackson, and the depositions of the three executive officers positively show that none of these defendants entertained a desire to bring about the results here or that they believed the result was substantially certain to follow.
Id. at 1290 (footnote omitted). Accordingly, the court upheld the trial court's summary judgment in favor of the employer.
The same result should obtain in this case. Plaintiff's allegations against Woodward, as alluded to above, are nothing more than an attempt to transform negligence into an intentional tort simply by averring that the employer "intentionally" engaged in its otherwise negligent conduct. This court should not countenance such bald-faced attempts to circumvent the worker's compensation law. In enacting this provision, the Legislature made a conscious attempt to broaden the class of employers insulated by the worker's compensation scheme. We should not abrogate that policy decision by allowing otherwise negligent conduct to be metamorphasized into an "intentional act" merely by the insertion of the word "intentional" into the plaintiff's petition.
*465 Moreover, in this case, there was no proof that Woodward actually desired to bring about Bridges' injury. Thus, plaintiff was required to show that Woodward knew that Bridges' injury was substantially certain to follow from its failure to repair the anti-two-block device, regardless of what its desire may have been as to that result. Bazley, 397 So.2d at 481.
Plaintiff's petition contains two types of allegations, those which are based on negligence and those which contain conclusionary allegations of intentional tortious conduct. The latter are a transparent attempt to transform negligence or possibly gross negligence into an intentional tort by averring that the employer "intentionally" engaged in otherwise negligent conduct.
In an attempt to discharge this burden, the plaintiff placed great emphasis on the affidavit of Mr. Lehman, in which he opined that a two-block situation is nearly inevitable and that injuries were "virtually certain" to result in the absence of an anti-two-block warning system. However, plaintiff failed to establish that anyone at Woodward knew this. In point of fact, Woodward's own crane operator, Charles Fuchs, stated that anti-two-block warning systems were uncommon devices and that he had never before operated a crane that had a functional anti-two-block warning system. We therefore conclude that Woodward did not know that either its failure to repair or replace the warning system, or its removal of the warning system, was "substantially certain" to result in injury to Bridges or anyone else. In other words, Woodward did not have the intent or desire to cause Bridges' injury nor did Woodward know it was substantially certain that Bridges would sustain an injury.
Until the legislature changes LSA-R.S. 23:1032(B) or the Louisiana Supreme Court modifies its interpretation of the statute, we are mandated to follow the law. We recognize that the dissenters in this case and in other cases, have eloquently advocated a different interpretation and result. See Armstead v. Boh Brothers Construction Co., 609 So. 2d 965 (La.App. 4th Cir.1992) (Waltzer, J., dissenting). However, until a change occurs, we are bound by the jurisprudence.
Conclusion
Accordingly, we affirm the trial court judgment granting the motion for summary judgment in favor of defendant Woodward. Both Bridges' case and American's intervention are dismissed.
AFFIRMED.
WALTZER, J., dissents with reasons.
MURRAY, J., dissents for reasons assigned by WALTZER, J.
WALTZER, Judge, dissenting with reasons.
I respectfully dissent from the majority opinion.
In opposition to Woodward's motion for summary judgment, Bridges provided the affidavit of Adm. Ben J. Lehman, USN (Ret.), a professional engineer and certified safety professional. In his opinion, the lack of the anti-two-blocking device on the auxiliary hoist was an immediate cause of Bridges' injury. Lehman opined:
"It is my considered professional opinion... [that] it is nearly inevitable that a two block situation will occur, having the potential of causing severe damage to the crane itself, to other property, and to persons working near it. Further, it is also my professional opinion that it was virtually certain that damage to the crane and to persons such as [Bridges] would be sustained if the Grove crane involved here were regularly operated without a properly installed, fully functioning and actively engaged anti-two-block device."
In Bazley v. Tortorich, 397 So. 2d 475 (La. 1981), the Court held:
The meaning of "intent" is that the person who acts either (1) consciously desires the physical result of his act, whatever the likelihood of that result happening from his conduct; or (2) knows that the result is substantially certain to follow from his conduct, whatever his desire may be as to that result.
(Emphasis added). Bazley, 397 So.2d at 481.
*466 Lehman's affidavit establishes, for purposes of summary judgment[1], the substantial certainty of a two-blocking accident. The intentionality of the fault charged to Woodward is proved or disproved by application of the substantial certainty test set forth in Bazley.
Dycus v. Martin Marietta Corp., 568 So. 2d 592 (La.App. 4th Cir.1990), writ denied, 571 So. 2d 649 (La.1990) does not require dismissal of Bridges' claim. Dycus' claim was for negligent repair, and the Court noted that "there [was] no indication that anyone was aware injury to the plaintiff was `substantially certain' to result from his doing his work without the proper safety equipment." Dycus, 568 So.2d at 595, quoting Davis v. Southern Louisiana Insulations, 539 So. 2d 922, 924 (La.App. 4th Cir.1989). This lack of evidence that defendant was aware that the injury was substantially certain distinguishes Dycus from the instant case.
According to Adm. Lehman's affidavit, it was "nearly inevitable" and "virtually certain" that in the absence of the warning device the two-blocking accident would cause injury to a person in Bridges' position.
The plaintiff produced sworn testimony that brings his claim precisely within the terms of Bazley's definition. It is impossible to conceive of testimony that would more clearly bring a plaintiff's claim within this definition, short of proof of a criminal act requiring specific intent. In light of Adm. Lehman's evidence, the majority's dismissal is tantamount to granting an exception of no cause of action: accepting the truth of Bridges' allegations, he is not allowed to recover. The writer of the majority opinion has espoused this view in his dissent in McKee v. Inspectorate America Corporation, 93-1253 (4/14/94), 636 So. 2d 305, writ denied 94-1269 (La. 9/2/94), 643 So. 2d 144; however, that is not the law. The majority yields to the temptation to extend tort immunity beyond the Bazley standard, and implicitly overrules both the rule of this circuit stated in McKee,[2] and that of the Louisiana Supreme Court stated in Carey v. UMC (United Mechanical Contractors), 553 So. 2d 472 (La.1989).
I believe that based upon the record plaintiff has not failed to state a cause of action as a matter of law, and is entitled to present his case before the trier of fact.
NOTES
[1] We are aware of several decisions which have upheld the no cause of action exception on the issue of intentional tort. In the seminal case of Bazley v. Tortorich, 397 So. 2d 475 (La.1981), the Supreme Court upheld an exception of no cause of action. See also Vallery v. Southern Baptist Hospital, 630 So. 2d 861 (La.App. 4th Cir.1993), writ denied, 634 So. 2d 860 (La.1994); Wilson v. State DHHR, 628 So. 2d 1164 (La.App. 3d Cir. 1993); Williams v. Charity Hospital, 499 So. 2d 1260 (La.App. 4th Cir.1986).
[1] In Dibos v. Bill Watson Ford, Inc., 622 So. 2d 677, 680 (La.App. 4th Cir.1993), this Court held that the papers supporting the position for the party moving for the summary judgment are to be closely scrutinized while the opposing papers are to be indulgently treated, in determining whether mover has satisfied his burden. All evidence and inferences drawn from the evidence must be construed in the light most favorable to the party opposing the motion. Carr v. City of New Orleans, 622 So. 2d 819, 822 (La.App. 4th Cir.1993), writ denied 629 So. 2d 404 (La.1993). Where the trial court is presented with a choice of reasonable inferences to be drawn from subsidiary facts contained in affidavits and attached exhibits, reasonable inferences must be viewed in the light most favorable to the party opposing the motion. Duvalle v. Lake Kenilworth, Inc., 396 So. 2d 1268 (La.1981). A motion for summary judgment is not designed to be a substitute for a trial on the merits. Oller v. Sharp Elec., Inc., 451 So. 2d 1235, 1237 (La.App. 4th Cir.1984), writ denied 457 So. 2d 1194 (La.1984). The weighing of conflicting evidence on a material fact has no place in summary judgment procedure. Mecom v. Mobil Oil Corp., 299 So. 2d 380 (La.App. 3rd Cir.1974), application denied, 302 So. 2d 308 (La. 1974).
[2] We note that the Louisiana Supreme Court denied the application to review this opinion from a five-judge panel of this Court. A dissent in the Fourth Circuit case contended that the intentional tort issue may be determined on an exception of no cause of action. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1750149/ | 413 So. 2d 995 (1982)
Oscar JACOBSEN and Cecelia Jacobsen
v.
SOUTHEAST DISTRIBUTORS, INC., Erwin Vogel, Richard Vogel, Frank Knight and ABC Insurance Company.
No. 12791.
Court of Appeal of Louisiana, Fourth Circuit.
April 21, 1982.
Writ Denied June 11, 1982.
*996 Melvin W. Mathes, Beard, Blue, Schmitt, Mathes, Koch & Williams, New Orleans, for defendant-appellant.
William W. Miles, Conner, Martinez & Miles, Metairie, for plaintiffs-appellees.
Joseph R. Ward, Jr., Buckley & Ward, New Orleans, for defendant-appellant.
Before BARRY, AUGUSTINE and WILLIAMS, JJ.
WILLIAMS, Judge.
This is an appeal from a decision of the trial court finding the defendant Frank Knight liable for injuries sustained by the plaintiff while he was working for Southeast Distributors, Inc. ["Southeast"].
The plaintiff was a painter for Southeast. At the time of the accident, plaintiff was working on a job applying a waterproofing mixture to the exterior of the De La Poste Hotel in New Orleans. Frank Knight was his supervisor on the job. On this job, the plaintiff worked on a "swinging stage". This is an eighteen-foot long stage supported by two ropes. According to the plaintiff, he requested a safety line on his first day on the job. A safety line is a rope, one end of which is attached to the building on which a man is working and the other end is attached to the worker's belt. It is designed to prevent the worker from striking the ground in case of a fall. The plaintiff testified that Knight refused to supply him with the line and a plywood covering for the adjoining roof. Because the swinging stage already had been rigged from a previous job at the same site, Knight apparently stated it required too much time to supply the requested equipment. There was also testimony introduced into the record to show that Knight had told the plaintiff not to worry about the lack of safety equipment because the ledge along side of which he was working would protect him.
On August 8, 1979, the plaintiff fell off the swinging stage. The exact reason that he fell is uncertain. The defendant claims that the man who was working with him on the stage caused the fall. Nevertheless, it is the plaintiff's contention that Knight's intentional act of not supplying the requested safety equipment was the cause of the injury sustained by him.
The plaintiff and his wife originally filed suit against Southeast and certain executive officers of the corporation, one of which was Frank Knight. During the course of trial, Mrs. Jacobsen was removed as a plaintiff, and all other defendants were removed other than Frank Knight.
The defense filed an exception of no cause of action which was denied by the trial judge, and on March 24-25, 1981, trial was held before a twelve-person jury. After trial, the jury found that Frank Knight committed an intentional act that was the cause of Oscar Jacobsen's injuries and awarded him $634,000.00 in monetary damages.
The defendant has appealed to this court, asserting that there were two errors in the lower court: (1) the trial court was in error in applying La.R.S. 23:1032 to the instant case, because Frank Knight did not commit an intentional act; and (2) the monetary award given to the plaintiff by the jury was clearly excessive. Because we find that the trial court was in error in finding Frank Knight liable under the provisions of La. R.S. 23:1032, we need not reach a decision as to issue of quantum.
The question presented by the instant case is whether the behavior of Mr. Frank Knight is an intentional tort within the contemplation of La.R.S. 23:1032 as amended.
In 1976, the Worker's Compensation law was amended to provide:
"The rights and remedies herein granted to an employee or his dependent on account of an injury or compensable sickness or disease for which he is entitled to compensation under this Chapter, shall be exclusive of all other rights and remedies *997 of such employee, his personal representatives, dependents, or relations, against his employer, or any principal or any officer, director, stockholder, partner or employee of such employer or principal, for said injury or compensable sickness or disease. The purposes of this Section, the word "principal" shall be defined as any person who undertakes to execute any work which is part of his trade, business or occupation in which he was engaged at the time he was injured, or which he has contracted to perform in contracts with any persons for the execution thereof.
Nothing in this Chapter shall affect the liability of the employer, or any officer, director, stockholder, partner, or employee of such employer or principal to a fine or penalty under the statute for the liability, civil or criminal, resulting from an intentional act. Immunity from civil liability provided by this Section shall not extend to:
1) Any officer, director, stockholder, partner or employee except employer or principal who was not engaged at the time of the injury in the normal course and scope of his employment; and
2) For the liability of any partner in a partnership which has been formed for the purposes of evading any of the provisions of this Section." La.R.S. 23:1032 as amended by Act 147 of 1976.
In Bazley v. Tortorich, 397 So. 2d 475 (La. 1981), the Louisiana Supreme Court upheld the constitutionality of La.R.S. 23:1032, as amended, as it precludes suits by employees seeking to recover from third persons for work-related injuries. In that decision, the Supreme Court held:
"[W]e construe the legislation under review as providing that the exclusive remedy rule shall be inapplicable to intentional torts or offenses."
Id. at 482.
In Jones v. Thomas, 413 So. 2d 180 (La. App. 4th Cir. 1981), we held that an employee has an action in tort against his employer only if that employer were responsible for an intentional tort that occasioned the damage sustained by the employee. In the instant case, there is no dispute as to the fact that Frank Knight is an executive officer of the corporation, and therefore within the purview of this provision of the statute. If the tort committed by Frank Knight is considered to be intentional, then he may be sued. If it is merely a tort involving some degree of negligence, even the grossest negligence, then the plaintiff's exclusive remedy is worker's compensation.
In Bazley, supra, the Louisiana Supreme Court concluded that the words "intentional act" contained in La.R.S. 23:1032 had the same meaning as "intentional tort" in reference to civil liability. Id. at 480. The court went into great discussion as to the meaning of intentional act and held that:
"The meaning of intent is that the person who acts either (1) consciously desires the physical result of his act, whatever the likelihood of that result happening from his conduct; or (2) knows that that result is substantially certain to follow from his conduct, whatever his desire may be as to that result. Thus, intent has reference to the consequences of an act rather than to the act itself."
The court also held that intent is not limited to those instances where the consequences of the act were desired. If the tortfeasor knows that the consequences are certain or substantially certain to result from the tort and still performs it, then in the eyes of the law he is treated as if he had in fact had the intent to produce that result. Id. at 482.
At trial, Knight testified that it was correct to assume that there was a reasonable probability of an accident occurring in view of the hazardous type of work that was being performed. He also testified he did know that if a man were to fall from the height from which the plaintiff fell, that he would injure himself.
The question before the court, therefore, is whether this knowledge which Frank Knight admitted to have as to the reasonable probability of an accident occurring and *998 as to the knowledge as to the result of such an accident, could be the substantial certainty required by the Bazley decision.
Webster's Third New International Dictionary (1961) defines "probable" as "that is based on or arises from fairly, though not absolutely adequate, convincing, conclusive intrinsic or extrinsic evidence or support". "Certain," however, is defined as "inevitable," or "incapable of failing". The semantical difference between "reasonably probable" and "substantially certain" is significant, especially in light of Frank Knight's actions. Furthermore, we cannot isolate Knight's use of the phrase "reasonably probable" from the rest of the evidence including the remainder of his testimony presented at trial. We are aware that the words "certain" or "substantially certain" are terms of the judicial art. Had Knight actually testified that it was certain, rather than probable, that an accident would happen, it still would not be conclusive on the issue of intent. A witness's choice of words to express himself, especially when the witness is a layman, is not necessarily so narrowly or judiciously made as always to be the precise expression of the witness's meaning.
Other cases have addressed the question of whether a tort was intentional and have found that a high degree of probability is not sufficient to find that the tortfeasor actually intended the consequences of his act. E.g. McGuire v. Honeycutt, 387 So. 2d 674 (La.App. 3d Cir. 1980).
Based on the circumstances presented by the instant case, we cannot find that the plaintiff has proved that Frank Knight had the intent to cause the tort which injured the plaintiff. Other than Mr. Knight's own testimony that he felt it would be a reasonable assumption to say that it was probable that an accident could occur on the job and that someone would be injured as a result thereof, there is not one scintille of evidence in the record to support a determination that Frank Knight intended for Mr. Jacobsen to sustain the injuries that he did as a result of his fall or was substantially certain that they would happen.
We note that the Bazley court pointed out that in most states, intentional misconduct "require[s] a commission of a genuine intentional tort and have refused to stretch liability to include negligence, recklessness or constructive intent." See Mayer v. Blue Cross Ins. Co., 402 So. 2d 273 (La.App. 4th Cir. 1981).
Knight's conduct in the instant case may not have been free of fault, but nevertheless we cannot say that it was intentional. Because the executive officer of the corporation is not liable in tort for the injuries which Jacobsen sustained while on the job, his exclusive remedy therefore, is worker's compensation.
For the foregoing reasons, the decision of the trial court is reversed.
REVERSED.
BARRY, Judge, concurs.
I have searched the record to find support for the judgment, but the problem is that the jury improperly applied the exclusive remedy (immunity) rule as it pertains to intentional torts.
Bazley defines the requisite intent of the executive officer in order to find liability under LSA-R.S. 23:1032 as: a conscious desire to cause injury or substantial certainty that injury will follow his conduct.
The defendant's failure to provide or refusal to provide a safety line, by itself, does not indicate or manifest a conscious desire to intentionally cause injury. This record is void of evidence to support a charge that the defendant consciously or unconsciously wanted to harm or injure plaintiff.
Defendant was asked on cross examination: "And you knew there was reasonable probability of accidents happening, ..." and he candidly replied: "Yes". From this answer plaintiff argues that the defendant fully appreciated as a fact that the accident would occur and therefore was substantially certain of the resultant injury. This reasoning and conclusion is erroneous and contrary to Bazley.
*999 Despite the Trial Judge's jury charge which correctly tracked Bazley's requirements in order to find an intentional tort, the jury misapplied the facts to the law and unfortunately its conclusion was clearly wrong.
The exclusive remedy rule, though harsh and restrictive, is a fact of life subject to change through the legislative process. In the meantime, seriously injured workers, such as this plaintiff, are relegated to the confines of the compensation statutes.
I reluctantly concur. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1859540/ | 794 So. 2d 983 (2001)
Martin Scott McGRATH
v.
The CITY OF GAUTIER, Mississippi and Officer Vincent D. Nicholson in his Official Capacity.
No. 1999-CA-01998-SCT.
Supreme Court of Mississippi.
June 28, 2001.
Rehearing Denied September 20, 2001.
Ralph Preston King, II, Wendy C. Hollingsworth, Ocean Springs, Attorneys for Appellant.
Phillip Wayne Jarrell, Gulfport, Trace D. McRANEY, Attorneys for Appellee.
Before BANKS, P.J., SMITH and COBB, JJ.
BANKS, P.J., for the Court:
¶ 1. This case is before the Court on appeal from a summary judgment dismissing the City of Gautier from liability under the Mississippi Tort Claims Act ("MTCA"), Miss.Code Ann. §§ 11-46-1 to 23 (Supp. 2000). Because we find that the maintenance of police vehicles is a governmental function which cannot be separated from police protection activities, which are expressly exempted from liability, we affirm.
I.
¶ 2. On October 7, 1998, Martin Scott McGrath (McGrath) filed suit in the Circuit Court of Jackson County against the City of Gautier, Mississippi (City) and officer Vincent D. Nicholson (Officer), in his official capacity, alleging that the officer, while acting in the course and scope of his employment with the City, negligently collided with the rear of his vehicle on October 14, 1997. According to the accident report, the officer, while on duty, was driving when the brakes in his patrol car failed, causing him to collide with *984 McGrath's car which was stopped at a red light. Although the officer attempted to engage his emergency brake prior to the collision, he was unable to in time, and his vehicle left 19 feet of skid marks at the scene.
¶ 3. The City moved for summary judgment asserting that it and the officer were entitled to immunity under the police protection exemption in the Mississippi Tort Claims Act, Miss.Code Ann. § 11-46-9(1)(c). McGrath argued there was no entitlement to immunity because the City was privately insured for tort liability and the officer was performing a ministerial function unrelated to police protection at the time of the accident. In an amended complaint, McGrath further argued that the officer was engaged in activities of a personal nature, and that the patrol car was negligently inspected and maintained as grounds for denying summary judgment. Nevertheless, the trial court granted summary judgment for the City and the officer.
¶ 4. While motions to reconsider and to compel were pending in the trial court, this Court issued its initial opinion in L.W. v. McComb Separate Mun. Sch. Dist., 754 So. 2d 1136 (1999), holding that the purchase of liability insurance by a governmental entity is a waiver of immunity. In reliance upon L.W., the trial court set aside its dismissal, for the limited purpose of procuring a copy of the City's liability insurance policy to determine if there was indeed coverage for the accident. Further action in the case was held in abeyance, pending the outcome of the rehearing in L.W.
¶ 5. In L.W., 754 So. 2d 1136, 1144-45 (Miss. Sept.2, 1999), this Court, denied the motion for rehearing, but withdrew its original opinion and departed from the portion of the original opinion which held the purchase of liability constitutes a waiver of immunity. Guided by that decision, the trial court found that the City and the officer were still entitled to summary judgment and dismissed the action with prejudice. McGrath appeals from that judgment.
II.
¶ 6. In reviewing a summary judgment, this Court proceeds de novo. Cities of Oxford v. Northeast Miss. Elec. Power Ass'n, 704 So. 2d 59, 64 (Miss.1997). If the pleadings, depositions, answers to interrogatories, and admissions, together with affidavits, show there is no genuine issue as to any material fact and the moving party is entitled to judgment as a matter of law, summary judgment is appropriate, M.R.C.P. 56, and this Court will not reverse.
¶ 7. Pursuant to the Mississippi Tort Claims Act (MTCA), which exempts governmental entities and their employees from liability for certain torts committed while acting within the course and scope of their employment, the trial court found that the City of Gautier and Officer Nicholson were entitled to immunity and summary judgment as a matter of law. The question presented, therefore, is one of statutory construction. We must decide whether the maintenance and inspection of police vehicles are activities related to police protection, so that the city and the officer are immune from liability arising out of negligence in the performance thereof.
¶ 8. The police protection exemption reads in pertinent part:
(1) A governmental entity and its employees acting within the course and scope of their employment or duties shall not be liable for any claim:
* * *
*985 (c) Arising out of any act or omission of an employee of a governmental entity engaged in the performance or execution of duties or activities relating to police or fire protection unless the employee acted in reckless disregard of the safety and well-being of any person not engaged in criminal activity at the time of injury;
Miss.Code Ann. § 11-46-9(1)(c) (Supp. 2000) (emphasis added).
¶ 9. Apparent in the language is that those officers who act within the course and scope of their employment, while engaged in the performance of duties relating to police protection, without reckless disregard for the safety and well being of others, will be entitled to immunity. Less apparent is precisely what construction to give to the language "duties or activities relating to police ... protection."
a.
¶ 10. The key phrase "police protection" is not defined in the statute, and this precise issue has never been decided by our courts. Our previous pronouncements examining liability for police actions under the Mississippi Tort Claims Act, however, include activities which shed some light on the issue, such as: deciding whether to arrest a driver or allow him to continue driving, arresting and detaining a suspect, administering an intoxilyzer test on the roadway, accidentally shooting a person resisting arrest, aiming weapons at and negligently detaining a suspect. See Jim Fraiser, A Review of the Substantive Provisions of the Mississippi Governmental Immunity Act: Employees' Individual Liability, Exemptions to Waiver of Immunity, Non-Jury Trial, and Limitation of Liability, 68 Miss. L.J. 703, 763-64 (1999) (citing Smith v. Thompson, No. 2:96CV159-B-B, 1998 WL 97287, at *2-3 (N.D. Miss. Jan 28, 1998) (granting summary judgment in favor of an officer who aimed his weapon at a person he mistakenly believed to be a real suspect); Moore v. Carroll County, 960 F. Supp. 1084, 1088-92 (N.D.Miss.1997) (holding a deputy to be immune from a state tort claim arising when the deputy's weapon accidentally discharged); Foster v. Noel, 715 So. 2d 174, 178-80 (Miss.1998) (holding that an officer was not liable under the Mississippi Tort Claims Act when he acted pursuant to a valid arrest warrant and not in reckless disregard for the arrestee's safety and well-being); Hall v. Mississippi Dep't of Pub. Safety, No. 96-CA-00832-SCT, slip op. at 7, 708 So. 2d 564 (Miss.1998) (table) (holding an officer liable when he placed a driver in harm's way while administering roadside sobriety tests) (emphasis added)). Although not an exhaustive list, these activities are clearly integral to providing police protection.
b.
¶ 11. On the issue of whether the negligent maintenance of brakes in the officer's car is an activity arising under the police protection exemption of MTCA, the trial court stated:
I see no genuine issue of material fact here. The fact that the City or its employees may have been negligent in the maintenance of a police vehicle, similarly in my judgment is an act of police protection. And I can't separate that from what police officers do. If there is some allegation of failure to maintain a police vehicle, I find the City to be immune under the same provisions, which are in 11-46-9(c).
¶ 12. We agree. Mississippi courts, however, have never directly confronted whether the maintenance of a police vehicle is an activity relating to police protection. Prior to the enactment of the MTCA, the determination of municipal immunity would depend upon whether the *986 municipality acted in a governmental or proprietary capacity. Where persons have suffered injuries caused by city employees driving city vehicles, for example, we have made the following pronouncements: (1) The establishment of and maintenance of the police department is a governmental function, rather than a proprietary function. (2) A municipality is immune when the injury stems from a performance of a governmental function. (3) Municipalities are not liable for the negligence of its officers, agents or employees while performing governmental functions. See Jackson v. Smith, 309 So. 2d 520, 523 (Miss.1975) (city found immune when policeman, while driving with mechanic as passenger to determine if vehicle was malfunctioning, responded to accident call and hit child with patrol car; court held the establishment of and maintenance of the police department is a governmental function, stating that the "duty to see that the police car used in connection with police duties was properly maintained was nothing more or less than a part of the activities of the police department in its law enforcement activity."); City of Meridian v. Beeman, 175 Miss. 527, 166 So. 757 (1936) (where judgment of liability upheld for both city and policeman, when he, while on patrol, ran over bicyclist; and testimony did not show that police officer was involved in duties distinctly police in their nature such as pursuing a criminal or responding to an emergency call). But see Thomas v. Hilburn, 654 So. 2d 898, 902 (Miss.1995) (city not entitled to immunity when city garage employee after pulling a police car out of the mud, collided with another car, because the operation of a service garage and tow truck for the maintenance of city vehicles was a proprietary function; court also finding that whether the vehicle was being retrieved for maintenance was of no consequence in contrast to Smith, because no state law requires the establishment of city garages and towing services.).
¶ 13. The rule that the establishment and maintenance of a police department are governmental functions was first announced in City of Hattiesburg v. Geigor, 118 Miss. 676, 79 So. 846 (1918), and restated most recently in Mosby v. Moore, 716 So. 2d 551, 555 (Miss.1998), and Gale v. Thomas, 759 So. 2d 1150, 1154-55 (Miss. 1999). In Geigor, the City of Hattiesburg contended that maintaining and operating its fire department were governmental functions for which it was not responsible for its negligence or that of its employees, when a city fireman was injured while driving an engine from a temporary shed to a fire barn. The Court agreed, stating that there are
some duties the nature of which as governmental is too well settled to be disputed, such as the establishment and maintenance of schools, hospitals, poorhouses, fire departments, police departments, jails, workhouses, and police stations, and the like.
79 So. at 846 (quoting 6 McQuillin, Municipal Corporations, at 5404-07 (emphasis added)).
¶ 14. In Mosby v. Moore, 716 So. 2d 551 (Miss.1998), we restated the rule announced in Geigor when a motorist was injured in a collision with a vehicle being pursued by police officers during a high speed chase. At the time of the accident, the Legislature in an extraordinary session, had enacted Miss.Code Ann. § 11-46-3(1) intending to grant to the state and its political subdivisions sovereign immunity, except, however, where the municipality or employee was engaged in proprietary functions. Miss.Code Ann. § 11-46-3(2) (Supp.1992). Based on the statute, and the holdings of Smith, Geigor, and Anderson v. Jackson Mun. Airport Authority, 419 So. 2d 1010 (Miss.1982), this *987 Court found that the city was immune because the establishment of a police force is a governmental rather than proprietary function.
¶ 15. A plurality of this Court reached the same result in Gale v. Thomas, 759 So. 2d 1150 (Miss.1999) (plurality opinion), yet again, when a driver was injured when a police officer, while on patrol, ran a red light. The plaintiff argued that because the officer's conduct in operating his patrol car was not a discretionary function, the city may be held liable. The plurality rejected the argument, stating that the appropriate inquiry was whether the maintenance and operation of a police department were proprietary or governmental functions. The plurality concluded, as a result, that the city was immune because the establishment and maintenance of police force is a governmental function, and the "conduct giving rise to the injury was not of a proprietary nature". Id. at 1155.
¶ 16. The Court is well aware that these cases are readily distinguishable from the case sub judice because they do not allege negligent maintenance of city vehicles caused the injuries sustained. They do, however, suggest that because an injury is caused by a police vehicle, operated and maintained by the police department, liability will automatically be precluded because the maintenance of a police department is a governmental function, for which municipalities are exempt. We, therefore, affirm the ruling of the trial court.
III.
¶ 17. McGrath has also asked this Court to find that no immunity attaches because the City of Gautier purchased liability insurance. We squarely addressed this issue in L.W. v. McComb Separate Mun. Sch. Dist., 754 So. 2d 1136 (Miss. 1999). The purchase of insurance by a governmental entity does not waive sovereign immunity. It does not matter that the City of Gautier has insurance to cover this incident. The purchase of insurance by a governmental entity covers claims in excess of the statutory cap. It does not limit enumerated exclusions or exemptions from the waiver of sovereign immunity. Id. at 1145. Accord, Maxwell v. Jackson County, 768 So. 2d 900, 903 (Miss.2000); Leslie v. City of Biloxi, 758 So. 2d 430, 434 (Miss.2000). This issue is therefore without merit.
IV.
¶ 18. For these reasons, the judgment of the Jackson County Circuit Court is affirmed.
¶ 19. AFFIRMED.
PITTMAN, C.J., SMITH, MILLS, WALLER, COBB AND DIAZ, JJ., CONCUR. McRAE, P.J., AND EASLEY, J., DISSENT WITHOUT SEPARATE WRITTEN OPINION. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/2508542/ | 395 S.C. 1 (2011)
716 S.E.2d 329
PALMETTO COMPANY, Respondent,
v.
Sean McMAHON, Appellant.
No. 4882.
Court of Appeals of South Carolina.
Submitted March 8, 2011.
Decided August 31, 2011.
*2 Thomas A. Belenchia, Travis D. Hilka, and John C. Strickland, of Spartanburg, for Appellant.
Joseph K. Maddox, Jr., of Spartanburg, for Respondent.
KONDUROS, J.
Sean McMahon appeals the circuit court's affirming the magistrate's court's ruling that the ten-year statute of limitations found in section 15-3-350 of the South Carolina Code *3 (2005) applies to the collection of rent due under a commercial lease. We reverse.[1]
FACTS/PROCEDURAL HISTORY[2]
On April 13, 1997, McMahon and Palmetto Company entered into a written agreement in which McMahon leased real property from Palmetto Company. The lease was from May 1, 1997, to April 30, 1998, and had an automatic renewal provision for successive twelve-month periods unless either party terminated with three months' notice. In 2000, McMahon began making sporadic payments.
On April 22, 2008, Palmetto Company filed an application and affidavit for collection of rent by distraint in the magistrate's court. The magistrate's court heard oral arguments on the proper statute of limitations.[3] McMahon argued the statute of limitations was three years under section 15-3-530(1) of the South Carolina Code (2005), action upon a contract. Palmetto Company argued it was ten years under section 15-3-350 of the South Carolina Code (2005), cause of action founded upon a title to real property or to rents out of the same. The magistrate's court found the ten-year statute of limitations applies when a party seeks to recover rents owed under a lease agreement. McMahon appealed to the circuit court, which affirmed the magistrate's court's ruling. This appeal followed.
STANDARD OF REVIEW
"Determining the proper interpretation of a statute is a question of law, and this [c]ourt reviews questions of law de novo." Town of Summerville v. City of N. Charleston, 378 S.C. 107, 110, 662 S.E.2d 40, 41 (2008).
*4 LAW/ANALYSIS
McMahon argues the circuit court erred in affirming the magistrate's court's ruling that the ten-year statute of limitations from section 15-3-350 applies rather than the three-year statute of limitations from section 15-3-530. McMahon contends the language in the statute is clear and unambiguous that the three-year limitation applies to contracts and a commercial lease agreement is a contract. He further maintains section 15-3-350 does not apply because it is only for an action founded upon title to real property and actions for rent based upon title to real property. We agree.
"A lease agreement is a contract...." Middleton v. Eubank, 388 S.C. 8, 14, 694 S.E.2d 31, 34 (Ct.App.2010). Section 15-3-530(1) of the South Carolina Code (2005) provides the statute of limitations for an action upon a contract is three years, and that article of the code is entitled "Actions Other Than for Recovery of Real Property." See also Anonymous Taxpayer v. S.C. Dep't of Revenue, 377 S.C. 425, 438, 661 S.E.2d 73, 80 (2008) ("The statute of limitations for actions pursuant to [a] contract ... is three years.").
Section 15-3-350 of the South Carolina Code (2005), entitled "Action founded on title or for rents or services," provides:
No cause of action or defense to an action founded upon a title to real property or to rents or services out of the same shall be effectual unless it appear that the person prosecuting the action or making the defense or under whose title the action is prosecuted or the defense is made, or the ancestor, predecessor or grantor of such person, was seized or possessed of the premises in question within ten years before the committing of the act in respect to which such action is prosecuted or defense made.
That section is found in the article entitled "Actions for Recovery of Real Property."
When a statute's language is plain and unambiguous, and conveys a clear and definite meaning, the court has no right to impose another meaning. Hodges v. Rainey, 341 *5 S.C. 79, 85, 533 S.E.2d 578, 581 (2000). "The cardinal rule of statutory construction is to ascertain and effectuate the intent of the legislature." Id. The best evidence of legislative intent is the text of the statute. Wade v. State, 348 S.C. 255, 259, 559 S.E.2d 843, 844 (2002). "All rules of statutory construction are subservient to the one that the legislative intent must prevail if it can be reasonably discovered in the language used, and that language must be construed in the light of the intended purpose of the statute." Broadhurst v. City of Myrtle Beach Election Comm'n, 342 S.C. 373, 380, 537 S.E.2d 543, 546 (2000). "Statutes, as a whole, must receive practical, reasonable, and fair interpretation, consonant with the purpose, design, and policy of lawmakers." TNS Mills, Inc. v. S.C. Dep't of Revenue, 331 S.C. 611, 624, 503 S.E.2d 471, 478 (1998). An appellate court will reject the interpretation of a statute that would lead to an absurd result the legislature could not have intended. Lancaster Cnty. Bar Ass'n v. S.C. Comm'n on Indigent Def., 380 S.C. 219, 222, 670 S.E.2d 371, 373 (2008). When "the language of an act gives rise to doubt or uncertainty as to legislative intent, the construing court may search for that intent beyond the borders of the act itself." Kennedy v. S.C. Ret. Sys., 345 S.C. 339, 348, 549 S.E.2d 243, 247 (2001). In some cases, legislative history may be probative in determining the legislature's intent. Eagle Container Co. v. Cnty. of Newberry, 366 S.C. 611, 630, 622 S.E.2d 733, 743 (Ct.App.2005), rev'd on other grounds, 379 S.C. 564, 666 S.E.2d 892 (2008).
The circuit court erred in affirming the magistrate's court's ruling that the ten-year statute of limitations applies. Although Palmetto Company titled its action as one for distraint, its claim for rent arose out of the lease, not its title to real property. Because a lease is a contract, the three-year statute of limitations applies. Accordingly, the circuit court is
REVERSED.
FEW, C.J., and THOMAS, J., concur.
NOTES
[1] We decide this case without oral argument pursuant to Rule 215, SCACR.
[2] The parties' statements of facts and statements of the case in their briefs are identical.
[3] The parties agreed that McMahon owed $101,600 under the three-year statute of limitations and $196,650 under the ten-year statute of limitations. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/2474997/ | 176 F. Supp. 2d 628 (2001)
Beryl LOCKETT, et al.
v.
ENVIRONMENTAL PROTECTION AGENCY, et al.
No. CIV A. 00-0989.
United States District Court, E.D. Louisiana.
November 14, 2001.
*629 Maurice J. Le Gardeur, Jr., Covington, LA, for Plaintiffs.
Roy Edward Blossman, Leann Opotowsky Moses, Carver, Darden, Koretzky, Tessier, Finn, Blossman & Areaux, New Orleans, LA, William W. Thompson, III, Donald H. Grissom, Grissom & Thompson, LLP, Austin, TX, Joseph Bernstein, Covington, LA, for Intervenor-Plaintiffs.
Kathryn Weekley Becnel, Orelia E. Merchant, U.S. Attorney's Office, New Orleans, LA, Gerald J. Nielsen, Thomas Christopher Pennebaker, William Ross DeJean, Nielsen Law Firm, Metairie, Michael Stephen Rolland, Law Offices of Michael S. Rolland, New Orleans, LA, Ron S. Macaluso, Christian Albert Garbett, Ron S. Macaluso, APC, Hammond, LA, for Defendants.
ORDER AND REASONS
LEMMON, District Judge.
Defendants Village of Folsom, Marshell Brumfield, and Merty Fitzmorris have filed a Motion to Dismiss for Lack of Subject Matter Jurisdiction (Document 53). IT IS ORDERED that plaintiffs' claims under the Clean Water Act are DISMISSED WITH PREJUDICE. Plaintiffs' state law claims are DISMISSED WITHOUT PREJUDICE.
A. Factual Background.
The eight plaintiffs own property in and around Folsom, Louisiana. On August 12, 1999, plaintiffs Carl and Beryl Lockett sent a "Notice of Violations and Notice of Intent to Sue for Violations of the Clean Water Act on a Ravine Running Over and Across Private Property in State of Louisiana" to the Administrator of the Environmental Protection Agency (EPA); defendant Brumfield, Folsom's Mayor; and defendant Fitzmorris, Folsom's Village Administrator. Copies of the notice were also delivered to numerous other public officials, state and local governmental departments, and civic groups. The Locketts claimed that Folsom had allowed its sewage treatment plant to emit both treated *630 and untreated effluvient and sewage into a ravine which runs directly through their property. Among other violations of federal law, the Locketts claimed that these emissions exceeded the levels specified in the plant's National Pollutant Discharge Elimination System (NPDES) permit. An appendix to the letter set forth a summary of the sewage plant's alleged violations of state and federal law from 1983 through 1999.
On November 4, 1999, the Louisiana Department of Environmental Quality (DEQ) issued a Compliance Order to Folsom under LSA-R.S. 30:2025 C. for the sewage plant's violations. The Compliance Order addressed sampling, operation, and maintenance violations discovered on March 23, 1998; miscellaneous additional violations discovered on January 14, 1999; a failure to record totalizer readings discovered on August 11, 1999; permit violations occurring between August 1996 and May 1999; untimely Discharge Monitoring Report submissions for various months between January 1997 and December 1998; and incomplete noncompliance reports. Since that time, the DEQ has been prosecuting an enforcement action against Folsom.
On December 7, 1999, the Locketts issued a second notice letter to Folsom and the EPA. This notice incorporated by reference the contents of the August 12, 1999 notice, and was sent via certified mail to J. Dale Givens as the Secretary of the DEQ (among others).
The Locketts filed suit on March 31, 2000, contending that defendants' actions violated the Clean Water Act, Louisiana statutory law, and the Louisiana constitution. Four additional plaintiffs, the Asevedos and the Ruberts, intervened on September 28, 2000, and two further plaintiffs, the Kings, intervened on July 5, 2001. Plaintiffs sought a declaratory judgment, a prohibitory injunction, a mandatory injunction (requiring Folsom to reroute the sewage pathway), damages, civil penalties, costs, and fees.
On August 20, 2001, the DEQ issued a Penalty Assessment under LSA-R.S. 30:2025 E. against Folsom. The assessment order recited the violations that had been noted in the November 4, 1999 Compliance Order, and stated that Folsom had received a notice of potential penalty on May 3, 2000. It assessed a $466,450.00 penalty against Folsom, together with legal interest and costs. That assessment has been appealed administratively, and is therefore not final, and has not been paid.
B. Analysis.
1. General standards for citizen suits under the Clean Water Act.
33 U.S.C. § 1365 governs citizen suits under the Clean Water Act. § 1365(a)(1) generally provides that a citizen "may commence a civil action on his own behalf" against a person who either violates an effluent standard or limitation set forth in the Act or violates an order issued by the EPA Administrator. The ability to sue under § 1365(a)(1), however, is not unlimited. First, § 1365(b) provides that "No action may be commenced" under § 1365(a)(1) if the EPA or any state "has commenced and is diligently prosecuting a civil or criminal action in a court of the United States, or a State" to require compliance with the standard, limitation, or order.
Second, the first sentence of § 1365(a) explicitly states that a citizen may commence a civil action under it "Except as provided in subsection (b) of this section and section 1319(g)(6) of this title." § 1319(g) generally sets forth the standards for the assessment of penalties by the EPA. § 1319(g)(6) is subdivided into two sections. § 1319(g)(6)(A) provides that if the EPA "has commenced and is diligently prosecuting an action under this *631 subsection," or if a state is doing so "under a State law comparable to" § 1319(g), then any such violation "shall not be the subject of a civil penalty action under subsection (d) of this section or section 1321(b) of this title or section 1365 of this title." See 33 U.S.C. § 1319(g)(6)(A)(i) (applying to EPA actions); id. at § 1319(g)(6)(A)(ii) (applying to state actions under comparable state laws). Under the plain language of this section, therefore, a "diligently prosecut[ed]" EPA or state action displaces a citizen suit under the conditions described in the statute. § 1319(g)(6)(A), however, is itself subject to an exception, which is set forth in § 1319(g)(6)(B):
The limitations contained in subparagraph (A) on civil penalty actions under section 1365 of this title shall not apply with respect to any violation for which -
(i) a civil action under section 1365(a)(1) of this title has been filed prior to commencement of an action under this subsection, or
(ii) notice of an alleged violation of section 1365(a)(1) of this title has been given in accordance with section 1365(b)(1)(A) of this title prior to commencement to an action under this subsection and an action under section 1365(a)(1) of this title with respect to such alleged violation is filed before the 120th day after the date on which such notice is given.
In summary, § 1319(g)(6) states that any violation for which the EPA or a state "has commenced and is diligently prosecuting" an action shall not be subject of a civil penalty action under § 1365, unless either (1) the § 1365 suit was filed before commencement of the action, or (2) adequate notice was given and the citizen suit came with 120 days of the notice.
Defendants argue that plaintiffs' suit is not permissible under the Act. They contend that the DEQ enforcement proceeding is "an action" under a state statute that is comparable to § 1319(g), and that it is being "diligently prosecut[ed]." They further argue that plaintiffs do not fall within the exception set forth in § 1319(g)(6)(B) because their suit was not filed prior to the commencement of the enforcement proceeding, nor did it come within 120 days of a notice of an alleged violation.
2. Does the DEQ enforcement proceeding constitute "an action under a State law" comparable to § 1319(g) that is being "diligently prosecut[ed]"?
Plaintiffs initially contend that because the DEQ has not brought a judicial action against defendants, their suit may proceed because an administrative proceeding cannot preclude a citizen suit. While numerous courts analyzing preclusion under § 1365 have focused on whether a judicial proceeding has been filed by the EPA or a state environmental agency, the language of § 1365 differs from § 1319, for § 1365(b)(1)(B) requires the commencement of "a civil or criminal action in a court of the United States, or a State." By contrast, § 1319(g)(6)(A)(i) and (ii) require only an "action" under federal or state law.
Plaintiffs rely on Washington Public Interest Research Group v. Pendleton Woolen Mills, 11 F.3d 883 (9th Cir.1993) for the proposition that a judicial action is necessary to preclude a citizen suit under § 1319(g)(6)(A). In that case, the EPA issued a compliance order stating that a textile mill was violating its effluvient permit. No penalties were pursued against the mill. Plaintiffs later commenced suit for the mill's permit violations. The Ninth Circuit held that it was the EPA's failure to seek penalties, not its failure to file a judicial action, that allowed plaintiffs' suit to proceed:
*632 The plain language of the statute states that such suits are barred only when the EPA is prosecuting an action "under this subsection," i.e., section 1319(g), which deals only with administrative penalty actions. We are unaware of any legislative history demonstrating a congressional intent to extend the bar on citizen suits created in section 1319(g)(6)(A) to a context other than an administrative penalty action. In this case, the EPA was not pursuing an administrative penalty under section 1319(g). Rather, the EPA acted pursuant to section 1319(a) when it issued a compliance order to Pendleton. The imposition of an administrative penalty requires elaborate procedures including hearings as well as public notice and comment, none of which took place. 33 U.S.C. § 1319(g)(4). Nor did the EPA purport to issue its compliance order pursuant to the provision of section 1319(g).
Id. at 885. Pendleton Woolen Mills, therefore, is distinguishable from this administrative penalty action, where the DEQ ultimately issued a $466,450 penalty assessment against Folsom under state law for the violations set forth in the November 4, 1999 Compliance Order.[1]
Because the DEQ enforcement proceeding constitutes an "action," the next question is whether the action is under "a State law comparable to" § 1319(g). Plaintiffs argue that Louisiana law is not comparable to federal law because state law does not contain the public notice requirements set out in § 1319(g)(4)(A), (B), and (C). Under these subsections, the EPA must provide public notice and a "reasonable opportunity to comment" before issuing "an order assessing a civil penalty." If a person comments on a proposed assessment, he or she "shall be given notice of any hearing held under this subsection and of the order assessing such penalty," and shall be given "a reasonable opportunity to be heard and to present evidence." Further, if no hearing is held, any person who commented is given the opportunity to set aside the order within 30 days of its issuance.
While the Fifth Circuit has not addressed the issue, several courts have held that it is not necessary for a state environmental scheme to contain notice requirements that are identical to federal law for *633 the state proceeding to be comparable to it under § 1319(g)(6)(A)(ii):
The common thread running through these cases [analyzing notice requirements] is a finding that the overall regulatory scheme affords significant citizen participation, even if the state law does not contain precisely the same public notice and comment provisions as those found in the federal CWA. We agree with the reasoning in [North and South Rivers Watershed Ass'n v. Town of] Scituate that the comparability requirement may be satisfied so long as the state law contains comparable penalty provisions which the state is authorized to enforce, has the same overall enforcement goals as the federal CWA, provides interested citizens a meaningful opportunity to participate at significant stages of the decision-making process, and adequately safeguard their legitimate substantive interests. Under those circumstances, the state statute should be presumed comparable unless the facts of the specific case demonstrate that the state denied an interested party a meaningful opportunity to participate in the administrative enforcement process.
Arkansas Wildlife Federation v. ICI Americas, Inc., 29 F.3d 376, 381 (8th Cir. 1994) (citing North and South Rivers Watershed Ass'n v. Town of Scituate, 949 F.2d 552 (1st Cir.1991)), cert. denied, 513 U.S. 1147, 115 S. Ct. 1094, 130 L. Ed. 2d 1062 (1995). The analysis of whether a particular state scheme is comparable to federal law must necessarily be done on a state-by-state basis. Because Louisiana law is not identical to that of other states, the value of precedent analyzing whether a particular state's law is comparable to federal law is limited. However, Jones v. City of Lakeland, 224 F.3d 518 (6th Cir. 2000) (en banc) is an instructive opinion that decided that the Tennessee statutory provision regulating clean water was not comparable to federal law due to notice differences:
An examination of the TWQCA [Tennessee Water Quality Control Act] reflects that it requires no public notice of hearings, nor does it require the State to extend third parties an opportunity to initiate or join mandatory controversial issues seeking justiciable resolution such as enforcement proceedings and consent orders similar to those unilaterally considered and approved by the TDEC [Tennessee Department of Environment and Conservation]. Nor does the Tennessee Open Meetings Act mandate procedures for public participation in an ongoing enforcement prosecution under the TWQCA by TDEC or before the Water Quality Control Board. Thus, TDEC attempts to artfully invoke the protection of a "diligent prosecution" of an ongoing enforcement action while its unilateral discretionary authority permits it to declare citizen or public participation "duplicitous or frivolous," so that the plaintiffs and other similarly situated citizens can be frozen out of commencing an original action, or intervening in an ongoing State enforcement action.
The only window for redress available to the plaintiffs in the instant case, and others similarly situated, occurs in an ongoing administrative action by the TDEC before the Water Quality Control Board when Tennessee law requires that, if a consent judgment is entered between the TDEC and an offending party and filed with the chancery court, the court shall withhold final judgment for forty-five days during which adversely affected parties shall be permitted to intervene. Needless to say, the language ... presupposes that a final order of the TDEC has been filed with the chancery court as a condition precedent to invoking its jurisdiction .... [Not] one of the four orders issued by the *634 TDEC and/or Water Quality Control Board, relied upon by the district court in arriving at its decision, were filed with the chancery court by the State or any of its agencies during the ten or more years of this ongoing enforcement proceeding. Consequently, the plaintiffs and other similarly affected citizens are, at the discretion of the TDEC, denied access to both the courts and to a meaningful opportunity to participate at significant stages of the administrative decision-making process, to adequately safeguard their legitimate interests as mandated by the Clean Water Act. Accordingly, the TWQCA and related Tennessee statutes are not comparable to 33 U.S.C. § 1365(a)(1)(b) and/or 33 U.S.C. § 1319(g)(6).
Id. at 523-24 (citations omitted; italics in original).
In this case, the notice requirements of state law do not render Louisiana law incomparable to federal law, and the notices actually provided to plaintiffs demonstrates the comparable nature of the two statutory schemes. The Louisiana statute specifically provides for public notice of a penalty determination:
After submission for a penalty determination at a hearing, the secretary or assistant secretary shall provide an opportunity for relevant and material public comment relative to any penalty which may be imposed.
LSA-R.S. 30:2025 E.(5). In addition, the record reflects that plaintiffs have, in fact, participated at certain stages in the enforcement proceeding, and have formally intervened into the administrative penalty proceeding.
Because the DEQ compliance action is under a state law that is "comparable to" § 1319(g), the next question is whether the DEQ is "diligently prosecuting" its action. Courts have not adopted a bright-line test for determining diligent prosecution. In ICI Americas plaintiffs argued that the state had not diligently prosecuted an enforcement action against a polluter because even though daily penalties could have reached $170,000, only a few $500 penalties were assessed. The court disagreed, noting that the polluter had implemented a comprehensive remedial action plan, spent approximately half a million dollars making technical changes, and ultimately came into compliance with effluvient standards under its permit. It therefore held that "[i]t would be unreasonable and inappropriate to find failure to diligently prosecute simply because ICI prevailed in some fashion or because a compromise was reached." ICI Americas, 29 F.3d at 380.
Plaintiffs argue that the DEQ proceeding has not been diligently prosecuted because there have been 18 years of noncompliance, because the DEQ has allegedly allowed Folsom to set its own schedule for compliance, and because the penalty that has been assessed is not final and subject to modification. However, the DEQ enforcement proceedings began with the issuance of the Compliance Order on November 4, 1999. Since that time, the DEQ has diligently prosecuted its action, and in fact assessed a $466,425.00 fine against Folsom as part of the enforcement proceeding only a year and a half after it commenced. While plaintiffs complain that this amount is subject to further negotiation and is not final, the deposition testimony of R. Bruce Hammatt, the Administrator in Enforcement for the DEQ, indicates that it is unlikely that the fine will be waived or forgiven. Plaintiffs' mere disagreement with the amount of the fine or with the DEQ's discretion to potentially reduce it as part of any settlement with Folsom does not indicate that it has not diligently prosecuted the enforcement proceeding.
*635 3. Did any of the plaintiffs provide adequate notice and file suit within 120 days thereafter?
§ 1319(g)(6)(B)(ii) provides that if plaintiffs gave adequate notice of alleged violations and sued within 120 days of such notice, their claims under the Clean Water t may proceed regardless of whether the DEQ is diligently prosecuting its enforcement action. The only plaintiffs who could conceivably avail themselves of this provision are the Locketts; it is undisputed that none of the other plaintiffs gave notice.
Initially, defendants argue that the Locketts' notices did not comply with statutory prerequisites because they did not cite the specific standard, limitation, or order violated, and did not provide the dates of the violations. While the Locketts' notices did not catalogue the violations in excessive detail, Appendix "A" to the notices consists of a five-page specific listing of Folsom's violations. In Louisiana Environmental Action Network, Inc. v. Evans Industries, Inc., No. 95-3002, 1997 WL 824310, at *4 (E.D.La. Sept. 30, 1997), this court rejected a similar argument:
Defendant argues that notice was insufficient because the notice does not identify the activity alleged to violate an EPA standard, does not identify a specific standard, limitation, or order violated, and does not provide the dates of the violations. In this case, while plaintiff's letter did not catalogue the violations in detail, the attached addendum gave as much information as was publicly available through defendant's filings with the EPA.
Louisiana Environmental Action Network, 1997 WL 824310, at *4 (italics in original).
Second, defendants argue that the Locketts did not file suit within 120 days of their notice. The Locketts concede that suit was filed more than 120 days after the August 12, 1999 notice (they filed suit on March 31, 2000), but argue that the August 12 notice did not comply with 40 C.F.R. § 135.2, for it was not sent to the "chief administrative officer of the water pollution control agency" of Louisiana. The Locketts therefore focus on the reissued December 7, 1999 notice, and argue that their suit came within 120 days of that date.
The first and second notices are substantively identical (with the second simply incorporating the first), and the only relevant distinction is that the second letter included the specific name of the Secretary of the Louisiana Department of Environmental Quality. Typically, plaintiffs in similar circumstances have argued the opposite position from that now advanced by the Locketts, claiming that their failure to strictly comply with the precise terms of the applicable regulation should be excused. Courts have held that a minor, hypertechnical deviation from the regulation does not render a notice ineffectual. See Louisiana Environmental Action Network, 1997 WL 824310, at *4 (holding that notice sent to "Evans Cooperage Company, Inc. (a/k/a Evans Industries)" was sufficient under 40 C.F.R. § 135.2, even though individual named on pollution discharge permit was "Evans Industries, d/b/a Evans Cooperage"); Sierra Club v. Raytheon Co., No. 84-1785, 1984 WL 2239, at *3 (D.Mass.1984) (holding that although notice was sent to company's president and plant supervisor instead of to its registered agent as required by 40 C.F.R. § 135.2, "such a highly technical flaw in giving notice" did not deprive court of jurisdiction); cf. Bettis v. Town of Ontario, 800 F. Supp. 1113, 1118 (W.D.N.Y.1992) (holding that while "some of the more technical departures" from statutory notice requirements "could perhaps be forgiven," nevertheless plaintiff's suit had to be dismissed *636 because "[m]ost of the defendants, in fact, were not apprised of anything at all, since they never received notice of any kind.").
Because the August 12, 1999 notice was sufficient to begin the 120-day period, the Locketts cannot avail themselves of the exception contained in § 1319(g)(6)(B)(ii). If the Locketts were allowed to merely reissue notice and sue within 120 days of the new notice date, the 120-day limitation would be meaningless; a plaintiff could postpone suit indefinitely by merely reissuing notice letters when any given 120-day period neared its end.
4. What is the scope of preclusion?
One final issue before the court is whether the DEQ enforcement proceeding precludes only plaintiffs' claim for civil penalties, or whether it precludes all of plaintiffs' federal claims. The court finds that all such federal claims are barred. As the Eighth Circuit has held:
We do not go so far as to say that it would be "absurd" to preclude citizens' claims for civil penalties without also precluding claims for declaratory and injunctive relief under the same circumstances. However, we agree with the First Circuit's assessment of such a result as "unreasonable." Allowing suits for declaratory and injunctive relief in federal court, despite a state's diligent efforts at administrative enforcement, could result in undue interference with, or unnecessary duplication of, the legitimate efforts of the state agency. We believe that such a result would undermine, rather than promote, the goals of the CWA, and is not the intent of Congress.
ICI Americas, 29 F.3d at 383; Scituate, 949 F.2d at 557-58 (holding that it would be not only "undesirable" but "absurd" to only preclude claims for civil penalties but not declaratory and injunctive relief). Plaintiffs may still maintain their tort and constitutional claims under Louisiana law in state court.
C. Conclusions.
Because the Louisiana DEQ has commenced and is diligently prosecuting an enforcement action against Folsom under a state law comparable to § 1319(g), plaintiffs' federal claims are precluded under § 1319(g)(6)(A)(ii). Because there are no federal questions remaining in this case, the court dismisses plaintiffs' supplemental state law claims without prejudice to their being urged in state court.
NOTES
[1] Several courts have disagreed with the view adopted in Pendleton Woolen Mills that a penalty action is a necessary prerequisite for preclusion. In North and South Rivers Watershed Ass'n v. Town of Scituate, 949 F.2d 552 (1st Cir.1991), the First Circuit held that:
The primary function of the provision for citizen suits is to enable private parties to assist in enforcement efforts where Federal and State authorities appear unwilling to act. Congress has found it necessary expressly to "recognize, preserve and protect the primary responsibility and rights of the States to prevent, reduce and eliminate pollution." It follows that "the citizen suit [under section 505] is meant to supplement rather than to supplant governmental [enforcement] action." Presumably, then, when it appears that governmental action under either the Federal or comparable State Clean Water Acts begins and is diligently prosecuted, the need for citizen's suits vanishes.
Appellant argues that if it can be found that governmental action to correct the violation which is being diligently pursued nevertheless has not specifically demanded a financial penalty, a citizen's suit may be instituted. Such an interpretation of section 309(g) would enable citizen's suits to undermine the supplemental role envisioned for section 505 citizen's suits, "changing the nature of the citizen's role from interstitial to potentially intrusive."
Id. at 555 (italics in original) (quoting 33 U.S.C. § 1251(b) and Gwaltney of Smithfield, Ltd. v. Chesapeake Bay Foundation, Inc., 484 U.S. 49, 108 S. Ct. 376, 98 L. Ed. 2d 306 (1987)). | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1495282/ | 834 S.W.2d 467 (1992)
Patrick Wayne BABERS, Appellant,
v.
The STATE of Texas, Appellee.
No. A14-91-00316-CR.
Court of Appeals of Texas, Houston (14th Dist.).
June 18, 1992.
Lott J. Brooks, Houston, for appellant.
Mary Lou Keel, Houston, for appellee.
Before J. CURTISS BROWN, C.J., and SEARS and ELLIS, JJ.
MAJORITY OPINION
SEARS, Justice.
Appellant, Patrick Wayne Babers, appeals his conviction for the offense of injury to a child by omission. Tex.Penal Code Ann. § 22.04 (Vernon 1989). The jury found appellant guilty and assessed punishment at 85 years in the Institutional Division of the Texas Department of Criminal Justice and a fine of $10,000.00. We affirm.
On September 29, 1989 at 8:50 a.m., Michael Thomas, a paramedic, was dispatched to an apartment in response to a 911 call. Thomas found a five-month old male infant, D.W., lying on the living room floor. The baby had second degree burns over half of his body. The baby was not breathing and had no pulse. Appellant, Joyce Washington, the baby's mother, and a small child were present. Thomas asked appellant and Washington how the burns occurred. They paused for a moment and then Washington *468 said D.W. pulled a pot of boiling water off a chair and onto himself. Appellant made a statement to the effect that the pot was "by the table" but Thomas did not recall his exact words. Thomas was suspicious of their explanation and asked them if they always put boiling water on the chair. They did not respond.
Sergeant James H. Binford of the homicide division of the Houston Police Department arrived at 9:50 a.m. He noted that skin was missing from the child's arm and burns were apparent over at least half of the baby's body. Binford questioned appellant as to the cause of the child's injuries. Appellant claimed that two days earlier the mother ran a kitchen cooking pot full of hot tap water and set it on a chair. While the mother was distracted, the five month old baby walked over to the chair and pulled the pot from the chair causing the pot to overturn on him. Binford did not feel it was possible for a five month old baby to walk up to a chair. Binford tested the temperature of the hot kitchen tap water and found it was about 133 degrees Fahrenheit.
In appellant's subsequent statement to Sergeant R.J. Goyen of the H.P.D. Homicide Division, he changed his story and stated the child was in a car seat on the commode and fell into a bathtub filled with hot water. Appellant stated he was in the other room when it happened. He returned and pulled D.W. from the tub, took him out of the carseat and put desitin on the burns. He did not take the baby to the doctor earlier because he was scared of what other people would think.
Mose Lavy, a specialist in pediatric dermatology at the Baylor College of Medicine, examined the burns and the strap marks of the car seat. He testified that the child was immersed face down in the water while strapped into the car seat. Assuming the water was 133 degrees, the child would have been immersed for approximately 30 seconds. Immediately after such an injury, a normal infant would cry and scream uncontrollably. He would then go into shock, become listless and lose consciousness. Lavy stated that with proper medical care D.W. would have survived this injury, but without medical care such an injury would produce dehydration and death. He found the failure to provide prompt medical care for such an injury was "grossly inappropriate."
In the punishment phase, appellant presented no evidence. The State produced D.A. Basin, D.B. Alexander and Dennis Nelius, narcotics officers for H.P.D., and they testified that appellant had a bad reputation for being a peaceful and law abiding citizen. Alexander also testified that on October 10, 1988, he searched a car that appellant was standing near. Alexander testified that he believed the car contained cocaine because appellant was a known cocaine dealer. Alexander found 180 rocks of crack cocaine and more than $1,000 in cash in the vehicle after appellant gave him verbal consent to search the vehicle. Alexander recorded in his police report that appellant admitted that the cocaine was his. Nelius testified of a second incident wherein appellant admitted to ownership of 185 pieces of cocaine found in a car that belonged to Eric Russell, a friend of appellant.
In appellant's first point or error, he contends that the trial court erred in permitting the State to introduce evidence of unadjudicated drug offenses during the punishment phase of trial. At the beginning of the punishment phase, the trial court asked the State if it would be presenting any extraneous unadjudicated offenses. The State responded that it would. The State argued that the offenses would be admissible pursuant to the new language added to Tex.Code Crim.Proc. Ann. art. 37.07, sec. 3(a) (Vernon Supp. 1992) ("[EJvidence may, as permitted by the Rules of Evidence, be offered by the state and the defendant as to any matter the court deems relevant to sentencing, including the prior criminal record of the defendant, his general reputation and his character.") (emphasis added underlined portion indicates new language). The State also brought to the court's attention, this court's opinion in McMillian v. State, 799 S.W.2d 311, 313 (Tex.App. Houston [14th *469 Dist.] 1990, pet. granted) interpreting the new language in article 37.07, sec. 3(a). This court held that unadjudicated offenses are admissible for any purpose under art. 37.07, 3(a) as long as they are relevant and not unfairly prejudicial in conformance with Tex.R.Crim.Evid. 401 and 403. Id. at 314. Appellant argued the offenses' prejudicial value far outweighed any probative value, and that the offenses were not relevant since it was an injury to a child case and the offenses involved possession of a controlled substance. Appellant also claimed that his due process rights were being violated because he had not been found guilty in the possession cases.
On appeal, Appellant cites Grunsfeld v. State, 813 S.W.2d 158 (Tex.App. Dallas 1991, pet. granted), and contends the new language in 37.07, sec. 3(a) was not intended to allow the use of unadjudicated offenses during the punishment phase. We note that several Court of Appeals, including this court, have resolved this question adversely to Grunsfeld. Slott v. State, 824 S.W.2d 225 (Tex.App. Beaumont 1992, pet. filed) (evidence of defendant's family violence admissible at punishment phase); Holland v. State, 820 S.W.2d 221 (Tex. App. Fort Worth 1991, pet. filed) (evidence that defendant was previously charged with driving while intoxicated but convicted of reckless relevant to juries determination of sentence in subsequent D.W.I.); Rexford v. State, 818 S.W.2d 494, 497 (Tex.App. Houston [1st Dist.] 1991), pet. ref'd, 823 S.W.2d 296 (Tex.Crim.App. 1991) (Court of Criminal Appeals made clear that its refusal was not an endorsement or adoption of the reasoning in case where judge permitted to consider prior no billed sexual assault in trial of subsequent sexual assault during punishment phase in the PSI report); Zayas v. State, 814 S.W.2d 509, 511 (Tex.App. Houston [14th Dist.] 1991, pet. ref'd) (prior arrest for assault admissible in punishment phase of aggravated sexual assault because of language in 37.07, sec. 3(a) and because appellant opened door when he admitted evidence at punishment stage that he could comply with the law if he was placed on probation); Gallardo v. State, 809 S.W.2d 540, 543 (Tex.App. San Antonio 1991, pet. granted) (unadjudicated aggravated and attempted aggravated sexual assaults relevant to punishment in aggravated sexual assault case); Hubbard v. State, 809 S.W.2d 316 (Tex.App Fort Worth 1991, pet. granted) (Evidence of unadjudicated charge of attempted murder admissible during punishment phase in prosecution for possession with intent to deliver controlled substance); Hunter v. State, 805 S.W.2d 918, 921 (Tex. App. Beaumont 1991, pet. granted) (prior unadjudicated cocaine possession relevant to sentencing in cocaine case); McMillian v. State, 799 S.W.2d 311 (Tex.App Houston [14th Dist.] 1990, pet. granted) (admitted evidence of unadjudicated offense in response to defendant's application for probation); Huggins v. State, 795 S.W.2d 909, 911 (Tex.App. Beaumont 1990, pet. ref'd) (prior unadjudicated thefts related to punishment in murder case).
The Court of Criminal Appeals has not issued an opinion on this subject although it has granted petitions from various Court of Appeals on cases involving this issue. We note that the Court of Criminal Appeals refused petition on at least three opinions which resolved this issue contrary to the Grunsfeld case, however, refusal of a petition does not necessarily endorse its reasoning. Rexford v. State, 823 S.W.2d 296 (Tex.Crim.App.1991). Only one other appeals court agrees with the Dallas court, and a petition for discretionary review has been filed. Blackwell v. State, 818 S.W.2d 134 (Tex.App. Waco 1991, pet. filed) (unadjudicated offenses are not admissible in a noncapital case).
We again hold that article 37.07, sec. 3(a) allows admission of unadjudicated offenses during the punishment phase so long as they are permissible pursuant to Tex. R.Crim.Evid. 401 and 403. The evidence of the prior possession of cocaine was relevant to the jury's determination of appellant's suitability for probation, and it was not unduly prejudicial, misleading or confusing. Appellant's point of error one is overruled.
*470 In point of error two, appellant contends the trial court erred in allowing the state to amend the indictment during trial. The indictment originally read in pertinent part as follows:
It is further presented that in Harris County, Texas, Patrick Wayne Babers, here after styled the defendant, heretofore on or about September 29, 1989, did then and there while having assumed care, custody and control of [D.W.], a child younger than 15 years of age, and after said child had been scalded in hot water he intentionally and knowingly by omission, engage fsic.l in conduct that caused serious bodily injury to the child, namely that the defendant did fail to provide proper medical care for the said child, (emphasis added).
During trial, the prosecutor moved to delete the underscored portion of the indictment. In making his motion, the prosecutor emphasized that his motion was not an amendment, and stated: "[W]ere asking the court to allow us to delete the surplusage which is not an amendment." The trial court agreed that the deletion did not constitute an amendment, and allowed the State to delete the surplus language.
Appellant argues that this was an amendment, rather than a deletion, and that the State was reducing its burden of proof in violation of Tex.Code CrimProc. Ann. art. 28.10 (Vernon 1989). Article 28.10 reads as follows:
(a) After notice to the defendant, a matter of form or substance in an indictment or information may be amended at any time before the date the trial on the merit commences. On the request of the defendant, the court shall allow the defendant not less than 10 days, or a shorter period if requested by the defendant, to respond to the amended indictment or information.
(b) A matter of form or substance in an indictment or information may also be amended after the trial on the merits commences if the defendant does not object.
(c) An indictment or information may not be amended over the defendant's objection as to form or substance if the amended indictment or information charges the defendant with an additional or different offense or if the substantial rights of the defendant are prejudiced.
Tex. Code Crim.Proc.Ann. art. 28.10 (Vernon 1989). Appellant suggests by his reliance on Alvarado v. State, 704 S.W.2d 36 (Tex. Crim.App.1985) that by deleting "engage in conduct", the State no longer had to prove that the appellant's conduct occurred intentionally or knowingly, only that the result occurred intentionally or knowingly. The court in Alvarado specifically stated that section 6.01 of the Penal Code superimposes an "engage in conduct" requirement onto "every offense". Id. at 38. Accordingly, we find the language "engage in conduct" in the indictment was surplusage, and deletion did not reduce the State's burden of proof.
The State may always abandon or delete language in an indictment that is surplus and not necessary to prove the elements of the crime charged. See Garcia v. State, 537 S.W.2d 930, 933 (Tex.Crim. App.1976); Davis v. State, 532 S.W.2d 626, 629-30 (Tex.Crim.App.1976); see also, Etchieson v. State, 653 S.W.2d 930 (Tex. App. Dallas 1983, pet. ref'd) (deletions of defendant's name and "the said" from indictment held not to be amendments subject to article 28.10 since they were unnecessary to the meaning of the indictment, did not explain or describe the offense, expand the State's burden of proof or affect the formal elements of the indictment); Brasfield v. State, 600 S.W.2d 288, 301 n. 2 (Tex.Crim.App.1980) (opinion on rehearing), overruled on other grounds, Janecka v. State, 739 S.W.2d 813 (Tex.Crim.App.1987); and Burrell v. State, 526 S.W.2d 799, 802 (Tex.Crim.App.1975) (unnecessary words that are not description of that which is essential to the indictment may be rejected as surplusage). Appellant's point of error two is overruled.
In appellant's third point of error, appellant contends the testimony of Michael Thomas, a paramedic, regarding appellant's and Joyce Washington's explanations for D.W.'s injury, was inadmissible. *471 Prior to trial, in response to appellant's motion to limine regarding "statements of codefendant", the State asked the court to allow Joyce Washington's statements to Michael Thomas under the hearsay exception for medical diagnosis or treatment, Tex.R.Crim.Evid. 803(4). The court allowed the statements for that purpose. In their opening statement, the State mentioned the statement Washington made to Thomas. Appellant objected "to 803" and the court overruled the objection. During trial, the State questioned Thomas about what Washington told him and appellant objected. The court directed Thomas not to testify about what someone else told him. The State then said, "I'll lay the predicate." After qualifying the witness to testify, the witness was then asked what Washington told him. Appellant did not object to the question or the answers. Thomas also testified without objection that appellant was present and also tried to offer explanations for the burns. Although the record reflects a pretrial motion in limine regarding a co-defendant's hearsay statements, no timely objections or rulings were made when the testimony appellant now complains of was admitted. Because appellant presented no objection at trial, error, if any, is waived. Tex.R.App.P. 52(a); See Lewis v. State, 814 S.W.2d 513, 515 (Tex. App. Houston [14th Dist] 1991, pet. ref'd) (citations omitted) ("no error is preserved in the absence of an adverse ruling"). Point of error three is overruled.
In point of error four, appellant contends the trial court erred in permitting a continuing course of misconduct by the prosecutor that deprived appellant of due process and a fair trial. He contends the prosecutor asked improper questions, testified in the form of questions and committed "other conduct" that tainted the fairness of the proceedings. Addressing this point of error is difficult since appellant admits he has not gone to the trouble to list all of the examples of due process and trial violations, only "some" of the examples, and that he expects this court to find the other examples. That is not the function of an appeals court. However, we have reviewed the examples listed and find nothing that would rise to the level of reversible error. Appellant's point of error four is overruled.
Accordingly, the judgment of the trial court is affirmed.
ELLIS, J., dissenting.
ELLIS, Justice, dissenting.
I respectfully dissent. The majority states, in addressing point of error one, that the new language in Tex.Code Crim. ProcAnn. art. 37.07, sec. 3(a) (Vernon Supp.1992), "any matter the court deems relevant to sentencing," means that any unadjudicated offenses may be admissible during the punishment phase as long as it is in conformance with Tex.R.Crim.Evid. 401 and 403. I disagree. I would follow the reasoning in Grunsfeld v. State, 813 S.W.2d 158 (Tex.App. Dallas 1991, pet. granted) that the legislature did not intend to enlarge the meaning of article 37.07 with these words to include admissibility of unadjudicated extraneous offenses in a noncapital case.
Further, I would hold that article 37.07, sec. 3(a) as amended does not allow the State to introduce evidence of unadjudicated extraneous offenses because this article as amended retains the exact same language of its predecessor defining "prior criminal record". Both articles define "prior criminal record" as: a final conviction in a court of record, or a probated or suspended sentence that has occurred prior to trial, or any final conviction material to the offense charged. The significance of the Legislature's decision is that it must therefore be presumed that by not deleting the definition of "prior criminal record" from the amended article, it did not intend to allow evidence of unadjudicated criminal behavior on the part of the accused.
Focusing upon this error, I would conclude that the trial court's error in allowing the jury to hear testimony from Officers D.B. Alexander and Dennis Nelius about appellant's two unadjudicated cocaine charges prejudiced the jury's decision-making process.
*472 Appellant was eligible for probation, but received eighty five (85) years imprisonment and a $10,000 fine. I therefore, cannot determine beyond a reasonable doubt that the error made no contribution to the punishment assessed. Tex.R.App.P. 81(b)(2). I would sustain appellant's first point of error and reverse the trial court's judgment and remand the cause for a new trial as to punishment only. Article 44.-29(b) of the Tex.Code Crim.Proc. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1828091/ | 864 So.2d 283 (2003)
Rodrequiz W. HARGETT, Appellant,
v.
STATE of Mississippi, Appellee.
No. 2002-CP-00545-COA.
Court of Appeals of Mississippi.
July 29, 2003.
Rehearing Denied October 7, 2003.
Certiorari Denied January 22, 2004.
Rodrequiz W. Hargett (Pro Se), for appellant.
Office of the Attorney General, By: W. Glenn Watts, attorney for appellee.
Before KING, P.J., THOMAS and CHANDLER, JJ.
THOMAS, J., for the court.
¶ 1. Rodrequiz W. Hargett, pro se, appeals an order of the Circuit Court of Harrison County, Mississippi denying his petition for post-conviction relief. Aggrieved, Hargett asserts the following issues on appeal:
I. THE CIRCUIT COURT ERRED IN FAILING TO ADVISE APPELLANT SUFFICIENTLY OF THE MANDATORY SENTENCE REQUIRED BY STATUTE.
*284 II. THE CIRCUIT COURT ERRED IN DENYING APPELLANT'S MOTION TO VACATE GUILTY PLEA BECAUSE IT WAS NOT KNOWINGLY, VOLUNTARILY, AND INTELLIGENTLY ENTERED INTO FOR FAILURE TO FULLY AND ADEQUATELY ADVISE OF NATURE AND CONSEQUENCES OF THE GUILTY PLEA.
III. THE CIRCUIT COURT ERRED IN DENYING APPELLANT'S MOTION TO VACATE GUILTY PLEA WHERE APPELLANT HAS BEEN DEPRIVED OF LIBERTY WITHOUT FULL DUE PROCESS BY PROSECUTING OFFICERS' USE OF PERJURED TESTIMONY AND STATES FAILURE TO PROVIDE CORRECTIVE JUDICIAL PROCESS.
IV. THE CIRCUIT COURT ERRED IN DENYING APPELLANT'S MOTION TO VACATE GUILTY PLEA BECAUSE APPELLANT WAS DENIED EFFECTIVE ASSISTANCE OF COUNSEL FOR PROVIDING APPELLANT WITH CLEARLY ERRONEOUS INFORMATION.
Finding no error, we affirm.
PROCEDURAL HISTORY AND FACTS
¶ 2. Rodrequiz W. Hargett pled guilty to transfer of a controlled substance as a habitual offender with the advice and assistance of counsel on May 9, 2000. The trial court sentenced Hargett to ten years in the custody of the Mississippi Department of Corrections. Hargett filed a motion for post-conviction relief on March 1, 2001, which the trial court summarily denied. Hargett then perfected an appeal to this Court.
ANALYSIS
¶ 3. In his original motion for post-conviction relief, Hargett complained that his guilty plea was not knowingly, intelligently, freely and voluntarily given and that he did not receive effective assistance of counsel. Hargett also now argues on appeal that he was given an illegally lenient sentence.
I. VOLUNTARINESS OF GUILTY PLEA
¶ 4. Hargett asserts that his guilty plea was not knowingly, intelligently, freely, and voluntarily given because he allegedly was not informed of the mandatory minimum sentence that he could receive for his guilty plea. The standard of review pertaining to voluntariness of guilty pleas is well settled: "this Court will not set aside findings of a trial court sitting without a jury unless such findings are clearly erroneous." Weatherspoon v. State, 736 So.2d 419, 421(¶ 5) (Miss.Ct.App.1999). The burden of proving that a guilty plea was involuntary is on the defendant and must be proven by a preponderance of the evidence. Id. at 422(¶ 8) (superceded by Miss.Code Ann. §§ 99-39-23 (Rev.2000)); Terry v. State, 839 So.2d 543, 545(¶ 7) (Miss.Ct.App.2002). A plea is considered "voluntary and intelligent" if the defendant is advised about the nature of the charge against him and the consequences of the entry of the plea. Alexander v. State, 605 So.2d 1170,1172 (Miss.1992).
¶ 5. Hargett signed a sworn statement which acknowledged that he was pleading guilty as a habitual offender and that acknowledged the maximum and minimum sentences as well as the maximum and minimum fine he could receive. Hargett's claims in his motion for post-conviction relief were unsupported by affidavits or any other evidence, and they contradict his sworn statements given before the court in his guilty plea. "Great weight is given to statements made under oath and in open court during sentencing." Gable v. State, 748 So.2d 703, 706(¶ 11) (Miss.1999) (quoting *285 Young v. State, 731 So.2d 1120, 1123(¶ 12) (Miss.1994)). This issue is without merit.
II. EFFECTIVENESS OF COUNSEL
¶ 6. Hargett argues that he was denied effective assistance of counsel because he did not actually commit the offense to which he pled guilty, perjured testimony was used against him, and he was not properly advised that he was pleading guilty as a habitual offender. Hargett provided no affidavits or proposed testimony in support of his argument, alleging that his witnesses could not be located or were in prison. According to Campbell v. State, 611 So.2d 209, 210 (Miss.1992), "such mere allegation is insufficient to require the trial court to grant an evidentiary hearing."
¶ 7. In order to be successful in a claim of ineffective assistance of counsel, the defendant is required to make both a showing of deficient performance and that, but for the deficient performance, a different result would likely have resulted. Strickland v. Washington, 466 U.S. 668, 686, 104 S.Ct. 2052, 80 L.Ed.2d 674 (1984); Donnelly v. State, 841 So.2d 207, 211(¶ 8) (Miss. Ct.App.2003). In order for Hargett to prove the ineffective assistance of counsel claim, under Miss.Code Ann. §§ 99-39-11(2) (Rev.2000), the allegation must be alleged with specificity. "[H]e must specifically allege facts showing that effective assistance of counsel was not in fact rendered, and he must allege with specificity the fact that but for such purported actions by ineffective counsel, the results of the trial court decision would have been different." Smith v. State, 434 So.2d 212, 219 (Miss.1983). See also Miss.Code Ann. §§ 99-39-9(1)(c) (Rev.2000); Terry v. State, 839 So.2d 543, 546(¶ 14) (Miss.Ct. App.2002). "On review, we look with deference upon counsel's performance, considering the totality of the circumstances to determine whether it was both deficient and prejudicial." Conner v. State, 684 So.2d 608, 610 (Miss.1996).
¶ 8. "In a case involving post-conviction relief, the Mississippi Supreme Court has held, `that where a party offers only his affidavit, then his ineffective assistance of counsel claim is without merit.'" Lindsay v. State, 720 So.2d 182, 184(¶ 6) (Miss. 1998). We hold that Hargett has failed to meet his statutory burden of proof required to establish a prima facie showing. Hargett is required to show that counsel's performance was deficient and that the defendant was prejudiced by counsel's mistakes. Strickland, 466 U.S. at 686-87, 104 S.Ct. 2052. Having failed to do so, this issue is without merit.
III. LEGALITY OF SENTENCE
¶ 9. Hargett claims for the first time on appeal that the trial court imposed an illegal sentence when it ordered him to serve ten years in the custody of the Mississippi Department of Corrections without benefit of probation or parole pursuant to Section 99-19-81. He argues now that the trial court should have imposed the maximum sentence of thirty years without parole. In what can only be classified as a tongue in cheek argument, Hargett argues not that he be re-sentenced to the full maximum sentence but that his plea and sentence be totally vacated when considered in conjunction with his claims of ineffective assistance and voluntariness of guilty plea.
¶ 10. The State's position is that since Hargett raised this issue for the first time on appeal in a supplemental brief that he is procedurally barred from complaining now. This argument is inviting but ignores the question of whether some fundamental right of Hargett's has been implicated and violated in his receiving an illegal sentence, which argument transcends a procedural bar.
*286 ¶ 11. We are increasingly witnessing arguments like that advanced by Hargett in post-conviction cases. These cases can be loosely characterized into three categories: (1) a defendant is trying to set aside an old conviction used to enhance a present day sentence as a habitual offender, (2) a defendant with a prior felony record is given a total or partially suspended sentence which is later revoked and the defendant now claims the sentence he is serving is illegal, and finally as to the case here, (3) a defendant pleads guilty as a habitual offender, receives a sentence less than the maximum and later, while serving that sentence, attempts to set the conviction and sentence aside because the judge was lenient.
¶ 12. McGleachie v. State, 800 So.2d 561 (Miss.Ct.App.2001), Chancellor v. State, 809 So.2d 700 (Miss.Ct.App.2001), Edwards v. State, 839 So.2d 578 (Miss.Ct. App.2003), and Graves v. State, 822 So.2d 1089 (Miss.Ct.App.2002) (cert. denied May 1, 2003) all involved the scenario of a defendant trying to set aside an old conviction used to enhance a sentence the defendant was then serving. In each case, the motion was filed after this three year time bar of the post-conviction relief statute. McGleachie, 800 So.2d at 562(¶ 2); Chancellor, 809 So.2d at 701(¶ 4); Edwards, 839 So.2d at 579(¶ 3); Graves, 822 So.2d at 1090(¶ 3). In each case, we explicitly held that the defendant was time barred from complaining at this point because no fundamental right had been implicated since the defendant was not prejudiced by receiving a harsher sentence but rather benefitted from a lighter sentence than that which the defendant should have received. McGleachie, 800 So.2d at 563(¶ 4); Chancellor, 809 So.2d at 701(¶ 8); Edwards, 839 So.2d at 580(¶ 7); Graves, 822 So.2d at 1091(¶ 8).
¶ 13. In Weaver v. State, 785 So.2d 1085 (Miss.Ct.App.2001), a defendant with a prior felony conviction was given an illegally suspended sentence which the State later attempted to revoke. We vacated the sentence and conviction in that case on the basis of Robinson v. State, 585 So.2d 757 (Miss.1991), and reasoned that the State's attempt to revoke was based solely on the fact that Weaver should not have been given a suspended sentence rather than on some new violation of the suspension. However, as cogently stated by Judge Irving in Graves:
A literal reading of Weaver would permit results not intended by this Court. Therefore, it is appropriate that we clarify Weaver. Weaver should not be read as permitting a prior convicted felon to withdraw a guilty plea induced by a beneficial though illegal plea bargain if the convicted felon has enjoyed the benefits of the favorable illegal bargain. Weaver applies to situations in which a guilty plea was induced at least in part by a recommendation that some part of the sentence be suspended. If the State later seeks to rescind that suspension solely because the sentence was statutorily barred and not because of an alleged violation of the terms of the probation, then removing the suspension would also require that the defendant be allowed to withdraw his guilty plea. On the other hand, a defendant should not be allowed to reap the benefits of an illegal sentence, which is lighter than what the legal sentence would have been, and then turn around and attack the legality of the illegal, lighter sentence when it serves his interest to do so. Allowing such actions would reap havoc upon the criminal justice system in this state. For example, all subsequent convictions and sentences of that defendant which are reliant upon the conviction concomitant with the illegal sentence would have *287 to be set aside. This would result in a number of enhanced and habitual offender sentences being set aside for the very offender who had already enjoyed greater leniency than the law allows. Likewise, the State should not be allowed to engage in a plea bargain encompassing a recommendation for a sentence more lenient than what the law permits, reap the benefit of not having to go to trial and later seek to have the illegal, lighter sentence set aside while maintaining the validity of the attendant conviction. We can perceive no constitutional imperative or compelling state interest which would require or permit either scenario.
Graves, 822 So.2d at 1092(¶ 11).
¶ 14. Juxtaposed between our latest pronouncement in Graves and the case at bar is Robinson v. State, No.2000-CP-02087-COA (Miss.Ct.App. Feb.26, 2002). In our Robinson opinion, we held, as in McGleachie, Chancellor, Edwards, and Graves, that the defendant could not argue about a less than maximum habitual sentence he was presently serving. On certiorari, our supreme court affirmed this Court on other grounds, finding from a review of later acquired document sheets that Robinson could receive less than a maximum sentence because the State had, in fact, dropped the habitual portion of his indictment as part of a plea bargain. Robinson, 836 So.2d 747, 750(¶ 10) (Miss.2002). As an apparent afterthought and without further discussion including the potential consequences of its comment, or discussion of McGleachie or Chancellor, that court in dicta stated that "[b]ut for the inclusion of the reference docket sheet of Monroe County which absolutely indicates the reduced non-habitual status of this plea of guilt and sentence, this Court could not affirm the Court of Appeals and trial court." Id. at 749(¶ 6). Inexplicably, the supreme court went on to hold that Robinson could be sentenced to a twenty year suspended sentence as a non-habitual even though he had prior felony convictions. This ruling flies in the face of Goss v. State, 721 So.2d 144 (Miss.1998) (overruled on other grounds), which held that one could not receive a suspended sentence if the defendant had a prior felony conviction. Goss, 721 So.2d at 146(¶ 12). Justice Carlson correctly pointed this out in a concurring opinion in Robinson even though he took issue with Goss's reasoning. Robinson, 836 So.2d at 752-53 (¶ 18). The dicta in Robinson can only be read to be an aberration in view of the fact that within less than four months after its rendition our supreme court denied certiorari on our decision in Graves.
¶ 15. We now turn to the case at bar. Hargett filed his post-conviction relief motion well within the three year statute of limitations. His argument below was that his plea was not knowingly, intelligently, freely and voluntarily given and that he did not receive effective assistance of counsel. We have already discussed and dismissed those arguments. For the first time on appeal Hargett argues also that his sentence was illegal. In view of our previous pronouncements and our discussion herein, we hold that Hargett is barred from raising this issue here, and for that matter, in the trial court had it been properly pled.
¶ 16. Ironically, defendants like Hargett place themselves in a precarious position by advancing illegal sentence arguments such as this. Since the record in this case without doubt reveals that Hargett knew that he was adjudicated a habitual offender, that he was explicitly advised that he could receive a thirty-year day for day sentence with a million dollar fine, and that his plea was otherwise freely and voluntarily given with adequate assistance *288 of counsel. We could be disposed to simply remand this case for imposition of the full maximum sentence. Fortunately for Hargett, we have chosen another path. One cannot help but be reminded of that old adage to the effect that one should be careful of what they ask for, lest they receive it.
¶ 17.THE JUDGMENT OF THE CIRCUIT COURT OF HARRISON COUNTY DENYING POST-CONVICTION RELIEF IS AFFIRMED. ALL COSTS OF THIS APPEAL ARE ASSESSED TO HARRISON COUNTY.
McMILLIN, C.J., KING AND SOUTHWICK, P.JJ., BRIDGES, LEE, IRVING, MYERS, CHANDLER AND GRIFFIS, JJ., CONCUR. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1137208/ | 647 So.2d 576 (1994)
Michael James DETRAZ, Sr., Shawnee Detraz, and Michael James Detraz, Jr., Plaintiffs/Appellees,
v.
HARTFORD ACCIDENT & INDEMNITY CO., Twin City Fire Insurance Co., Benny L. Toland, Drilling Services Supply Co., Marine Drilling Co., Mar-Drill, Inc., and Marine Drilling Management Co., Defendants/Appellants.
No. 94-708.
Court of Appeal of Louisiana, Third Circuit.
December 7, 1994.
*577 Richard J. Putnam Jr., Abbeville, for Michael Detraz, et al.
Jon Daniel Picou, Morgan J. Wells Jr., Metairie, for Hartford Acc. & Indem., et al.
Before KNOLL and WOODARD, JJ., and BERTRAND[*], J. Pro Tem.
LUCIEN C. BERTRAND, Jr., Judge Pro Tem.
This litigation arises out of an auto accident of February 5, 1992, when an 18 wheeler with an "over-height" load struck a bridge and knocked a 4,500-6,000 lb. trash compactor onto the front end of an oncoming Toyota Celica. The occupants of the Celica, Michael Detraz, Sr. and his daughter, Michelle, as well Detraz's wife, Shawnee, and their son Mike, Jr., filed suit for personal injuries against Hartford Accident & Indemnity Co., Twin City Fire Insurance Co., Benny L. Toland (the driver of the 18 wheeler), Drilling Services Supply Co., Marine Drilling Co., Mar-Drill, Inc., and Marine Drilling Management Co.
The trial court granted summary judgment in favor of the plaintiffs on the question of liability and, at plaintiffs' request, severed the claims of Michelle Detraz. The jury returned a verdict in favor of Michael Detraz, Sr., Shawnee Detraz, and Mike, Jr., as follows:
*578
I. MICHAEL DETRAZ, SR.:
A. Past medical expenses $ 63,151.46
B. Future medical expenses 25,000.00
C. Loss of past income, future income and earning capacity 400,000.00
D. Past and future physical and mental pain and suffering, disfigurement, and
physical disability 500,000.00
E. Past and future loss of enjoyment of life 300,000.00
II. SHAWNEE DETRAZ:
A. Past and future loss of consortium $ 80,000.00
III. MICHAEL DETRAZ, JR.
A. Past and future loss of consortium $ 25,000.00
TOTAL $1,393,151.46
The trial court denied defendants' post trial motions for a new trial and remittur. Defendants appeal, arguing that the awards for economic loss and general damages to Michael Detraz, Sr., and loss of consortium to Shawnee and Mike, Jr., are excessive.
FACTS
The accident happened at approximately 7:00 p.m. on February 5, 1992, as Detraz and his daughter Michelle were traveling across the Perry Bridge over the Vermilion River. A truck driven by Benny Toland with a load of three oilfield trash compactors was approaching from the opposite direction when the top of the first compactor struck the bridge's superstructure. This produced a domino effect, with all three compactors being thrown from the truck. Daniel Geoffroy, a truck driver who was directly behind the Detraz vehicle, testified that one compactor struck the hood of the Celica, instantly stopping its progress of approximately 35 mph.
Detraz was immediately transported to Hamilton Hospital in Lafayette where he would remain for the next 32 days. His multiple injuries included a fractured and dislocated left hip, a dislocated right shoulder, with a torn rotator cuff, a deep laceration to the left arm, a fractured sternum, fractured ribs, and abrasions to the head.
Dr. Charles Olivier, an orthopedic surgeon, explained that Detraz's hip injury was the result of great force applied to the knee or thigh while in a sitting position. Dr. Olivier first had to manually replace the hip into the socket, then install a traction pin which remained in place and essentially immobilized Detraz for 30 days. Because the dislocation also involved a fracture, Dr. Olivier had to reopen the hip joint one week later to secure two large bone fragments with screws and to remove some of the smaller fragments from the socket. Detraz remained in traction throughout his hospital stay, entirely confined to his bed. Approximately four months after his release from the hospital, Detraz had to undergo yet another operation on his shoulder to repair the torn rotator cuff.
Although Dr. Olivier was pleased with the results achieved, he acknowledged that Detraz would have restrictions in the use of his arm and leg and could not return to his former job. At trial, Detraz testified that he continues to have weakness, pain and restriction of motion in his right, dominant arm such that he can only lift 10-15 lbs. above his waist, he can no longer cast a fishing rod with his right hand, nor can he perform some simple tasks such as using a screwdriver. As to his leg, he testified that he can only walk ¼ of a mile and stand only 30-40 minutes without pain. Dr. Olivier agreed that these restrictions were consistent with his observations and expectations for Detraz's recovery.
At the time of the accident, Detraz was employed at two physically demanding, outdoor jobs. His primary position was that of a facilities technician for Louisiana Universities Marine Consortium (LUMCON), a state marine research and educational center. Detraz was singlehandedly responsible for the maintenance and operation of LUMCON's satellite facility on Bayou Fearman. This remote facility, located in the marsh and accessible only by boat, presented unique maintenance problems. Any plumbing or painting required the erection of scaffolding tiers that had to be carried through the marsh, and repairs of numerous walkways at *579 the site also required carrying lumber and posts through the marsh. Detraz's job duties also required him to load and unload all research equipment brought to the facility and at times to serve as a crew member on the facility's two research vessels. All physicians who testified at trial agreed that Detraz could no longer continue this employment.
The flexible hours of the LUMCON position permitted him to also work for the Seventh Ward Drainage District, which managed irrigation, drainage and flood control for over 80,000 acres. Detraz was responsible for three water control structures and had to be on call 24 hours a day. His duties included inspecting levee systems, testing water for salt content, opening and closing flood gates and running a mud boat. Before the accident, Detraz could perform each of these strenuous tasks without any assistance. Although he is still employed by the Drainage District, he now needs help from other maintenance employees or from his wife and son to get the job done.
Dr. Michael Heard, an orthopedic surgeon, also examined and treated Detraz at plaintiffs' request. Dr. Heard placed significant restrictions on Detraz's use of his right arm. A functional capacity evaluation advised no overhead lifting of more than 15 lbs. frequently, 35 lbs. occasionally. Dr. Heard also predicted that Detraz would develop post traumatic arthritis and require a total hip replacement within the next 15 years. A physical therapy report indicated that Detraz would be limited in all lifting, carrying, pushing, and pulling tasks. At the defendants' request, Dr. James McDaniel also examined Detraz. Dr. McDaniel acknowledged Detraz's significant injuries and believed that he could benefit from further physical therapy; however, the only restrictions he thought necessary were that Detraz refrain from overhead, jarring sports or work.
ECONOMIC LOSS
Defendants contend that the jury award of $400,000.00 for Detraz's past and future lost wages and lost of earning capacity is excessive. Defendants argue that the jury should not have accepted the testimony of the plaintiffs' economist, Dr. George Rice, because his calculations were based on an inflated annual salary for the LUMCON job. Defendants also contend that the testimony of their vocational rehabilitation expert, Mr. William Stampley, established that Detraz's present earning capacity is greater than his earnings before the accident.
Before a tort victim can recover damages for future loss of wages, he must prove the loss with reasonable certainty; however, such damages need not be proven with mathematical certainty. Futrell v. Scott Truck & Tractor Co., 629 So.2d 449 (La.App. 3rd Cir. 1993), writ denied, 635 So.2d 232 (La.1994).
The amount of lost future income is not solely predicated on the difference between actual earnings before and after a disabling injury. Another factor is the difference between the victim's earning capacity before and after the accident. Bernard v. Royal Ins. Co., 586 So.2d 607 (La. App. 4th Cir.), writ denied 589 So.2d 1058 (La.1991). Earning capacity itself is not necessarily determined by actual loss; damages may be assessed for deprivation of what the injured plaintiff could have earned despite the fact that he may never have seen fit to take advantage of that capacity. Folse v. Fakouri, 371 So.2d 1120 (La.1979).
The manifest error rule governs the review of awards for loss of earning capacity. The appellate question is not whether a different award may have been more appropriate, but whether the trial court's award can be reasonably supported by the record. Veazey v. State Farm Mutual Automobile Ins. Co., 587 So.2d 5 (La.App. 3rd Cir.1991).
At the time of the accident, Detraz was earning $15,400.00 per year with LUMCON and $7,500.00 per year with the Drainage District. He never returned to the LUMCON position after the accident, but he did continue his employment with the Drainage District. Using a work life expectancy of 17.3 years, Dr. Rice calculated that Detraz sustained future losses of $306,609.00 due to his inability to perform the LUMCON job. Defendants contend that Dr. Rice should not have used Detraz's annual salary at the time *580 of the accident because in the two previous years Detraz earned substantially lower amounts because of State budget cuts. The jury was aware of Detraz's reduction in salary but also heard the testimony of Dr. Paul Sammarco, Director of LUMCON, that Detraz would still have his job at his same rate of pay despite any budgetary considerations. We find no error in an award based upon Dr. Rice's calculations.
The record also supports the conclusion that Detraz sustained a significant loss of earning capacity. It is evident that Detraz, with only a high school education, depended upon his great physical strength for his livelihood. In describing Detraz's physical abilities, Steve Rabalais of LUMCON said that Detraz was "his own pair of vice grips," and Joseph Dehart, President of the Drainage District, said that "Mike is like a walking crane." In contrast, Dr. Heard summarized Detraz's physical restrictions after the accident:
What I am basically saying is he can't pick up anything real heavy, he can't do anythingany overhead lifting at all with his right arm, and he can't do anything where he has got to stand on his feet for prolonged periods of time. He can't do any repetitive climbing, stooping, or crawling.
Although Mr. Stampley, the defendants' expert, identified several jobs available to Detraz in the Acadiana area, he admitted that he considered only the restrictions of Dr. McDaniel, which were quite different from those of Dr. Heard.
Detraz also sustained past lost wages of $25,514.00, an amount that is apparently undisputed. When we consider Detraz's past lost wages, the significant restrictions in his physical abilities and the loss of earning capacity, we cannot say that an award of $400,000.00 is an abuse of discretion in this case.
GENERAL DAMAGES
Defendants next argue that the total award for Detraz's general damages, $800,000.00 is excessive. They point to Detraz's excellent recovery and to the absence of other damage awards in this range for these injuries.
Recently, in Youn v. Maritime Overseas Corp., 623 So.2d 1257 (La.1993), cert. denied, ___ U.S. ___, 114 S.Ct. 1059, 127 L.Ed.2d 379 (1994), the Supreme Court restated the standard for appellate review of general damage awards as follows:
Nevertheless, the theme that emerges from Gaspard v. LeMaire, 245 La. 239, 158 So.2d 149 (1963) through Coco v. Winston Industries, Inc., 341 So.2d 332 (La.1976), and through Reck to the present case is that the discretion vested in the trier of fact is "great," and even vast, so that an appellate court should rarely disturb an award of general damages. Reasonable persons frequently disagree about the measure of general damages in a particular case. It is only when the award is, in either direction, beyond that which a reasonable trier of fact could assess for the effects of the particular injury to the particular plaintiff under the particular circumstances that the appellate court should increase or reduce the award. (Emphasis added.)
623 So.2d at 1261.
Although the physicians were pleased with Detraz's recovery, it is clear that his continuing disability has produced drastic changes in his life. Detraz not only depended upon his remarkable physical strength to earn his living; it was also the source of great pleasure in his personal life. He "lived and breathed" to hunt and fish. His wife considered herself a "widow" during hunting season because her husband went everyday. His marksmanship was renowned as "the best shot in Vermilion Parish." Since the accident, however, he has only hunted once, has had difficulty handling his weapon, and when he is fishing he can no longer cast with his right hand.
Detraz also endured a grueling month long hospital stay. He was admitted with severe pain, but he could not be medicated immediately because of possible internal injuries. For 30 days he was literally tied to his bed in traction, unable to walk, bathe, or use the restroom. The removal of the traction pin and the arthrogram which diagnosed his torn rotator cuff were particularly painful. Although *581 the total award of general damages is high, we cannot conclude that it constitutes an abuse of the jury's discretion, when we consider the particular injuries suffered by this particular plaintiff.
LOSS OF CONSORTIUM
Defendants' final assignments of error concern the loss of consortium awards of $80,000.00 to Shawnee and $25,000.00 to Mike, Jr.
Loss of consortium contemplates something more than a loss of general overall happiness, but includes seven components: love and affection, society and companionship, sexual relations, right of performance of material services, right of support, aid and assistance, and felicity. Morris v. Owens-Illinois, Inc., 582 So.2d 1349 (La.App. 2d Cir.), writ denied, 588 So.2d 1119 (La.1991), citing Finley v. Bass, 478 So.2d 608 (La.App. 2d Cir.1985). The elements of a minor child's claim for loss of consortium are essentially the same as the spouse's, without, of course, the sexual component. Higley v. Kramer, 581 So.2d 273 (La.App. 1st Cir.), writ denied, 583 So.2d 483 (La.1991).
The record reveals that Detraz's great athleticism and love of the outdoors also brought great joy to his family. Every job that Detraz had, whether first as a rice farmer and later with LUMCON and the Drainage District, involved outdoor work, usually with Shawnee by his side, either in the rice fields or in the marsh at the LUMCON facility. Although Shawnee in the past voluntarily accompanied Detraz, she now must assist him in his work with the Drainage District in order for him to keep his employment. Detraz also participated in many outdoor activities with his son, Mike, Jr., from the time Mike was a small child through the date of the accident. These activities included hunting, fishing, baseball, football, and 4-H activities. Instead of recreational activities, much of Mike's time with his father is now spent helping him maintain his Drainage District job.
Shawnee described Detraz's personality before the accident as "happy go lucky." Detraz's employers praised his good natured personality and his ability to get along with others. After the accident, however, Mike, Jr., described his father as a man who "gets disgusted easily," who raises his voice for no apparent reason and who does not take into consideration his family's feelings.
Again, after considering the particular injuries suffered, we find no abuse of the jury's discretion in either award, and hence, we need not consider the other jurisprudence. However, in response to defendants' brief, we note that awards in this range have been reported. See Tracy v. Jefferson Dept. of Pub. Works, 523 So.2d 266 (La.App. 5th Cir.), writ denied 530 So.2d 569 (La.1988) ($75,000.00 to spouse affirmed); Morris, supra, ($60,000.00 to spouse awarded). After a careful review of the record, we can find no error in the consortium awards to either Shawnee or Mike, Jr.
For the above reasons, the judgment of the trial court is affirmed at appellants' costs.
AFFIRMED.
NOTES
[*] Judge Lucien C. Bertrand, Jr., Retired, participated in this decision by appointment of the Louisiana Supreme Court as Judge Pro Tempore. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1399451/ | 885 F.Supp. 881 (1995)
Cyrus E. SILLING, Jr., Plaintiff,
v.
Edna Marie Litton ERWIN, As Executor of the Estate of Willard H. Erwin, Jr., Deceased, et al., Defendants.
Civ. A. No. 2:94-0448.
United States District Court, S.D. West Virginia, Charleston Division.
April 25, 1995.
*882 *883 Christopher J. Winton, Mark W. Kelley, Payne, Loeb & Ray, Charleston, WV, Richard J. Miller, Jr., James Barriere, Couch, White, Brenner, Howard & Feigenbaum, Albany, NY, Josef A. Horter, Goodwin & Horter, Charleston, WV, for plaintiff Cyrus E. Silling, Jr.
Arden J. Curry, II, Pauley, Curry, Sturgeon & Vanderford, Charleston, WV, for defendant Edna Marie Litton Erwin, as Executor of Estate of Willard H. Erwin, Jr., deceased.
Neva G. Lusk, G. Thomas Battle, Spilman, Thomas & Battle, Charleston, WV, for defendant United Nat. Bank, as Executor of Estate of Cyrus E. Silling, Sr., deceased.
Raymond G. Dodson, Dodson, Riccardi & Lutz, Charleston, WV, for defendant Jane King.
MEMORANDUM OPINION AND ORDER
HADEN, Chief Judge.
Pending is Defendant Edna Marie Litton Erwin's Motion for Summary Judgment. Defendant Erwin asserts as a matter of law: 1) Plaintiff is incompetent to testify regarding transactions or communications with his deceased father; 2) Silling, Sr. had the requisite mental capacity to execute the codicil dated April 13, 1991; 3) the April 13, 1991 codicil was executed properly; 4) Plaintiff may not prevail on a claim based upon undue influence; 5) Plaintiff is estopped from contesting the validity of the April 13, 1991 codicil; 6) the contribution to the Shriners Hospital for Crippled Children was authorized and made at the request of Silling, Sr.; 7) Plaintiff's claims for fraudulent suppression of dividends may not be presented to the jury; 8) Plaintiff may not prevail on his claim Erwin improperly received a gift of ten thousand dollars ($10,000.00); and 9) Plaintiff may not recover on a claim regarding charges for accounting services by Erwin.
The parties have submitted memoranda in support of their respective positions and the matter is mature for adjudication. For the reasons that follow, the Court GRANTS the motion on all issues.
Under Rule 56(c) of the Federal Rules of Civil Procedure, summary judgment is proper only:
"If the pleadings, depositions, answers to interrogatories and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to summary judgment as a matter of law."
Fed.R.Civ.P. 56(c). A principal purpose of summary judgment is to isolate and dispose of meritless litigation. Celotex Corp. v. Catrett, 477 U.S. 317, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986). The moving party has the burden of initially showing the absence of a genuine issue concerning any material fact. Adickes v. S.H. Kress & Co., 398 U.S. 144, 90 S.Ct. 1598, 26 L.Ed.2d 142 (1970). Once the moving party has met its initial burden, the burden shifts to the nonmoving party to "establish the existence of an element essential to that party's case and on which that party will bear the burden of proof at trial." Celotex, 477 U.S. at 322, 106 S.Ct. at 2552.
To discharge this burden, the nonmoving party cannot rely on its pleadings but instead must have evidence showing that there is a genuine issue for trial. Id. at 324, 106 S.Ct. at 2553. If there is a complete failure of proof concerning an essential element of the non-moving party's case there can be no genuine issue of material fact and the moving *884 party is entitled to judgment as a matter of law. Id. at 322, 106 S.Ct. at 2552.
FACTUAL BACKGROUND
The undisputed facts are as follows. Cyrus E. Silling, Sr. ("Silling, Sr.") died at the age of ninety-three on June 6, 1993, a resident of Kanawha County, West Virginia. Silling, Sr. executed his Last Will and Testament on November 25, 1988 and three codicils dated April 13, 1991, June 12, 1992 and September 7, 1992.[1] The will and the three codicils were admitted to probate by the County Commission of Kanawha County on June 9, 1993 supported by authenticating affidavits of witnesses.
By his will, Silling, Sr. appointed Willard H. Erwin, Jr. ("Erwin") and the United National Bank ("Bank") Co-Executors and provided should Erwin become unable to serve, the Bank should continue as sole Executor. The Co-Executors qualified to serve on June 9, 1993. Erwin died on May 21, 1994 and this action is maintained against his widow, Edna Marie Litton Erwin, as executrix of his estate and the Bank.
Erwin was an accountant, minority shareholder, president, and director of One Morris, Incorporated. He also handled the finances of Silling, Sr. and held a general power of attorney over him.
The will devises and bequeaths the residue of Silling, Sr.'s estate to the Plaintiff. The codicil dated April 13, 1991, bequeathed two hundred and forty-two (242) shares of capital stock of One Morris[2], Incorporated to Erwin.
The Plaintiff has received partial distributions under Silling, Sr.'s Will of eighty thousand dollars ($80,000.00) in May 1994 and approximately nine hundred and twenty-eight thousand dollars ($928,000.00) in cash and securities in December 1994.
Silling, Sr. owned a controlling interest of fifty and one tenth percent (50.1%) of the shares in One Morris for many years prior to his death in 1993. In fact, at all times since 1950, he was the largest shareholder of One Morris. He was a director and an officer of One Morris at all times since the 1960's. One Morris did not declare a dividend in its forty-five year history. Plaintiff contends dividends should have been paid since 1986, when all remaining corporate debt was retired.
The Second Amended Complaint attacks, inter alia, the validity of the codicil on the grounds of alleged lack of testamentary capacity of Silling, Sr., the alleged lack of testamentary formalities, the alleged exercise by Erwin of undue influence over Silling, Sr., and the alleged tortious interference by Erwin with the rights of the Plaintiff as affected by the codicil. Plaintiff further alleges Erwin, acting as an officer and director of One Morris, Incorporated, fraudulently suppressed dividends of the corporation.
The Second Amended Complaint also alleges Erwin committed a breach of trust by virtue of his position as attorney-in-fact to Silling, Sr.: 1) when he allegedly made unauthorized gifts totalling seventy-five thousand dollars ($75,000.00)[3] to Shriners Hospitals for Crippled Children; 2) when he allegedly made an unauthorized gift of ten thousand dollars ($10,000.00) to himself; and, 3) when he allegedly made unauthorized payments of compensation to himself totalling fifty-six thousand eight hundred dollars ($56,800.00) for services rendered.
By Memorandum Opinion and Order entered April 4, 1995, 881 F.Supp. 236, this Court granted Defendants One Morris, Incorporated, Frank T. Litton, Jr. and Forrest Morris summary judgment and dismissed them from this action with prejudice.
*885 DISCUSSION
I.
PLAINTIFF'S COMPETENCE TO TESTIFY REGARDING TRANSACTIONS OR COMMUNICATIONS WITH HIS DECEASED FATHER
In West Virginia,
"No party to any action ... nor any person interested in the event thereof, nor any person from, through or under whom any such party or interested person derives any interest or title by assignment or otherwise, shall be examined as a witness in regard to any personal transaction or communication between such witness and a person at the time of such examination, deceased, ... against the executor, administrator, heir at law, next of kin, assignee, legatee, devisee or survivor of such person.... But this prohibition shall not extend to any transaction or communication as to which any such executor, administrator, heir at law, next of kin, assignee, legatee, devisee, survivor or committee shall be examined on his own behalf, nor as to which the testimony of such deceased person or lunatic shall be given in evidence[.]"
W.Va.Code § 57-3-1 (1937). The term "personal transactions and communications" has been given a broad interpretation which includes every method whereby one person may derive impressions or information from the conduct, condition, or language of another. Kuhn v. Shreeve, 141 W.Va. 170, 89 S.E.2d 685 (1955); Miami Coal Co. v. Hudson, 175 W.Va. 153, 332 S.E.2d 114 (1985).
"It has oft been stated that the purpose of the Dead Man's Statute is to prevent an undue advantage on the part of a survivor over a decedent. F. Cleckley, Handbook on Evidence for West Virginia Lawyers 43 (1978); Note, "Reevaluation of the Dead Man's Statute," 69 W.Va.L.Rev. 327, 328 (1967). In such circumstances the decedent is unable to confront the survivor, give his version of the affair, and expose the possible omissions, mistakes or perhaps even outright falsehoods of the survivor."
Miami Coal, 332 S.E.2d at 119.
Furthermore, testimony has been excluded under the statute where interested children and heirs of a deceased insane person desired to testify they had observed and knew the mental and physical condition of the decedent. Trowbridge v. Stone's Administrator, 42 W.Va. 454, 26 S.E. 363 (1896). The Court there found the testimony incompetent because it involved transactions and communications of the insane decedent in which the witnesses were interested against him. Id.; see Patterson v. Martin, 33 W.Va. 494, 10 S.E. 817 (1890).
Individuals in the same position as the Plaintiff have been found incompetent to testify under this statute regarding any communications or transactions they had with the decedent. Mann v. Peck, 139 W.Va. 487, 80 S.E.2d 518 (1954) (decedent's brother barred from testifying); Kuhn v. Shreeve, 141 W.Va. 170, 89 S.E.2d 685 (1955) (aunt and first cousin barred from testifying).
The Court concludes the Plaintiff is barred from testifying concerning any conversations or transactions he had with Silling, Sr. including his impressions or information from the conduct, condition, or language of Silling, Sr. This proffer would implicate the mental and physical condition of Silling, Sr. Accordingly, the Court GRANTS Defendant Erwin's motion for summary judgment on this issue.
II.
TESTAMENTARY CAPACITY
The burden of proving the testamentary capacity of the testator at the time of the execution of the codicil is upon the proponent of the codicil, Defendant Erwin. Rice v. Henderson, 140 W.Va. 284, 289, 83 S.E.2d 762, 766 (1954); Ritz v. Kingdon, 139 W.Va. 189, 79 S.E.2d 123 (1953); Kerr v. Lunsford, 31 W.Va. 659, 8 S.E. 493 (1888). In order to establish the testator possessed the requisite mental capacity to execute a will:
*886 "[i]t is not necessary that a person should possess the highest qualities of mind ... nor that he should have the same strength of mind which he may formerly have had; the mind may be in some degree debilitated, the memory may be enfeebled, the understanding may be weak, the character may be eccentric, and he may even want capacity to transact many of the ordinary business affairs of life; but it is sufficient, if he understands the nature of the business in which he is engaged, has a recollection of the property which he means to dispose of, the objects of his bounty, and the manner in which he wishes to distribute it among them."
Ritz v. Kingdon, supra. "Old age and eccentricity incident to it are not of themselves sufficient to establish lack of mental capacity of a testator." Prichard v. Prichard, 135 W.Va. 767, 65 S.E.2d 65 (1951); Ritz, supra 79 S.E.2d at 140; Delaplain v. Grubb, 44 W.Va. 612, 30 S.E. 201 (1898); Kerr v. Lunsford, supra. Mere infirmity of mind and body due to illness is not sufficient to establish mental incapacity. Ritz, supra 79 S.E.2d at 140; Payne v. Payne, 97 W.Va. 627, 125 S.E. 818 (1924); Kerr, supra; Nicholas v. Kershner, 20 W.Va. 251 (1882). A testator need not know every item of his property or the value of his estate. Freeman v. Freeman, 71 W.Va. 303, 76 S.E. 657 (1912). It is sufficient if he knows generally what it consists of and knows the persons to whom he desires to give it away. Id.
Furthermore,
"[T]he critical time to appraise the physical and mental capacity of a testator to make a will is the actual time of its execution. Concerning testamentary capacity, testimony relating to a testator's condition generally before and after the will is signed is of little or no probative value. The evidence of witnesses who were present at the execution of the will is entitled to peculiar weight, and this is especially so in relation to attesting witnesses."
Frye v. Norton, 148 W.Va. 500, 135 S.E.2d 603, 610 (1964) (citing Floyd v. Floyd, 148 W.Va. 183, 133 S.E.2d 726 (1963); Stewart v. Lyons, 54 W.Va. 665, 47 S.E. 442 (1904); Kerr v. Lunsford, supra; Nicholas v. Kershner, supra.
In a factually similar case, witnesses in a will contest, who were present at the time of the will's execution, testified the testator was competent. Floyd v. Floyd, 148 W.Va. 183, 133 S.E.2d 726 (1963). The contestants there presented evidence from witnesses tending to show that, in the time period before and after the execution of the will, the testator did not have the necessary mental capacity. Id. The contestants, however, were unable to produce any witnesses regarding the testator's mental capacity on the date of the execution. Id. The Court held:
"[w]here on an issue devisavit vel non relating to mental capacity of a testator to make a will, there is positive, direct and uncontradicted testimony by disinterested attesting witnesses ... to the effect that at the time the will was executed the testator was in full possession of his mental faculties and assented completely to each provision thereof as read to him, as well as other positive evidence of proper mental capacity of the testator about the time the will was executed, a jury verdict against the validity of the will must be set aside where the only evidence to support such verdict is that of witnesses who were not present at the execution of the will but who testified either generally or with regard to specific dates before and after the date of the execution of the will that the testator was not mentally competent to make a will."
Id., Syl.Pt. 9.
In support of her claim Silling, Sr. was competent to execute the April 13, 1991 codicil, Defendant Erwin presented the following uncontested evidence.
Each individual involved with the preparation of the codicil and its execution testified Silling, Sr. was mentally competent on April 13, 1991. Jeanette Whittington was contacted by Silling, Sr. who specifically asked her to draft the codicil in question. (Whittington Dep. 5-10). Whittington testified regarding Silling, Sr.'s mental competence at that time:
"Q: On the thirteenth of April, 1991, could you express an opinion as to whether or not Mr. Silling was mentally competent *887 for the purpose of placing his mark on the codicil?
A: No question in my mind. He certainly was.... it was what he wanted to do.... [and if he read the codicil or it was read to him he would definitely understand what was in it].... He was real irritated with us because we didn't get [the codicil] up [to his house] sooner."
Id. at 12-16.
William E. Mohler, the attorney who drafted the codicil and who was an attesting witness present at its execution[4], testified Silling, Sr. was the only individual who requested the codicil and that he was competent on April 13, 1991. (Mohler Dep. 86-89, 91-93, 98-100, 102-103). Mohler testified Silling, Sr. had called wanting Mohler to draft the codicil leaving his shares of stock in One Morris to Erwin. Id. at 86-87. Silling, Sr. was even aware of the number of shares he had to devise. Id. Mohler testified:
"I read [the codicil] to him, and I said, `Now, this is the codicil you've been after me to get up here, and I've got it and I want to read it to you.' `No,' he said, `I know all about what's in there. You did what I told you. You left the stock to Willard?' I said, "That's right, but I'm going to read it to you, anyway.' So I read him the entire codicil and said, `Now, you understand what you're doing?' `That's right. That's what I want done. We were in this thing together and we started it together, developed it, and I want him to end up with it."
Id. at 88. Mohler further testified Silling, Sr. was in poor physical health, but "his mind was very sharp and clear and there was no question but he knew exactly what he was doing." Id. at 92.
Jill Wiersteiner witnessed the April 13, 1991 codicil and testified regarding Silling, Sr.'s competence at that time:
"He knew what was going on. He is the one who called and set this all up.... He told Mr. Erwin on the phone, `I want to give you this." You know, "I want to give you this. This part of the property, I want to give it to you. I want you to have the whole thing.'"
(Wiersteiner Dep. 6-8, 10-12, 18, 20-21). She further testified that although Silling had at times been confused, this was mostly related to his health problems. Id. at 68-70. However, on the date the codicil was signed, Wiersteiner testified he was not confused, "he was perfect. He knew what he was doing and why he was doing it." Id.
Dr. Albert Pfister was Silling, Sr.'s treating physician since 1981. Dr. Pfister testified Silling, Sr. was "generally depressed and very dependent [or demanding] on his home care people," (Dr. Pfister Dep. 9-10). Id. He noted Silling, Sr. had been diagnosed with "organic brain syndrome" which he described as "disorientation, delirium.... just not oriented to place." Id. at 10-11.
Notwithstanding his knowledge of Silling, Sr.'s medical condition, Dr. Pfister signed an affidavit in July 1991, approximately three months after the codicil had been executed, stating:
"he had been the attending physician to Cyrus E. Silling for the past 10 years; that, in his opinion Cyrus E. Silling is mentally competent and fully capable of handling his financial and business affairs; that he is of sound mind and deposing memory; that he is fully aware of the objects of his bounty...."
(Dr. Pfister Affidavit July 12, 1991). Dr. Pfister also testified Silling, Sr., in 1991, was coherent, would have understood what a will was, would have understood what his property was, and was not mentally incompetent. (Dr. Pfister Dep. 5, 8-9, 39, 41-43).
Jewel Carte, the Vice President of Trusts of United National Bank, was in charge of the agency account of Silling, Sr. (Carte Affidavit April 13, 1995). Pursuant to that account, she was authorized to make investments and payments on behalf of Silling, Sr. out of his accounts with that institution. Id. Carte testified she had weekly conversations *888 with Silling, Sr. and visited him once a quarter.[5] (Carte Dep. 21, 23, 50). She had no information, either from outside sources or through her own direct dealings with Silling, Sr., that would lead her to believe he was not mentally competent to handle his affairs in April 1991. Id. Indeed, assessing competence was "another reason for the contact with the customers." Id. at 50.
Furthermore, every care provider rendering services to Silling, Sr. during April 1991 unequivocally testified Silling, Sr. was competent. (Cindy Atkinson Dep. 4, 12, 22-23) (Atkinson testified that on April 13, 1991, Silling, Sr. was mentally competent, would understand the content of the codicil, was mentally alert, and knew what he was doing); (Jackie Rutledge Dep. 33-35) (Rutledge testified that in April 1991 everything was fine with Silling, Sr.): (Delores Canterbury Dep. 19, 26, 32-33, 59) (Canterbury testified that in April 1991, Silling, Sr. was mentally competent, alert, and had no mental problems); (Lisa Bailey Affidavit Feb. 3, 1995) (Bailey states that in April 1991, Silling, Sr. was of sound mind, knew what was going on around him, and knew the value of his assets).
The Plaintiff offers evidence of Silling, Sr.'s "long history of medical problems" citing instances from the 1930's until 1977. (Plaintiff's Response at 9). Only Silling, Sr.'s business partner testified he kept in touch with him up to his death and that Silling, Sr.'s mental capacities "would just come and go" and he "wasn't real stable from the time he left the office back in [1977]." (Billy S. Marcum Dep. 40). Marcum based these beliefs on his feeling Silling, Sr. "couldn't do the administration of the office." Id. Marcum cited Silling, Sr.'s "failure to concentrate or comprehend." Id. at 42. However, Marcum also stated in his deposition he had no knowledge of the competency or mental capacity of Silling, Sr. on April 13, 1991. Id. at 55, 77.
Plaintiff also presents evidence Silling, Sr. twice suffered from a bowel obstruction which would cause him to become disoriented and confused. (Dr. Pfister Dep. 17-36). Those instances cited by the Plaintiff occurred, however, in January 1991 and August 1991. Id.
Plaintiff was and is unable to produce a single witness who can testify what Silling, Sr.'s mental capacity was on April 13, 1991, contrary to the defense version. Instead, Plaintiff relies solely upon time periods preceding *889 and following the date the codicil was executed. Under the standard set forth in Frye v. Norton, supra, Floyd v. Floyd, supra, and Ritz v. Kingdon, supra, this evidence is insufficient to rebut Defendant Erwin's evidence that Silling, Sr. was mentally competent on the date the codicil was executed. Every individual who had daily contact with Silling, Sr. in 1991, each individual present at the codicil's execution, and Silling, Sr.'s treating physician testified Silling, Sr. was competent to execute the codicil in April 1991. Accordingly, the Court GRANTS Defendant Erwin summary judgment that Silling, Sr. possessed the requisite mental capacity to execute the codicil on April 13, 1991.
III.
EXECUTION OF APRIL 13, 1991 CODICIL
In West Virginia,
"No will shall be valid unless it be in writing and signed by the testator, or by some other person in his presence and by his direction, in such manner as to make it manifest that the name is intended as a signature; and moreover, unless it be wholly in the handwriting of the testator, the signature shall be made or the will acknowledged by him in the presence of at least two competent witnesses, present at the same time; and such witnesses shall subscribe the will in the presence of the testator, and of each other, but no form of attestation shall be necessary."
W.Va.Code § 41-1-3 (1923).
Jill Wiersteiner, Silling, Sr.'s caretaker, and William Mohler, Silling, Sr.'s attorney, testified Silling, Sr.'s mark was placed on the will in their presence. Further, it is uncontested each witness signed in the presence of each other and in the presence of Silling, Sr. The Plaintiff has no evidence to rebut the two attesting witnesses and he cannot defeat summary judgment based upon speculation, conjecture, or argument. Celotex, 477 U.S. at 322, 106 S.Ct. at 2552. Plaintiff must present evidence showing the codicil was not executed properly. Id.
While all parties agree the notary of this codicil did not actually see Mohler and Wiersteiner place their signatures on the codicil, the fact that she did not actually witness their signatures does not invalidate the codicil. There is no requirement the notary witness the signature of the testator nor any of the witnesses. In fact, West Virginia Code, Chapter 41, Article 1, Section 3 specifically provides: "no form of attestation shall be necessary."
Accordingly, the Court GRANTS summary judgment that the April 13, 1991 codicil was executed properly.
IV.
UNDUE INFLUENCE
To overcome a will, undue influence must destroy the free agency of the testator. Mullens v. Lilly, supra; Stewart v. Lyons, supra. As the West Virginia Supreme Court has held:
"opportunity for, or possibility or suspicion of, the exercise of undue influence does not constitute or sufficiently prove the exercise of undue influence."
Ritz, 79 S.E.2d at 142 (citing Ebert v. Ebert, 120 W.Va. 722, 200 S.E. 831 (1938). "Influence which arises from acts of kindness and attention to the testator, from attachment or love, from persuasion or entreaty, or from the mere desire to gratify the wishes of another, if free agency is not impaired, does not constitute, and is not alone sufficient to establish, undue influence." Id.
"Undue influence to avoid a will must be such as to overcome the free agency of the testator at the time the instrument was made.... A disposition of property induced by gratitude for kindness, affection and esteem is not the result of undue influence.... The influence resulting from attachment, or merely desire of gratifying the wishes of another, if the free agency of the party is not impaired, does not affect the validity of the act.... The influence to vitiate a will must amount to force and coercion, destroying free agency; it must not be the influence of affection or attachment; and must not be the mere desire of gratifying the wishes of another, for that would be very strong grounds in *890 support of a testamentary act; further, there must be proof that it was obtained by this coercion by importunity that could not be resisted, that it was done merely for the sake of peace, so that the motive is tantamount to force and fear.... It must amount to force and coercion destroying free agency ... even entreaty, importunity, and persuasion may be employed, as well as appeals to remember past kindnesses or relieve distress."
Stewart v. Lyons, 54 W.Va. at 677-78, 47 S.E. 442 (citations omitted).
"Suggestion and advice, addressed to the understanding and judgment, never constitute undue influence; neither does solicitation, unless the testator be worn out with the importunities, so that his will gives way. Even earnest entreaty, importunity, and persuasion may be employed, as well as appeals to remember past kindnesses or to relieve distress. The criterion in every case is, is the influence irresistible? If it is, the will is not the instrument of the testator and cannot stand. If it is not, the influence is not undue. Its existence is immaterial, even though the testator did in fact yield to it."
Delaplain, 44 W.Va. at 624, 30 S.E. 201 (citations omitted).
The Supreme Court of Appeals of West Virginia has consistently held the burden of proving undue influence is upon the party who alleges the exercise of such influence. Frye v. Norton, 148 W.Va. 500, 135 S.E.2d 603, Syl.Pt. 5 (1964) ("the burden of proving undue influence is upon the party who alleges it and mere suspicion, conjecture, possibility or guess that undue influence has been exercised is not sufficient to support a verdict which impeaches the will upon that ground."); Floyd v. Floyd, 148 W.Va. 183, 133 S.E.2d 726 (1963) ("the burden of proof of such issues rests on the party alleging it"); Ritz v. Kingdon, 139 W.Va. 189, 79 S.E.2d 123 (1953) ("burden of proving undue influence is upon the party who alleges the exercise of such influence"); Mullens v. Lilly, 123 W.Va. 182, 13 S.E.2d 634 (1941) ("the burden of proving undue influence rests upon the one who assails a ... will"); Payne v. Payne, 97 W.Va. 627, 125 S.E. 818, Syl.Pt. 3 (1924) ("burden of proving undue influence ... is upon the contestants"); Bade v. Feay, 63 W.Va. 166, 61 S.E. 348 (1907) ("the burden of proof is on him who charges procurement of execution of an instrument by the exercise of undue influence"); Stewart v. Lyons, 54 W.Va. 665, 47 S.E. 442 (1904) ("burden of proving undue influence upon those who attack the will"); McMechen v. McMechen, 17 W.Va. 683, Syl.Pt. 11 (1881) ("burden of proof of fraud or undue influence ... is ... upon him who alleges it to exist").
Generally, there are no presumptions of undue influence in a will contest. Ritz v. Kingdon, supra, ("[u]ndue influence which will invalidate a will is never presumed but must be established by proof"); Ebert v. Ebert, 120 W.Va. 722, 200 S.E. 831 (1938) ("undue influence, sufficient to invalidate a will, is never presumed, but must be established by proof"); Coffman v. Hedrick, 32 W.Va. 119, 9 S.E. 65, Syl.Pt. 5 (1889) ("Upon the trial of an issue of devisavit vel non undue influence, in order to overthrow the will, must not only be alleged, but it must be proven by the contestants; it will not be inferred.").
However, the Plaintiff argues "[t]he general rule [that fraud, in general, is never presumed and when alleged it must be established by clear and distinct proof] is qualified and the burden is shifted where a fiduciary relationship exists." Work v. Rogerson, 152 W.Va. 169, 160 S.E.2d 159, 166 (1968); Atkinson v. Jones, 110 W.Va. 463, 158 S.E. 650 (1931) ("in a case where a fiduciary relationship exists and an inference of fraud arises, the burden of proof is then on the alleged feasor to establish the honesty of the transaction.").
"A corollary to the fiduciary principle is the rule that a presumption of fraud arises where the fiduciary is shown to have obtained any benefit from the fiduciary relationship, as stated in 37 Am.Jur.2d Fraud and Deceit § 441: `... if he seeks to support the transaction, he must assume the burden of proof that he has taken no advantage of his influence or knowledge and that the arrangement is fair and conscientious[.]'"
*891 Kanawha Valley Bank v. Friend, 162 W.Va. 925, 929, 253 S.E.2d 528, 530 (1979).
In a situation similar to the one sub judice, an elderly woman informed her attorney she desired to bequeath to him certain property. Frye v. Norton, 148 W.Va. 500, 135 S.E.2d 603 (1964). Counsel realized it would be improper to prepare the will granting these bequests and therefore obtained alternative legal counsel for the testatrix who met with the woman and drafted the will. Id. Those contesting the will questioned the testatrix's testamentary capacity and argued her attorney had exercised undue influence over her. Id. The contestants reasoned that the existence of an attorney-client relationship and the fact that the attorney would not have shared in her estate in the absence of a will created a presumption of fraud. Id. at 513, 135 S.E.2d 603. The trial court gave the following instruction:
"while the burden of proving fraud and undue influence in a contested will case ordinarily rests upon the contestants, this is not the rule if an attorney who represents the testatrix writes or procures the writing and execution of the will and is a beneficiary of a substantial amount under the will, and would not share in the estate except for the will, in which even there is a presumption and suspicion of fraud and undue influence which the burden of overcoming is upon the proponent of the will.... if you ... find that the [defendant] procured an attorney or attorneys to write the said will and procure the execution of the same, then, there is a suspicion and presumption of fraud and undue influence."
Id. 135 S.E.2d at 611 (emphasis added). The Supreme Court of Appeals of West Virginia found reversible error in giving this instruction because it was not supported by the evidence. Id.
"There is absolutely no evidence in the record of this case from which it can be implied that the defendant had anything to do with the writing or execution of [the decedent's] will. To the contrary, it affirmatively appears that [the defendant] had no part whatever in the preparation of such will.... Furthermore, it is undisputed that the defendant had no connection whatever in obtaining the execution of the will in question.... It is sufficient to note that [the defendant], upon being requested to write a will in which he was to be a beneficiary, proceeded with due caution and in full accord with the requirements of the ethics of his profession. There is nothing in the law which prohibits a client from leaving her property to her attorney if she so desires. It is difficult to see how this defendant could have acted in a more judicious manner."
Id. 135 S.E.2d at 611-612 (emphasis added). Furthermore, the Court stated:
"[t]he cases cited by the plaintiffs present circumstances where the beneficiary, holding a position of trust or confidence, was also the draftsman of the will; where the facts show that the testator was sick and feeble and readily susceptible to persuasion; and other factual situations which are not applicable to the facts as revealed by the record of the instant case. In proving undue influence the facts and circumstances of each case must be considered. Culpepper v. Robie, 155 Va. 64, 154 S.E. 687. Even if as contended by the plaintiffs, the burden shifted to the defendant to prove the absence of fraud and undue influence, we are of the view that such a burden was successfully borne. The record unquestionably shows that the defendant did not draft this will; that he was in no way concerned with its preparation or execution; that the testatrix had the capacity to make a will; and that she was fully and ably advised of all matters relating to the making of a will by independent counsel of unimpeachable character."
Id. 135 S.E.2d at 612 (emphasis added).
It is undisputed Erwin had a fiduciary relationship with Silling, Sr. He had a general power of attorney dated January 4, 1977 appointing him attorney in fact for Mr. Silling. He was also a trustee of the inter vivos Revocable Trust executed by Silling, Sr. on December 20, 1974. Nevertheless, the Frye case strongly holds the mere existence of the relationship of attorney and client between the testator and a beneficiary under a will does not in itself raise a presumption *892 that the attorney-beneficiary exercised undue influence to obtain the testamentary gift.[6]
It is undisputed that Erwin was not the draftsman of the codicil. Additionally, the evidence clearly demonstrates Silling, Sr. had the mental capacity to make the codicil and competent legal advise from independent counsel.[7] Further, the fact counsel read the codicil aloud in the presence of Silling, Sr. and the other witnesses, and that Silling, Sr. declared to those present the codicil was in accord with his wishes, is particularly persuasive the disposition was what Silling, Sr. desired.[8] Equally strong and prior to the codicil's execution was Silling, Sr.'s expression to disinterested parties of his desire to make the testamentary gift to Erwin.[9]
Because shifting the burden of proof requires clear and convincing evidence of procurement or draftsmanship and because Plaintiff has been unable to meet that burden, the Court GRANTS Defendant Erwin's motion for summary judgment on this ground.[10]
V.
ESTOPPEL OF PLAINTIFF FROM CONTESTING THE VALIDITY OF THE APRIL 13, 1991 CODICIL
Subsequent to Silling, Sr.'s death, Plaintiff accepted partial distributions under the will of eighty thousand dollars ($80,000.00) in May 1994 and approximately nine hundred twenty-eight thousand dollars ($928,000.00) in cash and securities in December 1994. Plaintiff then waited more than a year to challenge the codicil. After doing so, he has not offered to return any of the benefits to the estate. Defendant Erwin argues the acceptance of these distributions estop the Plaintiff from challenging the validity of the will and codicil.
A codicil is a part of a will modifying it in some respects and superseding it insofar as it is inconsistent with the original will. Fenton v. Davis, 187 Va. 463, 47 S.E.2d 372 (1948); Senger v. Senger's Executors, 181 Va. 786, 27 S.E.2d 195, 197 (1943); Simmons v. Gunn, 156 Va. 305, 157 S.E. 573 (1931). A will and codicil are construed together as one single instrument. Bradshaw v. Bangley, 194 Va. 794, 75 S.E.2d 609 (1953); Smith v. Trustees of the Baptist Orphanage of Va., 194 Va. 901, 75 S.E.2d 491, 492 (1953).
For the purpose of determining the testamentary intention of the testator, a will and codicil thereto are to be regarded as a single and entire instrument, taking effect at the time of the testator's death. Hope Natural Gas Co. v. Shriver, 75 W.Va. 401, 83 S.E. 1011, 1016 (1914); Unitarian Universalist Service of Boston v. Lebrecht, 670 S.W.2d 402, 404 (Tex.App.1984); Fischer v. LaFave, 188 Ill.App.3d 16, 135 Ill.Dec. 698, 700, 544 N.E.2d 55, 57 (2d Dis.1989). A lawfully executed codicil becomes a part of the original will, and the two instruments stand as one testamentary disposition. Matter of Estate *893 of Hamilton, 467 N.W.2d 801, 803 (Iowa App.1991).
If one has accepted benefits under a will, he "must adopt its whole contents, conforming to all its provisions, and renouncing every right inconsistent with it." Moore v. Harper, 27 W.Va. 362 (1886). "The general rule ... is that a beneficiary who accepts such benefits is bound to adopt the whole contents of that will and is estopped to challenge its validity." Tennant v. Satterfield, 158 W.Va. 917, 921, 216 S.E.2d 229, 232 (1975). However, this general rule is tempered with qualifications to the doctrine of estoppel.
"In order for estoppel to bar a will contest, it must first be shown that acceptance occurred, and second it must be shown that the acceptance was of such a nature as to give rise to equitable considerations which prevent the accepting party from later negating the instrument through which he received benefits."
Id.
The Plaintiff's acceptance of and failure to return very substantial asset distributions from the Estate binds him to adopt the entirety of the will and equitably estops him from challenging the codicil because it has merged with the will. Accordingly, Defendant Erwin's motion for summary judgment on this issue is GRANTED.[11]
VI.
CONTRIBUTION TO SHRINERS HOSPITAL
Pursuant to the Court's recent direction, the parties have submitted additional briefing on the validity of certain contributions. Count IIIA of Plaintiff's Second Amended Complaint alleges Erwin, acting as attorney in fact for Silling, Sr. made, from Silling, Sr.'s funds, unauthorized contributions to the Shriners Hospitals for Crippled Children ("Shriners Hospitals") in the amounts of twenty-five thousand dollars ($25,000.00) on February 20, 1991, and fifty thousand dollars ($50,000.00) on an unspecified date.
Since the allegation was made, the parties discovered these amounts are incorrect. The parties now stipulate the total charitable contributions made on behalf of Silling, Sr. to the Shriners Hospitals was thirty-five thousand dollars ($35,000.00). Sua sponte, the Court amends the Second Amended Complaint to conform to this claim.
United National Bank reviewed its records to determine the total amount of contributions. According to Jewel Carte of United National Bank, two checks were located. (Carte Affidavit April 11, 1995). The first check was dated November 14, 1990 in the amount of ten thousand dollars ($10,000.00) and made payable to the Shriners Hospitals on United National Bank's check number 448484. Id. The second check was dated February 28, 1991 in the amount of twenty-five thousand dollars ($25,000.00) and made payable to the Beni Kedem Crippled Children's Fund on United National Bank check number 452091. Id. Carte was unable to find any other checks issued to either of these two entities which would have made on behalf of Silling, Sr. Id.
Shriners Hospitals acknowledged receipt of the ten thousand dollars ($10,000.00) to "C.E. Silling, Sr. c/o United National Bank, Box 393, Charleston, West Virginia 25392" by their letter dated November 27, 1990. No other documentation exists regarding this contribution.
By letter dated February 20, 1991 to Jewel Carte, Erwin "confirmed the request of [Silling, Sr.] and his approval to disburse" twenty-five thousand dollars ($25,000.00) to "Shriner's Hospitals for Crippled Children Fund through the Beni Kedem Shrine Temple of Charleston." Then on February 28, 1991, a check payable to "Beni Kedem Crippled Children's *894 Fund" was drawn on the Agency Account of Silling, Sr. at United National Bank in the amount of twenty-five thousand dollars ($25,000.00). From this twenty-five thousand dollars ($25,000.00), Beni Kedem donated fifteen thousand dollars ($15,000.00) to the Shriners Hospitals and retained the remaining ten thousand dollars ($10,000.00) in their own Crippled Children's Fund.
On March 30, 1991, a check payable to Shriners Hospitals was drawn on the account of Beni Kedem Temple Trustees account at Charleston National Bank in the amount of fifteen thousand dollars ($15,000.00) upon Erwin's authorized signature as Trustee.[12] The stub for the Beni Kedem Temple Trustees check dated March 30, 1991 identifies the funds as "Contribution received from W.H. Erwin, Jr. for donation by Noble C.E. Silling, Sr., P.O. Box 3363, Charleston, WV 25333." By letter dated April 30, 1991, Shriners Hospitals acknowledged receipt of the fifteen thousand dollars ($15,000.00) to Silling, Sr. at Post Office Box 3363 in Charleston. The address is Erwin's post office box, not Silling, Sr.'s.
Silling, Sr. had been a long-time member of the Shriners. He was a Mason of the Thirty-Third Degree and had been active in Shriners functions. Silling, Sr. told disinterested witnesses, both prior to and after contributions were made, he desired the transactions take place. However, there is scant evidence on the amounts and times the contributions were made. The witnesses testify in general terms about how Silling, Sr. remarked he had contributed to the Shriners Hospital and he believed strongly in that organization.
Cindy Atkinson, his caretaker, testified Silling, Sr. told her he had made donations to the Shriners Hospital and that he was a firm believer in that entity. (Atkinson Dep. 41). When asked if Silling, Sr. ever told her about the size and amounts of those donations, Atkinson replied:
"No, that is business. He didn't tell me business. He got mad because I overheard him on the phone with [Erwin] once when One Morris Square needed a new furnace ... and it was four hundred thousand dollars. And I said, `Four hundred thousand dollars.' And this was when he was up and about. And he said, `You shouldn't have heard that.'"
Id.
Similarly, Delores Canterbury, another caretaker, testified Silling, Sr. told her he had made a fifty thousand dollar ($50,000.00) contribution to the Shriners Hospitals. (Canterbury Dep. 62-63).
Finally, Jewel Carte, of United National Bank, testified that when the request for a contribution of twenty-five thousand dollars ($25,000.00) came in, she verified that it was to be made with Silling, Sr. and he confirmed to her that he wanted to make the payment. (Carte Dep. 84-84; Carte Affidavit April 13, 1995). However, Carte testified she had no recollection as to who requested the November 14, 1990 ten thousand dollar ($10,000.00) contribution, nor did she have any documents which would indicate who made the request. Id. at 81-82. Carte indicated the donation could have been requested by either Silling, Sr. or Erwin. Id. Plaintiff has no evidence to contradict the contribution was made and authorized by Silling, Sr.
Because no documentation or other evidence exists regarding the November 14, 1990 contribution, other than the cancelled check and the letter from Shriners Hospitals acknowledging receipt of Silling, Sr.'s donation, there is no evidence to suggest Erwin had any involvement in the transaction whatsoever. Jewel Carte has no specific recollection of this transaction, but has testified she would contact Silling, Sr. for approval prior to disbursing any checks. Because there is no evidence to link Erwin to this transaction, Plaintiff's claim must fail.
On January 4, 1977, Silling, Sr. executed a document granting power of attorney to Erwin. The power of attorney gave Erwin the power to "give away" assets or property of Silling, Sr. in Silling, Sr.'s name and to:
"make, do and transact all and every kind of business of whatsoever nature and kind; to do, execute and perform all and every other act or acts, thing or things, in law *895 needful and necessary to be one in and about the premises, as fully, largely and amply, to all intents and purposes whatsoever as we or either of us might or could do if acting personally. And I hereby ratify and confirm the lawful acts done by our said attorney by virtue hereof."
(Erwin Power of Attorney Jan. 4, 1977).[13]
The power of attorney also granted Erwin the authority to sign checks and make payments directly on behalf of Silling, Sr. Rather than make payments directly, Erwin would notify United National Bank, under its agency account powers, when payments should be made. The Bank, through Jewel Carte, would verify with Silling, Sr. independently that the payments were to be made. Only if the payment was approved by Silling, Sr. would the Bank issue payment.
Erwin did not make the twenty-five thousand dollar ($25,000.00) contribution on Silling, Sr.'s behalf. Erwin merely requested the Bank, through Jewel Carte, to issue payment. As such, Erwin acted as a messenger in regard to the questioned transaction. He advised Carte on what he believed Silling, Sr. wanted done. Carte, however, would not take action based on Erwin's word. Rather, Carte independently verified with Silling, Sr. that he desired the requested contribution be made. The allegations contained in the Count III A of the Plaintiff's Second Amended Complaint therefore must fail because Erwin did not "[make] a gift ... of the funds of Cyrus E. Silling, Sr. to Shriner's Hospitals." Carte acted under her authority over Silling, Sr.'s agency account in verifying and issuing the check to the organization, Erwin merely made the initial request the contribution be made on Silling, Sr.'s behalf.
Additionally, "[f]ailure on the part of the principal to dissent from or repudiate an unauthorized act of his agent, within a reasonable time ... is evidence of ratification of the unauthorized act." Thompson v. Murphy, 60 W.Va. 42, 53 S.E. 908, Syl.Pt. 3 (1906). A principal "may ratify the contract either expressly or by accepting its benefits." Payne Realty Co. v. Lindsey, 91 W.Va. 127, 112 S.E. 306, Syl.Pt. 1 (1922); Rest.2d Agency § 82. Furthermore,
"[w]here with knowledge of the terms of the contract made by his agent, the principal accepts benefits thereunder under such circumstances as would make it his duty to promptly repudiate if he did not desire to be bound, he will be deemed to have ratified and confirmed the act of his agent. Such knowledge need not be shown by positive evidence; it may be inferred from circumstances."
Payne Realty, 91 W.Va. 127 at Syl.Pt. 2, 112 S.E. 306.
Acting under his authority as attorney in fact, Erwin sent a letter dated February 20, 1991 to Jewel Carte stating: "This is to confirm the request of Mr. Silling and his approval to disburse from his funds the sum of twenty-five thousand dollars ($25,000.00) to the Shriners Hospitals for Crippled Children Fund through the Beni Kedem Shrine Temple of Charleston." Carte testified unequivocally she remembered speaking with Silling, Sr. about the twenty-five thousand dollar ($25,000.00) contribution. (Carte Dep. 84-85).
*896 "Q Did you confirm this gift with Mr. Silling?
A Yes.
Q Do you specifically remember speaking to him about this?
A Yes.
Q What did he say?
A He wanted to give it to the Shrine.
Q Did he say how much he wanted to give to the Shrine?
A I just told him that I had the request for twenty-five thousand dollars ($25,000). He said he wanted to give the contribution to the Shrine."
Id.
It is clear Silling, Sr. ratified and confirmed the February 28, 1991 twenty-five thousand dollar ($25,000.00) contribution so as to bind him to it.[14] Accordingly, the Court GRANTS summary judgment to Defendant Erwin on the total of thirty-five thousand dollars ($35,000.00) in contributions made to the Shriners Hospitals.
VII.
FRAUDULENT SUPPRESSION OF DIVIDENDS
This Court has previously ruled on Plaintiff's claim for fraudulent suppression of dividends. By Memorandum Opinion and Order entered April 4, 1995, the Court dismissed Defendants One Morris, Incorporated, Frank T. Litton, Jr., and Forrest Morris because the Plaintiff lacks standing to bring an action for suppression of dividends. See Silling v. Erwin, 881 F.Supp. 236 (S.D.W.Va. 1995). Plaintiff also lacks standing with regard to these claims against Defendant Erwin. Accordingly, the Court GRANTS summary judgment in favor of Defendant Erwin on this issue.
VIII.
TEN THOUSAND DOLLAR GIFT TO ERWIN
A questioned ten thousand dollar ($10,000.00) gift to Erwin was memorialized in a memorandum to the United National Bank Trust Department dated November 5, 1992, which contained Silling, Sr.'s mark. Plaintiff alleges this document is improper, fraudulent, and that Silling, Sr. did not authorize the gift to Erwin. The Plaintiff is prepared to show, by offer of proof at trial, the gift letter is a forgery and that a later version of the same gift letter was also falsified.
The same memorandum Plaintiff attacks as a forgery also directed certain gifts to Silling, Sr.'s grandchildren and to the Plaintiff totalling sixty thousand dollars ($60,000.00)[15]. Plaintiff does not assert Silling, *897 Sr.'s grandchildren should be made to refund their gifts, nor does he indicate any desire that he should refund the ten thousand dollar ($10,000.00) gift made to him. Instead, he accepts the document's validity to the extent it authorizes the gifts to him and his children, but attacks it insofar as it authorizes the gift to Erwin.
Although Defendant Erwin does not rely on the doctrine of equitable estoppel in support of her motion for summary judgment, the Court finds those principles applicable here. Where one having the right to accept or reject a transaction takes and retains benefits thereunder, he ratifies the transaction, is bound by it, and cannot avoid its obligation or effect by taking a position inconsistent with it. See Baltimore and O. R.R. Co. v. Vanderwarker, 19 W.Va. 265 (1882) (if one has enjoyed the benefit of a supersedeas bond, he is estopped to allege the bond was invalid); Young v. Amoco Production Co., 610 F.Supp. 1479 (E.D.Tex. 1985), aff'd, 786 F.2d 1161 (5th Cir.1986) (one who accepts and retains benefits of a particular transaction will not thereafter be permitted to avoid its obligations or repudiate disadvantageous portions); In re Naramore, 3 B.R. 709 (D.C.N.Y.1980) (doctrine of equitable estoppel precluded defendant from voiding an oral agreement between two other parties from which the defendant derived the substantial benefit of $9,500.00); United States v. Consolidated Edison Co. of N.Y., Inc., 452 F.Supp. 638 (S.D.N.Y.1977), aff'd, 580 F.2d 1122 (2d Cir.1978) (party cannot assert he has repudiated a contract while continuing to accept its benefits); Thompson v. Soles, 42 N.C.App. 462, 257 S.E.2d 59 (1979), aff'd, 299 N.C. 484, 263 S.E.2d 599 (1980) (party may not enjoy benefits of contract and at same time deny its terms or qualifications); In re Washington Medical Center, Inc., 10 B.R. 616 (Bankr.D.Dist.Col. 1981) (where one accepts benefits of a contract, he will be estopped to deny the validity or binding effect of contract); Smith v. Hornbuckle, 140 Ga.App. 871, 232 S.E.2d 149 (1977); Dolgow v. Anderson, 45 F.R.D. 470 (E.D.N.Y.1968); Johnson v. Johnson, 262 N.C. 39, 136 S.E.2d 230, 234 (1964); Smith v. Price Bros. Co., 131 F.2d 750 (6th Cir.1942), cert. denied, 318 U.S. 762, 63 S.Ct. 560, 87 L.Ed. 1134 (1943); Berrier v. Sink, 190 N.C. 620, 130 S.E. 714 (1925).
In Equity, courts proceed on the theory there is an implied condition that he who accepts a benefit under an instrument shall adopt the whole, conforming to all its provisions and renouncing every right inconsistent with it. Wattie Wolfe Co. v. Superior Contractors, Inc., 417 P.2d 302 (Okla.1966); see also Asberry v. United States Postal Service, 692 F.2d 1378 (Fed.Cir.1982) (postal service employee, who voluntarily accepted settlement and its benefits, was equitably estopped to attack settlement); Magenheim v. Board of Ed. of School Dist. of Riverview Gardens, 347 S.W.2d 409, 419 (Mo.App.1961); Simmons v. Clampitt Paper Co., 223 S.W.2d 792 (Tex.1949). In the quaint but appropriate language of Scotch law, "a man shall not be allowed ... to approbate and reprobate." Rohanna v. Vazzana, 196 Va. 549, 84 S.E.2d 440, 442 (1954).
*898 Based upon the foregoing analysis,[16] the Court finds the principles of equitable estoppel prevent the Plaintiff from contesting the validity of the gift to Erwin.[17] Accordingly, the Court GRANTS Defendant Erwin's motion for summary judgment on this issue.
IX.
CHARGES FOR ACCOUNTING SERVICES
Erwin performed a significant amount of accounting work for Silling, Sr. (Expert Report Roger A. Griffith). These services included the handling of investments, providing investment advice, preparing tax returns, preparing quarterly tax estimates, and other necessary services to accomplish the business affairs of Silling, Sr. Id. Erwin was also responsible for obtaining home health care providers, providing all tax information necessary for the payment of these employees, acting as the liaison between Silling, Sr. and United National Bank, and conducting daily phone calls and at least bi-weekly visits with Silling, Sr. regarding his investment portfolio. Id.
Jewel Carte, of United National Bank, testified she confirmed payment of these bills for Erwin's services with Silling, Sr. (Carte Dep. 74-75). Silling, Sr. ratified and approved the payments made to Erwin. In addition, for the 1990 tax year, Silling, Sr. deducted twenty-one thousand six hundred dollars ($21,600.00) in expenses for accounting bills submitted by Erwin. This is one of the allegedly unauthorized amounts Plaintiff sets forth in Count III-C of his Second Amended Complaint.
Roger A. Griffith, in his expert report[18], verified the work actually performed by Erwin and has opined the work was reasonable and necessary. Id. In Griffith's opinion, the charges made by Erwin were approximately four times less than the going rate other certified public accounts would have charged for similar services at that time. Id.
Plaintiff offers no evidence to contradict the evidence offered by Defendant Erwin. Plaintiff simply argues, "Erwin apparently kept no time records. Plaintiff submits that a bill for eleven years of services submitted twelve years after the services were initially rendered, without any documentation to show the exact nature of the `services' is highly suspicious." (Plaintiff's Response 19).
Defendant Erwin met her burden of initially showing the absence of a genuine issue concerning any material fact. See Adickes v. S.H. Kress & Co., 398 U.S. 144, 90 S.Ct. 1598, 26 L.Ed.2d 142 (1970). The burden then shifted to Plaintiff to "establish the existence of an element essential to [his] case and on which [he] will bear the burden of proof at trial." See Celotex, 477 U.S. at 322, 106 S.Ct. at 2552. To discharge this burden, the Plaintiff cannot rely on his pleadings but instead must have evidence showing that there is a genuine issue for trial. Id. at 324, 106 S.Ct. at 2553. The Plaintiff has not met his burden. The Court finds the uncontroverted evidence demonstrates the charges made to Erwin for accounting services were reasonable and necessary.[19] Accordingly, the Court *899 GRANTS summary judgment to Defendant Erwin on this issue.
CONCLUSION
Based upon the absence of any genuine issue of material fact and the law, the Court GRANTS summary judgment that: 1) Plaintiff is incompetent to testify regarding transactions or communications with his deceased father; 2) Silling, Sr. had the requisite mental capacity to execute the codicil dated April 13, 1991; 3) the April 13, 1991 codicil was executed properly; 4) Erwin did not exercise undue influence over Silling, Sr. regarding the April 13, 1991 codicil; 5) Plaintiff is estopped from contesting the validity of the April 13, 1991 codicil; 6) the thirty-five thousand dollars ($35,000.00) in contributions to Shriners Hospitals were authorized by Silling, Sr.; 7) Plaintiff lacks standing to assert a claim for fraudulent suppression of dividends; 8) Plaintiff is estopped from asserting Erwin improperly received a gift of ten thousand dollars ($10,000.00); and, 9) Plaintiff may not recover on a claim regarding charges to the Estate for accounting services performed by Erwin for Silling, Sr. during his lifetime.
Because no genuine issues of material fact remain, the Court GRANTS summary judgment on all remaining issues in favor of the Defendant Erwin. The Court ORDERS this case dismissed from the docket of the Court.
NOTES
[1] The validity of the will is not in dispute. Furthermore, all parties have reached agreement the second and third codicils were not executed properly and are invalid. Consequently, the sole inquiry before the Court regarding Silling, Sr.'s testamentary disposition is whether the April 13, 1991 codicil is valid.
[2] Former Defendant One Morris is a closely held corporation that owns and manages an apartment building in Charleston, West Virginia. Former Defendants Frank T. Litton, Jr. and Forrest Morris were elected directors of One Morris in July 1994.
[3] The parties have since stipulated that no more than thirty-five thousand dollars ($35,000.00) in contributions were made. See, infra at 893-894.
[4] Mohler's and Wiersteiner's testimony regarding the competence of Silling, Sr. must be given particular weight because they were present at the execution of the codicil. Frye v. Norton, 135 S.E.2d at 610 (citing Floyd v. Floyd, 133 S.E.2d 726; Stewart v. Lyons, supra; Kerr v. Lunsford, supra; Nicholas v. Kershner, supra.
[5] Plaintiff objects to the testimony of Jewel Carte regarding any and all of Defendant Erwin's claims and defenses in this action. (Plaintiff's Response at 18 and Plaintiff's Supp.Mem. on Charitable Gifts at 3). Plaintiff argues that as a bank vice president, Ms. Carte is interested in the outcome of this lawsuit in which the bank, United National Bank, is a party, and is, therefore, incompetent to testify under the West Virginia Dead Man's Act, West Virginia Code 57-3-1. Id. As authority for this assertion, Plaintiff cites Stansbury v. Bright, 109 W.Va. 651, 156 S.E. 62 (1930) and First Nat'l Bank of Ronceverte v. Bell, 158 W.Va. 827, 215 S.E.2d 642 (1975) (Haden, C.J.).
The Court's holding in Stansbury is directly contrary to the position Plaintiff wishes this Court to adopt. Stansbury v. Bright, 109 W.Va. 651, 156 S.E. 62, Syl.Pt. 2 (1930). The Court held "[a]lthough ... a party in interest cannot testify for himself concerning transactions had by him with one who is dead, the cashier of a bank, who has no personal interest in it, but is merely its agent, may testify for his principal against a decedent's estate." Id. The Court only found it proper to exclude the testimony of the vice president of the bank because he was a stockholder interested in the outcome of the suit. Id. 109 W.Va. at 652, 156 S.E. 62.
The holding of First Nat'l Bank is equally unavailing to the Plaintiff. The Court held:
"Although tested prior to trial by a summary judgment motion, the competency of, or admissibility of, evidence alleged to be controlled by W.Va.Code 1931, 57-3-1, as amended, is to be determined when the evidence is offered for introduction at trial, whether offered in the form of answers to interrogatories, depositions or `live' testimony from a witness."
First Nat'l Bank of Ronceverte v. Bell, 158 W.Va. 827, 215 S.E.2d 642, Syl.Pt. 4 (1975) (Haden, C.J.).
Furthermore, the Court has also held an agent of a party to litigation is not expressly included in the Dead Man's Act as an interested person, and therefore, an agent contracting on behalf of his principal with a person since deceased is a competent witness in behalf of his principal against the estate of the deceased party to prove the transaction. Cross v. State Farm Mut. Auto. Ins. Co., 182 W.Va. 320, 387 S.E.2d 556 (1989).
Likewise, the testimony of a corporate agent is not barred by the Dead Man's statute solely on account of her interest as an agent. As such, there is no merit to the Plaintiff's contentions.
[6] See also Yribar v. Fitzpatrick, 91 Idaho 105, 416 P.2d 164 (1966); Re Heim's Will, 136 N.J.Eq. 138, 40 A.2d 651 (1945); Re Little's Will, 45 N.Y.S.2d 751 (N.Y.1943); Re Bleil's Estate, 96 Cal.App. 283, 273 P. 1088 (1929); Wunderlich v. Buerger, 287 Ill. 440, 122 N.E. 827 (1919); Graham v. Courtright, 180 Iowa 394, 161 N.W. 774 (1917).
[7] Whether the testator had independent advice in making his will wherein his attorney was named a beneficiary is a factor that may be considered in determining whether the gift was procured by the attorney through undue influence or whether a presumption of undue influence arising from such a gift is overcome. See Frye v. Norton, 148 W.Va. 500, 135 S.E.2d 603 (1964); Re Nixon's Will, 136 N.J.Eq. 242, 41 A.2d 119 (1945); Re Keeley's Estate, 167 Minn. 120, 208 N.W. 535 (1926).
[8] See Re Patterson's Will, 206 Misc. 268, 132 N.Y.S.2d 609 (N.Y.1954); Re Adin's Estate, 112 Wash. 379, 192 P. 887 (1920); Re Cotter's Estate, 180 Misc. 399, 40 N.Y.S.2d 93 (N.Y.1943); Wunderlich v. Buerger, 287 Ill. 440, 122 N.E. 827 (1919); Bennett v. Bennett, 50 N.J.Eq. 439, 26 A. 573 (1893); Wilson v. Moran, 3 Bradf. 172 (N.Y. 1855).
[9] See Slater v. Munroe, 316 Mass. 129, 55 N.E.2d 15 (1944); Re McCarty's Estate, 141 A.D. 816, 126 N.Y.S. 699 (1910); Re Morey's Estate, 147 Cal. 495, 82 P. 57 (1905); Wright v. Howe, 52 N.C. 412 (N.C.1860).
[10] Because the Court holds Plaintiff may not succeed on his claim of undue influence, Count II of the Second Amended Complaint regarding tortious interference based upon "unlawful and fraudulent acts and undue influence" of Erwin over Silling, Sr. must likewise fail.
[11] Because Plaintiff is estopped from contesting the validity of the codicil, it is unnecessary for the Court to determine whether Silling, Sr. possessed the requisite mental capacity to execute the codicil, whether the codicil was executed properly, and whether Plaintiff may prevail on a claim based upon undue influence in regard to that codicil. Nevertheless, the Court examines these issues, and in each instance, the Court finds in favor of Defendant Erwin that Silling, Sr. possessed the requisite mental capacity to execute the codicil, the codicil was executed properly, and Plaintiff may not prevail on a claim based upon undue influence.
[12] Erwin was a Potentate and Trustee of the Beni Kedem Temple.
[13] It is unnecessary for the Court to determine whether the power of attorney between Erwin and Silling, Sr. was "durable," that is, whether it was valid if Silling, Sr. was incompetent, because Erwin did not actually make the contributions from Silling, Sr.'s funds. Nevertheless, Jewel Carte testified:
"[d]uring the time I had discussions with Cyrus Silling, Sr. and received approval from him on various matters on the telephone or in person, he was able to maintain discussions with me, expressed his desires on various business matters, and appeared to be competent to me.... In confirming his desire to make [the twenty-five thousand dollar] payment, I recall speaking with him and, during that conversation, he appeared to be lucid, responded appropriately to my inquires, and informed me that he wanted to give that contribution to that Shrine. I did not notice anything during that conversation which would lead me to believe that he did not fully understand my inquiry or competently respond."
(Carte Affidavit April 13, 1995). If Silling, Sr.'s competence were in issue, it would be his competence in dealing with the holder of his agency account. Furthermore, other than general statements about Silling, Sr.'s poor health during the periods surrounding this transaction, Plaintiff presented no evidence to contradict Carte's testimony that, on the day in question, Silling, Sr. was competent.
[14] Charitable contributions were also placed on Silling, Sr.'s tax return as deductions. (Erwin's Rev.Mem.Summ.Judg. 15-16). Further, there is no evidence Erwin coerced Silling, Sr. to make these contributions. Affidavits from Lisa Bailey, Rita Lynn Hayes, Cindy Atkinson, Delores Canterbury, Dovie Chapman, William Mohler, Jackie Rutledge, and Jeanette Whittington, and Jewel Carte each state that each individual had not heard Erwin request, suggest, or recommend to Silling, Sr. that any gifts be made to the Shriners.
[15] The document in question provides:
4500 Virginia Ave., SE
Charleston, WV 25304
November 5, 1992
Memorandum for: Trust Department
Memorandum for: United National Bank
Memorandum for: Charleston, WV
Re: Gifts to be made with funds from my account, 1992
I have instructed and advised Willard H. Erwin, Jr., my Power of Attorney to
disburse from my funds to the parties listed below and in the amounts indicated:
To my Son and his children as follows:
My son Cyrus E. Silling, Jr. $10,000.
My grandchildren: Linda MacDonald 10,000.
Stephen M. Silling 10,000.
Michael A. Silling 10,000.
Elizabeth A. Sulzberger 10,000.
Rebecca C. Gilbert 10,000.
To Willard H. Erwin, Jr., with whom I have had a close
business and personal relationship for more than forty years
and who has always assisted me in many personal ways, the
sum of 10,000.
It is my request that the checks for my son and his children be accompanied with
a suitable "holiday greeting card" and all mailed to him for delivery to the
respective parties. The disbursement to Willard H. Erwin, Jr. may be delivered
directly to him.
I suggest this transaction be done as soon as possible and I do hereby so
authorize these transactions this 5th day of November, 1992.
HIS
MARK [handwritten "x"]
________________________________
Cyrus E. Silling, Sr.
Witness to his mark:
[signature "Lisa M. Bailey"]
[signature "Martha H. Hess"]
[16] Additionally, Plaintiff's claim must fail because Erwin did not actually make the ten thousand dollar ($10,000.00) gift out of Silling, Sr.'s funds to himself as alleged in Count III-B of the Plaintiff's Second Amended Complaint. Similar to the contributions made on Silling, Sr.'s behalf to the Shriners Hospitals, the Bank, through Jewel Carte, issued payment. Carte independently verified with Silling, Sr. that he desired the requested contribution be made. Therefore, the allegations contained in the Count III-B of the Plaintiff's Second Amended Complaint must fail because Erwin did not "[make] a gift ... of $10,000.00 out of the funds of Cyrus E. Silling, Sr. to [himself]."
[17] Notwithstanding the bar of estoppel, there is affirmative and direct evidence Silling, Sr. desired to make the gift to Erwin. Delores Canterbury, one of Silling, Sr.'s caretakers, testified Silling, Sr. specifically expressed his desire to make the ten thousand dollar ($10,000.00) gift to Erwin. (Canterbury Dep. 48-49). Moreover, when the request was made to United National Bank for payment, Jewel Carte called Silling, Sr. and specifically asked him to confirm his desire to make that gift, which he did. (Carte Dep. 99, 102, 132).
[18] Mr. Griffith's expert report was disclosed pursuant to Rule 26(a)(2)(B) of the Federal Rules of Civil Procedure.
[19] Similar to the contributions to charity and the inter vivos gift to Erwin, this aspect of the Plaintiff's claim must also fail because Erwin did not actually make the payments to himself out of the funds of Silling, Sr. as alleged in Count III-C of Plaintiff's Second Amended Complaint. Carte independently verified with Silling, Sr. that he desired the requested transaction take place and then issued payment. Therefore, the allegations contained in the Count III-C of the Plaintiff's Second Amended Complaint must fail because Erwin did not "[make] certain payments to himself for alleged accounting and management services out of the funds of Cyrus E. Silling, Sr." | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1399455/ | 885 F.Supp. 127 (1995)
Judy CORRIGAN
v.
METHODIST HOSPITAL, Sanford H. Davne and Donald Myers.
Civ. A. No. 94-CV-1478.
United States District Court, E.D. Pennsylvania.
May 8, 1995.
Joseph L. Messa, Jr., Thomas W. Sheridan, Giuliana F. Robertson, Mark W. Tanner, Ominsky, Welsh and Steinberg, P.C., Philadelphia, PA, for plaintiff.
Nancy A. Nolan, Kimberly A. Cummings, Post & Schell, P.C., Philadelphia, PA, for defendant Methodist Hosp.
Kevin H. Wright, Amalia V. Romanowicz, Wright, Young & McGilvery, P.C., Plymouth Meeting, PA, for defendant Sanford H. Davne, M.D.
Daniel F. Ryan, III, Christine A. Egan, O'Brien & Ryan, Plymouth Meeting, PA, for defendant Donald Myers, M.D.
MEMORANDUM
JOYNER, District Judge.
Plaintiff, Judy Corrigan, has moved this Court for relief from this Court's July 11, 1994 Order, and also requests a ruling in limine to introduce at trial the Minutes of the September 19, 1991 Quarterly Staff Meeting of Defendant Methodist Hospital. On July 11, 1994, this Court ruled that the Minutes were peer review material protected by Pennsylvania's peer review act. Plaintiff presents her requests as a motion to reconsider and it is that standard we use to evaluate her requests.
A motion for reconsideration is intended to permit a party to present newly discovered evidence, or correct manifest errors of law or fact. Harsco Corp. v. Zlotnicki, 779 F.2d 906, 909 (3d Cir.1985), cert. denied, 476 U.S. 1171, 106 S.Ct. 2895, 90 L.Ed.2d 982 (1986). It is not an opportunity for a party to re-litigate already decided issues or to present previously available evidence. Id. Plaintiff informs this Court that she "proceeds strictly on the theory that this Court's Memorandum and Order of July 11, 1994 should be reconsidered on the basis of newly discovered evidence." Pls. Brief at 2.
*128 Plaintiff's new evidence argument is based on the deposition of Kevin Hannifan, the Chief Executive Officer of Methodist. In his deposition, Mr. Hannifan was questioned about the September 19, 1991 Quarterly Staff Meeting that resulted in the Minutes at issue. He explained that the Quarterly Staff Meetings are meetings that the entire Medical Staff of Methodist, approximately 300 people, can attend, and that following the meeting, the Minutes are distributed to all members of the Medical Staff. Plaintiff argues that this new evidence indicates that the Staff Meeting was not a protected credentialling committee meeting or that if it was, any peer review privilege was waived, and that therefore, the Peer Review Protection Act does not apply.
The Peer Review Protection Act (PRPA), 63 Pa.Stat.Ann. §§ 425.1 425.4 (Supp.1994) states in relevant part:
Confidentiality of review organization's records
The proceedings and records of a review committee shall be held in confidence and shall not be subject to discovery or introduction into evidence in any civil action against a professional health care provider arising out of the matters which are the subject of evaluation and review by such committee.
(emphasis added). A review organization is defined by the statute, in part, as "any hospital board, committee or individual reviewing the professional qualifications or activities of its medical staff or applicants for admission thereto." 63 Pa.Stat.Ann. § 425.2. The debate today, then, is whether the new information from Mr. Hannifan serves to demonstrate that the September 19, 1991 Quarterly Staff Meeting was not a meeting protected by the PRPA.
According to Methodist's Medical Staff's Bylaws, in order for a doctor to become a member of Methodist's Medical Staff, first, the doctor must submit an application for appointment to the Secretary of the Medical Staff. Bylaws Art. V, § A, cl. 3. Second, the Credentials Committee reviews the application and conducts an investigation of the applicant. The Credentials Committee then transmits a written report of its investigation of the applicant and a recommendation to the Executive Committee, "which shall in turn pass its recommendations along to the medical staff for action." Id. at Art. V, § B, cl. 1. Third, at the next regular meeting of the Medical Staff, the Medical Staff votes by secret ballot "whether to recommend to the governing body that the applicant be provisionally appointed to the medical staff, that he be rejected for medical staff membership, or that his application be deferred for further consideration." Id. at Art. V, § B, cl. 2. Following this vote there are several other steps, including opportunities for re-evaluating doctors who were not approved by the Medical Staff. Id. at Art. V, § B, cls. 3-12.
It appears then, that when the Medical Staff votes at a regular Medical Staff meeting on the appointment of an applicant, the Medical Staff is acting to review the "professional qualifications or activities of its medical staff or applicants for admission thereto." 63 Pa.Stat.Ann. § 425.2. This is, in fact, what happened at the September 19, 1991 Quarterly Staff Meeting. A list of 20 doctors was presented to the Medical Staff present at the meeting, and they, as the Medical Staff, voted in accordance with the Bylaws. This conclusion finds added support in the Minutes themselves, which read, "Doctor Zeluck reminded all members that they are voting on the credentials of the applicants." Minutes at 3. We find, therefore, that the Quarterly Staff Meeting is a Review Organization under the protection of the PRPA.
We recognize Plaintiff's concern that the entire Medical Staff's ability to vote on the appointment may distinguish it from the common understanding of the term "committee," which can imply a select group of a larger whole. However, as Methodist points out, there is such a concept of a "committee of the whole," and it is perfectly understandable that on a matter as important as granting membership to a hospital's Medical Staff, that the entire Medical Staff, as a committee of the whole, would be invited to cast its vote.
Plaintiff also argues that because the Minutes were distributed to the entire Medical Staff, that there was no intent for the Minutes to be confidential or that any privilege *129 was waived. Plaintiff does not present any evidence, however, that would support this assertion. There is no argument that the Minutes were distributed to non-Medical Staff members, or that there was any reason why members of the Medical Staff who were not present at the meeting should not have been apprised of what occurred at the meeting.
For these reasons, Plaintiff's new evidence does not demonstrate either that the Staff Meeting was not a peer review organization as defined in the PRPA, the Minutes were not protected as peer review under the PRPA, or a peer review privilege was waived. Accordingly, we deny Plaintiff's Motion in Limine and Motion to relieve her of our July 11, 1994 Order.
An appropriate Order follows.
ORDER
AND NOW, this 8th day of May, 1995, upon consideration of Plaintiff's Motion for Relief from the Court's Order Dated July 11, 1994 and Motion in Limine to Introduce the Quarterly Staff Meeting Minutes, and responses thereto, the Motion is hereby DENIED. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/2320700/ | 787 A.2d 211 (2001)
346 N.J. Super. 126
STATE of New Jersey, Plaintiff-Respondent,
v.
Calvin DIXON, Defendant-Appellant.
Superior Court of New Jersey, Appellate Division.
Submitted October 2, 2001.
Decided December 20, 2001.
*212 Peter A. Garcia, Acting Public Defender, attorney for appellant (John J.A. Burke, Designated Counsel, of counsel and on the brief).
William H. Schmidt, Bergen County Prosecutor, attorney for respondent (Pia S. Perez, Assistant Prosecutor, of counsel and on the brief).
Appellant filed a pro se supplemental brief.
Before Judges STERN, EICHEN and LINTNER.
The opinion of the court was delivered by STERN, P.J.A.D.
Tried by jury, defendant was convicted of second degree eluding, N.J.S.A. 2C:29-2b (count one), and resisting arrest, N.J.S.A. 2C:29-2a, as a lesser included disorderly persons offense (count two). Co-defendant Gary M. Scott was also convicted of the disorderly persons offense of resisting arrest, N.J.S.A. 2C:29-2a, as a lesser included offense on count three. Defendant was sentenced to an extended term, pursuant to N.J.S.A. 2C:44-3a, of eleven years in prison with three years and six months to be served before parole eligibility on count one. He received a concurrent term of six months imprisonment on count two. Defendant appeals and argues:
POINT I [THE TRIAL JUDGE'S] FAILURE TO CHARGE THE JURY ON IDENTIFICATION DENIED DEFENDANT A FAIR TRIAL AND IS REVERSIBLE ERROR, BECAUSE THE SOLE ISSUE, WHETHER DEFENDANT WAS THE CAR'S DRIVER, WAS SUPPORTED ONLY BY EYEWITNESS TESTIMONY NOT CORROBORATED BY INDEPENDENT IDENTIFICATION EVIDENCE (NOT RAISED BELOW).
POINT II [THE JUDGE] COMMITTED REVERSIBLE ERROR WHEN, CONTRARY TO N.J.S.A. 2C:2-2(C), HE FAILED TO CHARGE THE JURY ON THE LEVEL OF CULPABILITY SUFFICIENT TO PROVE DEFENDANT CREATED A RISK OF DEATH OR INJURY TO ANY PERSON, THE ESSENTIAL ELEMENT OF THE SECOND DEGREE OFFENSE *213 OF ELUDING DEFINED UNDER N.J.S.A. 2C:-29-2[b] (NOT RAISED BELOW).
POINT III DEFENDANT IS ENTITLED TO A NEW TRIAL BECAUSE THE JURY WAS PERMITTED TO INFER THAT DEFENDANT'S CONDUCT CREATED "A RISK OF DEATH OR INJURY" IF IT DETERMINED THAT HIS CONDUCT "INVOLVED" ANY OF THE MOTOR VEHICLE OFFENSES SET FORTH IN CHAPTER 4 OF TITLE 39, IN THE ABSENCE OF AN INSTRUCTION THAT THE JURY HAD TO FIRST DETERMINE THAT DEFENDANT WAS GUILTY OF THOSE OFFENSES BEYOND A REASONABLE DOUBT BEFORE IT COULD DRAW THE INFERENCE. (NOT RAISED BELOW).
POINT IV DEFENDANT'S EXTENDED TERM SENTENCE OF ELEVEN YEARS OF IMPRISONMENT WITH THREE AND ONE-HALF YEARS OF PAROLE INELIGIBILITY IS EXCESSIVE.
In a pro se supplementary brief, defendant also contends:
POINT I THE DEFENDANT'S SENTENCE SHOULD BE VACATED BECAUSE IT VIOLATES [THE] DUNBAR ANALYSIS AND [IS] PER SE ILLEGAL.
POINT II THE DEFENDANT['S] CONSTITUTIONAL RIGHT TO A FAIR TRIAL WAS VIOLATED BECAUSE THE DEFENDANT['S] TRIAL ATTORNEY RENDERED INEFFECTIVE ASSISTANCE OF COUNSEL WITH THE RESULT THAT A SUSPECT VERDICT WAS RENDERED AGAINST THE DEFENDANT.
POINT III THE DEFENDANT IS ENTITLED TO A FULL EVIDENTIARY HEARING BECAUSE THE DEFENDANT HAS PRESENTED A PRIMA FACIE CASE ON INEFFECTIVE ASSISTANCE OF COUNSEL.
Our careful review of the record leads us to conclude that these contentions are without merit and require only the following discussion in a written opinion. R. 2:11-3(e)(2).
I.
On November 6, 1998, at about 1:30 a.m., Officer Daniel Graber, a seven year veteran of the Port Authority Police Department, was on traffic patrol in a marked police vehicle. As he was driving westbound on the upper deck of the George Washington Bridge, he observed a maroon Plymouth Horizon with a broken tail light that was speeding and passing other traffic. Officer Graber began to follow the vehicle which he clocked at approximately 74 m.p.h.
Officer Graber followed the car for about one-half mile and then "activated" his overhead emergency lights to stop the car. However, the car kept going. Officer Graber then turned on his siren but the driver did not pull over. Officer Graber thereafter radioed the George Washington Bridge communications desk, advised that he "was attempting to stop a vehicle," and gave them the license plate number and description of the car. As a result, Officer Matthew Lombardo joined Officer Graber in the chase.
Officer Graber followed the Plymouth onto Route 4, where it was traveling at "[a]bout 70 miles an hour" and "was weaving in and out of the lanes and traffic." Although the traffic was "light," the driver's conduct caused "other motorists to hit *214 the[ir] brakes, stop[ ][and] swerve," to avoid a collision. The car then "veered" from the left lane to the right hand exit that led to the City of Englewood. Officers Graber and Lombardo continued chasing the car with their lights and sirens on.
The Plymouth Horizon, now traveling about 50 m.p.h. in a 25 m.p.h. local traffic zone, drove through "at least 20" stop signs on several side streets, forcing drivers who had the right of way "to hit their brakes and stop." When the car slowed down to about 40 m.p.h., one of the passengers opened the rear door of the car, jumped out and ran away.
The vehicle then pulled onto a "dead end-street" into an apartment complex. As the vehicle slowed down, defendant, who had been driving, and the front seat passenger "jumped out" of the car. Graber testified that defendant ran to the left of a large "dumpster" into "an open field," and the front seat passenger ran to the right of the dumpster into the same field. Meanwhile, the car continued to roll down the street into the dumpster, and Graber "yelled" to Lombardo "to get the driver."
Officer Graber immediately arrested a passenger who remained in the rear of the car, as Officer Lombardo pursued defendant and the front seat passenger on foot. Lombardo was able to arrest defendant about fifty yards from the car, although the front seat passenger escaped. After placing defendant under arrest, the officers put him in the rear of the patrol car with the back seat passenger, co-defendant Scott. Meanwhile, approximately ten officers arrived on the scene as "back-up." For about one hour the officers unsuccessfully tried to apprehend the two occupants who had fled.
While processing defendant at headquarters, Graber discovered that defendant's license was suspended, and he issued six motor vehicle summons. Graber specified that defendant was charged with driving while suspended, reckless driving, speeding, having an inoperable stop light, and failure to comply with the lawful directions of a police officer. Graber also testified that his in-court identification of defendant was based on the amount of time he spent with defendant that night.
Officer Lombardo, a six year veteran of the Port Authority Police Department, testified at trial that his vehicle was directly behind defendant's, and that he "was able to maintain eye contact" and never lost sight of defendant from the moment he exited the car to when he was apprehended. He further testified that, after the suspects ran from the car, the passenger ran to the left, jumping over a fence and into a water viaduct, and the driver ran towards the right, behind the housing complex before he "stumbled" and was pushed to the ground by Lombardo. Defendant resisted arrest, but Lombardo "finally was able to cuff him."
II.
Defendant argues that "[e]ven in the absence of a request to charge, the nature of the eyewitness identifications, combined with the fact that identification was the sole defense, required [the judge] to give the jury an identification charge." Defendant asserts that Officer Graber's identification was based solely on clothing and a twelve hour interview conducted at police headquarters. Defendant further contends that Officers Graber and Lombardo never actually saw the face of the driver before he exited the car, and therefore, his conviction for second degree eluding should be reversed because identification was "the key issue in this case, and the judge ... failed to charge the jury on identification."
*215 The judge, however, did charge on identification. While he gave no specific instruction during his original charge, defense counsel thereafter pointed out she "should have ... asked for an identification charge," and requested that it be given "because we're disputing that Mr. Dixon is in fact the driver of the car." She also asked that "cross-racial identification be charged because it's pretty obvious my client is an African American and the officers were both caucasian." Over the prosecutor's objection, the judge then supplemented the charge and instructed the jurors on these subjects. Defendant posed no objection to the supplementary instructions after they were given and does not attack their adequacy before us.
III.
Defendant argues that, assuming he was the driver, his "conduct did not result in injury to anyone," traffic was light, and "Officer Graber's testimony that several vehicles had to apply their brakes to avoid a collision" lacked reference to a "specific event." He, therefore, asserts that, particularly "[u]nder these facts, defendant was entitled to have the jury told that they must find that he knowingly created a risk of death or injury to anyone" in order to be convicted of second degree eluding. Stated differently, defendant asserts that "the jury had to find beyond a reasonable doubt that defendant Dixon knowingly created a risk of death or injury to any person." The State contends that it met "its burden of establishing that defendant's unlawful driving created a risk of death or injury to others," the prerequisite to second degree eluding, and that "the trial judge properly charged the jury concerning the crime of second-degree eluding."
The judge instructed the jurors:
In order to convict the defendant of third degree [e]luding the State must prove beyond a reasonable doubt each of the following six elements. Number one, that Calvin Dixon was operating a motor vehicle on a street or highway in this state. Number two, that Daniel Graber and Matthew Lombardo are or [were] a police or law enforcement officer. Number three, that Daniel Graber and/or Matthew Lombardo signalled Calvin T. Dixon to bring the vehicle to a full stop. Number four, that Calvin T. Dixon knew the officers had signalled him to bring the vehicle to a full stop. Number five, that Calvin Dixon knew that Daniel Graber and/or Matthew Lombardo were or was a police or law enforcement officer. And number six, that Calvin Dixon knowingly fled or attempted to [e]lude the officer.
Mere failure to stop does not constitute flight. To find flight you must find that the defendant's purpose in leaving was to avoid being stopped by the officer. A person attempts to perform an act if he does or omits to do anything with the purpose of performing that act without further conduct on his part, or purposely does or omits to do which under the circumstances as a reasonable person would believe them to be is an act of omission, an act or [o]mission constituting a substantial step planned to culminate in the performance of that act. That's the legal definition of purpose.
A person acts purposely with respect to the nature of his conduct or result thereof if it is his conscious object to engage in conduct of that nature which would cause such a result.
A person acts knowingly with respect to the attendant circumstance of his conduct if he is aware that such circumstances exist or there was a high probability of their existence. Knowing or with knowledge or equivalent terms have the same meaning.
*216 If you find that the State has failed to prove any of these elements beyond a reasonable doubt you must find the defendant not guilty. If on the other hand the State has proven all six of the above elements beyond a reasonable doubt you must go on to your deliberations to consider a seventh element which will distinguish third degree [e]luding from the greater offense of second degree [e]luding. The State must prove beyond a reasonable doubt element number seven, that the flight or attempt to [e]lude created a risk of death or injury to any person.
The trial judge also instructed the jurors that they could infer that defendant placed people at risk of death or injury if the defendant's conduct in eluding the officer involved speeding, reckless driving or failure to observe the direction of a police officer. The judge charged:
You may infer risk of death or injury to any person if the defendant's conduct in fleeing or attempting to [e]lude the officer involved a violation of the motor vehicle laws of this state.
It is alleged that the defendant's conduct involved violations of speeding, reckless driving and failure to observe observation of the direction of a police officer. And I'll explain those to you now.
Reckless driving is defined by our statutes as a person who drives a vehicle heedlessly in wilful or wanton disregard of the rights or safety of others in a manner so as to endanger or be likely to endanger a person or property shall be guilty of reckless driving.
Speedingsubject to the provisions of our statute it shall be prima facie law [sic] for the driver of a vehicle to drive it at a speed not exceeding the following: 25 miles per hour in any business or residential district, 35 miles per hour in any suburban business or residential district.
Drivers of vehicles, street cars or horses shall at all times comply with all directions by voice or hand of a member of a police department or a police officer or the director while enforcing any provision of this statute. That's for observance of directions of officers.
Those are the statutes that he has been charged with.
Whether the defendant is guilty or not of these offenses will be determined by an appropriate court. In other words, it's not your job to decide whether he's guilty or not of the motor vehicle offenses including any other motor vehicle offenses mentioned in the testimony. However, you may consider the evidence that he committed a motor vehicle offense in deciding whether he created a risk of death or injury. At the same time remember that you're notyou're never required to compel or draw this inference. As I've already explained, it is your exclusive province to determine whether the facts and circumstances shown by the evidence support any inferences and you're always free to accept or reject any inference if you wish.
If you find the State has proven beyond a reasonable doubt all seven elements of the offense then you must find the defendant guilty of the second degree crime of [e]luding an officer. On the other hand, if you find the State has failed to prove the seventh element beyond a reasonable doubt but has proven the first six elements beyond a reasonable doubt then you must find the defendant not guilty of second degree [e]luding and guilty of third degree [e]luding. Finally, if you find the State has failed to prove any of the first six elements beyond a reasonable doubt then you *217 must find the defendant not guilty of the crime.[1]
Jury instructions must be clear and correct because they serve as "a road map to guide the jury," State v. Cooper, 151 N.J. 326, 363, 700 A.2d 306 (1997) (quoting State v. Martin, 119 N.J. 2, 15, 573 A.2d 1359 (1990)), and, particularly when the judge fails to properly detail an element of the crime, erroneous instructions are "poor candidates for rehabilitation under the harmless error theory." State v. Wilson, 128 N.J. 233, 241, 607 A.2d 1289 (1992); State v. Vick, 117 N.J. 288, 289, 566 A.2d 531 (1989); State v. Weeks, 107 N.J. 396, 410, 526 A.2d 1077 (1987). On the other hand, the charge must "be examined as a whole to determine its overall effect." State v. Delibero, 149 N.J. 90, 106-07, 692 A.2d 981 (1997) (quoting State v. Wilbely, 63 N.J. 420, 422, 307 A.2d 608 (1973)).
N.J.S.A. 2C:29-2b, in relevant part, provides:
Any person, while operating a motor vehicle on any street or highway in this State ... who knowingly flees or attempts to elude any police or law enforcement officer after having received any signal from such officer to bring the vehicle or vessel to a full stop commits a crime of the third degree; except that, a person is guilty of a crime of the second degree if the flight or attempt to elude creates a risk of death or injury to any person.
Thus, a person may be found guilty of second-degree eluding only if the jury finds that his flight or attempt to elude created a risk of death or injury to any person. State v. Wallace, 158 N.J. 552, 560, 730 A.2d 839 (1999) (finding that "the statute was designed to punish those who elude the police and ... whose unlawful conduct creates a possibility of injury to others[ ]"). See also Apprendi v. New Jersey, 530 U.S. 466, 120 S.Ct. 2348, 147 L.Ed.2d 435 (2000); State v. Johnson, 166 N.J. 523, 766 A.2d 1126 (2001). Our Supreme Court has determined that a permissive inference may be established through evidence that defendant "violated one or more motor vehicle statutes" during the chase. Wallace, supra, 158 N.J. at 558-559, 730 A.2d 839. However, the term "knowingly" does not relate to the risk which aggravates the eluding and makes it a second degree crime. The relevant clauses in N.J.S.A. 2C:29-2b are separated by a semi-colon, and there is no culpability requirement independent of the third degree crime. We, therefore, reject defendant's contention that the judge erred by failing to instruct the jury that it had to find that the defendant "knowingly" created *218 a risk of death or injury to another person.
We recognize that N.J.S.A. 2C:2-2c(3) requires a "knowing" culpability where culpability is intended and the Code is otherwise silent. We also recognize that the "risk of death or injury" factor, whether considered a sentence enhancer or element of the second degree crime, requires a jury finding of proof beyond a reasonable doubt. See Apprendi v. New Jersey, supra, 530 U.S. at 495-97, 120 S.Ct. at 2365-67, 147 L.Ed.2d at 458-59; State v. Johnson, supra, 166 N.J. at 549, 766 A.2d 1126; N.J.S.A. 2C:1-13a. Nevertheless, the structure of N.J.S.A. 2C:29-2b, and a reasonable reading of its provisions, results in a construction that a defendant need not knowingly create the risk so long as the defendant, as in this case, is found to have committed third degree eluding with the requisite knowing culpability. Cf. State v. Mendez, 345 N.J.Super. 498, 785 A.2d 945 (App.Div.2001) (indicating "knowingly flees or attempts to elude" requires knowing culpability). See also State v. Burford, 163 N.J. 16, 20, 746 A.2d 998 (2000).
IV.
Defendant argues that the jury charge violated due process and "conflicted with [the] settled law of State v. Wallace [158 N.J. 552, 730 A.2d 839 (1999) ]" because the jury was allowed to draw an inference which raises eluding to a crime of the second degree without finding, beyond a reasonable doubt, a motor vehicle violation or other violation of law which provides the basis for the inference. N.J.S.A. 2C:29-2b provides that, "[f]or purposes of this subsection, there shall be a permissive inference that the flight or attempt to elude creates a risk of death or injury to any person if the person's conduct involves a violation of chapter 4 of Title 39 or chapter 7 of Title 12 of the Revised Statutes."[2] Defendant insists that the jury must make this finding in light of State v. Wallace.
In Wallace, the Supreme Court noted:
The trial court ... instructed the jury on each element of the following motor vehicle offenses with which defendant had been charged: careless driving, N.J.S.A. 39:4-97, failing to stop at a stop sign, N.J.S.A. 39:4-144, driving the wrong way on a one-way street, N.J.S.A. 39:4-85.1, littering or throwing debris from his vehicle, N.J.S.A. 39:4-64, leaving a vehicle with the engine running, N.J.S.A. 39:4-53, and failure to keep right, N.J.S.A. 39:4-82. The jury found defendant guilty of violating those motor vehicle laws.
Under the proper jury instructions, the State, in reliance on the permissive inference, was not obligated to prove affirmatively that there was "any person" who was placed at risk of death or injury in order to establish that defendant was guilty of second-degree eluding. The present case is to be distinguished from Dorko where the jury was not asked to decide whether the motor vehicle statutes had been violated. Here, the jury found that defendant had committed multiple violations of motor vehicle and traffic laws, and thus properly applied the permissive inference.
*219 [158 N.J. 552, 559-60, 730 A.2d 839 (1999) (emphasis added).]
The jury charge given in State v. Dorko, and our response to same, was as follows:
Now, you may infer such a risk if the defendant's conduct in fleeing or in attempting to elude the officer involved a violation of the motor vehicle laws of this state. It is alleged in this case that the defendant's conduct involved a violation of the following motor vehicle laws: failure to stop at stop signs; speeding; running a red light; making a right turn on red; driving while suspended; reckless driving; and failure to yield to an emergency vehicle. However, you are never required or compelled to draw this inference.
As I've already explained, it is your exclusive province to determine whether the facts and circumstances shown by the evidence support any inference, and you are always free to accept or reject any inference if you wish. As I started to explain to you before, it is, you do not have to decide the motor vehiclethe guilt or innocence of the defendant on the motor vehicle summonses. Those summonses... will be in the jury room with you [and] will be handled by an appropriate court at a later time.
The judge, however, declined to charge the elements of the governing motor vehicle offenses. We determine that the failure of the court to charge the elements of the applicable motor vehicle statutes was additional reversible error.
[298 N.J.Super. 54, 59, 688 A.2d 1109 (App.Div.1997).]
This case is similar to Dorko because the jury was not asked to determine whether the motor vehicle statutes had been violated. Defendant therefore contends that reversal is required. We disagree. So long as the jury was told the elements of the motor vehicle offenses, for it to consider if a violation occurred, the second degree eluding conviction must stand. As we previously noted, the judge charged the jury that it was "alleged that the defendant's conduct involved violations of speeding, reckless driving and failure to observe ... the direction of a police officer." The judge charged the elements of each offense, without objection, and there is no claim that the charge was inadequate in this respect. Having defined the elements of the motor vehicle offenses, the jury had a standard by which the inference could be applied. It was for the judge, not the jury, to determine defendant's actual guilt of the motor vehicle infraction.
As the Criminal Practice Committee reported to the Supreme Court following its decision in Wallace:
The Committee was asked to consider whether the decision of State v. Wallace, 158 N.J. 552, 730 A.2d 839 (1999) required a change in the rules. Specifically, the Committee considered the practice regarding the trial of non-indictables with indictables in light of the Court's opinion and whether it is inconsistent with State v. Muniz, 118 N.J. 319, 571 A.2d 948 (1990).
In Wallace, the trial judge submitted the motor vehicle charges and disorderly persons offenses to the jury along with the eluding charge. In Muniz, the Court held that the lesser included motor vehicle offense were to be brought to the attention of the jury, but had to be determined by the judge. The Court also stated: "we conclude that with respect to the joinder of lesser-included offenses, the Code standards do not permit and common law policies do not require, the simultaneous submission to and the disposition by a jury of motor *220 vehicle violation in conjunction with its determination of offenses under the Code." Id [.] at 331-332, 571 A.2d 948[.] Therefore, since the usual practice pursuant to Muniz is for the judge to reserve decision on the disorderly persons offenses or motor vehicle offenses until after the jury returns its verdict, did Wallace intend to change this practice at least in eluding cases, and, if so, do the court rules need to be changed? In Wallace, the Court held that the trial court's failure to define the term "injury" in a second degree eluding case was harmless error because the defendant had been convicted by the jury of certain motor vehicle law violations, thereby satisfying a rebuttable inference that there was a risk of death or injury. The "problem" with the opinion, brought to the attention of the Criminal Practice Committee by the Conference of Criminal Presiding Judges, was the recitation of the procedural history including defendant's conviction by jury of motor vehicle violations. It seems to many of the presiding judges that presentation of the motor vehicle violations to the jury simultaneously with the criminal charges was inconsistent with the Supreme Court's earlier opinion in Muniz, and the rule changes based thereon embodied in R. 3:15-3.
The Committee believes that the Supreme Court's mere recitation of the procedural history in Wallace, without any endorsement or further discussion concerning same, was not intended to modify Muniz with respect to presentation of motor vehicle violations, even in eluding cases. The Committee suggests that, while no rule change is required, a "comment to the rules should note that Wallace does not change the procedural history of State v. Muniz, 118 N.J. 319, 571 A.2d 948 (1990)." The Committee also hopes this matter can be resolved quickly by case law. The Committee has forwarded its recommendation to Judge Pressler.
[159 N.J.L.J. 664 (Feb. 14, 2000).]
Accordingly, the jury did not have to expressly decide if defendant violated any motor vehicle law.
V.
Defendant also contends in his pro se brief that the extended term sentence, imposed under N.J.S.A. 2C:44-3a, is unconstitutional in light of the United States Supreme Court's decision in Apprendi v. New Jersey, 530 U.S. 466, 120 S.Ct. 2348, 147 L.Ed.2d 435 (2000). He specifically asserts that pursuant to Apprendi, supra, a jury, rather than a judge, was required to determine the factors permitting imposition of his extended sentence.
In Apprendi, the majority stated that the jury must find, beyond a reasonable doubt, "any fact (other than prior conviction) that increases the maximum penalty for a crime." Apprendi, supra, 530 U.S. at 476, 120 S.Ct. at 2355, 147 L.Ed.2d at 446. However, the Court expressly noted that the fact of a "prior conviction" need not be found by the jury prior to imposition of an enhanced term based upon a recidivist status. Apprendi, supra, 530 U.S. at 488, 120 S.Ct. at 2361-62, 147 L.Ed.2d at 454.[3]See also State v. Johnson, *221 166 N.J. 523, 535-36, 541, 549, 766 A.2d 1126 (2001) (finding that a jury must determine whether a crime was "violent" for purposes of required ineligibility term under No Early Release Act, but noting status of law concerning recidivism); State v. Stanton, 339 N.J.Super. 1, 6-7, 770 A.2d 1198 (App.Div.2001) (stating "[a]s we understand Johnson ... it holds that if imposition of a statutorily mandated parole ineligibility term is based on the existence of a fact other than a record of a prior conviction, then, as a matter of the imperatives of the Fifth and Sixth Amendments, that fact must be found by a jury beyond a reasonable doubt" (emphasis added)) certif. granted and denied, 169 N.J. 609, 782 A.2d 427 (2001).
The prerequisites to an enhanced sentence under N.J.S.A. 2C:44-3a are related to the issue of "recidivism" and may be found by the judge without presentation to the jury. The statute requires findings "by a preponderance of the evidence." The required fact-finding does not relate to the present offense or its elements. As the Second Circuit recently said:
In short, we read Apprendi as leaving to the judge, consistent with due process, the task of finding not only the mere fact of previous convictions but other related issues as well. Judges frequently must make factual determinations for sentencing, so it is hardly anomalous to require that they also determine the `who, what, when and where' of a prior conviction.
[United States v. Santiago, 268 F.3d 151, 156 (2d Cir.2001) ].
As with the statute at issue in Santiago, the factual prerequisites to an extended term under N.J.S.A. 2C: 44-3a are "requirement[s that fall] squarely within the range of facts traditionally found by judges at sentencing and is sufficiently interwoven with the facts of the prior crimes that Apprendi does not require" them to be presented to the jury. See also, e.g., People v. Thomas, 91 Cal. App.4th 212, 221-23, 110 Cal.Rptr.2d 571 (Ct.App.2001); People v. Dunn, 2001 WL 1388512 at *4-*5, ___ Ill.App.3d ___, ___ _ ___, 260 Ill. Dec. 94, 760 N.E.2d 511, ___ _ ___ (3d Dist.2001); People v. Dixon, 319 Ill.App.3d 881, 884-86, 254 Ill. Dec. 244, 747 N.E.2d 1, 3-4 (3 Dist.2001) (facts concerning age of defendant at time of prior convictions, number and sequence of convictions need not be decided by jury or beyond a reasonable doubt). Similarly, the factors resulting in an ineligibility term imposed on the extended sentence under N.J.S.A. 2C:44-3a do not require fact-finding by the jury. See State v. Dunbar, 108 N.J. 80, 91-95, 527 A.2d 1346 (1987); compare State v. Johnson, supra (NERA expressed no burden of proof or fact-finder, and the sentencing factor related to the offense); McMillan v. Pennsylvania, 477 U.S. 79, 106 S.Ct. 2411, 91 L.Ed.2d 67 (1986) (discussed at length in Apprendi and Johnson).
VI.
The record does not support defendant's claim of ineffective assistance of counsel. State v. Preciose, 129 N.J. 451, 460, 609 A.2d 1280 (1992). The judgment is affirmed.
NOTES
[1] Count one of the indictment charged:
that CALVIN T. DIXON, on or about November 6, 1998, in the Borough of Fort Lee, in the County of Bergen aforesaid, and within the jurisdiction of this Court, or in some other municipality and County within the jurisdiction of this Court, did, while operating a motor vehicle on any street or highway in this State, knowingly flee or attempt to elude law enforcement officers, to wit: Patrolmen Daniel Graber and/or Matthew Lombardo of the Port Authority Police Department after having received a signal from the police or law enforcement officer to bring the vehicle to a full stop, by operating a motor vehicle in a manner which creates a risk of death or injury to any person; contrary to the provisions of NJS 2C:29-2b, and against the peace of this State, the Government and dignity of the same.
There is no contention that the count had to be more specific or assert a specific violation of Title 39. As noted, defendant was charged with six motor vehicle violations, five of which were identified to the jury during the trial. The judge found defendant guilty of reckless driving and dismissed the remaining motor vehicle complaints incident to the sentence.
[2] See N.J.S.A. 2C:1-13e; N.J.R.E. 301 and 303. Presumptions are generally inferences in criminal cases. See, e.g., State v. Ingram, 98 N.J. 489, 498-99, 488 A.2d 545 (1985). They are not elements of the offense which a jury must find in order to convict, and defendant does not contend they are. In any event, proof of the motor vehicle offenses was presented. See Apprendi v. New Jersey, supra, 530 U.S. at 475, 120 S.Ct. at 2354-55, 147 L.Ed.2d at 446.
[3] The Court specifically stated that "[o]ther than the fact of a prior conviction, any fact that increases the penalty for a crime beyond the prescribed statutory maximum must be submitted to a jury, and proved beyond a reasonable doubt." 530 U.S. at 490, 120 S.Ct. at 2362-63, 147 L.Ed.2d at 455. In the absence of any question being raised or an enhanced sentence having been imposed on any ground other than recidivism, we do not address any issue concerning notice of defendant's exposure to an enhanced sentence. See R. 3:21-4(e). | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/2327624/ | 119 F.Supp.2d 589 (2000)
UNITED STATES of America
v.
Edwin EDWARDS, et al.
No. Crim.A. 98-165-B-M2.
United States District Court, M.D. Louisiana.
July 27, 2000.
*590 James B. Letten, Peter G. Strasser, Dept. of Justice, U.S. Atty.'s Office, New Orleans, LA, Michael William Manger, U.S. Atty.'s Office, E.D. La., New Orleans, Thomas L. Watson, Dept. of Justice, U.S. Attys. Office, New Orleans, LA, Eddie J. Jordan, Jr., U.S. Atty.'s Office, New Orleans, LA, Stephen A. Higginson, U.S. Atty.'s Office, E.D. La., New Orleans, LA, for U.S.
Richard G. Crane, Corrections & Sentencing Law, Nashville, TN, Daniel I. Small, Butters, Brazilian & Small, LLP, Boston, MA, for Edwin Edwards.
Edwin Edwards, Baton Rouge, LA, pro se.
Stephen Edwards, Baton Rouge, LA, pro se.
James M. Cole Bryan Cave LLP, Washington, DC, for Stephen Edwards.
Rebecca L. Hudsmith, Federal Public Defenders Office, Lafayette, LA, for Cecil Brown.
Servando C. Garcia, III, Ryan J. Roemershauser, Garcia & Bishop, Metairie, LA, William H. Jeffress, Jr., James R. Heavner, Jr., Miller, Cassidy, Larroca & Lewin, LLP, Washington, DC, for Andrew Martin.
James Michael Small, Law Offices of J. Michael Small, Alexandria, LA, for Bobby Johnson.
RULING
POLOZOLA, Chief Judge.
The United States of America[1] filed a Motion for an Anonymous Jury in this case.[2] The defendants opposed the motion.[3] On January 7, 2000, the Court granted the government's motion.[4] The Court now assigns its reasons for granting the government's motion.
BACKGROUND
The grand jury for the Middle District of Louisiana returned a 34-count indictment and later a superseding indictment against Edwin W. Edwards, Stephen Edwards, Cecil Brown, Andrew Martin, Bobby Johnson, Gregory Tarver, and Ecotry Fuller. This indictment charged, among other things, violations of Racketeer Influenced Corrupt Organization Act ("RICO"),[5] RICO conspiracy, mail and wire fraud, illegal wiretapping, money laundering and extortion. Because of the high media interest in this case, the Court issued a "gag order" on November 9, 1998[6] and February 9, 2000[7] in an attempt to control prejudicial statements made by the parties in this case and to ensure the parties would receive a fair trial with an impartial jury. The Court also issued a credentialing order for members of the media and another order allowing the press to have a place to conduct interviews outside of the federal courthouse.[8] To further ensure a fair and impartial jury which would not be subject to improper and prejudicial contact, influence, or harassment from the parties, the press and others, the Court granted the government's motion for an anonymous jury to the extent the Court withheld the *591 names, addresses[9] and places of employment of the jurors from the parties, the media and the public. The Court now assigns reasons to support its decision.
CONTENTIONS
The government requested an anonymous jury for the following reasons: (1) "Edwin Edwards is alleged to have been the central figure of an enterprise which corrupted a major industry in the State of Louisiana;"[10] (2) Edwin Edwards accomplished the alleged illegal acts "in large measure through the power of his elected office as governor;"[11] (3) Edwin Edwards and Stephen Edwards are charged with interfering with the lawful judicial process, specifically conspiring to obtain illegal wiretaps of the homes of FBI agents who were investigating their criminal activity; (4) Edwin Edwards is charged with interfering with the lawful judicial process, specifically attempting to bribe Judge Alfred Foster Sanders, III and offering to terminate a pending investigation being conducted by the United States Attorney for the Middle District of Louisiana;[12] (5) all defendants potentially face lengthy prison sentences; and (6) the potential for publicity and/or harassment of jurors due to the high level of media scrutiny.[13]
The defendants have filed an opposition to the motion for anonymous jury based on the following reasons:[14] (1) there is no evidence of any of the defendants being tied to "organized crime" in the traditional sense; (2) there is no evidence of physical harm present; (3) the defendants have not interfered with the judicial process; (4) the defendants would suffer prejudice if an anonymous jury is empaneled; and (5) there is a strong potential to adversely affect the exercise of their peremptory and cause challenges during voir dire. Defendants rely heavily on the factors enunciated in United States v. Krout[15] to support their arguments.
Oral argument was held on the motion on September 14, 16 and 17, 1999. The Court granted the motion and noted it would assign written reasons at a later date. These reasons now follow.
LEGAL STANDARDS
The issue of whether a court may use an anonymous jury in the trial of a defendant *592 charged with a criminal offense is not a matter of first impression. The Fifth Circuit as well as other circuits have approved the use of an anonymous jury under certain circumstances. A review of the jurisprudence from the Fifth Circuit and the facts of this case support the Court's decision to use a partially anonymous jury herein. While the Court did grant the government's motion to use an anonymous jury in this case, the use of the term "anonymous" is very misleading. It is true the Court did not give the parties, the media or the public the names, addresses or places of employment of the jurors. However, the Court did provide all concerned with a voluminous amount of information about each juror. The Court used a 28-page questionnaire which was answered by each potential juror and consisted of 116 questions, some with numerous sub-parts.[16] In addition, the Court conducted an extensive voir dire of the potential jurors comprising approximately 2,000 pages of transcript. The parties were permitted to suggest questions and follow up questions to be asked of each juror. All of the parties had an exhaustive amount of knowledge about each juror which allowed each of them to make an informed decision on which jurors should be accepted, challenged for cause, or peremptorily challenged. The Court now turns to a discussion of the jurisprudence from the Fifth Circuit on this issue.
The Fifth Circuit Court of Appeals first addressed the issue of whether it was proper to have an anonymous jury in United States v. Krout.[17] In Krout, as in this case, the names, addresses, and places of employment of the jurors were withheld. Relying on jurisprudence from the Second Circuit, the Fifth Circuit set forth several factors that may justify anonymity of a jury: (1) the defendant's involvement in organized crime; (2) the defendant's participation in a group with the capacity to harm jurors; (3) the defendant's past attempts to interfere with the judicial process or witnesses; (4) the potential that, if convicted, the defendant will suffer a lengthy incarceration and substantial monetary penalties; and (5) extensive publicity that could enhance the possibility that jurors' names would become public and expose them to intimidation and harassment.[18]
In Krout, the Fifth Circuit affirmed the trial court's decision to empanel an anonymous jury. The appellate court found that the district court's decision was supported by the evidence adduced at the trial and by the wiretap affidavits presented by the government. Additionally, the Fifth Circuit found that the "Texas Mexican Mafia" was an inherently dangerous organization. Since Krout was decided, a number of Fifth Circuit decisions have upheld use of anonymous juries under a variety of circumstances. A careful review of those cases is in order.
In United States v. Riggio,[19] the defendant was indicted for conspiracy to commit arson and use of fire to commit a federal felony. Concerned about possible jury tampering, the trial court assigned numbers to the jurors to assure anonymity. The trial court based its decision to use an anonymous jury on the following factors: (1) the record reflected that witnesses were allegedly threatened;[20] (2) the defendant had been accused of jury tampering in a previous case; and (3) there were alleged ties of the defendant to organized crime. In affirming the district court, the *593 Fifth Circuit stated the following with respect to the propriety of empaneling an anonymous jury:
In determining whether jurors need protection, the district court should consider the defendant's involvement in organized crime, his past attempts at interfering with judicial proceedings, his previous history of violence, the extent of press coverage, and the likelihood of juror harassment or intimidation.[21]
The Fifth Circuit also noted that Riggio had "committed fraud in order to serve on another jury, demonstrating a lack of respect for the judicial process and suggesting that he was capable of and willing to interfere with the jury system."[22] The Court also noted that "[t]he district court had a reasonable basis to conclude that similar threats and attempts at intimidation were likely to be made to the jurors if their identities were known."[23]
In United States v. Branch,[24] a trial involving the Branch Davidians, the district court sua sponte ordered the use of an anonymous jury. The Fifth Circuit upheld the trial court's decision. However, in doing so, the Fifth Circuit stated that referring to the jury as "anonymous" was misleading for the following reasons:
Anonymity has long been an important element of our jury system. Jurors are randomly summoned from the community at large to decide the single case before them and, once done, to "inconspicuously fade back into the community." "Anonymous jury" has come to mean something different in recent years, signaling the district court's decision to withhold certain biographical information about potential jurors from the parties involved. That said, we should be wary of painting with too broad a brush. "Anonymous" juries include those about whom more has been concealed than here. The jurors here were not "anonymous" except in the most literal sense. The district court ordered only the jurors' names and addresses be withheld from the parties. Otherwise, the court provided the defendants with a wealth of information about the venire, including occupations and names of employers.[25]
Thus, the Fifth Circuit does not consider a district court's decision to withhold the names and addresses of the jurors to truly qualify the jury as "anonymous."
The Branch Court further stated that the trial court is required to "make a sensitive appraisal of the climate surrounding a trial and a prediction as to the potential security or publicity problems that may arise during the proceedings."[26] In discussing the Krout factors, the Fifth Circuit stated that there was no intent to suggest that "these or some aggregate must be established on pain of reversal."[27] The Court stressed that district courts should look to the "totality of the circumstances."[28]
The trial court in Branch based its decision to withhold the names and addresses of the jurors on a number of factors. Specifically, the court found that an anonymous jury was proper "because of the `enormous amount of world-wide attention' generated by the case and the emotionally charged atmosphere surrounding it. Not *594 all celebrated trials merit an anonymous jury, but `[t]he prospect of publicity militates in favor of jury anonymity to prevent exposure of the jurors to intimidation or harassment.'"[29] Because the defendants in Branch were furnished with answers to eighty (80) detailed questions, the defendants' ability to select an impartial jury had not been prejudiced. The Court also emphasized that at voir dire, "the court asked the defendants' proposed questions and elicited additional information regarding potential juror bias."[30] In rejecting the defendants' assertion that their ability to select an impartial jury had been impaired, the court noted that defense counsel had available an "arsenal of information" about each prospective juror.
In United States v. Sanchez,[31] the trial court redacted certain identifying juror information because of a 10-day delay between jury selection and the commencement of the evidentiary phase of the trial and the potential fears of jurors in adjudicating the guilt or innocence of a "rogue" police officer. The Fifth Circuit reversed the district court's decision to empanel an anonymous jury, concluding that there was no evidence that the defendant had attempted to interfere with the judicial process or witnesses, and there was no indication that the jurors would be subjected to the type of extensive publicity that might bring about intimidation and harassment. The Court held that the district court's decision must rest on more than "mere allegations or inferences of potential risk."[32] Based upon the dearth of evidence supporting use of an anonymous jury in Sanchez, the Fifth Circuit held that the trial court abused its discretion.
The Fifth Circuit continued its evaluation of the use of anonymous juries in United States v. Salvatore[33] which involved seventeen defendants who were indicted for operating a criminal enterprise that subverted the licensing requirements of Louisiana's Video Poker Law, charges similar in nature to those contained in the present indictment. Fourteen of the seventeen defendants pled guilty prior to the trial. The district court empaneled an anonymous jury. The trial court found that Salvatore and the Tusas were closely connected with organized crime. The government also submitted evidence which showed that there was an ongoing investigation into possible jury tampering in connection with one defendant's acquittal of criminal charges in state court. Furthermore, there was evidence indicating that certain defendants showed a "willingness to interfere with the judicial process,"[34] namely their guilty pleas to the video poker conspiracy. The Court also found that extensive publicity surrounding the trial "enhanc[ed] the possibility that the jurors' names would have become public."[35]
In affirming the trial court's decision to empanel an anonymous jury, the Fifth Circuit reiterated the factors previously set forth in Krout which may be considered by a trial judge. The Fifth Circuit also noted that a "district court may certainly consider evidence other than that relating to these five factors when deciding whether to empanel an anonymous jury, for the decision to do so should be based upon the `totality of the circumstances.'"[36] Two of the defendants who had pled guilty in Salvatore also pled guilty to jury tampering *595 in a prior case. The Fifth Circuit stated that the involvement of these two defendants in the video poker conspiracy "establishes that [the three] appellants participated in a criminal enterprise and conspired with individuals having the capacity and willingness to interfere with the judicial process."[37] Thus, a defendant's association with persons who have the capacity or willingness to interfere with the judicial process may be considered by the trial judge in determining whether to empanel an anonymous jury.[38] In addition to the fact that the three appellants in Salvatore were connected with organized crime, the Fifth Circuit noted the following upon review: (1) the defendants initially faced potentially long sentences; and (2) "the publicity surrounding the trial was quite extensive, thus enhancing the possibility that the jurors' names would have become public."[39]
While most of the Fifth Circuit cases in which anonymous juries were approved involved persons associated with organized crime (with the exception of Branch), it is clear that this is not a required factor under the Fifth Circuit jurisprudence. The "organized crime factor" weighs heavily in favor of an anonymous jury, but it is only one of the numerous factors which may be considered based on the "totality of the circumstances" of the case.[40] In Branch and Salvatore, the Fifth Circuit discussed the factors enumerated in Krout and stressed that those factors were not the sole matters to be considered by the court in making its decision. In Branch, the Court, noted that "[o]ther circumstances may also justify [the use of an anonymous jury]. Indeed, while evidence that the defendant has in the past or intends in the future to tamper with the jury may be sufficient to warrant an anonymous jury, it is by no means necessary."[41] Thus, under Fifth Circuit jurisprudence, the analysis the Court must make in deciding whether to use an anonymous jury is fact intensive and depends upon the particular and total circumstances involved in the case. It is also clear that the use of an anonymous jury satisfies constitutional muster "when needed to ensure against a serious threat to juror safety provided the defendant's interest in the conduct of an effective voir dire of prospective jurors and the presumption of innocence are maintained."[42] A lower court's decision to empanel an anonymous jury is entitled to deference and is subject to abuse of discretion of review.[43]
The Court now turns to a review of the evidence which supports the Court's decision to empanel an anonymous jury in this case.
ANALYSIS
It is clear from the Fifth Circuit jurisprudence that a trial court may consider various forms of evidence in deciding whether to empanel an anonymous jury. The list of factors set forth in Krout is not intended to be exhaustive. In fact, a court must look to the totality of the circumstances and may consider additional factors beyond those enumerated in Krout. The courts may receive evidence in camera and/or ex parte.[44] A motion for anonymous *596 jury may also be determined by the trial court without any hearing on the matter.[45] The evidence presented to the Court in connection with the government's motion for anonymous jury, the testimony and exhibits presented during the course of the trial, matters pertaining to the jury which occurred during the trial, and extensive media attempts to contact the jurors during the trial clearly support the Court's decision to empanel an anonymous jury. There was also a serious concern on the part of some jurors about being identified during voir dire and after the trial. This important factor was considered by the Court and also supports the Court's decision herein.[46]
A review of this evidence is in order.
A number of factors weigh in favor of an anonymous jury in this case. First, the nature of the charges brought against Edwin and Stephen Edwards in this case and the nature of the charges brought against Edwin Edwards and others in United States v. Brown are indicative of attempts by Edwin Edwards and Stephen Edwards and others associated with them to interfere with the judicial process or witnesses. Edwin Edwards and Stephen Edwards are charged in Count 33 of the superseding indictment in this case with illegal wiretapping and counter surveillance of an FBI agent.[47] A co-defendant, Dempsey White, has already pled guilty to a crime relating to the allegations set forth in Count 33.[48] The other charges set forth in this indictment also show a pattern to disregard the judicial and administrative process established by the State of Louisiana for the proper selection of licenses to operate gaming riverboats in Louisiana.[49]
In the indictment returned against Edwin Edwards in United States v. James Harvey Brown, et al., Edwin Edwards is charged with tampering with a witness pursuant to 18 U.S.C. § 1512(b)(3).[50] Judge Edith Brown Clement recently granted the government's motion for an anonymous jury in that case.[51]
Both the government and the defendants submitted evidence pertaining to matters involving jury selection and possible jury tampering in two earlier criminal *597 trials involving Edwin Edwards in the Eastern District of Louisiana in the 1980s. There are numerous affidavits presented from the current and former Commandants of the Louisiana State Police, attorneys in the former cases and others who may have been involved in the jury selection process. This Court does not believe it is necessary for the Court to determine with certainty whether all of the events which were alleged in these affidavits actually occurred. The potential for these events to have interfered with the judicial process is sufficient evidence for the Court to take into consideration, together with the other evidence in this case. Indeed, there was very credible evidence presented in the form of affidavits which suggest that the methods used to select jurors in the earlier cases had the potential to affect the judicial process in the earlier case.
The evidence presented during the course of the current trial also established that Andrew Martin had the potential for interfering with the judicial process. In a taped conversation which occurred in Edwin Edwards' office on January 9, 1997, Andrew Martin states that he has obtained a transcript of a wiretap from a "friend of a friend."[52] The transcript of this conversation,[53] which was played to the jury in connection with the Treasure Chest scheme provides:
[AM Andrew Martin
EWE Edwin W. Edwards]
AM: (UI). (Greetings in French)
EWE: (UI) what you got there?
(Rustling noises heard)
AM: You uh, see this? It's on the transcript of the wire tap for, from LARRY.
EWE: From LARRY?
AM: Yeah.
EWE: The whole thing?
AM: No. You want the whole thing?
EWE: Anything about you in here?
AM: No. Uh huh.
EWE: Huh?
AM: Uhn huh.
EWE: Anything about me?
AM: No. Have the DEQ guy KUARSKI (ph) in there. (Pause) I don't need it. You can have it if you want to. I'll let you have it but I'd like to get it back if I can. If you uh you wanna read it.
(Pause in conversation)
AM: As long as you're not in there you don't care uhh Chief. (Chuckles). But some of the stuff it said, LARRY really, you Know ...
EWE: Come on strong.
AM: (Sighs). I'll tell you what you know, some of that, some of that stuff he, language he said was, uh, was something else.
(Pause)
EWE: A lot of loose tongues in here.
AM: So you really don't realize after you read one of these things what they can do, what they can't do.
(Pause)
EWE: Where did you get this?
AM: Friend of a friend of a friend.
(Chuckles)
(Pause)
AM: You want it you can have it. I really don't need it.
EWE: Huh?
AM: I really don't need it. You can have it if you want it.
EWE: I'll take it and I'll read it just for the hell of it.
It is also appropriate to consider crimes charged in an indictment when determining *598 use of an anonymous jury.[54] The crimes charged in the indictment in this case clearly suggest attempts to corrupt the legal system of selecting licenses under the laws and regulations of the State of Louisiana pertaining to riverboat gaming licenses. These matters may also be considered against all of the defendants. The allegations become even more relevant when the Court considers the number of persons associated with the defendants who have plead guilty to charges related to the indictment returned in this case.
In United States v. Salvatore,[55] the Fifth Circuit affirmed the trial court's consideration of a "current" investigation of jury tampering on the part of a co-defendant and consideration of the appellants' alleged involvement in a video poker conspiracy with two co-defendants who pleaded guilty to the conspiracy prior to empaneling an anonymous jury. The Fifth Circuit stated that these considerations established that the "appellants participated in a criminal enterprise and conspired with individuals having the capacity and willingness to interfere with the judicial process."[56] The same situation is presented in the present case with regard to Edwin Edwards, Stephen Edwards and Andrew Martin and their co-conspirators. In Salvatore, the Fifth Circuit said it was proper for the trial court to consider an ongoing investigation into possible jury tampering on the part of a co-defendant in support of using an anonymous jury. The evidence is even stronger in the present case. Here, an investigation resulted in two indictments being returned against Edwin Edwards for allegedly trying to engage in illegal wire tapping, witness tampering and engaging in the other conduct alleged in the indictment in this case and in United States v. Brown. In addition, co-defendants and other persons have entered guilty pleas to charges related to those in the two cases. In addition, Stephen Edwards was charged with similar conduct in this case and a taped conversation revealed Andrew Martin's ability to obtain a transcript of a wiretap conversation that he was not entitled to have regarding an ongoing investigation. These allegations taken together with the allegations set forth in the affidavits pertaining to jury selection utilized by Edwin Edwards in the two Edwin Edwards trials conducted in the Eastern District of Louisiana clearly show that these defendants have the capacity, ability and willingness to interfere with the judicial process and witnesses.
In United States v. Riggio, the Fifth Circuit approved the trial court's consideration of facts indicating that the defendant "had been accused of jury tampering in a previous case" in support of empaneling an anonymous jury.[57] Thus, in the Fifth Circuit, a court may consider charges lodged outside of the pending criminal case in determining whether an anonymous jury is warranted. The Court in Riggio also held that evidence adduced at trial may be considered by the appellate court in determining the propriety of the trial court's decision.[58]
As noted earlier in this opinion, it is appropriate for the Court to consider the nature of the crimes charged in the indictment.[59] The defendants in the present case were accused of being part of a broad-based conspiracy to interfere with *599 the lawful process established by the State of Louisiana for issuance of gaming licenses to operate riverboats in Louisiana.[60] All of the defendants except Ecotry Fuller[61] were charged as members of a criminal enterprise, the objective of which was to manipulate the lawful licensing process for riverboats in order to enrich themselves and their associates and family members. These allegations support the Court's finding that the defendants had a propensity or willingness to interfere with the lawful state licensing process. The fact that the jury found all of the defendants except Tarver and Fuller guilty of some of these charges only confirms the concern the Court had at the beginning of the trial about the defendants' ability and willingness to interfere with the licensing process.
In determining whether to empanel an anonymous jury, the Fifth Circuit has held that the court may also consider the potential that, if convicted, the defendants face lengthy incarceration and substantial monetary penalties. Such is the case pending before the Court. Under the indictment, the defendants were faced with the following maximum sentence of imprisonment and monetary fines and forfeiture: (1) Edwin Edwards: 350 years of imprisonment, a fine of $7,250,000.00, or both; the Court could also impose restitution and/or a forfeiture in the amount of $3,129,000.00; (2) Stephen Edwards: 300 years of imprisonment, a fine of $500,000.00, or both; the Court could also impose a restitution and/or forfeiture in the amount of $3,129,000.00; (3) Cecil Brown: 80 years of imprisonment, a fine of $1,000,000.00, or both; the Court could also impose a restitution and/or forfeiture in the amount of $2,425,000.00; (4) Andrew Martin: 120 years of imprisonment, a fine of $1,750,000.00, or both; the Court could also impose a restitution and/or forfeiture in the amount of $2,425,000.00; (5) Bobby Johnson: 75 years of imprisonment, a fine of $2,250,000.00, or both; (6) Gregory Tarver: 55 years of imprisonment, a fine of $2,750,000.00, or both; and (7) Ecotry Fuller: 60 years of imprisonment, a fine of $3,000,000.00, or both.
Thus, each defendant at the time the Court issued its original opinion faced substantial terms of imprisonment and staggering penalties and forfeitures. All but two of the defendants continue to face lengthy jail sentences, fines and forfeitures following the jury's verdict. The fact that some defendants were acquitted of all charges and other defendants were found not guilty on some counts does not change the analysis. In Salvatore, the Fifth Circuit held that the relevant inquiry is whether the defendants are initially facing potentially lengthy prison sentences and monumental financial penalties.[62]
The publicity and the emotional, political climate surrounding the trial are additional factors which the Court may and did consider in determining whether to empanel an anonymous jury. The Fifth Circuit acknowledged the existence of the extensive news coverage in its opinion affirming the Court's gag order in U.S. v. Brown.[63] Extensive publicity of these proceedings enhance the possibility that jurors' names would become public, thereby exposing them to possible intimidation and harassment.[64] This case has received extensive media coverage before, during and after the trial. This Court entered two standing orders pertaining to media coverage, reserved seating, credentials, a "bull pen" for interviews and reserved parking for media *600 trucks on a closed lane of a public street.[65] This Court has outlined in other opinions the extensive procedures the Court was required to put in place to accommodate the numerous local and national media representatives who wanted to attend and cover the trial. The record also reflects the numerous motions filed by the press before, during and after trial seeking the names, addresses and places of employment of jurors. The media has also sought to obtain the juror questionnaires, all in camera hearings pertaining to jurors, and the entire sealed record. Courts have recognized that "[a] trial judge is usually well-aware of the ambience surrounding a criminal trial and the potential for juror apprehensions."[66] The Court's decision to withhold juror identifying information "`requires a trial court to make a sensitive appraisal of the climate surrounding a trial and a prediction as to the potential security or publicity problems that may arise during the proceedings.'"[67] The trial judge's assessment is given due deference by the appellate court. The evidence in this case not only reflects the Court's apprehension and concern, but the concern and apprehension of some jurors about being identified publicly.
Some background regarding the parties is appropriate and necessary for a full understanding of the facts surrounding media coverage and the emotional, political climate that existed herein. One of the defendants is Edwin Edwards, a four-term Governor of the State of Louisiana. It is easy to conclude that Edwin Edwards is a powerful, influential figure in Louisiana's political history. As a result, he is and has been the subject of intense media coverage during his political career. The current indictments only increased the media's interest in Edwin Edwards.
In 1985 and 1986, Edwin Edwards was tried in the Eastern District of Louisiana on charges relating to interfering with the lawful process of licensing for nursing homes. The first trial ended in a hung jury. The former governor was acquitted of all charges during the second trial. Both of these trials received national media attention. The indictment in this case and in Brown have also been the subject of intensive media and public interest as indicated by the news clippings set forth in the appendix.
Also named as a defendant in this case is the former governor's son, Stephen Edwards, who has also been the subject of extensive media coverage. Three of the former governor's associates, Andrew Martin, Bobby Johnson and Cecil Brown, are also included in the indictment. Finally, a powerful state senator and a member of the state gaming board were named as defendants. The potential witness list included Eddie DeBartolo, the former president of the San Francisco 49'ers professional football team and Super Bowl champions, and Cleo Fields, a former congressman and current state senator. Witnesses such as these increased the already extensive media attention and pre-trial coverage. This interest increased even more during the trial when Eddie DeBartolo and other members of his staff testified and during the playing of the video tape of a meeting between Senator Fields and Edwin Edwards. Indeed, the media interest continues today and there are now pending before the Court numerous media motions and requests seeking to copy the audio and video tapes played to the jury as well as other evidence, exhibits and pleadings. The media also filed a mandamus action against the Court in the Fifth Circuit on July 13, 2000 seeking this and other information.[68]
*601 This trial was expected to last three months, but actually took longer because of illnesses of the parties and jurors and other factors. The trial began on January 10, 2000 and a verdict was returned on May 9, 2000. The media coverage was and is as extensive as the Court thought it would be at the time the Court granted the government's motion. "The prospect of intense publicity militates in favor of jury anonymity to prevent exposure of the jurors to intimidation or harassment."[69]
During voir dire, many members of the jury panel expressed concerns about being identified. Many of the jurors who were picked to serve on the jury expressed similar concerns. After the jury returned its verdict, nine of the eleven members of the trial jury[70] requested the Court to advise the media that they did not wish to be contacted.[71] However, this is only the beginning and not the ending of the story regarding the media coverage of the jurors. When rendering its opinion granting the government's motion to empanel an anonymous jury, the Court was concerned about juror apprehension, intimidation and harassment by the media and other persons who were not even directly involved in the case, but who had strong feelings for or against parties and the charges.
In addition to concerns about the media coverage, other events involving third parties and their contacts with the jurors or allegations which occurred during the trial support the Court's decision herein. Despite the anonymity ordered by the Court, the media, upon learning the name of one juror, published the juror's name in the newspaper.[72] It seems highly likely that if the jurors were not given anonymity, there would have been widespread dissemination of their names, addresses and places of employment, thereby subjecting them to possible harassment or intimidation from the media and others. Indeed, this very thing happened during the trial as will be discussed later. The Court can only wonder what additional problems the Court and the jurors would have had if the names, addresses and places of employment of the jurors were made public. Following are a few examples of the problems the Court faced despite the numerous precautions taken by the Court.
For the convenience and protection of the jurors, the jurors reported to a location away from the courthouse where United States Marshals picked up the jurors and transported them to and from the courthouse each day. This procedure did not deter the press from attempting to locate where the jurors were parking their cars or from attempting to identify jurors presumably by obtaining their identity from license plate numbers on the jurors' cars. Some members of the media discovered the location where the jurors met and attempted to video tape and talk to some of the jurors. After the jury's verdict on the guilt and innocence phase of the trial, but prior to the final verdict on the issue of forfeiture and their discharge as jurors, some members of the media appeared at the homes of jurors to interview jurors presumably about their verdict.
During the voir dire, each juror was questioned individually in open court with the parties, public and media present. Newspaper articles were published about the answers given by the jurors. These detailed answers caused some jurors to be identified by co-workers, friends and others even though their names and places of employment were withheld from the parties, media and public. Jurors were also required to give their opinions about Edwin Edwards and the other defendants, *602 gambling, wiretaps, use of informants, plea bargains and people who dealt in large sums of cash. It was important for this jury to be able to express honest opinions about these and other questions without being concerned about harassment or other contact from the media or any other person. There was little, if anything the Court could do to prevent certain stories from being published. For example, although sealed to protect their identity, a list of 61 unindicted co-conspirators was published and widely disseminated by the media.[73] The Court's gag order did not seem to deter the press from seeking interviews of the defendants, attorneys or witnesses. This is not a criticism of the media's desire and right to cover this case in accordance with the rights guaranteed to the press under the Constitution and jurisprudence. It is, however, justification for trying to protect the identity of the jurors and free them from being questioned, harassed or otherwise bothered and intimidated during and after this lengthy trial.
The Court also believed it was important to shield the jurors from improper contact, harassment and possible influence from the general public and others. A cursory review of the answers given by the prospective jurors to questions set forth in the juror questionnaire reveals a good sample of the public's feelings about the parties and charges brought against the defendants. The emotional, political atmosphere that surrounded this case could not be avoided. No juror serving in a case where there is such high public interest as this case should have to be concerned about being contacted, influenced or harassed by the general public or anyone else. The Court concedes that not every case where there is extensive media interest justifies or requires an anonymous jury. But when, as in this case, a totality of the facts suggest the potential that the jurors will be exposed to intense media coverage that could lead to possible intimidation and harassment, an anonymous jury is necessary.
Despite the best efforts of the Court and the United States Marshal's Service, some individuals did attempt to cause problems for some jurors because of personal bias against a juror, personal relationships with the parties and other reasons. This caused the Court to conduct several hearings which required the jurors and in some cases, their families, to be questioned by the Court. The Court believes that the use of the anonymous jury prevented more of this type of conduct. The Court's decision to withhold the jurors' identities allowed the jury to concentrate on the evidence and proved to be a substantial deterrent to intentional or accidental contact and influence on the jury. This protection also lessened the prejudice which could arise from such actions, innocent though they may appear. The Court's action also ensured all of the parties a fair and impartial trial.
The Court cannot overlook the emotional, political atmosphere that surrounded this case. As noted earlier, Edwin W. Edwards was a four-term governor of Louisiana. A state senator and a member of the state gaming board were also named as defendants. Witnesses included a mayor, chairman of the gaming board and members of the former governor's staff. The potential witness list included many current and former political appointees and state employees. To "minimize the prejudicial effects of the pretrial publicity surrounding this trial and an emotional, political atmosphere that created a risk of jury intimidation and improper influence,"[74] the Court withheld the names, addresses and places of employment of the jurors. The Court does not believe there were any other alternatives under the totality *603 of the facts in this case. The Sixth Circuit upheld similar action taken by the trial judge in U.S. v. Dakota,[75] The totality of the facts of this case create a similar, if not greater need for the Court's action than those set forth in Dakota.
Certain defendants have argued that because the government's evidence in support of an anonymous jury did not pertain to all of the defendants,[76] it would be unfair and prejudicial to require an anonymous jury for all of the defendants. This argument is without merit. The defendants are incorrect in their assessment of the evidence and the jurisprudence which the Court followed in reaching its decision. Furthermore, defendants' argument was rejected in United States v. Ross.[77] In Ross, the Eleventh Circuit stated that "[e]ven though the government did not prove that these incidents were related to Appellant or another co-conspirator, the court nevertheless properly considered them in establishing an anonymous jury."[78] What the defendants fail to acknowledge is the fact that six of the seven defendants in this case are charged as members of a criminal enterprise to manipulate the lawful state licensing process in order to enrich themselves and others via extortionate activities. Some of the alleged objectives of the enterprise include actions of the defendants: (1) to enrich the members of the enterprise as well as their associates, friends, families, and partners, through the illegal manipulation and corruption of the lawful system to award riverboat gaming licenses, in order to ensure that licenses would be awarded to those applicants supported by the enterprise; (2) to enrich the members of the enterprise [and related others] by extorting payments from riverboat license applicants, thus manipulating the lawful licensing process; (3) to enrich the members of the enterprise [and related others] by ensuring that the gaming operations benefitting Edwin Edwards and the members of the enterprise would not be economically harmed or otherwise affected by adverse political action; (4) to secretly divide and launder the proceeds of the enterprise's racketeering activity; (5) to implement any means deemed necessary, including using, endeavoring to use, and procuring other persons to use illegal electronic wiretaps to intercept telephone communications of government agents and prosecutors, in order to corruptly formulate defenses and counter-measures to the government's investigation of the enterprise.[79] It is clear that the Court may consider the evidence pertaining to one co-conspirator against the other co-conspirators and members of the criminal enterprise when deciding whether to empanel an anonymous jury.
While Ecotry Fuller is not alleged to have been a member of the aforementioned criminal enterprise, he was charged in this case with perjury before a federal grand jury regarding his statements about the executive summary. The allegation that Mr. Fuller made false statements to a grand jury while under oath is indicative of a willingness to subvert the lawful judicial process.
It is also obvious that neither Gregory Tarver nor Ecotry Fuller were prejudiced by the Court's decision to grant the government's motion. Both were found not guilty on all charges brought against them. Furthermore, not guilty verdicts were returned on other charges and racketeering acts brought against some of the other defendants. It is clear that the jury gave very careful consideration to all of the evidence brought against each defendant and based their verdicts on the evidence *604 and not the fact that their names had not been disclosed. There was never any indication or suggestion made to the jury by the Court or any attorney involved in the case that the defendants were violent or dangerous. The Court's charge mentioned elsewhere in this opinion dispelled any suggestion that names of jurors were withheld because the defendants might physically harm the jurors or their families. The fact that numbers instead of names were used by the jurors did not prejudice the defendants or interfere with the jury's ability to fairly and impartially render a proper verdict herein.[80]
Judge Edith Brown Clement's decision in United States v. Carollo[81] supports the Court's decision to empanel an anonymous jury even when some of the evidence presented in support thereof does not directly relate to every defendant. After Judge Clement determined that the jury in Carollo would be anonymous, a number of the defendants moved for separate trials. These defendants argued that they would be unfairly prejudiced by the "decision because the jury will assume that all of the defendants are dangerous, whereas in reality the Court's decision to empanel an anonymous jury was based on the histories of only a few defendants."[82] The Court refused to grant separate trials, finding that the prejudice feared by the defendants could be cured by limiting instructions to the jury. This Court gave similar limiting instructions to the jury. Because of the verdicts rendered by the jury, it is obvious that the jury not only followed these instructions, but actually returned not guilty verdicts on all charges brought against two of the parties who were complaining of prejudice. The jury also found Edwin W. Edwards and Stephen Edwards not guilty on some charges and racketeering acts. It is apparent that the jury followed the Court's limiting instructions on why numbers were used instead of names.
There is a consensus among all circuits that have considered the anonymous jury issue that once the decision to empanel an anonymous jury is made, the trial court must take appropriate action to ensure the parties are given adequate voir dire to allow the parties to have sufficient information to meaningfully exercise their challenges. The focus of the inquiry is whether the defendants were prejudiced in selecting an impartial jury because relevant and meaningful information was withheld from them. A common sense reading of the jurisprudence indicates that the mere disclosure of the name of a person is not particularly enlightening insofar as gleaning information about the biases, beliefs, prejudices and values of that person. As the record will reveal, the parties were provided with extensive information about each juror. There were only three things the parties did not know: the juror's name, specific address and specific place of employment. However, the parties did know in which parish and what zip code each juror currently lived and a history of prior places where the juror lived. The parties were also provided with extensive information about the juror's current and prior employment history. This information provided to the parties will be discussed in detail later in this opinion and it is also indicated on the juror questionnaire which is attached as an exhibit in the appendix of this opinion.
Numerous courts have upheld a trial court's decision to empanel an anonymous jury when extensive voir dire and answers to questionnaires are provided. The thrust of the inquiry is whether "measures are taken to inform a defendant of jury *605 demographics and to permit ample voir dire,"[83] so that a defendant's right to intelligently exercise peremptory challenges is not impaired. In United States v. Branch,[84] the Fifth Circuit held that there was no showing that refusing to release the names and addresses of the jury prejudiced the defendants' ability to select an impartial jury.[85] The defendants in Branch were furnished with answers to 80 detailed questions submitted to prospective jurors.[86]
In the present case, the parties were provided with an "arsenal of information" based upon the extensive questionnaires completed by potential jurors, as well as the Court's individual voir dire of potential jurors. Specifically, the parties were provided with answers to 116 detailed questions submitted to prospective jurors.[87] The final questionnaire utilized by the Court was compiled from questions submitted jointly by the parties. Copies of the completed questionnaires prepared by the 125 jurors who were summonsed for the trial were given to the parties several days prior to jury selection. This allowed the parties ample time to review the completed questionnaires.[88] The government and the defendants also submitted follow-up questions they wished the Court to ask during individual voir dire. But for the name, address and place of employment, the parties were provided with a wealth of information as to each potential juror. This included information about the age, race, medical problems, economic and other hardships, residential history,[89] family history and marital status, number of children, current employment status, occupation, nature of the employer's business, length of employment, size of company where the juror worked, prior jobs, training and employment for federal, state or local governments, training in business, financial or accounting, prior business investments and whether the juror's employer ever did business with the state. The questionnaire also provided information regarding the juror's education, military experience and background information regarding the juror's spouse or partner. The jurors also provided information about their activities, including volunteer work, involvement in education, religious, professional, *606 political, or other union groups, and any leadership positions held. Jurors were required to disclose their political party affiliation and whether they considered themselves liberal, conservative, moderate or some other status. The jurors disclosed whether they or any member of their family had run, been elected or appointed to public office, had contributed to or made gifts to political candidates or campaigns or worked in such campaigns. In addition to the above, the questionnaire required each juror to state how closely they followed Louisiana politics. Jurors set forth their religion, how often they attended church and whether there were any religious beliefs which prevented them from serving as a juror. Questions 57-71 asked jurors detailed information about gambling in Louisiana, religious beliefs regarding gambling and other knowledge about gambling laws, regulations, corruption in awarding riverboat licenses, any responsibility Edwin Edwards may have had for problems in the state gaming industry and opinions about people who deal in large sums of cash. Detailed questions were asked each juror about their prior jury service and their opinions of the court system.[90] Included in the questions about the court system were questions seeking the juror's opinions about plea agreements, use of informants, immunity and reduced sentences.
There were extensive questions directed to the jurors regarding any connections they had with the parties, attorneys and agents in this case. Questions were also asked about the media and pretrial publicity, opinions of jurors on the guilt or innocence of the defendants, the defendants' presumption of innocence and right to remain silent, the government's burden of proof beyond a reasonable doubt and the juror's obligation to follow the law as given by the judge. Finally, questions were asked of each juror whether they could serve in a fair and impartial manner. As will be noted later, jurors were then individually questioned during voir dire about the answers they gave in the questionnaire.
The Court summoned 125 jurors to appear on the first day of the trial. The Court began the voir dire by asking questions to the entire jury panel in a group after the jurors had been placed under oath. Then individual voir dire was conducted on each juror outside the presence of the other jurors. The parties were allowed to exhaust every appropriate question relevant to this case either via the written questionnaire and by suggesting questions during the voir dire process. The transcript of voir dire will consist of approximately 2,000 pages.[91] The Court took eight days to actually empanel the jury. After all questions were asked of the jurors, the Court allowed the parties considerable time to again review the questionnaires and the answers given by the jurors during voir dire before requiring the parties to exercise their challenges. A review of the answers given during voir dire and the answers to the juror questionnaires reveals the parties had more than ample information to use in deciding which jurors to select, challenge for cause or peremptorily strike. In short, the information provided to the United States and the defendants was far more extensive and detailed than the parties could have obtained by just knowing the name, address and place of employment of a juror. The information obtained from the questionnaire and the voir dire adequately explained any bias or prejudice a juror may have had against a defendant, the government, and on the issues involved in the case. This information permitted the parties, including the defendants, to meaningfully exercise their challenges and to obtain a fair, honest and impartial jury. The defendants' fundamental right to an unbiased jury was adequately protected by the *607 procedure used by the Court and the information provided by each juror.
This Court was cognizant of the defendants' constitutional rights to a presumption of innocence until proven guilty beyond a reasonable doubt. The Court was also aware that a neutral, plausible and nonprejudicial reason for anonymity must be provided to the jurors. Depending upon the particular case, these instructions should ordinarily include some of the following: (1) defendants are entitled to a presumption of innocence; (2) the case is one of high profile; (3) the jurors are to remain anonymous because of the publicity surrounding the case and the need to shield jurors from the possibility of extrajudicial communications;[92] (4) use of an anonymous jury ensures that there will be a fair trial for both sides;[93] (5) empaneling an anonymous jury in no way suggests that improper communications have been made by either side;[94] and (6) it is common practice in many cases in federal court to keep the names and identities of the jurors in confidence.[95]
The jurors in the present case were provided with neutral, nonprejudicial reasons for the Court's decision in order to protect the defendants' constitutional right to a fair trial. The Court gave the following instruction to the jury:
You have been randomly selected to serve as a potential juror in the trial of United States versus Edwin W. Edwards, Stephen Edwards, Bobby Johnson, Andrew Martin, Cecil Brown, Gregory Tarver and Ecotry Fuller.
This case has attracted a high degree of publicity. To protect your privacy during the jury selection process and trial, you have been assigned an individual juror number which will be used to identify you. You must use your juror number at all times. This procedure has been followed in other highly publicized cases in federal court and is designed to protect the privacy of jurors during the course of the trial.
With any potentially high profile case, we are all subject to receiving phone calls and letters about the case and even inquiries from members of the media or from friends, neighbors or relatives. I want to ensure that there not be any such contact with members of the jury during the course of this trial. I also want to protect the defendants as well as the government from any belief on the part of the jury that any such communications are coming from one side or the other. In other words, I do not want the defendants or the government to be characterized as anyone who would be sending communications to the jury or as someone who is trying to improperly influence the jury.
The use of these procedures is to ensure that both sides will get a fair trial. It will also permit you the jury to perform your important duties without your privacy being invaded.
You are also to remember that the defendants have entered not guilty pleas to the charges brought against them. Therefore, they are presumed innocent unless and until the government proves their guilt beyond a reasonable doubt.
Therefore, as we proceed today and throughout the remaining days of this trial, you should only use your juror number to identify yourself. Do not use your or your spouse's name, home or business address or the name or address of your employers in responding to questions or otherwise communicating with the Court.
Are there any members of the jury who would have any bias, prejudice or negative feelings toward the United States or the defendants because of the *608 Court's decision not to reveal your names to the public?
All jurors assured the Court that they had no bias, prejudice or negative feelings toward the United States or the defendants because of the use of an anonymous jury. In addition to giving the quoted charge, the Court set forth the following language in the first questionnaire submitted to the prospective jurors:
This case has attracted a high degree of publicity. To protect your privacy during the jury selection process and trial, you have been assigned an individual juror number which will be used to identify you. Your juror number is located in the top right-hand corner of the first page of the attached juror questionnaire and on each page thereafter. The procedure used in this case has been followed in highly publicized cases and is designed to protect the privacy of jurors during the course of the trial.
Defendants argue that empaneling an anonymous jury in this case effectively establishes a new category of cases appropriate for that procedure. The Court disagrees. As noted earlier in this opinion, the Fifth Circuit in United States v. Branch[96] upheld impalement of an anonymous jury despite the fact that the defendants had no "ties to organized crime." After carefully considering the totality of the circumstances in this case, the Court concludes that empaneling an anonymous jury was necessary to protect the lawful administration of justice, ensure all parties a fair and impartial trial, protect the privacy of the jurors and protect the jurors from undue harassment, intimidation, and inquiries.
This is not the first case where a court has empaneled an anonymous jury where the defendants had no ties to organized crime. In United States v. Branch,[97]United States v. Talley[98] and United States v. Dakota[99] the appellate court affirmed the impalement of an anonymous jury even though links to organized crime were absent. In fact, if there was a specific requirement that organized crime be present before the courts can approve an anonymous jury, the appellate courts would have clearly stated such. The Branch decision has been previously cited and discussed herein. In United States v. Talley, there was no evidence of any involvement by the defendant in a "criminal organization that included a pattern of violence," nor was there evidence that Talley had ever attempted to tamper with any previous juries.[100] There was evidence, however, of Talley's dangerous propensities to do so. The Court also believed that Talley's "many years of law enforcement experience provided him with the types of contacts that would enable him to tamper with the jury."[101] In the present case, it is clear that Edwin Edwards' sixteen years of service as Governor of Louisiana have provided him with similar kinds of contacts.[102] This fact is borne out by the affidavits submitted in conjunction with the anonymous jury issue regarding the manner in which the juries were selected during the 1985 and 1986 trials of Edwin *609 Edwards.[103] It appears that co-workers or fellow union members of potential jurors were contacted.[104] According to the affidavits, the jury selection and research process was "organized and efficient" and involved more than 100 close supporters of the former governor. Political operatives contacted friends, neighbors and co-workers of potential jurors. Research on the jurors continued during the course of the trial. There is some indication that a sheriff and some of his associates may have assisted in the jury selection process.[105] Additionally, FBI Agent Hultz interviewed Colonel Paul Fontenot, who was the primary trooper in charge of guarding Edwin Edwards during the 1985 and 1986 trials. According to Agent Hultz, Colonel Fontenot, who was later named Commandant of the Louisiana State Police by Edwin Edwards, stated that during the previous trials, he was requested by members of Edwin Edwards' staff to perform records and license plate checks on various persons. Colonel Fontenot further stated that since the 1985 and 1986 trials, Stephen Edwards has requested him to perform background checks on various persons.
The statements contained in the affidavits submitted by all of the parties indicate the extensive resources which were and are available to Edwin Edwards to obtain information about jurors. It is also clear that during the prior trials, the defense team continued to receive information about the sitting jurors during the course of the trials. The defendants submitted some clarifying affidavits from some of the same persons from whom the FBI took statements. It is not necessary for the Court to resolve this conflict in the affidavits to a certainty. This evidence when combined with the other evidence considered by the Court strongly supports the Court's decision to withhold the names, addresses and places of employment of the jurors.
This Court can understand the need for gathering information about potential jurors in accordance with the local rules of court and the Federal Rules of Criminal Procedure to assist counsel in the selection of the jurors. However, once the trial jurors are seated, continuing research of the jurors creates the potential for prejudicial communications, innocent or otherwise, with a juror or a friend, family member or co-worker of a juror. Such contacts, though innocent in nature, can unduly influence a juror's decision. It is precisely this kind of communication, contact or influence which the Court in this case wished to avoid.
CONCLUSION
It is important to note that the Court did not just rely on the affidavits submitted with the motion to support its decision to withhold the name, address and place of employment from the parties, media and public. The Court also considered: (1) the nature of the charges pending in this case and in Brown; (2) the defendants' past attempts to interfere with the judicial process or witnesses; (3) the potential lengthy jail sentences and substantial monetary penalties the defendants were facing, if convicted; (4) the extensive publicity that could enhance the possibility that jurors' names would become public and expose them to intimidation, influence and harassment; (5) the potential and actual contact by the media and other individuals with members of the jury panel while the trial was being held; (6) the emotional, political atmosphere of this case; (7) juror apprehension about being identified or interviewed; and (8) the totality of the circumstances in this case.
The Court believes that empaneling an anonymous jury was the only manner in which the Court could ensure that the jurors in this case were protected from outside influence and intimidation from *610 persons associated with the government, the defendants, the media, and individuals who had an interest for or against any of the parties or the jurors in this case.
The totality of all of the circumstances in this case establish a clear and actual need to withhold the names, addresses and places of employment of the jurors. The evidence which supports the Court's decision was clear at the time the Court made its initial decision to withhold the names, addresses and places of employment from the parties. The evidence presented at the trial, the media's actions and other events which occurred during and after the trial established an absolute need for a "partially anonymous jury" in this case.
The answers given by the jurors to the questionnaire and to questions asked during the voir dire gave the parties more than sufficient information for the parties to make an informed decision on which jurors to accept, challenge for cause or peremptorily challenge. The jury was properly instructed by the Court why their names, addresses and places of employment were withheld. Finally, the jury's verdict shows these parties were not prejudiced because numbers instead of names were used by the jurors.
For these reasons, the motion of the United States for an anonymous jury is and was GRANTED.
APPENDIX A
Juror No. _________
UNITED STATES DISTRICT COURT
MIDDLE DISTRICT OF LOUISIANA
CHIEF JUDGE FRANK J. POLOZOLA
UNITED STATES OF AMERICA CRIMINAL ACTION
VERUS NUMBER 98-165-B-M2
EDWIN W. EDWARDS, STEPHEN EDWARDS
CECIL BROWN, ANDREW MARTIN,
GREGORY TARVER, BOBBY JOHNSON,
ECOTRY FULLER
JUROR QUESTIONNAIRE
In order to speed up the process of jury selection, a juror questionnaire has been prepared
for you to complete. These questions should be answered by you and returned to the Clerk
of the United States District Court for the Middle District of Louisiana in the enclosed
envelope. A response is required by December 17, 1999. Do not place your name, address
or place of employment anywhere on this questionnaire. Your name, address or place of
employment should only be placed on the cover sheet attached to the questionnaire. Please
place your signature on the cover sheet. Your answers will have the effect of a statement
made under oath.
The questionnaire is designed to obtain information about your background as it relates to
your possible service as a juror in this case. Its use will avoid the necessity of asking each
prospective juror every one of these questions in open court, thereby substantially shortening
the jury selection process.
All information contained in this questionnaire will be kept confidential. It will be reviewed
only by the Court and by the attorneys on each side. Neither your identities nor your
answers will be released to the general public or the media. You will be identified at trial
only by your juror number.
Respond to each question as fully and completely as possible. Your complete candor and
honesty is necessary so that both the prosecution and the defense will have a meaningful
opportunity to select an appropriate jury. Your cooperation is of vital importance.
*611
Juror No. _________
Because the questionnaire is part of the jury selection process, the questionnaires are to be
answered under your oath as a prospective juror to tell the truth. You are instructed not to
discuss this case or the questionnaire with anyone, including your family, friends, co-workers
and fellow jurors. You must complete the questionnaire yourself without consulting,
talking to or seeking assistance from anyone.
If you require additional space for your response or wish to make further comments
regarding any of your answers, please use the additional blank pages attached to the back of
your questionnaire. Please identify by number the question you are responding to on the
blank page.
Please keep in mind that there are no "right" or "wrong" answers. Your answers will
assist the Court and the parties in selecting an appropriate jury.
Please fill out the entire questionnaire. Do not leave any questions blank. If you are
unable to answer a question or do not understand the question, please answer "do not know"
or "do not understand" in the space after the question.
PLEASE WRITE OR PRINT LEGIBLY. IF YOUR ANSWERS ARE ILLEGIBLE,
YOU WILL BE REQUIRED TO RE-COPY YOUR ANSWERS.
Thank you for your full cooperation. It is of vital importance to the Court that you return
your completed questionnaire by DECEMBER 17, 1999.
1. Age: ________
2. Gender: _____Male _____Female
3. What is your race?
____ White
____ Hispanic/Latino
____ Black/African-American
____ Asian
____ Native American
Other: ____________________________________________________________________________
4. Do you have any difficulty reading, speaking, or understanding the English language?
Yes ____ No ____
5. Do you speak or understand any languages in addition to English?
____ Yes What language(s): ___________________________________________________________
____ No
6. Do you have:
Any difficulty hearing Yes ____ No ____
Any difficulty seeing Yes ____ No ____
Primary responsibility for a young child, a disabled or elderly
relative Yes ____ No ____
Regular doctor's appointments for a chronic health problem Yes ____ No ____
IF YES, please briefly explain: ________________________________________________
7. Are you taking any medication on a regular basis? Yes ____ No ____
IF YES, which ones: ____________________________________________________________
Please answer the following questions even if the Court has previously denied your
request to be excused for hardship reasons. The Court will reconsider any request to be
excused for hardship reasons.
8. The Court estimates that the trial of this case may last 2-3 months. Do you have any
personal problems or medical condition(s) which could affect your ability to serve as a
juror in a trial of this length?
*612
Juror No. _________
Yes ____ No ____
IF YES, please state the nature of the problem(s): _____________________________
___________________________________________________________________________________________
___________________________________________________________________________________________
___________________________________________________________________________________________
9. Jury service is one of the highest duties and privileges of a citizen of the United States.
Mere inconvenience or the usual financial hardships of jury service will be insufficient to
excuse a prospective juror. Jurors are paid $40.00 per day plus mileage expenses. Do
you wish to apply to the Court to be excused on the ground that jury service would be a
serious hardship?
Yes ____ No ____
IF YES, please briefly explain the hardship: ___________________________________
___________________________________________________________________________________________
___________________________________________________________________________________________
10. Is there anything else of a personal or professional nature that might make it difficult
for you to concentrate on this trial?
Yes ____ No ____
IF YES, please explain: ________________________________________________________
Residential History
11. City of residence: _____________________________ Zip Code: ________________________________
12. Do you: (check one)
____ Own your home
____ Rent your home
____ Live with other homeowners
____ Live with relatives, if so state relationship: ______________________________________
13. How long have you lived in Louisiana? ____ years
Where else have you lived in Louisiana, and how long did you live there?
___________________________________________________________________________________________
___________________________________________________________________________________________
14. Please list the places outside Louisiana where you have lived and how long you have
lived there:
___________________________________________________________________________________________
___________________________________________________________________________________________
15. Where were you born? ______________________________________________________________________
Background/Family History
In answering questions 16-31 do not give the name or address of any employer or
employer's business. If a question asks about an occupation, only provide a general
description about the nature of that occupation. (For example: construction, A/C,
plumbing, government, etc.)
16. Marital status: (check one)
____ Single (never married)
____ Living with a partner for ____ years
____ Married for ____ years
____ Separated for ____ years; married for ____ years
____ Divorced for ____ years; married for ____ years
____ Widowed for ____ years; married for ____ years
17. If you have children, stepchildren or grandchildren, please list: (do NOT list names)
Does he/she
Relationship Age Education Occupation live with you?
___________________________________________________________________________________________
___________________________________________________________________________________________
*613
Juror No. _________
___________________________________________________________________________________________
___________________________________________________________________________________________
___________________________________________________________________________________________
________________________________________________________________________________________________
Employment
18. Current employment status (check any and all that apply):
____ Self-employed
____ Work full-time
____ Work part-time
____ Homemaker for ____ years
____ Student for ____ years
____ Disabled and unable to work for ______ years or ____ months
____ Unemployed/laid off for ______ years or ____ months
____ Retired for ____ years
____ Other: ______________________________________________________________________________
19. What is or was your occupation? (If you are retired, unemployed, homemaker, or
disabled, what was your last job?) Do NOT list name of employer or name of
employer's business.
___________________________________________________________________________________________
20. What are (were) your main responsibilities on your most recent job?
___________________________________________________________________________________________
___________________________________________________________________________________________
___________________________________________________________________________________________
21. Please state the nature of your current or last employer's business (e.g. construction,
A/C, plumbing, government, etc.) Do NOT list name of employer or name of employer's
business.
___________________________________________________________________________________________
22. Length of employment at current or last job: ____ (years) (months)
23. Do you work for a:
____ Small company (Less than 50 employees)
____ Large company (50 employees or more)
____ Self-employed Company name: _________________________________________________________
____ Government agencySpecify: ____________________________________________________
____ Other: ______________________________________________________________________________
24. How satisfied are you with your current work situation?
____ Very satisfied
____ Somewhat satisfied
____ Somewhat dissatisfied
____ Very dissatisfied
____ Not working
25. Have you ever been laid off? Yes ____ No ____
IF YES, please explain: ___________________________________________________________________
___________________________________________________________________________________________
26. Do you supervise other people? Yes ____ No ____
If yes, how many? _________________________________________________________________________
Did you hire/fire others? Yes ____ No ___
Describe your responsibilities: ___________________________________________________________
___________________________________________________________________________________________
27. Whether or not you are currently employed, please complete the following information
for previous jobs and employers: (Do NOT include current job and Do NOT list name of
employer or name of employer's business.)
*614
Juror No. _________
Job Title or Kind of Work Length
___________________________________________________________________________________________
___________________________________________________________________________________________
___________________________________________________________________________________________
___________________________________________________________________________________________
28. Have you or anyone in your family ever had training or employment in the following:
Federal government Yes ____ No ____
Internal Revenue Service Yes ____ No ____
State government or legislature Yes ____ No ____
Local government Yes ____ No ____
Law enforcement (local, state, or federal) Yes ____ No ____
Court system (local, state, or federal) Yes ____ No ____
Law or law office Yes ____ No ____
Gaming industry Yes ____ No ____
IF YES TO ANY OF THE ABOVE, please explain whether this is yourself or a
relative, courses or job(s) held, and dates of employment:D
___________________________________________________________________________________________
___________________________________________________________________________________________
___________________________________________________________________________________________
29. Have you taken any courses or had training in business, finance, or accounting?
Yes ____ No ____
Please explain: ___________________________________________________________________________
30. Have you ever owned or invested in a business?
Yes ____ No ____
a. Are you still operating the business?
Yes ____ No ____
IF NO, why not? ________________________________________________________________________
________________________________________________________________________________________
b. Please describe the business but do not give the name:
________________________________________________________________________________________
________________________________________________________________________________________
c. Was this experience: (check one) ____ positive ____ negative ____ mixed
Please explain: ________________________________________________________________________
________________________________________________________________________________________
31. Have you or your employer ever done business or sought to do business with any state
government agency?
Yes ____ No ____
IF YES, please explain: ___________________________________________________________________
___________________________________________________________________________________________
___________________________________________________________________________________________
a. Were you or your employer treated fairly by the state agency?
Yes ____ No ____
b. Was this experience: (check one) ____ positive ____ negative ____ mixed
Please explain: ________________________________________________________________________
________________________________________________________________________________________
Education
32. What is the highest grade or degree you completed in school? ______________________________
If more than high school, please fill in below:
Dates Area(s) of study/training Degree/Certificate
___________________________________________________________________________________________
___________________________________________________________________________________________
33. When you were in school, what was your:
*615
Juror No. _________
Favorite Subject Least Favorite Subject
__________________________________ _______________________________________________________
__________________________________ _______________________________________________________
Military
34. Have you ever been in the military?
Yes ____ No ____
IF YES, which branch? What was your rank and dates of service, and what type of
discharge did you receive?
___________________________________________________________________________________________
___________________________________________________________________________________________
If you served in the military, please describe the types of jobs you had, any special
training, including law enforcement or military courts, and the types of skills you
acquired.
___________________________________________________________________________________________
___________________________________________________________________________________________
Your Spouse or Partner's Background
Please complete all of the following questions regarding your present spouse or non-married
partner. If you are widowed, divorced, or separated, please complete all the following
questions regarding your former spouse or partner.
35. What is your spouse's or partner's age? ____
36. Spouse or partner's current employment status (check any and all that apply):
____ Self-employed
____ Work full-time
____ Work part-time
____ Homemaker for ______ years
____ Student for ____ years
____ Disabled and unable to work for ____ years or ____ months
____ Unemployed for years ____ or months ______
____ Retired for ____ years
____ Other: _______________________________________________________________________________
37. What is or was your spouse or partner's occupation? (If he/she is retired, unemployed,
homemaker, or disabled, what was their last job?) Do NOT list name of employer or
name of employer's business.
___________________________________________________________________________________________
38. What are (or were) your spouse or partner's duties and responsibilities: __________________
___________________________________________________________________________________________
39. List the nature of your spouse or partner's current or last employer(s)' business (e.g.,
construction, plumbing, government, etc.). Do NOT list name of employer or name of
employer's business.
___________________________________________________________________________________________
___________________________________________________________________________________________
40. Length of spouse/partner's employment at current or last job: ____________ years
41. What other types of work has he/she done? _________________________________________________
___________________________________________________________________________________________
42. Was your spouse/partner ever laid off? Yes ____ No ____
IF YES, please explain: ___________________________________________________________________
___________________________________________________________________________________________
43. What is the last grade or degree your spouse or partner completed in school?
___________________________________________________________________________________________
*616
Juror No. _________
If more than high school, please fill in below:
Dates Area(s) of study/training Degree/Certificate
___________________________________________________________________________________________
___________________________________________________________________________________________
Activities
44. Have you ever done any volunteer work?
Yes ____ No ____
IF YES, please describe: _______________________________________________________
___________________________________________________________________________________________
45. Have you or your family been involved in any organizations, such as educational,
religious, professional or political groups?
Yes ____ No ____
IF YES, please explain: ________________________________________________________
___________________________________________________________________________________________
46. Have you or has your spouse/partner ever belonged to a union?
Yes ____ No ____
IF YES, who: Self ____ Spouse/Partner ____
Dates of Membership: Self ____ to ____ Spouse/Partner _____ to _____
47. Have you ever held a leadership position in any organization?
Yes ____ No ____
IF YES, please list the leadership positions you have held: _______________________________
___________________________________________________________________________________________
48. In terms of political party affiliation, are you a:
____ Democrat
____ Republican
____ Independent
____ Libertarian
____ Other: _________
____ None
49. Do you consider yourself to be politically:
____ Extremely Liberal
____ Liberal
____ Moderate
____ Conservative
____ Extremely Conservative
____ None of the above
50. Have you, or anyone close to you, ever run for, been appointed or been elected to serve
in any public office or governing board, such as a school board or police jury?
Yes ____ No ____
IF YES, please explain: ___________________________________________________________________
___________________________________________________________________________________________
51. Have you ever given a gift to a public official or contributed money or made a loan to a
political candidate or campaign?
Yes ____ No ____
IF YES, please explain: ___________________________________________________________________
_______________________________________________________________________________________________
52. Have you ever worked in the field of politics or donated your time to work on the
campaign of a political candidate?
Yes ____ No ____
IF YES, please explain: ___________________________________________________________________
___________________________________________________________________________________________
*617
Juror No. _________
53. How closely would you say you follow Louisiana state politics?
____ Follow very closely
____ Follow somewhat closely
____ Follow rarely
____ Do not follow at all
54. What is your religion?
____ No preference
____ Baptist
____ Protestant
____ Catholic
____ Jewish
____ Other: _________
55. Approximately how often do you attend church or religious services?
____ Never
____ Rarely
____ Several times a year
____ Once a month
____ Several times a month
____ Once a week
____ Several times a week
56. Is there anything in your religion or personal beliefs which would prevent you from
sitting as a juror, in judgment of the guilt or innocence of another person, or following
the law given to you by the Court?
Yes ____ No ____
Gambling
57. How do you feel generally about legalized gambling in Louisiana?
____ Approve
____ Disapprove
____ No opinion
58. Does your church or religious organization have a position on gambling?
____ Yes, it is against gambling.
____ Yes, it is not against gambling.
____ No, my church has no opinion on gambling.
____ Don't know.
____ Not applicable.
IF YES, do you agree with your church's position?
Yes ____ No ____
59. Do you have any moral or personal opposition to legalized gambling?
Yes ____ No ____
IF YES, please explain: ___________________________________________________________________
___________________________________________________________________________________________
60. Do or did you support the campaign to reform or repeal the state gaming laws?
Yes ____ No ____
61. Are you specifically opposed to any of the following:
Riverboat gambling Yes ____ No ____
Casino gambling Yes ____ No ____
Video poker Yes ____ No ____
62. Have you or has anyone close to you ever had an interest in or investment with any
companies or person involved in the ownership of gaming operations?
Yes ____ No ____
*618
Juror No. _________
IF YES, please describe: _______________________________________________________
___________________________________________________________________________________________
63. Do you know anyone who has had any contact with the Louisiana State Police Riverboat
Gaming Division?
Yes ____ No ____
IF YES, please explain: ________________________________________________________
___________________________________________________________________________________________
___________________________________________________________________________________________
64. Do you know anyone who now works or has worked in the gaming industry?
Yes ____ No ____
IF YES, please explain in what job(s), when, and where he/she is employed:
___________________________________________________________________________________________
___________________________________________________________________________________________
65. Have you read, seen, or heard any news reports regarding regulation of the gaming
industry in Louisiana?
Yes ____ No ____
IF YES, what have you read, seen, or heard? _______________________________________________
___________________________________________________________________________________________
66. Do you believe that the citizens of Louisiana should have more influence over how
gambling is regulated in the state?
____ Agree strongly
____ Agree somewhat
____ Disagree somewhat
____ Disagree strongly
____ No opinion
67. Do you believe that a person who is connected with the gaming industry is more likely to
violate the law than one who is not connected with the legalized gambling industry?
____ Agree strongly
____ Agree somewhat
____ Disagree somewhat
____ Disagree strongly
____ No opinion
68. Do you believe that the gaming industry is necessary to Louisiana's economy?
____ Agree strongly
____ Agree somewhat
____ Disagree somewhat
____ Disagree strongly
____ No opinion
69. Do you believe there has been corruption in the awarding of Louisiana riverboat gaming
licenses?
____ Agree strongly
____ Agree somewhat
____ Disagree somewhat
____ Disagree strongly
____ No opinion
70. Do you believe former Governor Edwards is responsible for previous or current
problems in the state's gaming industry?
____ Agree strongly
____ Agree somewhat
____ Disagree somewhat
____ Disagree strongly
____ No opinion
*619
Juror No. _________
71. Do you believe that anyone who deals in large sums of cash is probably engaged in
criminal activity?
____ Agree strongly
____ Agree somewhat
____ Disagree somewhat
____ Disagree strongly
____ No opinion
Jury Service/Experience and Opinions about the Court System
72. Have you ever served on a jury? Yes ____ No ____
IF YES, please complete the following for each case on which you served:
Civil or Charges or Was a verdict reached? Were you the
Criminal Allegations When Where If no, why not? Verdict Foreperson?
___________________________________________________________________________________________
___________________________________________________________________________________________
73. Do you believe everyone should be treated equally under the law?
____ Agree strongly
____ Agree somewhat
____ Disagree somewhat
____ Disagree strongly
74. Do you believe the police are very thorough and accurate in their usual investigations?
____ Agree strongly
____ Agree somewhat
____ Disagree somewhat
____ Disagree strongly
75. Have you or your family been the victim of wrongdoing by others (whether or not
criminal charges were filed)?
Yes ____ No ____
IF YES, please describe: _______________________________________________________
___________________________________________________________________________________________
___________________________________________________________________________________________
___________________________________________________________________________________________
76. Have you ever testified as a witness in a trial?
Yes ____ No ____
Please explain: ___________________________________________________________________________
___________________________________________________________________________________________
77. Have you or has a family member ever been involved in a lawsuit or legal action of any
kind?
Yes ____ No ____
Please explain: ___________________________________________________________________________
___________________________________________________________________________________________
78. Have you ever accused someone or been accused of dishonest practices or activities?
Yes ____ No ____
IF YES, please explain: ___________________________________________________________________
___________________________________________________________________________________________
___________________________________________________________________________________________
79. Do you know anyone (including an employer) who has been charged or convicted of a
crime or been involved in a criminal investigation?
Yes ____ No ____
IF YES, please explain: ___________________________________________________________________
___________________________________________________________________________________________
___________________________________________________________________________________________
*620
Juror No. _________
80. Have you or anyone close to you ever been treated unfairly by any branch of
government?
Yes ____ No ____
IF YES, please identify the government agency and explain what happened.
___________________________________________________________________________________________
___________________________________________________________________________________________
81. Have you or has a close family member or friend ever served time in jail or prison?
Yes ____ No ____
a. Please explain who, when, how long, and the nature of the charge(s):
___________________________________________________________________________________________
___________________________________________________________________________________________
___________________________________________________________________________________________
b. Did you or that person apply for a pardon?
Yes ____ No ____
Please explain who applied, when, and the outcome: ________________________________________
___________________________________________________________________________________________
82. Do you know anyone who agreed to cooperate with the prosecution in a criminal case in
order to get a reduced sentence or immunity?
Yes ____ No ____
IF YES, please explain: _________________________________________________________
____________________________________________________________________________________________
83. Some of the government's witnesses in this case are testifying as part of plea bargaining
agreements or under a grant of immunity from prosecution. What is your opinion about
the use of plea agreements or granting immunity for this purpose?
____ Approve
____ Disapprove
____ No opinion
Please explain your answer: _______________________________________________________________
___________________________________________________________________________________________
84. What is your opinion regarding law enforcement's use of Court authorized telephone
wire taps in conducting an investigation?
____ Approve
____ Disapprove
____ No opinion
Please explain your answer: _______________________________________________________________
___________________________________________________________________________________________
85. What is your opinion regarding law enforcement's use of informants in gathering
information relating to possible criminal violations of the law?
____ Approve
____ Disapprove
____ No opinion
Please explain your answer: _______________________________________________________________
___________________________________________________________________________________________
Connections with Parties to this Case
86. Do you or does anyone close to you know or have any connection with any of the
prosecutors in the case: Eddie Jordan, Jr., Jim Letten, Michael Magner, Peter Strasser,
Fred Harper, or Todd Greenberg?
Yes ____ No ____
IF YES, what is the connection and whom is it between? _________________________
___________________________________________________________________________________________
_______________________________________________________________________________________________
87. Have you or has anyone close to you had any contact with Judge Polozola or his staff?
*621
Juror No. _________
Yes ____ No ____
IF YES, please explain: ________________________________________________________
___________________________________________________________________________________________
88. Do you know anyone who is or was associated with any of the United States Attorney's
offices in Louisiana, the U.S. Department of Justice, or the F.B.I.?
Yes ____ No ____
IF YES, what was the association and what is your relationship? ________________
___________________________________________________________________________________________
___________________________________________________________________________________________
89. Do you or does anyone close to you know of or have any connection with any of the
following defense lawyers: Dan Small, Jim Cole, Pat Fanning, Sonny Garcia, Mary Olive
Pierson, Hillar Moore, Rebecca Hudsmith, Craig Smith, William Jeffress, James Heavner,
Ernest Johnson?
Yes ____ No ____
IF YES, what is the connection and whom is it between? _________________________
___________________________________________________________________________________________
___________________________________________________________________________________________
90. Do you or does anyone close to you know or have any connection with any of the
defendants in this case: former Governor Edwin Edwards, Stephen Edwards, Cecil
Brown, Senator Greg Tarver, Andrew Martin, Bobby Johnson or Ecotry Fuller?
Yes ____ No ____
IF YES, what is the connection and whom is it between? _________________________
___________________________________________________________________________________________
___________________________________________________________________________________________
91. Former Governor Edwin Edwards was previously tried and found not guilty of federal
charges in 1986 in a separate case. Would your opinion of the verdict (in the prior case)
make it difficult for you to sit as a fair and impartial juror in this case?
Yes ____ No ____ Not sure ____
IF YES OR NOT SURE, please explain: ____________________________________________
___________________________________________________________________________________________
92. Would your current opinion about former Governor Edwards make it difficult for you to
be a fair and impartial juror in this case?
Yes ____ No ____ Not sure ____
93. Do you think former state officials (no longer in office) should be allowed to provide
services to companies doing business with, or regulated by, the state?
Yes ____ No ____
94. Do you think that a current state official's family members should be allowed to provide
services to companies doing business with or regulated by the state?
Yes ____ No ____
Media
95. Do you read a daily newspaper?
Yes ____ No ____
Which one(s)? _____________________________________________________________________________
96. What other magazines and newspapers do you read on a regular basis?
___________________________________________________________________________________________
97. What radio and television programs do you enjoy?
TV: _______________________________________________________________________________________
Radio: ____________________________________________________________________________________
98. Have you followed news accounts of any trials in the news?
Yes ____ No ____
*622
Juror No. _________
IF YES, please explain: ___________________________________________________________________
___________________________________________________________________________________________
99. Do you or have you ever had a bumper sticker on your car?
Yes ____ No ____
IF YES, what does or did it say? _______________________________________________
___________________________________________________________________________________________
Pretrial Publicity
Because this case has received publicity, you have probably seen, read, or heard something
about this case either in the media or from friends, relatives, or co-workers. It is important
that you carefully and completely answer the following questions concerning what you have
learned about the case. There are no right or wrong answers. Please be as candid as
possible.
100. a. Briefly tell what information you have read, seen, or heard about the case, the
defendants, or their attorneys:
______________________________________________________________________________________
______________________________________________________________________________________
______________________________________________________________________________________
______________________________________________________________________________________
______________________________________________________________________________________
______________________________________________________________________________________
b. What have you read, seen, or heard about the government's investigation, the
federal prosecutors, or government witnesses?
______________________________________________________________________________________
______________________________________________________________________________________
______________________________________________________________________________________
______________________________________________________________________________________
______________________________________________________________________________________
______________________________________________________________________________________
101. From which source(s) have you heard, read, or seen anything about this case? (Check
any and all that apply)
____ TV news
____ Radio
____ Newspapers
____ Magazines
____ Internet
____ Word of mouth
Other: ___________________________________________________________________________________
102. Approximately how many media (television, newspaper, magazine, and radio) reports in
total have you seen, read, or heard about this case?
____ None
____ 1 - 5
____ 6 - 10
____ 11 - 20
____ 21 - 30
____ 31 - 50
____ 51 - 75
____ 75 - 100
____ 101 - 200
____ More than 200
103. Have you heard others express opinions about this case or about any of the defendants?
Yes ____ No ____
IF YES, what opinions were expressed? _________________________________________
__________________________________________________________________________________________
__________________________________________________________________________________________
*623
Juror No. _________
__________________________________________________________________________________________
104. Have you personally met or do you have any knowledge of anyone associated with this
case?
Yes ____ No ____
IF YES, please list who they are and how you know them: _______________________
__________________________________________________________________________________________
__________________________________________________________________________________________
105. Have you formed any opinion about the case or about any of the defendants?
Yes ____ No ____
IF YES, (a) what is your opinion? _____________________________________________
__________________________________________________________________________________________
__________________________________________________________________________________________
(b) would you be able to set aside your current opinion and base your verdict on the
law and evidence in this case? ___________________________________________________________
__________________________________________________________________________________________
106. Every defendant is presumed innocent and cannot be convicted unless the jury, based
solely on all the evidence in this case, unanimously decides that his guilt has been
proven beyond a reasonable doubt. The burden of proving guilt rests entirely with the
government. The defendants have no burden of proof at all. Would you have any
difficulty following these rules?
Yes ____ No ____
107. If, as a juror, you determine that the government has proven a defendant guilty of a
charged offense beyond a reasonable doubt, would you be able to vote in favor of a
guilty verdict?
Yes ____ No ____
108. Conversely, if, as a juror, you believe that the government has failed to carry its burden
of proving a defendant guilty of a charged offense beyond a reasonable doubt, would
you be able to vote for a verdict of not guilty?
Yes ____ No ____
109. Do you believe that a defendant in a criminal trial should be required to testify?
____ Agree
____ Disagree
IF AGREE: the judge will instruct you that:
a. a defendant in a criminal trial has no obligation to testify;
b. jurors cannot draw any conclusion from the fact that a defendant chooses not to
testify; and
c. that the fact that a defendant chooses not to testify cannot be a factor in reaching
your verdict.
Would you have any problem following those instructions if a defendant chooses not to
testify?
Yes ____ No ____
IF YES, please explain: _______________________________________________________
__________________________________________________________________________________________
110. Would you be more likely to believe a law enforcement officer or other government
agent than any other witness?
Yes ____ No ____ Treat all the same ____
111. You as a juror must follow the law as given to you by the Judge whether you agree with
it or not. Would you have any difficulty following this rule?
Yes ____ No ____
112. The indictment in this case is an accusation and not evidence of guilt. Would you have
any difficulty treating the indictment as an accusation and not as evidence of guilt?
Yes ____ No ____
*624
Juror No. _________
113. There are seven defendants in this case. Each defendant and each charge must be
considered separately. You cannot find a defendant guilty on any count unless the
government has proven his guilt on that count beyond a reasonable doubt. You must
not draw any conclusion from the fact that the defendants are on trial together, and you
must not find one defendant guilty by reason of your finding another defendant guilty.
Would you have difficulty following these rules?
Yes ____ No ____
114. Do you know of any reason why you could not fairly and impartially decide in
accordance with your oath and based solely on the law and evidence, whether the
government has proved a defendant's guilt beyond a reasonable doubt?
Yes ____ No ____
IF YES, what is the reason? ___________________________________________________
__________________________________________________________________________________________
______________________________________________________________________________________________
Conclusion
115. Is there any matter not covered by this questionnaire that you think the attorneys or
court might want to know about when considering you as a juror in this case?
Yes ____ No ____
Please explain: __________________________________________________________________________
__________________________________________________________________________________________
__________________________________________________________________________________________
__________________________________________________________________________________________
116. Is there any matter not covered by this questionnaire that may affect your ability to
reach a fair and impartial verdict?
Yes ____ No ____
IF YES, please explain: _______________________________________________________
__________________________________________________________________________________________
__________________________________________________________________________________________
__________________________________________________________________________________________
NOTES
[1] The United States of America will hereinafter sometimes be referred to as "the government" and "the United States."
[2] Rec.Doc. No. 278.
[3] Rec.Doc. No. 296.
[4] Rec.Doc. No. 887.
[5] 18 U.S.C. § 1961.
[6] Rec.Doc. No. 3.
[7] Rec.Doc. No. 1010.
[8] Rec.Doc. Nos. 47 (Credentialing Order) and 292 (Media Bullpen Order).
[9] As will be noted later, while the Court did not give the specific street address, the Court did provide the parties with the juror's zip code and parish of residence.
[10] Rec.Doc. No. 278.
[11] Rec.Doc. No. 278.
[12] These acts are alleged in the indictment filed in United States v. James Brown, Alfred Foster Sanders, III, Edwin Washington Edwards, Robert Andre Bourgeois, David Judd Disiere, and Ronald R. Weems, Cr-99-151 (M.D.La.). Alfred Foster Sanders, III and Robert Andre Bourgeois have entered guilty pleas in that case.
[13] The government submitted the following affidavits in support of the motion for anonymous jury: (1) FBI Agent Dennis Horner; (2) FBI Agent Dennis Swikert; (3) Josephine Beninati, Financial Analyst with the FBI; (4) FBI Agent Theresa Hultz; (5) Supervising FBI Agent Geoffrey Santini; and (6) Sid Moreland. The government also submitted the following exhibits: (1) the factual basis underlying Dempsey White's plea agreement; (2) an article which appeared in the Baton Rouge Advocate on July 2, 1999; (3) a transcript from a wiretap of a conversation between Constance A. Koury and Edwin Edwards; (4) an AP wire article dated January 17, 1986; (5) the indictment filed in United States v. James Brown, et al; and (6) the superseding bill of information and factual basis related to Judge Foster Sanders, who pled guilty in United States v. James Brown, et al.
[14] The defendants submitted the following affidavits in opposition to the motion for anonymous jury: (1) Camille Gravel; (2) Evelyn Gravel; (3) Debbie Baer (two affidavits); (4) Mike Baer; (5) Ann Davenport; (6) Victor Bussie; (7) Fran Bussie; Susan McDuff Fontenot; (8) Edwin Edwards; and (9) Patrick Fanning. Defendants also submitted an excerpt from a conference in the chambers of Judge Vance in the matter of United States v. Cleveland on June 19, 1997, and statements made by Patrick Fanning in open court on September 17, 1999.
[15] 66 F.3d 1420 (5th Cir.1995).
[16] A copy of the questionnaire used is attached as Appendix A to this opinion. The parties stipulated to the questions set forth in this questionnaire.
[17] 66 F.3d at 1420.
[18] Krout, 66 F.3d at 1427 (citations omitted).
[19] 70 F.3d 336 (5th Cir.1995).
[20] "The record reflects that witness A was told he would be a `dead mother' if he cooperated, witness B was told Riggio would `blow his brains out,' and witness C was told that the witnesses would become a part of `history ... real quick.'" 70 F.3d at 338.
[21] Riggio, 70 F.3d at 339-340 (emphasis added) (citing United States v. Paccione, 949 F.2d 1183 (2nd Cir.1991)).
[22] Riggio, 70 F.3d at 340, n. 21.
[23] Riggio, 70 F.3d at 340, n. 22.
[24] 91 F.3d 699 (5th Cir.1996), cert. denied, Branch v. United States, 520 U.S. 1185, 117 S.Ct. 1467, 137 L.Ed.2d 681 (1997).
[25] Branch, 91 F.3d at 723 (citations omitted).
[26] Branch, 91 F.3d at 723 (citing United States v. Childress, 58 F.3d 693, 702 (D.C.Cir. 1995), cert. denied, 516 U.S. 1098, 116 S.Ct. 825, 133 L.Ed.2d 768 (1996)).
[27] Branch, 91 F.3d at 724.
[28] Branch, 91 F.3d at 724 (citing United States v. Ross, 33 F.3d 1507, 1521 (11th Cir. 1994)) (emphasis added).
[29] Branch, 91 F.3d at 724 (citations omitted) (emphasis added).
[30] Branch, 91 F.3d at 725 (citing United States v. Wong, 40 F.3d 1347, 1377 (2nd Cir. 1994) (upholding anonymous jury where "extensive" voir dire adequately explored prospective juror bias)).
[31] 74 F.3d 562 (5th Cir.1996).
[32] Sanchez, 74 F.3d at 564 (citing Krout, 66 F.3d at 1427).
[33] 110 F.3d 1131 (5th Cir.1997).
[34] 110 F.3d at 1144.
[35] 110 F.3d at 1144.
[36] Salvatore, 110 F.3d at 1143 (citing Branch, 91 F.3d at 724 (emphasis added)).
[37] 110 F.3d at 1144.
[38] Such is the case before the Court. A number of persons have pled guilty to related charges set forth in United States v. Edwards and United States v. Brown. These pleas clearly show an association with persons who have the capacity or willingness to interfere with witnesses or the judicial process.
[39] Salvatore, 110 F.3d at 1145.
[40] See, Salvatore, 110 F.3d at 1135 (citing United States v. Branch, 91 F.3d 699, 724).
[41] Branch, 91 F.3d at 724 (citations omitted).
[42] Riggio, 70 F.3d at 339.
[43] Krout, 66 F.3d at 1426.
[44] See, United States v. Paccione, 949 F.2d 1183 (2nd Cir.1991) (court considered affirmations received in camera, ex parte); United States v. Salvatore, 110 F.3d 1131 (5th Cir. 1997) (court considered evidence in camera; ex parte). While the Court did receive from the United States an affidavit which complained of an alleged threat signed by Sid Moreland, the Court did not consider this information about an alleged threat in making its decision. During the trial, the Court ordered the United States to give a copy of the Moreland affidavit to the defendants while Moreland was testifying.
[45] Krout, 66 F.3d at 1420 (no hearing held and the court relied upon unsworn affidavits); United States v. Edmond, 52 F.3d 1080 (D.C.Cir.1995) (sua sponte and without a hearing); United States v. Eufrasio, 935 F.2d 553 (3rd Cir.1991) (hearing not required as a matter of law, though it is a better practice to record findings and reasons when empaneling anonymous juries); United States v. Wilson, 160 F.3d 732 (D.C.Cir.1998) (evidentiary hearing was unnecessary where court relied upon the charges in the indictment and prosecutor's affidavit).
[46] See, Rec.Doc. No. 1350 (Minute Entry which indicated nine of the eleven jurors did not want to be contacted by the press).
[47] This charge was severed with the consent of all parties.
[48] Dempsey White plead guilty to the offense of misprision of a felony relative to his failure to reveal the existence of these criminal acts to the authorities.
[49] A number of persons plead guilty to these charges and testified at the trial.
[50] The Court recused itself in the Brown case for reasons unrelated to this case. See Rec. Doc. Nos. 254, 261 (Cr-99-151). When ruling on the pending anonymous jury motion, the Court was not required to make credibility determinations of any potential witnesses in the Brown case. As noted elsewhere in this opinion, the Court is not required to look beyond the allegations of certain facts that, if true, would justify the impanelment of an anonymous jury. Even if the Court excludes the allegations against Edwin Edwards which are set forth in the indictment in Brown, an anonymous jury would still be warranted under the facts of this case. While the defendants have filed a motion to recuse this Court in this case because of its recusal in Brown, neither the law nor the evidence in this case requires recusal. See Rec.Doc. No. 1489.
[51] Rec.Doc. No. 270 (Cr-99-151)
[52] This tape and the corresponding transcript were introduced in connection with the Treasure Chest scheme. Andrew Martin was found guilty on charges related to this scheme.
[53] Designated by the government during trial as transcript number 110.
[54] See, Riggio, 70 F.3d at 336 (defendant accused of jury tampering in a previous case).
[55] 110 F.3d at 1131.
[56] 110 F.3d at 1144.
[57] 70 F.3d at 338.
[58] See, Krout, 66 F.3d at 1427 (citing United States v. Wong, 40 F.3d 1347, 1376-77 (2nd Cir.1994)). This is particularly important in this case. As will be seen later in this opinion, the Court's concern about media coverage proved to be a valid concern. Furthermore, the tapes played during the trial also confirmed conclusions reached by the Court when it made the decision to empanel the jury and withhold the names, addresses and places of employment of the jurors.
[59] Riggio, 70 F.3d at 340.
[60] Rec.Doc. No. 311 at 3 (Amended Joint Proposed Summary of Indictment) (emphasis supplied).
[61] Ecotry Fuller and Greg Tarver were acquitted by the jury.
[62] 110 F.3d at 1144.
[63] See U.S. v. James Harvey Brown, 218 F.3d 415, 427 (5th Cir.2000).
[64] Salvatore, 110 F.3d at 1143.
[65] Rec.Doc. Nos. 47 and 292.
[66] United States v. Eufrasio, 935 F.2d 553, 574 (3rd Cir.1991).
[67] Branch, 91 F.3d at 723 (citing United States v. Childress, 58 F.3d 693, 702 (D.C.Cir. 1995)).
[68] 5th Circuit Docket # 00-30702.
[69] Wong, 40 F.3d at 1377 (citation omitted).
[70] One juror was excused during deliberations. Under Rule 23 of the Federal Rules of Criminal Procedure, the jury was allowed to continue its deliberations with eleven jurors.
[71] Rec.Doc. No. 1350.
[72] The juror's name was known because he was employed as a reporter by that newspaper.
[73] The Court has been unable to determine how and from whom the reporter obtained this sealed document.
[74] United States v. Dakota, 188 F.3d 663, 668 (6th Cir.1999).
[75] 188 F.3d at 663.
[76] There is evidence relating directly to defendants Edwin Edwards, Stephen Edwards and Andrew Martin. There is also evidence related directly to persons associated with the defendants in this case.
[77] 33 F.3d 1507 (11th Cir.1994).
[78] 33 F.3d at 1521 n. 25 (citation omitted).
[79] Rec.Doc. No. 306, pp. 8-10.
[80] This is particularly so given the substantial information given to parties about the jurors.
[81] No. 94-158, 1995 WL 591322 at *2 (E.D.La. Aug.28, 1995) (not reported in F.Supp.) (court empaneled an anonymous jury where the backgrounds of some of the defendants necessitated it, while the backgrounds of others did not).
[82] 1995 WL 591322 at *1.
[83] Eufrasio, 935 F.2d at 574 (citing Scarfo, 850 F.2d at 1015).
[84] 91 F.3d at 699.
[85] 91 F.3d at 724.
[86] See also, Eufrasio, 935 F.2d at 574 (anonymous jury is justified as long as defendants are afforded full voir dire); Paccione, 949 F.2d at 1192 (when anonymous jury is warranted, the defendant's fundamental right to an unbiased jury is adequately protected by the court's conduct of a voir dire designed to uncover bias as to issues in the cases and as to the defendant himself); United States v. Edmond, 52 F.3d 1080, 1082 (D.C.Cir.1995) (voir dire was more than adequate to compensate for the information denied by juror anonymity; it elicited information about the prospective jurors' habits, activities, work experiences, and families that was far more extensive and detailed than appellants might have drawn from jurors' mere names and addresses); Wong, 40 F.3d at 1377 (despite withholding of jurors' names, addresses, and employers, the court questioned prospective jurors about their familiarity with the case, the defendants and the crime scenes, and inquired about their neighborhoods, marital status, employment, spouse's and children's employment, education, organizational affiliations, ethnicity, military service, and other matters; this "extensive voir dire adequately explored prospective jurors' bias" as to issues in the case and as to the defendants and "was more than sufficient to enable the defendants to exercise their challenges meaningfully, and to obtain a fair and impartial jury."); United States v. Crockett, 979 F.2d 1204 (7th Cir. 1992) (names, addresses, and places of employment withheld, but district court conducted a "searching and thorough" voir dire).
[87] A copy of the questionnaire is attached hereto.
[88] Because Edwin Edwards was hospitalized during jury selection, the parties had additional time to study the completed questionnaires.
[89] This included information whether the juror owned or rented a home or lived with others and how long and where in Louisiana the juror lived.
[90] Questions 72-85.
[91] Only 80 jurors were questioned individually before the Court obtained a sufficient pool to select the jury.
[92] United States v. DeLuca, 137 F.3d 24, 32 (1st Cir.1998).
[93] Salvatore, 110 F.3d at 1144.
[94] Salvatore, 110 F.3d at 1144.
[95] Edmond, 52 F.3d at 1093.
[96] See, Branch, 91 F.3d 699.
[97] 91 F.3d at 699.
[98] 164 F.3d 989 (6th Cir.1999).
[99] 188 F.3d 663 (6th Cir.1999).
[100] 164 F.3d 989, 1002. (6th Cir.1999)
[101] 164 F.3d at 1002.
[102] The court in Talley further found that the defendant's current charge of attempting to kill an F.B.I. agent in his case and a witness indicated that he had "already attempted to affect the judicial process." Although Mr. Edwards is not charged with attempting to kill an F.B.I. agent, he is charged with illegal wiretapping and counter surveillance of an F.B.I. agent in this caseevidence that he attempted to tamper with the lawful judicial process. He is also charged in United States v. Brown with tampering with a witness and bribing a judge.
[103] Rec.Doc. No. 1446.
[104] Rec.Doc. No. 975.
[105] Rec.Doc. No. 1449. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/2569688/ | 124 F.Supp.2d 958 (2000)
Kimberly R. PITCHFORD, Plaintiff,
v.
OAKWOOD MOBILE HOMES, INC., et al., Defendants.
Civil Action No. 5:99CV00053.
United States District Court, W.D. Virginia, Harrisonburg Division.
November 13, 2000.
*959 *960 Timothy Earl Cupp, Cupp & Cupp, P.C., Harrisonburg, VA, Thomas Dean Domonoske, Dale Wood Pittman, Law Office of Dale W. Pittman, Petersburg, VA, for Plaintiff.
Rosalie Pemberton Fessier, Boyce Eugene Brannock, Timerlake, Smith, Thomas & Moses, P.C., Staunton, VA, for Defendants.
MEMORANDUM OPINION
MICHAEL, Senior District Judge.
Before the court is a motion by the defendants to compel arbitration and stay proceedings in the above-captioned civil action, pursuant to an arbitration agreement between the parties. The matter was referred to the presiding United States Magistrate Judge, B. Waugh Crigler, pursuant to 28 U.S.C. § 636(b)(1)(B) for recommended findings of fact and a proposed disposition. The Magistrate recommended that the court deny the defendants' motion to compel. Both parties filed timely objections to the Report and Recommendation and the court shall make a de novo review. See 28 U.S.C. § 636(b)(1)(C).
I.
Kimberly Pitchford signed a Retail Installment Contract ("contract") with Oakwood Mobile Homes, Inc ("Oakwood") on June 19, 1997, agreeing to purchase a mobile home for $46,200. Pitchford paid a cash down payment of $2500 and financed the balance through defendant Oakwood Acceptance Corporation ("Oakwood Acceptance").
Pitchford was in immediate need of a place to live due to her personal circumstances of recently being divorced and caring for her four young children. Pitchford responded to an advertisement by Oakwood for a mobile home, went to Oakwood's Harrisonburg Office to view the mobile homes one day, and returned the following day to purchase a mobile home. The plaintiff met with a sales agent[1] for approximately 20-30 minutes to execute all of the relevant documents. The plaintiff apparently took considerable care in reviewing the six-page contract, which purported to embody the entire agreement of the parties. The sale was "subject to the terms of this Contract," the term "Contract" being defined as "this document and any separate document that secures this Contract." After signing the contract, the plaintiff was presented with sixteen pages of documents, eight of which required her signature, none of which "secured the contract." Of these documents, the only one to purport to add materially to the terms of the contract was the Arbitration Agreement.
The Arbitration Agreement is the source of the present dispute between the parties, the plaintiff contending on various grounds that the agreement is unenforceable. While many of the plaintiff's arguments would require an analysis of the surrounding facts, the court's determination that the Magnuson-Moss Act precludes enforcement of the Arbitration Agreement *961 dispenses with the need to go into the factual situation in further detail at this time. For a further factual analysis, the court refers the reader to the Report and Recommendation of the Magistrate Judge, at 1-6.
II.
A.
The defendant objects to the evidentiary hearing held in this matter on October 15, 1999. Defendants object on the grounds that the agreements between the parties are unambiguous on their faces, thereby triggering the parol evidence rule and prohibiting evidence of anything other than the documents themselves. District courts have jurisdiction under the sections 3 and 4 of the Federal Arbitration Act ("FAA") to adjudicate questions concerning the validity of any arbitration contract or clause. See 9 U.S.C. §§ 3,4; Hooters of America, Inc. v. Phillips, 173 F.3d 933, 937-38 (4th Cir.1999) (Wilkinson, C.J.); Glass v. Kidder Peabody & Co., 114 F.3d 446 (4th Cir.1997). The FAA states that, in any suit brought in federal court on any issue referable to arbitration, "upon being satisfied that the issue involved in such a suit ... is referable to arbitration [the court] shall stay the trial." 9 U.S.C. § 3 (emphasis added). The Supreme Court has interpreted this as calling for a hearing with a restricted inquiry into factual issues. See Moses H. Cone Mem. Hosp. v. Mercury Constr. Corp., 460 U.S. 1, 22, 103 S.Ct. 927, 74 L.Ed.2d 765 (1983).
Where the parties contest the enforceability of an agreement and an evidentiary hearing is necessary to determine whether a contract is valid, as in the present case, the court would be remiss not to hold a hearing. This case has raised a myriad of complex problems that the court has labored to resolve. The Magistrate, recognizing that such a situation was present, was proper and responsible to hold the October 15, 1999 hearing in this case.
B.
The parties contest whether the Arbitration Agreement is a part of the contract for the purchase and sale of the mobile home, or whether the Arbitration Agreement is a separate agreement. The Magistrate found that the contract and the Arbitration Agreement were two separate agreements. Furthermore, the Magistrate found that, because the contract was fully executed and capable of standing on its own prior to any mention of the arbitration agreement, the two documents are separate. The defendant objects to this holding on the grounds that the Arbitration Agreement itself purports to be a part of the contract. The Arbitration Agreement begins by stating:
This Arbitration Agreement ("Agreement") is executed contemporaneously with, and as an inducement and consideration for, an installment and sales contract ("Contract") for the purchase of a manufactured home ("Home") as described in the Contract ... The parties hereto acknowledge that this Agreement is part of the Contract and that this contract evidences a transaction in interstate commerce governed by the Federal Arbitration Act.
However, the Contract states:
Your purchase of the Manufactured Home is subject to the terms of this Contract. "Contract" means this document and any separate document that secures this Contract.
The Arbitration Agreement does not secure the Contract. Although the Contract incorporates other documents by reference, such as the warranty, one searches the six pages of the contract in vain for any reference to arbitration or an arbitration agreement. Virginia contract law requires a plain reading of a contract where the language therein is unambiguous. See Dominion Sav. Bank, FSB v. Costello, 257 Va. 413, 416, 512 S.E.2d 564 (1999); Management Enterprises, Inc. v. Thorncroft Co., Inc., 243 Va. 469, 472, 416 S.E.2d 229 (1992). The plain reading of the Contract *962 the validity of which is not challenged by any party is that the Contract and any attendant securing document, plus those documents incorporated by reference, shall constitute the entire agreement between the parties as to the purchase of the home. To hold that the Arbitration Agreement is a part of the Contract, the court must look beyond the four corners of the valid, fully executed Contract. Thus, the Contract indicates that the Arbitration Agreement is not part of the Contract, but rather, is a separate agreement between the parties.
The court has considered whether the Contract and the Arbitration Agreement should be treated as one contract based on the fact that they appear to be part of a contemporaneous transaction. In the context of deeds and underlying notes, Virginia law holds that they shall be deemed separate agreements. Virginia Housing Development Authority v. Fox Run Ltd. Partnership, 255 Va. 356, 364-65, 497 S.E.2d 747 (1998). However, where notes and agreements are contemporaneous, they may be treated as one, "[s]o long as neither document varies or contradicts the terms of the other." Id. On their faces, the Contract and the Arbitration Agreement conflict with one another: the Contract explicitly details that which shall be considered part of the contract, clearly omitting the Arbitration Agreement, whereas the Arbitration Agreement plainly states that it is part of the Contract. The parties do not challenge the validity of the Contract, but vehemently disagree over the propriety of the Arbitration Agreement. The parties also do not dispute that the Contract was fully executed by the parties prior to any mention of arbitration.[2] The court relies on the plain meaning of the document that is relied upon by both of the parties which, read for its plain meaning, indicates that the Arbitration Agreement is not contemplated as part of the Contract.
Having determined that the Arbitration agreement and the Contract are two separate agreements, between the parties, the court shall look to the Arbitration Agreement to determine whether it is a valid document such that the defendants' motion to compel arbitration can be granted.
III.
The defendants invoke the Federal Arbitration Act ("FAA"), 9 U.S.C. § 1, et seq., as authority for their motion to compel arbitration. The judiciary has recognized that Congress, in enacting the FAA, expressed a preference in favor of arbitration, which the judiciary has enforced. See Moses H. Cone, 460 U.S. at 24-25, 103 S.Ct. 927. The FAA creates a "`heavy presumption of arbitrability,'" such that "`when the scope of the arbitration clause is open to question, a court must decide the question in favor of arbitration.'" American Recovery Corp. v. Computerized Thermal Imaging, Inc., 96 F.3d 88, 92 (4th Cir.1996) (quoting Peoples Sec. Life Ins. Co. v. Monumental Life Ins. Co., 867 F.2d 809, 812 (4th Cir.1989)). Nevertheless, "[a]rbitration under the [FAA] is a matter of consent, not coercion, and parties are generally free to structure their arbitration agreements as they see fit." Volt Information Sciences, Inc. v. Board of Trustees of Leland Stanford Junior University, 489 U.S. 468, 479, 109 S.Ct. 1248, 103 L.Ed.2d 488 (1989).
The FAA serves the purpose of putting arbitration agreements "on the same footing" as other contracts. See Gilmer v. Interstate/Johnson Lane Corp., 500 U.S. 20, 33, 111 S.Ct. 1647, 114 L.Ed.2d 26 (1991). As the Supreme Court has held, "arbitration is simply a matter of contract between the parties." First Options of Chicago, Inc. v. Kaplan, 514 U.S. 938, 943, 115 S.Ct. 1920, 131 L.Ed.2d 985 (1995). Accordingly, arbitration agreements are *963 enforceable "save upon such grounds as exist at law or in equity for the revocation of any contract." 9 U.S.C. § 2; see also Marrowbone Dev. Co. v. District 17, 147 F.3d 296, 300 (4th Cir.1998) ("[T]he obligation to arbitrate is a creature of contract and ... a party cannot be required to submit to arbitration unless he has agreed to do so in a contract.") "It [i]s for the court, not the arbitrator, to decide in the first instance whether the dispute [is] to be resolved through arbitration." Hooters of America, Inc. v. Phillips, 173 F.3d 933, 937-38 (4th Cir.1999) (Wilkinson, C.J.). "When deciding whether the parties agreed to arbitrate a certain matter (including arbitrability), courts generally ... should apply ordinary state-law principles that govern the formation of contracts," giving due regard to the federal policy favoring arbitration. First Options, 514 U.S. at 944, 115 S.Ct. 1920.
Although there is a preference in the FAA favoring arbitration, the threshold question is whether a particular claim is even arbitrable. See Hooters, 173 F.3d at 937 (quoting AT & T Technologies, Inc. v. Communications Workers of America, 475 U.S. 643, 651, 106 S.Ct. 1415, 89 L.Ed.2d 648 (1986)). "Although all statutory claims may not be appropriate for arbitration, having made the bargain to arbitrate, the party should be held to it unless Congress itself has evinced an intention to preclude a waiver of judicial remedies for the statutory rights at issue." Gilmer, 500 U.S. at 26, 111 S.Ct. 1647.
It is clear that the Magnuson-Moss Warranty Act, 15 U.S.C. § 2301, et seq., applies to the parties in so far as it regulates Oakwood's warranty for Pitchford's mobile home. The question before the court, therefore, is whether disputes involving issues arising under the Magnuson-Moss Act can properly be submitted to binding arbitration, as called for by the parties' Arbitration Agreement. The burden is on the plaintiff to show that Congress intended to preclude a waiver of a judicial forum for Magnuson-Moss claims. See Gilmer, 500 U.S. at 26, 111 S.Ct. 1647.
A.
In 1974, Congress enacted the Magnuson-Moss Act "In order to improve the adequacy of information available to consumers [and] prevent deception." 15 U.S.C. § 2302(a). In the Magnuson-Moss Act, Congress evinces a clear policy to "encourage warrantors to establish procedures whereby customer disputes are fairly and expeditiously settled through informal dispute settlement mechanisms." 15 U.S.C. § 2310(a)(1). Congress explicity empowered the Federal Trade Commission ("FTC") to prescribe rules setting forth the minimum requirements for any informal dispute settlement mechanism ("mechanism") to be used in conjunction with a written warranty. See id. at § 2310(a)(2). "The FTC regulations are extensive and address all facets of the mechanisms' operation." Wolf v. Ford Motor Co., 829 F.2d 1277, 1279 (4th Cir. 1987). Regulations and interpretations of an Act promulgated under the express delegation of Congress are entitled to judicial deference. See Ford Motor Credit Co. v. Milhollin, 444 U.S. 555, 566, 100 S.Ct. 790, 63 L.Ed.2d 22 (1980) ("The Court has often repeated the general proposition that considerable respect is due the interpretation given [a] statute by the officers or agency charged with its administration" (internal citations and quotations omitted)).
The FTC has made it clear that, although Magnuson-Moss encourages the use of mechanisms, such mechanisms must conform to the minimum requirements as expressed in 16 C.F.R. § 703, et seq. Informal settlement dispute mechanisms are the Act's only exception to Congress's clear rule preserving a judicial forum for consumers. See 15 U.S.C. § 2310(d) (a consumer damages by a warrantor "may bring suit for damages and other legal and equitable relief"). The applicable Code of Federal Regulations holds that "Decisions *964 of the Mechanism shall not be legally binding on any person ... In any civil action arising out of a warranty obligation and relating to a matter considered by the Mechanism, any decision of the Mechanism shall be admissible in evidence, as provided in section 110(a)(3) of the Act." 16 C.F.R. § 703.5(1). Section 703.5(j) makes it clear that mechanisms under Magnuson-Moss cannot contemplate binding resolution of a warranty dispute. See also Wilson v. Waverlee Homes, 954 F.Supp. 1530, 1538 (M.D.Ala.1997) aff'd, 127 F.3d 40 (11th Cir.1997) (table) (legislative history reflects congressional intent that any non-judicial dispute resolution would be nonbinding, with consumers always retaining right of access to courts). Furthermore, the federal regulations state:
A warrantor shall not indicate in any written warranty ... either directly or indirectly that the decision of the warrantor ... or any designated third party is final or binding in any dispute concerning the warranty ... Nor shall a warrantor ... state that it alone shall determine what is a defect under the agreement. Such statements are deceptive since section 110(d) of the Act gives state and federal courts jurisdiction over suits for breach of warranty ...
16 C.F.R. § 700.8; see also 40 Fed.Reg. 60168, 60211 (1975) ("reference within the written warranty to any binding, non-judicial remedy is prohibited by the Rule and the [Magnuson-Moss] Act").
Contrary to the regulations, Oakwood explicitly states in its Arbitration Agreement that disputes or controversies arising out of the warranty (among other things) shall be submitted to a third party for binding arbitration. The regulation prohibits the aforementioned in written warranties, yet Oakwood includes the language in its Arbitration Agreement. The language does not appear in Oakwood's warranty because, contrary to federal regulation, Oakwood's warranty contains no explanation of the informal dispute settlement mechanism Oakwood intends to use. See 16 C.F.R. § 701.3(6) (requiring warrantors to include in the warranty information regarding its chosen mechanism). The fact that the disallowed statement regarding jurisdiction over warranty disputes is contained in the Arbitration Agreement rather than the warranty does not change the FTC's characterization of such a statement as "deceptive." To allow Oakwood to include the warranty in the binding arbitration agreement where federal law prohibits a binding arbitration agreement to be incorporated into the warranty would be an evisceration of the purpose and effect of the Magnuson-Moss Act.
The clear intent of Magnuson-Moss, as explicitly detailed in the attendant regulations is to encourage alternate dispute settlement mechanisms, but to not deprive any party of their right to have their warranty dispute adjudicated in a judicial forum. See 15 U.S.C. § 2310(a)(1); 16 C.F.R. §§ 700-703. Other federal courts to address this issue have also concluded that Magnuson-Moss precludes binding arbitration of disputes over written warranties. See Wilson, 954 F.Supp. at 1532 (case of first impression concluding that enforcement of binding arbitration clause in contracts for sale and financing of mobile home would violate Magnuson-Moss Warranty Act); see also Raesly v. Grand Housing, Inc., 105 F.Supp.2d 562, 573 (S.D.Miss.2000) ("binding arbitration of written warranties, in transactions to which the Magnuson-Moss Warranty Act applies, is forbidden by that Act"); Boyd v. Homes of Legend, Inc., 981 F.Supp. 1423 (M.D.Ala.1997) (Congress intended the Magnuson-Moss Act to preclude mandatory binding arbitration of written warranties). In Wilson, the Middle District of Alabama was apparently the first federal court to address the question of whether the Magnuson-Moss Act precludes agreements at the time of sale to binding arbitration of warranty disputes. See Wilson, 954 F.Supp. at 1537. That court performed an in depth review of the Congressional *965 intent of the Magnuson-Act to which this court conforms. See id. at 1537-39. Based on this and the foregoing analysis, the court holds that there can be no agreement at the time of sale to enter into binding arbitration on a written warranty.
B.
Contrary to the mandate of the Magnuson-Moss Act, the Arbitration Agreement between the parties requires binding arbitration of disputes arising under Oakwood's warranty. Thus, the court must next decide what effect the invalidity of said portions of the Arbitration Agreement have on the remainder of the agreement. In Dean Witter Reynolds, Inc. v. Byrd, 470 U.S. 213, 218-19, 105 S.Ct. 1238, 84 L.Ed.2d 158 (1985), the Supreme Court held that when a particular claim is found to be inarbitrable, a court must compel arbitration for otherwise arbitrable claims notwithstanding the likely inefficiency of bifurcating the proceedings. The Court explained that, although there was congressional intent for efficient proceedings, the stronger express intent of Congress with the FAA was to place arbitration agreements on the same footing as other contracts. See id. When contractual principles make an arbitration agreement enforceable, such agreement could not be displaced in the interest of efficiency. See id. Supreme Court precedent holds that the purpose of the FAA was to treat arbitration agreements like contracts, but to construe such contracts in favor of arbitration whenever there was a doubt as to the arbitrability of the dispute. See e.g., First Options, 514 U.S. at 944, 115 S.Ct. 1920. Accordingly, in deciding the defendants' motion to compel arbitration, this court does not consider the potential inefficiency of bifurcating the plaintiff's claims, but rather focuses its concern on whether contractual principles would hold that the Arbitration Agreement between the parties is enforceable, notwithstanding the portions in violation of the Magnuson-Moss Act.
In order to determine the issue of whether the contract between the parties to arbitrate is enforceable notwithstanding certain unlawful provisions, the court must apply Virginia laws of contract. See First Options, 514 U.S. at 944, 115 S.Ct. 1920. A contract shall be considered as a whole when, "by its terms, nature, and purpose it contemplates and intends that each and all of its parts and the consideration shall be common each to the other and interdependent." Shelton v. Stewart, 193 Va. 162, 167, 67 S.E.2d 841 (1951) (citations and quotations omitted). However, Virginia law does permit clauses of contracts to be severed from the main contract if the parties manifest the intent that the portions of the contract can survive on their own. See e.g., Reistroffer v. Person, 247 Va. 45, 439 S.E.2d 376 (1994) (provision regarding attorney's fees was severable and survived nullified contract); Vega v. Chattan Assoc., 246 Va. 196, 199, 435 S.E.2d 142 (1993) ("Whether contractual provisions are severable is determined from the intention of the parties") (citing Eschner v. Eschner, 146 Va. 417, 422, 131 S.E. 800 (1926)).
Virginia courts have also recognized the difference between severing a clause or provision of a contract, and rewriting or "blue penciling" a contract in order to make it enforceable. See Nida v. Business Advisory System, Inc., 44 Va. Cir. 487, 1998 WL 972125, *5 (Va. Cir. Ct. Mar. 2, 1998). Although Virginia courts will look to the intent of the parties to determine severability of clauses or provisions, they will not "blue pencil" a contract to make it enforceable. See Cliff Simmons Roofing, Inc. v. Cash, 1999 WL 370247, *1-2 (Va. Cir. Ct. June 4, 1999) (refusing to edit contract by selectively enforcing only those portions permissible by law); Nida, 1998 WL 972125 at *5 ("Generally, Virginia courts do not rewrite the parties contract for them"); Pais v. Automation Products, Inc., 36 Va. Cir. 230 (1995) ("[T]his court has not been granted the authority to `blue pencil' or otherwise *966 rewrite the contract, the covenants therefore fail"). Therefore, it is critical to determine whether the Arbitration Agreement at issue is subject to severability or blue penciling.
"The difference between "blue penciling" and severing is a matter of focus. The former emphasizes deleting, and in some jurisdictions adding words in a particular clause. The latter emphasizes construing independent clauses independently." Roto-Die Co., Inc. v. Lesser, 899 F.Supp. 1515, 1523 (W.D.Va.1995) (refusing to interpret Virginia law as permitting blue pencil rule). The Arbitration Agreement between Oakwood and Pitchford maintains throughout that the arbitration shall be binding and that it includes any claims on the warranty. There is no isolated clause about either the fact that the parties shall be bound or the inclusion of the warranty. The structure and nature of the Arbitration Agreement indicate that all parts contemplate interdependence. See Shelton, 193 Va. at 167, 67 S.E.2d 841. Based on the drafting of the contract on its face, severability is unavailable because there is no particular clause or provision that could be treated independently to cure the conflict with the Magnuson-Moss Act. To the contrary, in order to cure the problems with the Arbitration Agreement, the court would be forced to edit the agreement in one of two ways: the court would have to remove all reference to the warranty or remove all reference to the fact that the arbitration must be binding. As noted above, this form of blue penciling is precisely what Virginia courts consistently have refused to engage in. The court sees the wisdom of the refusal to rewrite the contract between the parties because to do so would be to wreak potential havoc with basic contractual principles, such as mutual assent.
Bearing closely in mind the strong federal preference for arbitration, the court must also follow the statutory directive that arbitration agreements "shall be valid, irrevocable, and enforceable, save upon such grounds as exist at law or in equity for the revocation of any contract." 9 U.S.C. § 2 (emphasis added). Because the Arbitration Agreement between the parties is in violation of the Magnuson-Moss Act and can only be cured through blue penciling a procedure disallowed in Virginia the agreement is unenforceable.[3]
IV.
For the foregoing reasons, the defendants' motion to compel arbitration and stay the proceedings shall be denied. An appropriate Order shall this day enter.
ORDER
Before the court is the defendants' Motion to Compel Arbitration, which was filed in state court prior to the July 6, 1999 removal of the above-captioned civil action to this court. Defendants' Memorandum in Support of Motion to Compel was filed on August 24, 1999, and the action was referred by Order of the court dated August 30, 1999, to presiding United States Magistrate Judge B. Waugh Crigler for proposed findings of fact and a recommended disposition. The Magistrate filed his Report and Recommendation on December 20, 1999, to which both parties filed timely objections. Accordingly, the court has performed a de novo review of those portions of the Report and Recommendation to which objections were made. See 28 U.S.C. § 636(b)(1)(C). Having thoroughly reviewed the Report and Recommendation, all memoranda of the parties, the entire record, the applicable case law, and for the reasons stated in the accompanying Memorandum Opinion, it is accordingly this day
ADJUDGED ORDERED AND DECREED as follows:
*967 (1) The ultimate recommended disposition in the Magistrate Judge's December 20, 1999 Report and Recommendation shall be, and hereby is ACCEPTED, but the court has reached its decision on different grounds from the Magistrate, as detailed in the accompanying Memorandum Opinion.
(2) The defendants' January 18, 2000 Objections to the Report and Recommendation shall be, and hereby are, OVERRULED.
(3) The plaintiff's January 3, 2000 Objection to the Report and Recommendation shall be, and hereby is, SUSTAINED.
(4) The defendants' Motion to Compel Arbitration shall be, and hereby is, DENIED.
(5) The above-captioned civil action shall be referred back to the Magistrate Judge pursuant to the August 30, 1999 Order of the court.
The Clerk of Court hereby is directed to send a certified copper of this Order and the accompanying Memorandum Opinion to Magistrate Judge Crigler and all counsel of record.
NOTES
[1] The parties dispute which sales agent with whom the plaintiff dealt. For the purposes of the opinion, whether the plaintiff dealt with Wanda Fisher (as the plaintiff contends) or Ralph Smith (as the defendant contends) is not material. With respect to the transaction, the court will refer to undisputed facts, unless otherwise noted.
[2] There is disagreement between the parties over whether arbitration was ever discussed. However, even if it was, according to the defendant, it was not raised until after the full execution of the Contract. (Oct 15, 1999 Transcript at 94, 99.)
[3] The plaintiff's additional arguments as to invalidity of the Arbitration Agreement based on intent, lack of consideration, and unconscionability, are not herein addressed because, based on the court's holding, these issues need not be decided. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/2019534/ | 24 Ill. App.3d 237 (1974)
321 N.E.2d 187
THE PEOPLE OF THE STATE OF ILLINOIS, Plaintiff-Appellee,
v.
ROY M. WATSON, Defendant-Appellant.
No. 73-176.
Illinois Appellate Court Second District.
December 18, 1974.
*238 Frank Wesolowski, Jr., Public Defender, of Wheaton (Robert H. Heise, Assistant Public Defender, of counsel), for appellant.
John J. Bowman, State's Attorney, of Wheaton (Ralph J. Gust, Jr., Assistant State's Attorney, of counsel), for the People.
Judgment affirmed.
Mr. PRESIDING JUSTICE THOMAS J. MORAN delivered the opinion of the court:
A jury convicted defendant of possession of burglary tools. (Ill. Rev. Stat. 1971, ch. 38, § 19-2.) He appeals contending: (1) he was not proven guilty beyond a reasonable doubt; (2) the court erred in refusing to instruct the jury that they should not find defendant guilty unless the facts and circumstances proved excluded every reasonable theory of innocence; (3) the court erred in denying defendant's motion to suppress evidence obtained from his automobile; and (4) he was denied his right to a fair trial by discrepancies in the testimony of the state's primary witness as given at the motion to suppress and at the trial.
Illinois State Trooper DeDiemar testified at trial that at about 1:30 A.M. on November 23, 1972, he observed a vehicle, its lights off, parked approximately 5 feet from the office door of a closed auto service station. In the light of his car's headlamps, the trooper observed two persons in the parked vehicle. Within thirty seconds, the vehicle, squealing its tires, sped from the service station and traveled approximately 100' before turning on its lights. The trooper followed, attaining a speed up to 85 mph, and after roughly a mile and a half, overtook and curbed the vehicle. As he did so, he saw, in the beam of his spotlight, a third person sit up in the back seat of the curbed auto. The trooper approached the auto, shone his flashlight into the back seat and observed the third occupant crouched on the back seat with an ax between his legs; a lug wrench protruded from under the front passenger's seat and was partially covered by a floor mat. The trooper retrieved the ax and radioed a passing sheriff's patrol car for assistance. With the sheriff present, the defendant (identified as the driver) and his passengers were ordered out *239 of the car and searched. Upon finding a pair of surgical gloves in the pocket of one passenger, the entire car was searched. Found in its interior, in addition to the lug wrench and ax earlier mentioned, were two pair of pliers, a small pry bar, a rubber-coated flashlight, and a small spatula. A small bolt cutter, wire cutter, tin snips, small screwdriver, and a pocket pen-flashlight were found in the glove compartment; a second lug wrench and a ballpeen hammer were found in the trunk. Defendant and the two passengers were arrested. During defendant's trial for possession of burglary tools, items found in the search were introduced into evidence.
1, 2 The defendant maintains he was not proven guilty beyond a reasonable doubt. In order to sustain a conviction for possession of burglary tools, the State must prove that the defendant possessed tools adapted and designed for breaking and entering and that they were possessed with knowledge of their character and with the intent to commit a felony or theft. The required intent must ordinarily be shown by circumstantial evidence in the absence of a confession. People v. Faginkrantz, 21 Ill.2d 75, 79-80 (1960); Ill. Rev. Stat. 1971, ch. 38, § 19-2.
The defendant contends that the circumstantial evidence presented by the State failed to establish beyond a reasonable doubt the requisite intent to commit a felony because there was no evidence that a burglary had in fact been committed. This proposition is not supported by law. In cases where no burglary had been committed, the necessary intent for possession of burglary tools has been found in the total factual circumstances. (People v. Faginkrantz, supra; People v. Ray, 3 Ill. App.3d 517 (1972), reversed on other grounds, 54 Ill.2d 377 (1973); People v. Esposito, 18 Ill.2d 104 (1959).) In affirming the conviction for possession of burglary tools, the court in Faginkrantz found the necessary criminal intent from the facts that the defendant was illegally parked in an alley behind a plumbing supply firm at 4:30 A.M. with his motor and lights off, that he was far from home, that his being there was unsubstantiated, and that he had in his possession tools adapted to breaking and entering. In Ray, the defendant was arrested at 10:15 P.M. in an alley behind a photography studio, wearing gloves, carrying a pry bar and a flashlight. Gouge marks were found outside two windows of the building, but tests failed to prove defendant's pry bar made the remarks. Despite there having been no burglary committed, the court held there was sufficient evidence of the requisite criminal intent for possession of burglary tools. The necessary intent in Esposito was based upon the facts that the defendant was an unemployed laborer and had no apparent use (in his lawful employment) for the equipment found in his car. He was stopped *240 by police, late at night, many miles from his home, driving in the company of a person who fled when the car was stopped. His statements concerning the tools were contradictory.
3 The facts in the instant case establish sufficient evidence upon which to base a finding that the defendant had the requisite intent: he was parked at a closed gas station at 1:25 A.M., departed at a high speed with his headlights off, the passenger in the back seat behaved in a furtive manner, and the car contained many instruments suitable for breaking and entering.
4 Defendant next contends that the trial court erred in refusing to give defendant's instruction which included both paragraphs of IPI Criminal No. 3.02. The proof of the defendant's possession of the tools in question, one of the elements of the offense, was by means of direct evidence based upon the eye witness observations of the arresting officers. Since both direct and circumstantial evidence were utilized in establishing defendant's guilt, the court properly refused the defendant's requested instruction. People v. Christiansen, 118 Ill. App.2d 51, 56-57 (1969).
The defendant next contends that the court erred in denying his motion to suppress evidence obtained as a result of the search of the car. While repetitious in some respects, we deem it necessary to relate the evidence presented at the hearing on the motion. Trooper DeDiemar testified that at 1:25 A.M. he saw a car with its lights off, parked at a closed gas station; that he pulled into the gas station across the street and subsequently saw defendant's car exit from the gas station, without lights, at a "high rate" of speed; that he followed the car for 1 1/2 miles traveling at a speed between 65 and 70 mph and eventually curbed the vehicle; that in shining his flashlight into the back seat of the car he saw a heavily-taped ax between the legs of one of the occupants and a lug wrench protruding from the right side of the front seat; that he ordered the occupants out of the car and radioed a passing sheriff's police squad car to assist him; that on arrival, the sheriff told the trooper that all three of the occupants of the car were known burglars in the Du Page County area; that the car was then searched; that he did not have a search warrant, and that at the time of the search none of the occupants of the car had been arrested. Trooper DeDiemar also testified that he did not issue a traffic citation, nor did he observe the occupants of the car commit any crime.
The threshold question is whether the investigatory stopping of the car was reasonable within the limitations imposed by the fourth amendment. Without deciding whether the defendant was under "arrest" at the time of the search, we hold that in these circumstances the investigatory *241 stop was justified under the authority of People v. Tassone, 41 Ill.2d 7 (1968), cert. denied, 394 U.S. 965 (1969). In Tassone, two police officers observed an unoccupied semi-trailer truck, keys in the ignition, parked behind a motel. The truck was placed under surveillance. After a 3-hour period an automobile drove up and one of the occupants, the defendant, left the car, entered the truck and drove it away. The officers followed the truck a short distance before curbing it. The defendant produced his driver's license but refused to answer any questions pertaining to the possession of the truck. He was placed under arrest and the truck was taken by the police. The trial court denied the defendant's motion to suppress. The supreme court sustained the denial of the motion stating that there was no need to determine whether the search and seizure of the defendant and the truck were incident to an arrest. Rather, the validity of the search was determined by whether the "facts available to the officer at the moment of the seizure or the search warrant a man of reasonable caution to believe that the action taken was appropriate." (People v. Tassone, 41 Ill.2d 7, 10.) In holding that the stopping of the truck was proper and reasonable, the court applied guidelines set forth by the United States Supreme Court in Terry v. Ohio, 392 U.S. 1, 20 L.Ed.2d 889, 88 S.Ct. 1868 (1968). Under these guidelines, the fact that the policemen had a legitimate interest in effectively discovering and preventing crime justified their approaching the defendant to investigate the suspicious circumstances surrounding his driving away with the truck.
5 The circumstances of the instant case similarly justified the trooper's stopping of the car, and the subsequent seizure of the lug wrench and ax was also justified under the plain view doctrine, both items having been in open view to the trooper. People v. Joyner, 50 Ill.2d 302, 310 (1972).
The further search of the car and the seizure of additional burglary tools were reasonable and did not violate the fourth amendment's proscriptions against unreasonable searches and seizures. It is a well established principle of law that where there is probable cause to believe that the contents of a car offend against the law, a warrantless search may be reasonable. (Carroll v. United States, 267 U.S. 132, 69 L.Ed. 543, 45 S.Ct. 280 (1925); Chambers v. Maroney, 399 U.S. 42, 26 L.Ed.2d 419, 90 S.Ct. 1975 (1970); People v. Joyner, 50 Ill.2d 302 (1972).) Probable cause was established in the instant case by the suspicious conduct of the auto's occupants and by the plain view presence of the ax and lug wrench. The trial court correctly denied defendant's motion to suppress evidence.
6 Defendant last argues that he was deprived of his right to a fair *242 trial and bases his claim on discrepancies in the testimony of the arresting officer at the motion to suppress evidence and at trial. We have reviewed the claimed discrepancies and find them to be minor, lacking in substance and unrelated to matters essential in proving the elements of the crime charged. Further, any discrepancies should have been brought to the jury's attention during cross-examination of this witness at trial; this was not done. By failing to raise such conflicts in testimony at the trial court, in order that the trier of fact might fully evaluate the credibility of this witness, defendant waived his right to object on appeal to those discrepancies.
For these reasons, the judgment is affirmed.
Judgment affirmed.
GUILD and RECHENMACHER, JJ., concur. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/2019535/ | 348 B.R. 618 (2006)
In re R.J. PATTON CO., INC., Debtor.
Roberta Napolitano, Trustee, Plaintiff,
v.
Vibra-Conn, Inc., Defendant.
Bankruptcy No. 04-32927 (LMW), Adversary No. 05-3063 (LMW).
United States Bankruptcy Court, D. Connecticut.
August 30, 2006.
*619 *620 Irve J. Goldman, Esq., Jessica Grossarth, Esq., Pullman & Comley, LLC, Bridgeport, CT, Attorney for Plaintiff/Trustee.
James E. Townsend, Esq., Winsted, CT, Attorney for Defendant.
MEMORANDUM OF DECISION
LORRAINE MURPHY WEIL, Bankruptcy Judge.
In this adversary proceeding, the chapter 7 trustee (the "Trustee") for the above-referenced debtor's (the "Debtor") estate seeks avoidance of certain transfers (the "Transfers") and recovery of $23,871.54 (plus interest and costs) as preferences paid to the above-referenced defendant (the "Defendant") involving, inter cilia, three checks made payable to the Defendant and the Debtor jointly. The court has jurisdiction over this adversary proceeding as a core matter pursuant to 28 U.S.C. §§ 1334 and 157(b), and that certain Order dated September 21, 1984 of the District Court (Daly, C.J.)[1] This memorandum constitutes the findings of fact and conclusions of law mandated by Rule 7052 of the Federal Rules of Bankruptcy Procedure.
I. BACKGROUND
The Debtor commenced this chapter 7 case on June 18, 2004. (See Case Doc. I.D. No. 2.)[2] Roberta Napolitano, Esq. is the Trustee. The Trustee commenced this adversary proceeding under 11 U.S.C. §§ 547 and 550(a)[3] by the filing of a complaint (A.P. Doc. I.D. No. 1, the "Complaint") on April 7, 2005. The Defendant filed its answer (A.P. Doc. I.D. No. 7, the "Answer") on May 10, 2005. The Answer denied certain material allegations of the Complaint but did not allege any affirmative defenses under Bankruptcy Code § 547(c). (See Answer.)
The trial (the "Trial")[4] on the Complaint was held on November 28, 2005. At the Trial, the Trustee introduced her own testimony and the testimony of the Debtor's principal, Robert Patton. The Defendant introduced the testimony of Timothy King, the Defendant's president. Both parties introduced documentary evidence into the record at Trial.[5] The Trial record subsequently *621 was supplemented pursuant to a certain evidentiary Stipulation (A.P. Doc. I.D. No. 28, the "Stipulation"). Post-Trial briefing has been had[6] and the matter is ripe for decision.
II. FACTS[7]
Some time prior to the petition date, FIP Construction, Inc. ("FIP"), as prime contractor, entered into the following construction contracts (the "Contracts") with the following owners (collectively, the "Owners"): (a) a contract with Wesleyan University for a project (the "Wesleyan Project") generally referred to as "Center for Film Studies;" (b) a contract with Quinnipiac University for a project (the "Quinnipiac Project") generally referred to as "Development & Public Affairs Building;" and (c) a contract with The Elim Park Baptist Home, Inc. for a project (the "Spring Meadow Project," collectively with the other two projects, the "Projects") generally referred to as "Spring Meadow." (See Stipulation (Trustee Exh. 21, 22, 23).) Subsequently FIP entered into the following subcontracts (collectively, the "Subcontracts") with the Debtor (as "mechanical subcontractor")[8]: (a) Subcontract dated May 21, 2003 with respect to the Wesleyan Project; (b) Subcontract dated June 3, 2003 with respect to the Quinnipiac Project; and (c) Subcontract dated April 9, 2003 with respect to the Spring Meadow Project. (See Stipulation (Trustee Exh. 21, 22, 23); Transcript at 9 (testimony of Mr. Patton).) Subsequently, the Debtor entered into agreements (either by purchase orders or otherwise, the "Supply Agreements") with the Defendant pursuant to which the Defendant agreed to supply certain materials and/or services for each of the Projects for certain consideration to be paid by the Debtor. (See Transcript at 29-30 (testimony of Mr. King).)
The Defendant performed under the Supply Agreements and issued the following invoices to the Debtor: (a) an invoice dated November 17, 2003 (with a "ship date" of October 17, 2003) with respect to the Wesleyan Project in the amount of $8,082.00 (Trustee Exh. 2); (b) an invoice dated December 15, 2003 (with a "ship date" of December 9, 2003) with respect to the Quinnipiac Project in the amount of $4,800.00 (Trustee Exh. 8); and (c) an invoice (the "Spring Meadow Project Invoice" collectively with the other two invoices, the "Invoices") dated November 17, 2003 (with a "ship date" of November 5, 2003) with respect to the Spring Meadow Project in the amount of $18,120.00[9] (Trustee Exh. 14).
The Debtor fell into financial difficulty in approximately February of 2004. (See Transcript at 8 (testimony of Mr. Patton).) Around that time, Mr. King (at the Defendant) "contact[ed] . . . [Mr. Patton at the *622 Debtor] to see about . . . [the Defendant's] getting paid for . . . [the Invoices] after so much time had gone by." (Transcript at 32:22-23 (testimony of Mr. King); see also Transcript at 33:2-8 (testimony of Mr. King).) Mr. Patton told Mr. King that "there was some difficulty that . . . [the Debtor] had and that . . . [the Defendant] should contact FIP, that they . . . were offering to negotiate those invoices." (Transcript at 33:10-15 (testimony of Mr. King).) At that time, FIP owed money to the Debtor under each of the Subcontracts which receivables included the amounts owing by the Debtor to the Defendant pursuant to the unpaid Invoices.[10] (See Transcript at 12-18) (testimony of Mr. Patton). Mr. King then had one or more "follow-up" conversations with FIP. (Transcript at 34 (testimony of Mr. King).) Those conversations resulted in a meeting between representatives of FIP and the Defendant at FIP's offices on May 12, 2004 (the Debtor was not represented at that meeting). (See Transcript at 34-36 (testimony of Mr. King).)
In preparation for that meeting, either FIP or the Debtor had prepared a form of "Joint Pay Agreement[:] Prime Contractor/Subcontractor/Supplier" (each hereafter referred to as a "JPA" and discussed further below) for each of the Projects and, for each Invoice, FIP had issued a check (each dated April 27, 2004, a "Joint Check") made payable jointly to the Debtor and the Defendant in the reduced amounts alleged in Exhibit A to the Complaint. The Debtor had signed each of the JPAs and endorsed each of the Joint Checks at FIP's offices on April 28, 2004 and had left all of the foregoing there. (See Transcript at 23 (testimony of Mr. Patton); Transcript at 36-37 (testimony of Mr. King); see also Trustee Exh. 3, 9, 15.) Presumably, FIP had prepared the forms of the lien waivers and general releases described below. When Mr. King arrived at FIP's offices on May 12, 2004, the partially executed JPAs, the partially endorsed Joint Checks and the forms of lien waivers and general releases all were waiting for him. (See Transcript at 40 (testimony of Mr. King).)
At or before the meeting, FIP's representative told Mr. King that the Defendant could have a seventy-seven cent (77¢) on the dollar payment on the Invoices (i.e., payment in the aggregate amount of the Joint Checks endorsed by the Debtor) if the Defendant would execute and deliver lien waivers and general releases to FIP. (See Transcript at 38-39 (testimony of Mr. King).) On behalf of the Defendant, at the May 12, 2004 meeting Mr. King signed the JPAs, executed lien waivers with respect to each of the Projects (as discussed further below), executed general releases of FIP and each of the Owners (as discussed further below) and delivered all of the foregoing to FIP. (See Trustee Exh. 3, 9, 15; Defendant Exh. A, B, C.) Mr. King then was given the partially endorsed Joint Checks, took them back to his office and they were deposited into the Defendant's bank account. (See Transcript at 39 (testimony of Mr. King).)
III. THE JPAs, THE LIEN WAIVERS AND THE RELEASES
Each of the JPAs provides in relevant pelt as follows:
"[T]o induce . . . [the Defendant] to furnish the above items,[[11]] [the Debtor] *623 . . . requests and authorizes . . . [FIP] to issue all applicable payment checks jointly payable to . . . [the Debtor and the Defendant] in the amounts specified in . . . [the Debtor's] billings. . . . No funds will be paid to . . . [the Defendant] in excess of that which is due on this particular job. This agreement to pay by joint check is made solely as an accommodation and is not intended to create in any way a contractual relationship, direct or indirect, between . . . [FIP and the Defendant] and/or any of its subsidiaries. Furthermore, all payment terms as contained in the contract between . . . [FIP and the Debtor] remain in effect.
[The Debtor] shall forward to [FIP] a copy of the invoice from . . . [the Defendant] indicating the joint check amount. All joint checks shall be delivered to [the Debtor] for endorsement and forwarded to the . . . [Defendant]. . . . This Joint Pay Agreement is not revocable, until all parties agree in writing.
(Trustee Exh. 3, 9, 15).
Each lien waiver (a "Lien Waiver") provides that the Defendant
waived, relinquished, and released and do[es] hereby waive, relinquish, and release all liens and claims of liens we now have or may hereafter have upon . . . [the respective Project] for labor done or to be done and materials furnished or to be furnished in the erection, construction or repair of said . . . [Project].
(Defendant Exh. A, B, C.)
Each general release (a "General Release") provides that the Defendant
remised, released and forever discharged . . . FIP . . . [and the respective Owner], their predecessors, successors, assigns, affiliates, subsidiaries, directors, officers, employees, agents, all related insurers, underwriters, sureties, and financial sources of all listed parties, of and from all, and all manner of action and actions, cause and causes of action, suits, debts, dues, sums of money, accounts, reckoning, bonds, bills, specialties, covenants, contracts, controversies, agreements, promises, variances, trespasses, damages, judgments, extents, executions, claims and demands whatsoever, in law, or equity, which . . . [the Defendant] ever had, now has or which it or its successors, subsidiaries and related parties, heirs and assigns hereafter can, shall or may have for, upon or by reason of or in connection with the construction of the . . . [respective Project].
(Defendant Exh. A, B, C.)
IV. ANALYSIS
A. Applicable Law and Standards
Bankruptcy Code § 547(b) provides in relevant part as follows:
(b) Except as provided in subsection (c) of this section, the trustee may avoid any transfer of an interest of the debtor in property
(1) to or for the benefit of a creditor;
(2) for or on account of an antecedent debt owed by the debtor before such transfer was made;
(3) made while the debtor was insolvent;
(4) made
(A) on or within 90 days before the date of the filing of the petition . . .; and
*624 (5) that enables such creditor to receive more than such creditor would receive if
(A) the case were a case under chapter 7 of this title;
(B) the transfer had not been made; and
(C) such creditor received payment of such debt to the extent provided by the provisions of this title.
11 U.S.C.A. § 547(b) (West 2005). "Transfer" is defined by the Bankruptcy Code to mean "every mode, direct or indirect, absolute or conditional, voluntary or involuntary, of disposing of or parting with property or an interest in property. . . ." 11 U.S.C.A. § 101(54) (West 2005). Bankruptcy Code § 550(a) provides in relevant part:
(a) [T]o the extent that a transfer is avoided under section . . . 547 . . . of this title, the trustee may recover, for the benefit of the estate, the property transferred, or, if the court so orders, the value of such property, from
(1) the initial transferee of such transfer. . . .
11 U.S.C.A. § 550(a) (West 2005).
The burden is on the Trustee to prove by a preponderance of the evidence every element of Section 547(b) (including that the property transferred was property in which the debtor had "an interest" within the statutory purview). See, e.g., Stingley v. AlliedSignal, Inc. (In re Libby Int'l, Inc.), 247 B.R. 463, 466 (8th Cir. BAP 2000); 11 U.S.C.A. § 547(g).
B. Application of Law to Fact
The Defendant contends that the Trustee has not proved that the Transfers were of "an interest of the [D]ebtor in property" within the purview of Section 547(b) and also contests other elements of a preference to the extent that they necessarily devolve from the foregoing. In furtherance of its position the Defendant argues as follows: (1) the Transfers were not of property in which the Debtor had an interest pursuant to the doctrine of "earmarking;" (2) the Debtor lacked sufficient control of the Joint Checks to give it a property interest in them within the purview of Section 547(b); and (3) the payment to the Debtor must be deemed to have been a payment of third-party (i.e., FIP's) funds and not a payment of proceeds of the Receivables because FIP had an independent contractual duty to pay the Defendant. The court will consider each argument in turn.
1. Earmarking
[3-5] The Defendant argues that there was no transfer of "an interest of the [D]ebtor in property" within the purview of Bankruptcy Code § 547(b) because the Joint Checks were "earmarked" for the Defendant.
Under the earmarking doctrine, where a third party lends money to a debtor for the purpose of paying a specific creditor, the loan is not a preferential transfer. Instead the third party simply is substituted for the original creditor. . . .
The earmarking doctrine applies only where a third party lends money to the debtor for the specific purpose of paying a selected creditor.
Glinka v. Bank of Vermont (In re Kelton Motors, Inc.), 97 F.3d 22, 25, 28 (2d Cir. 1996) (emphasis added; internal quotation marks omitted). The Joint Checks were not the proceeds of a third party loan substituting one creditor for another. Accordingly, the earmarking doctrine does not apply.
2. Lack of Control Over Joint Checks
The Defendant further argues that, because the Debtor had so little control over the Joint Checks, the Debtor had no "interest" in them for Section 547(b) purposes. *625 That argument might be more persuasive if the JPAs had been executed and delivered outside of the preference period even if the Debtor had endorsed the Joint Checks within it. That is because the Debtor might have been deemed to have transferred its interest in the Receivables pursuant to the JPAs with later endorsement of the Joint Checks (i.e., the proceeds of the Receivables) a mere formality. Cf. Herzog v. Sunarhauserman (In re Network 90°, Inc.), 126 B.R. 990 (N.D.Ill. 1991).[12] Here, however, the Debtor signed the JPAs and endorsed the Joint Checks at the same time and both within the preference period. When the Defendant signed the JPAs and simultaneously accepted the Joint Checks, the Debtor's interest in the Receivables was transferred to the Defendant and that was a transfer of property of the Debtor within the preference period. Cf. Buono, 119 B.R. at 501 n. 1 (trustee prevails on similar theory).
The Defendant argues that the Trustee cannot prevail on the above theory because the Complaint does not specifically seek avoidance of the JPAs, the Trustee's counsel did not refer to the timing of the JPAs until after all the Trial evidence had come in (except for the Stipulation) and the Defendant has been unfairly surprised.[13] In another case that argument might have some appeal. However, as noted above, in this case the execution of the JPAs and the endorsement and delivery of the Joint Checks were so contemporaneous as to constitute one single occurrence. On those facts, the Defendant cannot be unfairly surprised by the Trustee's attack on the JPAs and reference to the Joint Checks in the Complaint was sufficient notice that the entire transaction (including the JPAs) was under attack. For this court to require the Trustee specifically to seek avoidance of the JPAs in order to prevail on the Complaint would be to take an unduly technical approach which this court declines to do.
3. Independent Duty of FIP To Pay the Defendant
Finally, the Defendant argues that FIP incurred an independent contractual duty to pay the Defendant in accordance with the JPAs because the Defendant executed and delivered the Lien Waivers and the General Releases to FIP in reliance upon the JPAs. As a result, the Defendant further argues, the payments by FIP must be deemed to be payments from FIP's own funds rather than from the proceeds of the Receivables.
It is true that, under some circumstances, courts have deemed payments by a third party contractor to a debtor's supplier to be satisfaction of an independent contractual obligation of the contractor to pay the supplier rather than a payment from the debtor's construction receivable. See, e.g., Shaw Industries, Inc. v. Gill (In re Flooring Concepts, Inc.), 37 B.R. 957 (9th Cir. BAP 1984).[14] This court has *626 some doubts that the Flooring Concepts doctrine applies when the construction receivable owing from the third-party is property of the subcontractor's estate and the third-party's payment is charged against that receivable. That the subject checks were made payable to the Debtor and the Defendant jointly (rather than solely to the Defendant) is evidence that the payments here were intended to be credited against the Receivables and that is consistent with Mr. Patton's testimony. (See Transcript at 13: 2-6; 16:7-16; 18:3-17 (testimony of Mr. Patton).) Moreover, no cogent argument has been made that the Receivables were not property of the Debtor which would have become part of its bankruptcy estate upon filing. Cf. Flooring Concepts, 37 B.R. at 961 ("[T]he account ostensibly due the debtor could not have become part of the bankruptcy estate.").
However, the court need not reach that issue because Flooring Concepts and cases similar to it are otherwise not factually apposite here. That is because in this case the Defendant did not give up its lien rights against the Projects in reliance on the JPAs and issuance of the Joint Checks but, rather, the Defendant already had forfeited such lien rights by failure to comply with applicable law as of the time it executed the Lien Waivers.[15] Nor did the Defendant relinquish anything meaningful to it when it executed the General Releases[16] or when it agreed to take less than the aggregate face amount of the Invoices as a "final settlement."[17] Accordingly, the *627 Defendant did not meaningfully rely upon the JPAs and issuance of the Joint Checks.[18]Cf. Flooring Concepts, 37 B.R. at 961 (noting that the supplier gave up materialman's liens which "it had a right to pursue"). Therefore, on the facts presented here, the equities do not favor deeming the payment from FIP to be payment from its own funds (rather than from proceeds of the Receivables which were property of the Debtor) as the equities might if there had been meaningful reliance by the Defendant. For the foregoing reasons, the court finds this particular argument by the Defendant to be unpersuasive.[19]
V. CONCLUSION
For the reasons stated above, the court concludes that a transfer of proceeds of the Receivables occurred upon the execution and delivery of the JPAs and endorsement and delivery of the Joint Checks and such was a transfer of "an interest of the [D]ebtor in property" within the purview of Section 547(b). Based upon the foregoing and upon the Trial record, the court concludes that the Trustee successfully has carried her burden with respect to all elements of Bankruptcy Code §§ 547(b) and 550(a). The Complaint seeks interest and costs. The court exercises its discretion to award prejudgment interest on $23,871.54 from April 7, 2005 at the rate applicable as of such date under 28 U.S.C. § 1961. Cf. Hirsch v. Union Trust Co. (In re Colonial Realty Co.), 229 B.R. 567, 577 (Bankr.D.Conn.1999). The request for costs is granted. Judgment consistent with the foregoing will enter.[20]
NOTES
[1] That order referred to the "Bankruptcy Judges for this District" inter alia "all proceedings . . . arising under . . . Title 11, U.S.C....."
[2] References herein to the docket of this chapter 7 case are in the following form: "Case Doc. I.D. No. ___." References herein to the docket of this adversary proceeding are in the following form: "A.P. Doc. I.D. No. ___."
[3] References herein to title 11 of the United States Code or to the Bankruptcy Code are references to the same as they appeared prior to the effective date of their amendment by the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005.
[4] References herein to the transcript of the Trial appear in the following form: "Transcript at ___:___."
[5] References herein to the Trustee's Trial exhibits appear in the following form: "Trustee Exh. ___." References herein to the Defendant's Trial exhibits appear in the following "Defendant Exh. ___."
[6] The Defendant filed a responsive brief (A.P.Doc. I.D. No. 41) on February 9, 2006. Pursuant to an order entered after notice and a hearing and dated April 13, 2006 (A.P.Doc. I.D. No. 48) that brief was stricken from the record for the Defendant's counsel's failure to comply with this court's administrative procedures (i.e., electronic filing of documents). Nevertheless, this court has considered that brief.
[7] The facts found below and elsewhere in this memorandum are found on the basis of the Trial record and/or the entire record of this adversary proceeding and chapter 7 case. Except as otherwise indicated herein, outstanding evidentiary objections hereby are resolved in favor of the Defendant.
[8] The parties have not referred to the terms of the Subcontracts in their arguments and this court will do likewise in analyzing the merits of those arguments.
[9] The copy of the Spring Meadow Project Invoice in evidence has a typed amount due of $19,207.20 which was corrected by hand to delete a 51,087.20 charge for "Sales Tax." (See id.)
[10] The Debtor's rights to payment under the Subcontracts with respect to the Invoice are referred to herein as the "Receivable."
[11] The JPAs state that they were executed to induce the Defendant to supply the subject goods and/or services to the Projects. As is apparent from the Trial record discussed in part II, supra, that is untrue; the JPAs were executed after the Debtor already had incurred its debt to the Defendant under the Supply Agreements. That conclusion is not barred by the parol evidence rule. See TIE Communications, Inc. v. Kopp, 218 Conn. 281, 291, 589 A.2d 329 (1991) ("The parol evidence rule pertains to contract terms, not assertions of fact.").
[12] [T]he debtor in Dal-Tile Corp. v. Reitmeyer (In re Buono), 119 B.R. 498 (Bankr.W.D. Pa.1990) . . . still had control of the payments it would receive at the beginning of the preference period, and its surrender of control consequently resulted in a diminution of the estate. In this case, however, Network 90° had relinquished its interest in the payments well before the preference period began; accordingly, the transfer of those payments to SunarHauserman did not dissipate the estate.
Network at 995 n. 4.
[13] In fact, the Trustee's counsel referred to tile timing of the JPAs in his opening Trial statement. (See Transcript at 3:17-18 ("[E]ach of the joint pay agreements themselves was executed within the preference period.") (remarks of Attorney Goldman).)
[14] While it appears that the payments were made by an account debtor of the bankrupt to a creditor of the bankrupt, in actuality, [the general contractor] . . . made a new contract with . . . [the supplier], whereby [the general retractor] . . . agreed to pay . . . [the supplier] directly in exchange for . . . [the supplier's] forbearance to further pursue its lien remedies. [The supplier] . . . furnished independent consideration to . . . [the general contractor] who thereby received the assurance that its [sic] property would be free of a materialman's lien, which . . . [the supplier] had a right to pursue.
Id. at 961.
[15] Under Connecticut law, a mechanics lien is not "valid" unless the supplier properly "lodges" with the appropriate town clerk a proper lien certificate within ninety (90) days after the supplier last supplied goods and/or services for the subject property. Conn. Gen. Stat. § 49-34. In his opening statement at the Trial, counsel for the Trustee asserted that the Defendant's lien rights already had lapsed prior to its execution of the JPAs and Lien Waivers. (See Transcript at 4:12-13 (remarks of Attorney Goldman).) That assertion was repeated in the Trustee's Post Trial Memorandum of Law. (See A.P. Doc. I.D. No. 32 at 12-13.) Neither of those assertions were controverted by the Defendant either at the Trial (see Transcript) or in either of its post-Trial briefs (see A.P. Doc. I.D. No. 34 at 3-4, A.P. Doc. I.D. No. 41). Moreover, the evidence at the Trial supports the conclusion that, at the time the Defendant executed the JPAs, more than ninety days had expired from the last date the Defendant supplied materials and/or services to any Project (i.e., the respective "ship dates"). (See Transcript at 12:19-23; 12:24-25; 15:24-16:3; 17:23-18:2 (testimony of Mr. Patton); 43:16-20; 44:3-15 (testimony of Mr. King).) There was no evidence that the Defendant had validated its lien rights pursuant to Section 49-34 within the statutory ninety days. Based upon all of the foregoing, the court finds that the Defendant's lien rights in respect of the Projects had lapsed prior to the time the Defendant executed the JPAs, Lien Waivers and General Releases.
[16] As noted above, the General Releases purported to release FIP and each respective Owner from claims of the Defendant. The Defendant never had any claims against FIP or the Owners, neither of whom were in contractual privity with the Defendant; the Defendant does not argue otherwise. The Defendant may have had claims against the Owners' respective properties at one time (i.e., inchoate mechanics' liens) but, as discussed above, those claims lapsed when the period to record those liens expired and that was before the Defendant's execution of the General Releases and the JPAs.
[17] By accepting that "settlement," all the Defendant "surrendered" was a "20 percent best case . . . distribution [on the Invoices in this case]" (Transcript at 6:15 (testimony of the Trustee)).
[18] That is not to say that the General Releases and Lien Waivers had no value to FIP. There may have been a "peace of mind" factor involved and/or the Contracts may have required FIP to deliver those documents to the Owners. However, value to FIP is not relevant here; detriment (if any) to the Defendant is.
[19] The court has considered the Defendant's remaining arguments and finds them to be unpersuasive. The court has reviewed the authorities cited by the Defendant and finds them to be consistent with its decision, inapposite and/or unpersuasive.
[20] The Trustee shall file and serve on the Defendant's attorney an itemized application for statutory costs on or before September 15, 2006. Objection to such application, if any, most be filed and served on or before September 29, 2006. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/2019537/ | 697 N.E.2d 302 (1998)
297 Ill. App.3d 668
231 Ill.Dec. 748
The PEOPLE of the State of Illinois, Plaintiff-Appellee,
v.
John Allan SIMPKINS, Defendant-Appellant.
No. 4-97-0632.
Appellate Court of Illinois, Fourth District.
Argued April 15, 1998.
Decided June 10, 1998.
As Modified on Denial of Rehearing August 6, 1998.
*303 Michael B. Metnick, Diana N. Cherry (argued), Metnick, Cherry & Frazier, Springfield, for John Allan Simpkins.
Charles G. Reynard, State's Attorney, McLean County Law & Justice Center, Bloomington, Norbert J. Goetten, Director, Robert J. Biderman, Deputy Director, Charles F. Mansfield (argued), Staff Atty., State's Attorneys Appellate Prosecutor, Springfield, for the People.
MODIFIED ON DENIAL OF REHEARING
Justice STEIGMANN delivered the opinion of the court:
In May 1997, a jury convicted defendant, John Allan Simpkins, of three counts of aggravated *304 criminal sexual assault, finding that he committed acts of sexual penetration with his daughter, K.S., when she was under 13 years of age (720 ILCS 5/12-14(b)(1) (West 1992)). In June 1997, the trial court entered a judgment of guilty as to two counts, but granted defendant's motion for judgment of acquittal notwithstanding the verdict as to the remaining count (count III). The court then sentenced defendant to eight years in prison on count I and seven years in prison on count II, with those sentences to be served consecutively.
Defendant appeals, arguing that the trial court erroneously (1) admitted certain hearsay testimony in violation of section 115-10 of the Code of Criminal Procedure of 1963 (Code) (725 ILCS 5/115-10 (West 1992)); (2) admitted certain hearsay testimony in violation of section 115-13 of the Code (725 ILCS 5/115-13) (West 1992); (3) permitted the jury to take into the jury room during deliberations an Illinois Department of Children and Family Services (DCFS) report which had not been admitted into evidence; (4) admitted certain opinion testimony; and (5) sentenced defendant to consecutive sentences. Defendant also argues that the State failed to prove him guilty beyond a reasonable doubt. We reverse and remand for a new trial.
I. BACKGROUND
In November 1995, the State charged defendant by indictment with three counts of aggravated criminal sexual assault. Counts I and II alleged that sometime between October 1, 1993, and November 30, 1993, defendant committed acts of sexual penetration with K.S. (five years old at the time of the offenses and eight years old at trial) using his finger (count I) and a bottle (count II). Count III alleged that sometime between June 1, 1994, and July 30, 1994, defendant committed an act of sexual penetration with K.S. using his finger. 720 ILCS 5/12-14(b)(1) (West 1992).
A. The Section 115-10 Hearing
In April 1996, the State filed a notice of intentunder section 115-10 of the Codeto offer at defendant's trial statements K.S. made to Mel Devall, a DCFS child protective services investigator. Later during that same month, the State filed another such notice of intent to offer statements K.S. made to her mother, Annette Simpkins.
In April 1997, the trial court conducted a section 115-10 hearing, and the following testimony was presented. Devall testified that on September 16, 1994, he interviewed K.S. (then six years old) at her grade school pursuant to allegations of physical abuse of K.S. and her siblings by defendant and allegations of sexual abuse of an older sibling (D.D.) by defendant, which had been reported to DCFS. During that interview, Devall initially established that K.S. knew the difference between the truth and a lie, a good touch and a bad touch, and inside and outside. Devall then asked K.S. if she remembered him. (Devall had interviewed K.S. about one month earlier pursuant to a report of sexual abuse of D.D. by a grandfather.) K.S. responded that she remembered that he had previously talked with her "about grandpa touching [D.D.]." Devall then testified that K.S. indicated that defendant had touched her, as follows:
"A. [Devall:] Then I asked her, has anyone ever touched you in a bad way? She said yes, daddy had, that daddy had spanked her real hard and left bruises on her.
* * *
Q. [Prosecutor:] What did you ask her then?
A. Has anyone else ever touched you in a bad way?
Q. And what, if anything, did she ever say?
A. Yesdaddy.
* * *
Q. What was the [next] question?
A. How did daddy touch you in a bad way?
Q. And what, if anything, did she say?
A. She stated that daddy had taken her upstairs and put her on [a sibling's] bed, had pulled her pants and underwear down, had inserted his finger inside of her private, that daddy also had put a bottle inside of her private. She stood up at that *305 point and said daddy told me to lay on the bed like this, and she stood up and spread her legs apart. She said that blood had come out of that, and that it hurt."
Devall also stated that K.S. told him that the sexual abuse had happened on more than one occasion, the first time was when she bled and the last time was on the Fourth of July.
On cross-examination, Devall acknowledged that he did not specifically recall what he had asked K.S. during his previous interview of her (which took place about one month before the September 16, 1994, interview). He stated, however, that typically he would ask whether the child had been told anything about the alleged abuser. Devall also stated that he did not ask K.S. when the first incident happened or which Fourth of July she was referring to. He also stated that Annette told him that K.S. had recanted the allegations against defendant.
Annette (K.S.' mother) testified that on one occasion after Devall's September 16, 1994, interview of K.S., K.S. came to her and asked why defendant "would do something like that." K.S. said nothing else, and Annette did not question her about the statement. On another occasion when Annette and K.S. were in a pharmacy, K.S. brought a bottle of Betadine to Annette and said "this is what daddy used." Annette told her to put the bottle back and did not question K.S. about the statement. Annette also testified about K.S.' recantation, as follows:
"[I]t was a few months ago, [K.S.]well, the girls went with their [paternal] grandparents for that Saturday, and a few daysit was like two or three days later [K.S.] says how come we can't see dad, and I'm just like, we can't talk about that. She said, well, I know why, and I lied about what daddy did, and I said, why would you lie about something like that, and she said because [K.S.] was mad at him. And I said why were you mad at him, and she was, like because he used to hit us all of the time."
The trial court determined that the statements K.S. made to Devall and Annette were admissible pursuant to section 115-10 of the Code.
B. Trial Testimony
At defendant's trial, K.S. testified that defendant had spanked her with a belt but had not done anything else that hurt her. She stated that she had told Devall "bad things" and what she told him was a "big lie." She further stated that she did not know why she lied to Devall. K.S. remembered seeing Dr. Lance Cordoni, a pediatrician at the Pediatric Resource Center (a child abuse center), but she did not remember talking to him.
On cross-examination, K.S. testified that she did not remember Devall interviewing her the first time. She stated that she had lied to her mother because K.S. was mad at defendant. She also stated that defendant had not put his finger or a bottle inside her.
Annette testified that on one occasion when K.S. was in kindergarten, Annette noticed blood on K.S.' underwear. That same day, she took K.S. to Dr. Jivan Patel, K.S.' pediatrician. Patel visually examined K.S. and told Annette that K.S. was "fine." Annette also stated that K.S. told her that she had lied about defendant sexually abusing her because she was mad at him. She also testified substantially the same as she had at the section 115-10 hearing regarding the statements K.S. made to her after Devall's September 16, 1994, interview of K.S.
On cross-examination, Annette testified that when she noticed blood on K.S.' underwear, she asked K.S. what happened and K.S. responded that she did not know. She also stated that when K.S. showed her the bottle of Betadine in the pharmacy, K.S. did not say what defendant had done with the bottle. She further stated that she and defendant routinely kept Betadine in their home and used it on their children.
Devall testified that he had been a DCFS child protective services investigator for seven years, and he had to complete 20 hours of continuing education each year. He stated that he had interviewed "over a thousand" children who had reported sexual abuse. Devall also stated that prior to his September 16, 1994, interview of K.S. at her grade school, he had spoken with her about possible sexual abuse of D.D. by a grandfather. During the first interview, Devall asked K.S. *306 "very generic questions," such as "How is grandpa?" He acknowledged having talked with K.S. about the allegations of sexual abuse by the grandfather during the first interview. K.S. knew about the grandfather "possibly touching [D.D.] in a sexual way."
During Devall's September 16, 1994, interview of K.S., K.S. told him that defendant had touched her in a bad way. K.S. told him that defendant put his finger inside her "private" and "blood came out." K.S. held up her right index finger when Devall asked her which finger defendant had put inside her private. K.S. also told him that the incident happened at nighttime, and the alleged sexual abuse occurred on more than one occasionnamely, when she bled and on the Fourth of July. Devall stated that during the interview, K.S. was "very matter of fact" and "kept very good eye contact."
K.S. also told Devall that defendant told her that he had to put medicine on her, and he put a bottle inside of her. She also told Devall that when defendant touched her, her mother was downstairs sleeping. K.S. also told him that her mother found the bloody underwear and took her to Patel's office.
Devall also testified that he was familiar with studies and articles relating to child sexual abuse and he reads such literature as part of his investigator duties. Over defendant's objection, Devall testified that he has interviewed children who made allegations of sexual abuse who subsequently recanted. Devall also testified that in his experience, recantation occurs in 50% of the cases. Devall further testified regarding the reasons child victims recant their allegations of sexual abuse, as follows:
"Q. [Prosecutor:] And in your training and experience and the articles you have read and the education you have had in this area, what are some of the reasons given for why children recant?
[Defense counsel]: I will object as to reasons given. I don't believe this witness is qualified to testify in that respect. What articles he refers to[,] what he has read, whether they are experts in the area, I don't think he has been qualified as an expert in the field of child psychology.
THE COURT: I will allow the question. Overruled.
A. [Devall:] It can be some of unsupported [sic] family, a family member that does not believe that the abuse occurred. There has [sic] been cases that I have dealt with [where] the child has been away from a father or a mother for a period of time and has been scapegoated or blamed by the other family members and that child has changed the story. There could be many reasons like that."
On cross-examination, Devall testified that on September 16, 1994, he recorded the interview "[w]ord-for-word" using shorthand. Later that same day, he typed the report (which the prosecutor used to refresh his recollection) and destroyed his handwritten notes. He also stated that when he typed the report, he put it into a question and answer format. He further stated that during the first interview with K.S., she knew he was there to discuss the grandfather's alleged sexual abuse of D.D. because D.D. had told her siblings.
Patel testified that on November 9, 1993, Annette brought K.S. to see him because Annette had noticed bleeding around K.S.' vaginal area. Patel stated that he conducted a visual examination of K.S.' vaginal area and "found everything pretty normal." He therefore did not conduct an internal examination of K.S. On redirect examination, Patel testified that it was possible, although unlikely, for someone to have an internal injury even though a visual examination appeared normal.
Cordoni testified that on October 25, 1994, he saw K.S. pursuant to a DCFS report of possible sexual abuse. On that day, Cordoni took K.S.' medical history and completed a physical examination. While taking her medical history, Cordoni asked K.S. if she knew why she was at the center. K.S. told him that she was there because defendant touched her "down there." K.S. simultaneously pointed to her vaginal area. Cordoni then asked her what defendant did to her, and she told him that defendant touched her and put medicine in her. Cordoni asked K.S. if defendant touched her with his hand, and she said that defendant put his hand inside *307 her and again pointed to her vaginal area. Cordoni further stated that when he first met K.S. on October 25, 1994, she was "very open" and "somewhat playful." However, when he questioned her about the alleged sexual abuse, she became "quiet and withdrawn."
Cordoni then conducted a physical examination of K.S. Cordoni found no physical signs of sexual abuse; however, he stated that 80% of child victims of sexual abuse have "a normal physical examination." He further stated that, given K.S.' description of the sexual abuse, he would not expect to find any physical evidence of sexual abuse even a day after it occurred.
Defendant testified and denied committing the crimes charged. He also stated that he did not recall K.S. having bloody underwear. Defendant's parents testified that although they regularly visited K.S. and her siblings, they never discussed the sexual abuse allegations with the children. On this evidence, the jury convicted defendant.
II. HEARSAY STATEMENTS ADMITTED PURSUANT TO SECTION 115-10
Defendant first argues that the trial court erred by admitting K.S.' statements to Devall regarding the sexual abuse pursuant to section 115-10 of the Code (725 ILCS 5/115-10 (West 1992)). We agree.
Section 115-10(b) of the Code provides that certain evidence shall be admitted as an exception to the hearsay rule under the following circumstances:
"(1) The court finds in a hearing conducted outside the presence of the jury that the time, content, and circumstances of the statement provide sufficient safeguards of reliability; and
(2) The child either:
(A) Testifies at the proceeding; or
(B) Is unavailable as a witness and there is corroborative evidence of the act which is the subject of the statement." 725 ILCS 5/115-10(b) (West 1992).
When conducting a section 115-10 hearing, a trial court must evaluate the totality of the circumstances surrounding the making of the hearsay statements. Some factors that are important in making the reliability determination include the following: (1) the child's spontaneity and consistent repetition of the incident; (2) the child's mental state; (3) use of terminology unexpected of a child of similar age; and (4) the lack of motive to fabricate. People v. West, 158 Ill.2d 155, 164, 198 Ill.Dec. 393, 397-98, 632 N.E.2d 1004, 1008-09 (1994); People v. Peck, 285 Ill.App.3d 14, 23, 220 Ill.Dec. 897, 903, 674 N.E.2d 440, 446 (1996).
The State, as the proponent of out-of-court statements sought to be admitted pursuant to section 115-10 of the Code, bears the burden of establishing that the statements were reliable and not the result of adult prompting or manipulation. People v. Zwart, 151 Ill.2d 37, 45, 175 Ill.Dec. 711, 714, 600 N.E.2d 1169, 1172 (1992). A reviewing court will reverse a trial court's determination pursuant to section 115-10 of the Code only when the record clearly demonstrates that the court abused its discretion. Zwart, 151 Ill.2d at 44, 175 Ill.Dec. at 714, 600 N.E.2d at 1172.
In this case, the circumstances surrounding K.S.' allegations made to Devall are particularly troubling. Approximately one month prior to K.S.' making statements to Devall implicating defendant, Devall interviewed her regarding alleged sexual abuse of an older sibling by a grandfather. The State did not introduce any evidence regarding the substance of Devall's previous interview of K.S. On cross-examination, Devall acknowledged that he could not specifically recall what he had asked K.S. during that prior interview.
The circumstances here are similar to those in Zwart, in which the alleged child victim had been interviewed on three prior occasions regarding alleged sexual abuse, and the State failed to introduce any evidence regarding the substance of those prior interviews. The supreme court in Zwart concluded that "[w]ithout such evidence, it was impossible for the trial court to determine whether the victim was questioned in a suggestive manner or was encouraged to accuse the defendant of sexual abuse." Zwart, *308 151 Ill.2d at 44-45, 175 Ill.Dec. at 714, 600 N.E.2d at 1172. Although the prior interview in this case dealt with allegations of sexual abuse of a sibling by someone other than defendant, without any evidence of the substance of that interview, it is impossible to determine to what extent Devall discussed the alleged sexual abuse by the grandfather or whether Devall questioned K.S. in a suggestive manner or somehow intimated that defendant was also a sexual abuser. See Zwart, 151 Ill.2d at 45, 175 Ill.Dec. at 714, 600 N.E.2d at 1172 ("A trial court should not presume from a silent record that suggestive interview techniques were not used"). Evidence as to what transpired during the prior interview was particularly important here because K.S.' age made her susceptible to suggestion from outsiders.
The lesson of Zwart is clear. When the declarant of a statement the State seeks to offer under section 115-10 of the Code has been previously interviewed concerning allegations of sexual misconduct and the previous interview is relatively recent with regard to the timing of the section 115-10 statement, the State must affirmatively establish the content of the previous interview and must affirmatively demonstrate that it did not compromise the reliability of the proffered statement. If the State fails to offer any evidence regarding the substance and circumstances of the prior interview, the proffered statement should not be admitted unless other factors strongly suggest that the statement is reliable and not the result of suggestiveness by others. Those individualsparticularly law enforcement officers or child abuse investigatorsinterviewing an alleged child victim should understand the importance of recording those interviews; it is simply not good enough to testify, "I don't recall what I asked the alleged victim."
In a given case, a statement by a child to a third party may have been given under circumstances which suggest sufficient indicia of reliability, and yet an argument could be madeperhaps successfullythat the statement was a product of suggestive interviewing techniques or manipulation. The best means to respond to this argument is for the child protective services investigator to audiotape (or record in some fashion) his interview of the alleged victim. Doing so provides the best evidence that no adult prompting or manipulation occurred, and trial courts can reasonably view the failure to do so as a negative factor when evaluating witness credibility and the State's claim that no improper interviewing techniques were used. Considering that many of the issues in a section 115-10 hearing are close, and considering further the deference courts of review would give to a trial court's ruling denying admission of the child's statement under section 115-10 of the Code, the State henceforth should be on notice of the risk it takes by not recording interviews of alleged child victims.
The descriptive terms K.S. used in response to Devall's questions tend to lend support to the reliability of K.S.' statements. For example, she referred to her vagina as her "private" (a term indicative of a young girl not versed in the nomenclature of bodily organs). See People v. Back, 239 Ill.App.3d 44, 59, 178 Ill.Dec. 895, 906, 605 N.E.2d 689, 700 (1992). However, K.S. did not make the out-of-court statements to Devall spontaneously. They occurred only during questioning by Devall after a report of sexual abuse against D.D. by a grandfather, a report of physical abuse against K.S. and her siblings by defendant, and a report of sexual abuse against D.D. by defendant. Moreover, K.S.' statements to Devall and Cordoni were inconsistent, which does not tend to support the reliability of her statements. For example, during her physical examination by Cordoni, K.S. told him that defendant put medicine in her, whereas K.S. told Devall that defendant put a bottle inside her "private."
In addition, K.S. recanted her allegations against defendant a few months prior to the April 1997 section 115-10 hearing. Regarding K.S.' motive to fabricate, Annette testified that K.S. told her that she had lied about defendant sexually abusing her because she was mad at defendant for hitting her and her siblings.
Section 115-10 of the Code specifies that the time of the victim's statements must provide sufficient safeguards for their reliability. In this case, the State alleged that *309 the abuse occurred between October and November 1993, and between June and July 1994. K.S.' statement to Devall was not made until September 16, 1994. K.S.' delay in reporting defendant's actions, standing alone, does not undermine the reliability of K.S.' statement. See Zwart, 151 Ill.2d at 45-46, 175 Ill.Dec. at 714-15, 600 N.E.2d at 1172-73; see also People v. Land, 241 Ill. App.3d 1066, 1081, 182 Ill.Dec. 476, 487, 609 N.E.2d 1010, 1021 (1993) (the fact that the defendant was the child's father explained the several-month delay in reporting the abuse). However, the delay becomes significant when considered in light of other factors which tend to show that K.S.' statements to Devall lacked reliability.
Viewing the totality of the circumstances surrounding the statements K.S. made to Devall, we conclude that the State failed to show the statements possessed sufficient "safeguards of reliability" under section 115-10 of the Code. Accordingly, we hold that the trial court abused its discretion by admitting the statements pursuant to that statutory provision, and our conclusion precludes their admission on remand.
We further conclude that the remaining evidence was sufficient to support a finding of guilt beyond a reasonable doubt. Thus, we remand for a new trial, noting that defendant faces no risk of double jeopardy on retrial. See People v. Cruz, 162 Ill.2d 314, 374, 205 Ill.Dec. 345, 373, 643 N.E.2d 636, 664 (1994).
III. ISSUES ON REMAND
We now consider issues likely to arise on remand.
A. Hearsay Statements Admitted Pursuant to Section 115-13
Defendant argues that the trial court erred by admitting K.S.' statements to Cordoni pursuant to section 115-13 of the Code. Specifically, he contends that Cordoni's testimony violated section 115-13 because K.S. did not see Cordoni for purposes of medical treatment or diagnosis but, rather, to compile evidence to be used in a subsequent prosecution. We disagree.
Section 115-13 of the Code provides, as follows:
"In a prosecution for violation of [s]ection 12-13, 12-14, 12-15[,] or 12-16 of the `Criminal Code of 1961[,'] statements made by the victim to medical personnel for purposes of medical diagnosis or treatment including descriptions of the cause of symptom, pain or sensations, or the inception or general character of the cause or external source thereof insofar as reasonably pertinent to diagnosis or treatment shall be admitted as an exception to the hearsay rule." 725 ILCS 5/115-13 (West 1992).
(Defendant here was being tried for aggravated criminal sexual assault, a violation of section 12-14 of the Criminal Code of 1961 (720 ILCS 5/12-14(b)(1) (West 1992)).) Section 115-13 of the Code is a narrow codification of the common law rule permitting the use of hearsay evidence revealed during medical treatment. People v. Falaster, 173 Ill.2d 220, 229, 218 Ill.Dec. 902, 907, 670 N.E.2d 624, 629 (1996).
In Falaster, following the child victim's report of abuse to authorities, an assistant State's Attorney accompanied the child to an examining physician's office. Falaster, 173 Ill.2d at 233, 218 Ill.Dec. at 909, 670 N.E.2d at 631 (Harrison, J., specially concurring, joined by McMorrow, J.). Once there, a registered nurse obtained a medical history from the child prior to the physician's examination. During the taking of the history, the child described the sexual abuse and identified the defendant as her offender. The trial court allowed the nurse's testimony regarding the child's statements. On appeal, the defendant contended that section 115-13 did not authorize the use of the nurse's testimony because the victim was not at the doctor's office "for purposes of medical diagnosis or treatment." Instead, the defendant claimed that the victim underwent the examination solely as a means of developing evidence for use in a subsequent prosecution. Falaster, 173 Ill.2d at 228-29, 218 Ill.Dec. at 906-07, 670 N.E.2d at 628-29. In rejecting the defendant's contention, the supreme court wrote the following:
*310 "We do not agree with the defendant that the diagnostic purpose of the examination would be incompatible with its investigatory function. We note, moreover, that the statute does not distinguish between examining physicians and treating physicians." (Emphasis added.) Falaster, 173 Ill.2d at 229, 218 Ill.Dec. at 907, 670 N.E.2d at 629.
In the present case, Devall took K.S. to be examined by Cordoni on October 25, 1994. Cordoni testified that he obtained a medical history from K.S. and completed a physical examination of her. Cordoni stated that the purpose of taking a medical history from K.S. "was to obtain information about the nature of the alleged sexual assault, exactly what happened to her[,] and get an idea of what possible potential findings or abnormalities might be present." Cordoni further stated that a medical history is relevant to both his examination and diagnosis of a patient. During the taking of K.S.' medical history, K.S. described to Cordoni the sexual abuse and identified defendant as her offender.
Consistent with the supreme court's decision in Falaster, we conclude that the examination conducted in this case was for a purpose within the scope of section 115-13 of the Code. Accordingly, we hold that the trial court did not err by admitting Cordoni's testimony regarding K.S.' statements pursuant to that section.
Having so concluded, we also reject defendant's contention that if section 115-13 of the Code "is interpreted to permit the admission of such statements, that section violates the constitutional right of confrontation." In People v. Roy, 201 Ill.App.3d 166, 178, 146 Ill.Dec. 874, 882-83, 558 N.E.2d 1208, 1216-17 (1990), this court addressed this issue and held that statements properly admitted pursuant to section 115-13 of the Code do not deny a defendant his confrontation rights. In so concluding, this court wrote, as follows:
"Section 115-13 is a codification of the firmly rooted common law hearsay exception allowing statements describing medical history, symptoms, pain, or sensations made for purposes of medical diagnosis or treatment. The assumption underlying both section 115-13 and the common law exception is that the desire for proper diagnosis or treatment outweighs any motive to falsify. Mere codification of the common law rule does not change these assumptions, nor are they negated when minor children are involved." Roy, 201 Ill.App.3d at 179, 146 Ill.Dec. at 883, 558 N.E.2d at 1217.
B. The Trial Court's Decision To Allow the DCFS Investigator To Testify Regarding Recantation by Sexually Abused Children
Defendant argues that the trial court erred by allowing Devall to testify about the frequency with which child victims of sexual abuse recant and the reasons for such recantation. Specifically, he contends that Devall's testimony constituted an improper comment on the veracity of K.S.' trial testimony and invaded the province of the jury to assess K.S.' credibility. We agree.
A trial court should allow expert testimony only if (1) the proffered expert has knowledge and qualifications uncommon to laypersons that distinguish him as an expert; (2) the expert's testimony would help the jury understand an aspect of the evidence that it otherwise might not understand, without invading the province of the jury to determine credibility and assess the facts of the case; and (3) the expert's testimony would reflect generally accepted scientific or technical principles. People v. Enis, 139 Ill.2d 264, 288, 151 Ill.Dec. 493, 502, 564 N.E.2d 1155, 1164 (1990); People v. Wilson, 246 Ill.App.3d 311, 320, 186 Ill.Dec. 226, 231, 615 N.E.2d 1283, 1288 (1993).
Section 115-7.2 of the Code allows admission, as evidence, of the testimony of an expert qualified by the trial court relating to any recognized and accepted form of posttraumatic stress syndrome. 725 ILCS 5/115-7.2 (West 1992). This court has previously applied this statute to allow experts to explain or testify with respect to certain symptoms or behavioral characteristics of child victims of sexual abuse, including (1) abnormal fears; (2) nightmares; (3) acting out sexually with toys or other children; (4) precocious sexual knowledge and the ability to relate explicit sexual behavior; (5) excessive masturbation; (6) regressive behavior, *311 including bed-wetting; (7) being fearful and clinging to certain people; (8) tantrums and sudden mood swings; (9) complaints of pain in the vaginal or anal areas; (10) self-destructive behavior; (11) problems communicating with others; (12) inability to trust others; (13) failure in school; and (14) initial denial of the abuse. See People v. Turner, 241 Ill.App.3d 236, 244-45, 181 Ill.Dec. 655, 661-62, 608 N.E.2d 906, 912-13 (1993) (allowing police officer's testimony regarding the tendency of child sexual abuse victims to initially deny that they have been sexually abused); People v. Wasson, 211 Ill.App.3d 264, 271, 155 Ill.Dec. 710, 715, 569 N.E.2d 1321, 1326 (1991) (allowing therapist's testimony regarding behaviors indicative of sexual abuse and application of such knowledge to the facts of the case); People v. Roy, 201 Ill.App.3d 166, 180, 146 Ill.Dec. 874, 884, 558 N.E.2d 1208, 1218 (1990) (allowing pediatrician's testimony as to behavioral characteristics of child victims of sexual abuse under the label of posttraumatic stress syndrome); People v. Coleman, 205 Ill.App.3d 567, 585, 150 Ill.Dec. 883, 894, 563 N.E.2d 1010, 1021 (1990) (allowing testimony of nurse, physician, and therapist regarding behavioral characteristics of child victims of sexual abuse).
However, in Wilson, 246 Ill.App.3d at 322, 186 Ill.Dec. at 232, 615 N.E.2d at 1289, this court upheld the trial court's rejection of the defendant's proffered expert testimony concerning the reliability of child-victim testimony, specifically child victims' allegedly poor memories and proclivities to invent accusations. In that case, the defendant's expert testified in an offer of proof regarding his findings in studies about how the limited cognitive ability of child victims taints their recollection of events. In upholding the trial court's ruling, this court concluded that the proffered testimony (1) would not have provided the jury with much information beyond the knowledge of an average layperson, and (2) would have severely impinged on the province of the jury to determine credibility and assess the facts of that case.
The Wilson court noted that the supreme court in Enis had addressed a similar situation when the defendant in that case offered an expert to testify about the reliability of eyewitness testimony, as follows:
"Although the [Enis] court noted that much of the expert's testimony would have resolved purported `myths' about eyewitness testimony that were not pertinent to that case, the court wrote the following:
`We caution against the overuse of expert testimony. Such testimony, in this case concerning the unreliability of eyewitness testimony, could well lead to the use of expert testimony concerning the unreliability of other types of testimony and, eventually, to the use of experts to testify as to the unreliability of expert testimony. So-called experts can usually be obtained to support most any position. The determination of a lawsuit should not depend upon which side can present the most or the most convincing expert witnesses. We are concerned with the reliability of eyewitness expert testimony [citations], whether and to what degree it can aid the jury, and if it is necessary in light of defendant's ability to cross-examine eyewitnesses. An expert's opinion concerning the unreliability of eyewitness testimony is based on statistical averages. The eyewitness in a particular case may well not fit within the spectrum of these averages. It would be [inappropriate] for a jury to conclude, based on expert testimony, that all eyewitness testimony is unreliable.' " Wilson, 246 Ill.App.3d at 321, 186 Ill.Dec. at 232, 615 N.E.2d at 1289, quoting Enis, 139 Ill.2d at 289-90, 151 Ill. Dec. at 503, 564 N.E.2d at 1165.
In the present case, we hold that Devall's testimony regarding the frequency of and reasons for recantation by child victims of sexual abuse (1) did not aid the jury in reaching its conclusion, and (2) severely impinged upon the province of the jury to determine credibility and assess the facts of the case. Devall testified that, in his experience, about 50% of children who made allegations of sexual abuse subsequently recanted those allegations. He further testified that based upon his education and training, including articles he had read, some of the reasons child victims recant include an unsupportive family and the child feeling blamed for the abusive parent's absence from the family. However, in this case, no evidence was presented *312 that K.S. recanted her allegations against defendant because of an unsupportive family or because she felt like a scapegoat. Thus, Devall's testimony had nothing to do with K.S.' credibility. See Enis, 139 Ill.2d at 289-90, 151 Ill.Dec. at 503, 564 N.E.2d at 1165 (expert opinion testimony would not have aided the trier of fact in reaching its conclusion when the testimony regarding purported "myths" of eyewitness testimony had little or no similarities to the eyewitnesses in that case).
When stripped to its basic level, Devall's testimony regarding recantation by child victims constitutes a commentary on K.S.' credibility, similar to eyewitness opinion testimony. In essence, Devall was being asked to give his opinion on the believability of K.S., the child witness in this case. We view testimony regarding symptoms and behavioral characteristics as being different because such testimony does not constitute direct commentary on the child witness' believability. Instead, that testimony constitutes circumstantial evidencethat is, it describes certain behaviors shown by sexually abused children; thus, if other evidence shows the victim in a particular case engaged in those behaviors, a jury could reasonably view that evidence as supporting the State's claim that the child had been sexually abused. Just as trial courts reject defense attempts to offer purported expert testimony attacking witnesses' credibility, so should trial courts reject the State's attempt to use purported expert testimony to bolster witnesses' credibility. These are matters best left to the trier of fact. Accordingly, we hold that the trial court abused its discretion by allowing Devall's testimony regarding recantation by child victims of sexual abuse.
IV. CONCLUSION
For the reasons stated, we reverse and remand for a new trial consistent with the views expressed herein.
Reversed and remanded.
GREEN and McCULLOUGH, JJ., concur. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1591447/ | 70 S.W.3d 265 (2001)
Fred GILCREASE & Dorothy Gilcrease, Appellants,
v.
TESORO PETROLEUM CORPORATION, Appellee.
No. 04-00-00699-CV.
Court of Appeals of Texas, San Antonio.
December 26, 2001.
*267 Carol P. Lomax, James L. Branton, Branton & Hall, P.C., San Antonio, Charles S. Siegel, Fernando P. Arias, Sherrie Pouzar, Waters & Kraus, L.L.P., Dallas, for Appellant.
Robert G. Newman, Lisa Horvath Shub, W. Wendell Hall, Fulbright & Jaworski, L.L.P., San Antonio, for Appellee.
Sitting: PHIL HARDBERGER, Chief Justice, PAUL W. GREEN, Justice and SARAH B. DUNCAN, Justice.
OPINION
PAUL W. GREEN, Justice.
Fred and Dorothy Gilcrease ("the Gilcreases") appeal the trial court's entry of summary judgment in favor of Tesoro Petroleum Corporation in two issues, claiming Alaska's ten-year statute of repose does not apply to bar their claims. We affirm the summary judgment.
Background
After Fred Gilcrease, now deceased, discovered he had mesothelioma in 1999, he and his wife, Dorothy, filed suit against the owners of thirty-six refineries, including Tesoro, the owner of a refinery in Kenai, Alaska. Fred had worked in Tesoro's Alaskan refinery in 1974 and 1980 as a welder and pipefitter. Although the Gilcreases were residents of Oregon at the time suit was filed and Fred had never worked in a Texas refinery, the Gilcreases brought suit in Texas under Texas's borrowing statute. See Tex. Civ. Prac. & Rem. Code Ann. § 71.031 (Vernon Supp.2001). Section 71.031 permits nonresident plaintiffs to bring suit for wrongful conduct occurring in a foreign state so long as suit is filed in Texas "within the time provided by the laws of the foreign state or country in which the wrongful act, neglect, or default took place." Id.
The Gilcreases filed suit in Bexar County, alleging Tesoro failed to provide protective equipment and warn about the dangers of asbestos exposure. Tesoro filed a motion for summary judgment, arguing Alaska's ten-year statute of repose applied to bar the Gilcreases' claims. While Alaska has a statute of repose requiring personal injury plaintiffs to bring suit within ten years of the wrongful conduct, Texas has no similar provision. See Alaska Stat. § 09.10.055(a) (West 1997). The trial court granted summary judgment.
Texas's Section 71.031
The Gilcreases claim the trial court erred in granting summary judgment because, although the borrowing statute in section 71.031 requires nonresident plaintiffs to satisfy procedural time limits, such as statutes of limitation, the Gilcreases argue it does not encompass substantive limitations, such as foreign *268 statutes of repose.[1] Whether section 71.031 requires the nonresident plaintiff to satisfy foreign statutes of repose is a case of first impression in Texas. In construing a statute, our objective is to give effect to the legislature's intent. Albertson's, Inc. v. Sinclair, 984 S.W.2d 958, 960 (Tex.1999). To determine legislative intent, we look to the language of the statute, relevant legislative history, the object sought to be obtained, and the consequences following from alternate constructions. In re Bay Area Citizens Against Lawsuit Abuse, 982 S.W.2d 371, 380 (Tex.1998).
A. Language of Section 71.031
In relevant part, section 71.031 provides:
(a) An action for damages for the death or personal injury of a citizen ... of the United States ... may be enforced in the courts of this state, although the wrongful act, neglect, or default causing the death or injury takes place in a foreign state or country, if:
(3) for a resident of a foreign state or country, the action is begun in this state within the time provided by the laws of the foreign state or country in which the wrongful act, neglect, or default took place.
Tex. Civ. Prac. & Rem.Code Ann. § 71.031(a)(3) (emphasis added). Section 71.031 fails to provide language defining the scope of the statute's language referring to "foreign time limitations," and as such, we must examine the statute's legislative history to discern the legislature's intent.
B. Legislative History of Section 71.031
Recently, the supreme court traced the history of section 71.031, noting the statute's original version was enacted in 1913 to provide Texas citizens the convenience of bringing suit in Texas for out-of-state wrongful conduct.[2] In 1985, the statute was consolidated with its sister provisions and codified into section 71.031. Dubai Petroleum Co., 12 S.W.3d at 76-78. Importantly, the 1985 version did not contain language imposing foreign time limits on nonresidents' claims. House Comm. on Civil Practices, Bill Analysis, Tex. S.B. 220. In other words, a California resident suing based on "wrongful conduct" occurring in California could bring suit in Texas so long as the Texas statute of limitations had not expired, regardless of whether the suit was barred by the California statute of limitations.
In 1997, the Legislature proposed Senate Bill 220 in response to concerns that Texas courtrooms were becoming crowded by nonresidents' personal injury lawsuits. Dubai, 12 S.W.3d at 77-78. The open-ended nature of the 1985 version had made Texas courts too amenable to nonresident plaintiffs whose out-of-state claims were barred by more restrictive foreign time limitations. Owens Corning v. Carter, 997 S.W.2d 560, 565-66 (Tex.1999). By not limiting nonresidents to the time constraints imposed by the foreign state where the claim *269 arose, former section 71.031 encouraged nonresidents to forum shop in Texas the result, Texas courtrooms crowded with suits having little or no connection to Texas at the expense of Texas residents. Id. In passing Senate Bill 220, the Legislature amended section 71.031 to add the "borrowing" language currently found in subsection (a)(3). Id. at 566. Now, a nonresident may bring suit in Texas under section 71.031 only if the suit satisfies Texas's time limits along with those imposed by the state or country where the wrongful act took place. Id.
By amending section 71.031 to add the "time limitation" language, the Texas Legislature demonstrated a clear intent to prevent forum shopping. Both statutes of limitation and statutes of repose serve to limit the amount of time under which suit may be brought, and therefore, we hold a nonresident plaintiff bringing suit under section 71.031 must satisfy not only the statute of limitations, but also the statute of repose "of the foreign state or country in which the wrongful act, neglect, or default took place."[3] To hold otherwise encourages the very behavior sought to be prevented by the Legislature. We overrule the Gilcreases' first issue.[4]
Alaska's Section 09.10.055
After holding section 71.031 requires the imposition of foreign statutes of repose, we must determine whether Alaska's repose statute, section 09.10.055, bars the Gilcreases' claims. Section 09.10.055 requires plaintiffs to bring suit within ten years of "the last act alleged to have caused the personal injury, death, or property damage." Alaska Stat. § 09.10.055(a) (West 1997). In this case, Mr. Gilcrease was exposed to asbestos in 1974 and and 1980; therefore, section 09.10.055 requires him to have filed suit by 1990. The Gilcreases did not file suit until 1999; however, they argue their claims are not barred because they fall outside the repose statute's effective date and, alternatively, within the applicable exceptions.
C. Section 09.10.055's Effective Date
Section 09.10.055 applies to "causes of action accruing on or after August 7, 1997." See Alaska Stat. § 09.10.055 (editor's notes) (emphasis added). The Gilcreases argue their claims accrued in 1974 and 1980 when Mr. Gilcrease was exposed to asbestos, and consequently, the repose statute does not apply. However, Alaska, like Texas, applies the discovery rule. As such, the Gilcreases' claims did not "accrue" until they knew or reasonably should have known of the injury. See Pedersen v. Zielski, 822 P.2d 903, 906-08 (Alaska 1991) (stating "[o]rdinarily, a personal injury action `accrues' when the plaintiff is injured.... *270 Under the discovery rule, the cause of action accrues when the plaintiff has information sufficient to alert a reasonable person to the fact that he has a potential cause of action"). The Alaska Supreme Court reaffirmed its Pedersen holding in 2001 by providing the following scenario:
The [exposure] giving rise to this lawsuit occurred between September 11 and 16, 1990. Sopko did not file suit until April 11, 1996. The applicable limitations period, defined by AS 09.10.070, is two years. The discovery rule bars Sopko's claim unless his cause of action "accrued" on or after April 11, 1994. Under the terms of the discovery rule, Sopko's claim accrued before this date if Sopko discovered, or reasonably should have discovered, the existence of all of the elements of his cause of action before April 11, 1994.
Sopko v. Dowell Schlumberger, Inc., 21 P.3d 1265, 1270 (Alaska 2001). We hold the Gilcreases' claims are governed by section 09.10.055.
D. Application of Section 09.10.055
The Gilcreases also argue their claims fall within section 09.10.055's exception for "prolonged exposure to hazardous waste" or, alternatively, within the tolling provision premised upon the presence of "foreign bodies."[5]
1. Hazardous Waste Exception
The Gilcreases argue that because asbestos is "inherently dangerous to humans," it is governed by section 09.10.055's exception for "prolonged exposure to hazardous waste."[6] We disagree with the Gilcreases' characterization of asbestos. Although section 09.10.055 does not define "hazardous waste," the section's legislative history suggests the term refers to solid wastes, as opposed to air contaminants, like asbestos:
Representative Ethan Berkowitz asked whether hazardous waste had a legal definition or was addressed by a body of law.
Representative Porter replied, "It is an attempt to address another concern that was raised of the more typical kinds of `someone's property leached chemicals into my property and I didn't know about it,' those kinds of things."
Floor Debates on H.B. 58, Ch. 26 SLA 97, Feb. 21, 1997, No. 1050. No Alaska statute characterizes asbestos as a "hazardous waste." Indeed, when the Alaska Legislature chose to regulate asbestos, it published the provision within the Health, Safety, and Housing Code, rather than in the section regulating "hazardous wastes." Compare Alaska Stat. § 18.31.200 (Lexis 1998) (requiring certification to conduct asbestos abatement services), with Alaska Stat. § 46.03.302 (Lexis 1998) (requiring a special *271 permit to treat or dispose of hazardous waste).
Further, the Alaska Legislature, like Congress, has drawn a distinction between the regulation of solid waste and the regulation of air contaminants. Alaska's Air Quality Control Act adopts the list of "air contaminants" provided within the federal Air Quality Control Act. Alaska Stat. § 46.14.990(1), (4) (Lexis 1998) (regulating pollutants "listed in or under 42 U.S.C. § 7412(b)"). Asbestos is listed among the "hazardous air contaminants" regulated. 46 U.S.C. § 7412(b)(1) (West 1995 & Supp. 2001). We hold the Gilcreases' absestos-exposure claims do not fall within the "hazardous waste" exception to section 09.10.055.
"Foreign Bodies" Tolling Provision
The Gilcreases also argue their claims fall under section 09.10.055's tolling provision, which permits the ten-year period to be tolled:
during any period in which there exists the undiscovered presence of a foreign body that has no therapeutic or diagnostic purpose or effect in the body of the injured person and the action is based on the presence of the foreign body.
Alaska Stat. § 09.10.055(c) (Lexis 1998). Neither section 09.10.055 nor any other Alaska provision defines the term, "foreign body."[7] The legislative history indicates a narrow interpretation of the term is appropriate:
Representative Porter referred to Section 5(2)(c), which he described as somewhat unusual, a sticking point for which accommodation was made along the way. "The old sponge left in the body after surgery" kept coming up, he said. "We toll the statute of repose. Tolling is a nice legal word for meaning that it's null and void, held in abeyance until this thing is discovered, that if there is a foreign body that has no therapeutic or diagnostic purpose found ... in a person's body, that is an exception to the statute of repose."[8]
Further, other courts tolling repose statutes in cases involving asbestos exposure rely on specific provisions expressly regulating "asbestos-related injuries." See, e.g., Travis v. Ziter, 681 So. 2d 1348, 1354-55 (Ala.1996) (discussing Alabama's statutory exceptions to repose statutes for "asbestos actions" and "medical malpractice"); Holmes v. ACandS, Inc., 711 N.E.2d 1289, 1290 (Ind.Ct.App.1999) (discussing Indiana's "asbestos exception" to its ten-year repose statute); Ripley v. Tolbert, 260 Kan. 491, 921 P.2d 1210, 1219 (1996) (discussing Kansas's "latent disease exception," which expressly mentions asbestos); Rose v. Fox Pool Corp., 335 Md. 351, 643 A.2d 906, 914-15 (1994) (discussing the *272 exception for "asbestos-related diseases"); Spilker v. City of Lincoln, 238 Neb. 188, 469 N.W.2d 546, 546 (1991) (discussing exception for "injuries arising from exposure to asbestos"); Wyatt v. A-Best Prods. Co., 924 S.W.2d 98, 103-04 (Tenn.Ct.App.1995) (discussing Tennessee's "asbestos" and "silicon breast implant" exceptions to the ten-year repose statute). We hold the Gilcreases' claims do not fall within section 09.10.055's tolling provision based upon the presence of "foreign bodies." We overrule the Gilcreases' second issue.
Conclusion
Because we interpret section 71.031 to encompass foreign statutes of repose, we hold the Gilcreases' claims are governed by Alaska's ten-year statute of repose, section 09.10.055. Further, we hold the Gilcreases' claims fall within section 09.10.055's effective date and outside the claimed exceptions. We overrule the Gilcreases' issues and affirm the summary judgment in favor of Tesoro.
NOTES
[1] "Unlike traditional limitations provisions, which begin running upon accrual of a cause of action, a statute of repose runs from a specified date without regard to accrual of any cause of action. One court has characterized statutes of repose as `a substantive definition of, rather than a procedural limitation on, rights.'" Trinity River Auth. v. URS Consultants, Inc., 889 S.W.2d 259, 261 (Tex. 1994) (quoting Lamb v. Wedgewood South Corp., 308 N.C. 419, 302 S.E.2d 868, 872 (1983)).
[2] Dubai Petroleum Co. v. Kazi, 12 S.W.3d 71, 76-78 (Tex.2000); see Act of April 8, 1913, 33rd Leg., R.S., ch. 161, § 1, 1913 Tex. Gen. Laws 338, 338; Act of March 30, 1917, 35th Leg., R.S., ch. 156, § 1, 1917 Tex. Gen. Laws 365, 365.
[3] Although some courts have excluded statutes of repose from the scope of their borrowing statute, other courts, focusing on the legislative intent to prevent forum shopping, have held borrowing statutes encompass foreign statutes of repose. See, e.g., Stuart v. American Cyanamid Co., 158 F.3d 622, 627 (2d Cir.1998) ("[T]he purpose of the borrowing statutepreventing forum shopping by plaintiffs seeking the holy grail of the longer periodis best served by applying the period of the foreign state, regardless of how it is denominated."); Barnett v. Johnson, 839 F. Supp. 236, 238-40 (S.D.N.Y.1993); Giest v. Sequoia Ventures, Inc., 83 Cal. App. 4th 300, 303-04, 99 Cal. Rptr. 2d 476 (2000); Hall v. General Motors Corp., 229 Mich.App. 580, 582 N.W.2d 866, 871 (1998).
[4] The Gilcreases also argue Tesoro's "wrongful conduct" occurred at the Texas headquarters, rather than at the Alaska refinery, and as such, Texas law applies. However, the Gilcreases brought suit under section 71.031, which by its own language, applies only when the "wrongful conduct" occurs outside Texas.
[5] Alaska Stat. § 09.10.055(b)-(c) (Lexis 1998). The Gilcreases' arguments regarding the applicability of two other exceptions, the defective product exception and the gross negligence exception, are waived for failure to raise them at the trial court level. City of Houston v. Clear Creek Basin Auth., 589 S.W.2d 671, 678 (Tex.1979).
[6] The GENERAL PROVISIONS of the ENVIRONMENTAL CONSERVATION CODE defines "hazardous waste" as "a waste or combination of wastes that because of quantity, concentration, or physical, chemical, or infectious characteristics may ... cause, or significantly contribute to, an increase in mortality or an increase in serious irreversible or incapacitating reversible illness." ALASKA STAT. § 46.03.900(9) (Lexis 1998). Importantly, the GENERAL PROVISIONS separately define the term, "air contaminant," as "dust, fumes, mist, smoke, other particulate matter, vapor, gas, odorous substances or a combination of these." Id. § 46.03.900(1).
[7] The Alaska Legislature has used the term in only one other statute relating to optometrists. Alaska Stat. § 08.72.273 (West 2001) (providing that a "licensee may remove superficial foreign bodies from the eye and its appendages").
[8] Floor Debates on H.B. 58, Ch. 26 SLA 97, Feb. 21, 1997, No. 1050. Other states use the term consistent with this purpose. See, e.g., Calif. Civ. Proc.Code § 340.5 (West 2001) (tolling the three-year limitations period on medical malpractice actions until the discovery of "the presence of a foreign body, which has no therapeutic or diagnostic purpose or effect"); Fla. Stat. Ann. § 766.102(4) (West 2001) (creating a presumption of negligence upon proof that a foreign body was left in patient's body); Wash. Rev.Code Ann. § 4.16.350 (West 2001) (providing medical malpractice action must be commenced within three years of the wrongful conduct, but tolling the period "upon proof of ... the presence of a foreign body not intended to have a therapeutic or diagnostic purpose"). | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/2062210/ | 104 Mich. App. 97 (1981)
304 N.W.2d 495
YON
v.
THE ALL AMERICAN TRANSPORT COMPANY, INC
Docket No. 46027.
Michigan Court of Appeals.
Decided March 3, 1981.
Coleman, Lipson & Bradford, P.C., for plaintiffs.
Plunkett, Cooney, Rutt, Watters, Stanczyk & Pedersen, P.C. (by Larry Mason and Jeannette A. Paskin), for defendants on appeal.
Before: V.J. BRENNAN, P.J., and BRONSON and BASHARA, JJ.
BRONSON, J.
Plaintiffs commenced an action based on defendants' alleged negligence. Leo Yon sought damages for severe and permanent injuries, and Charlotte Yon sought damages for loss of consortium. On December 1, 1975, defendants filed their answer denying liability. At this time, they also filed a jury demand.
*99 On May 17, 1979, at a settlement conference held in the judge's chambers one hour before trial was to begin, it was discovered that the jury fee had not been paid. Plaintiffs offered to pay the fee, but the trial judge refused. The trial court stated that it would accept the fee from defendants' lawyer's firm, however. Consequently, defendants' trial counsel phoned his clients to ascertain if they still desired a jury. Upon returning from making the call, he stated that his clients wished to proceed without a jury.
A bench trial was conducted on May 17 and 18, 1979. At the close of plaintiffs' proofs, defendants moved for a directed verdict pursuant to GCR 1963, 515.1. The trial court stated that he would treat the motion as one for dismissal pursuant to GCR 1963, 504.2, which he granted. A judgment of no cause of action was entered on June 1, 1979.
On June 7, 1979, plaintiffs moved for a new trial in part based on the court's denial of a jury trial. A hearing was held on June 22, 1979, and plaintiffs' motion was denied. Plaintiffs now appeal as of right, contending that the trial court abused its discretion in denying them a jury.
GCR 1963, 508, which governs demands for jury trials in the circuit courts, provides in pertinent part:
".2 Demand.
"(1) Actions Commenced in Circuit Courts. Any party may demand a trial by jury of any issue so triable of right by filing a demand therefor in writing at any time after the commencement of the action and not later than 30 days after the filing of the answer or a reply filed within the time prescribed. Such demand may be endorsed on a pleading of a party if notice of the demand is included in the entitlement of the pleading.
* * *
*100 ".4 Waiver; Withdrawal. The failure of a party to file a demand as required by this rule or to deposit the jury fee by the close of the pretrial conference constitutes waiver by him of trial by jury. A waiver of trial by jury is not revoked by an amendment of a pleading asserting only a claim or defense arising out of the conduct, transaction, or occurrence set forth or attempted to be set forth in the original pleading. A demand for trial by jury as herein provided may not be withdrawn without the consent, expressed in writing or in court, of the parties or their attorneys."
As a reading of the court rule reveals, to be entitled to a jury as a matter of right two requirements must be satisfied. First, there must be a timely demand. Second, there must be timely payment of the jury fee. See, also, Jamison v Lloyd, 51 Mich. App. 570, 573; 215 NW2d 763 (1974), lv den 392 Mich. 771 (1974).
Where a party fails to properly satisfy the prerequisites for obtaining a jury trial by right, whether or not a jury is utilized is a decision in the discretion of the court. The court's decision on whether or not to allow a trial by jury will not be overturned absent an abuse of discretion. Roberts v Duddles, 47 Mich. App. 601, 604-605; 209 NW2d 720 (1973).
In the instant case, we are compelled to find that the trial court abused its discretion by refusing to allow a jury trial. GCR 1963, 508.4 provides that the jury fee must be paid by the close of the pretrial conference. However, pursuant to Wayne County Circuit Court Rule 301.1(1), no pretrial conference is conducted except on motion of one of the parties or by order of the court. In this case, no pretrial conference was held. As such, the time at which the fee was due was somewhat unclear.
The lower court stated that the jury fee had to be paid within 30 days from the date stamped on *101 the notice of trial sent to the parties or else the jury would be deemed waived. In this case, however, the computer docket printout from the circuit court shows that the jury fee was paid on December 26, 1975. We conclude that, at most, the nondemanding party has an obligation to check with the clerk of the court to ascertain if the jury fee has been paid.[1] If said party is told that the fee has been paid, he or she has a right to rely on the clerk's statement.
In the case sub judice, the trial court acknowledged that either the demanding or nondemanding party had the right to pay the jury fee. Nonetheless, the judge permitted the more culpable defense counsel the opportunity to pay the fee if it still desired, while refusing to allow the plaintiffs' attorney this option.[2] We are unable to divine any reason upon the record at hand which could possibly justify the court in granting to defendants the exclusive option of whether or not to proceed with a jury trial when they were errant in not timely paying the fee in the first instance.
Defendants contend that GCR 1963, 508.2(1) contemplates *102 a request by all parties desiring a jury trial. In their opinion, since plaintiffs did not demand a trial by jury, they had no right to pay the fee. We disagree with this construction because it would render nugatory the last sentence of GCR 1963, 508.4, which prohibits either party from unilaterally withdrawing a jury demand without the consent of the opposing party. This sentence impliedly recognizes that only one of the parties to a lawsuit need demand a jury trial. If each party was required to demand a jury trial to make certain that the right would not be lost, there would be no need for a rule prohibiting unilateral withdrawal of the demand. Indeed, one would expect the court rules to permit unilateral withdrawal as no party could rely on its opposition's jury demand.[3]
At oral argument before this Court, defendants' attorney contended that even if we found that the *103 circuit judge abused his discretion in denying the jury trial, in light of his decision to grant defendants' motion to dismiss, no prejudice was established by plaintiffs. We have examined the trial record and conclude that the issue of defendants' negligence would have been submitted to the jury had a jury been empaneled to sit as factfinder.[4] The trial court is not obligated to examine the evidence in the light most favorable to the plaintiff where a motion to dismiss is under consideration. This is the crucial difference between it and a motion for a directed verdict. Murphy Real Estate Corp v Barron, 55 Mich. App. 210, 219; 222 NW2d 184 (1974). Since a trial court's decision to grant a motion to dismiss does not necessarily mean that the evidence was insufficient to create a jury question, we must reverse.
Reversed and remanded.
NOTES
[1] There is no dispute over whether plaintiffs' counsel checked with the court clerk concerning the jury fee. However, the parties do disagree concerning when this check occurred. On the facts of this case, we do not deem the actual time at which the check occurred especially relevant.
[2] Wayne County Administrative Order 1978-1 provides:
"The statutory jury fee shall be paid at the time of filing a timely demand for jury trial in writing as provided in GCR 1963, 508.2(1). If notice of the demand is not included in the entitlement of a pleading as provided in GCR 1963, 508.2(1), the demand for jury trial shall appear on a separate paper filed with the County Clerk. The County Clerk shall strictly enforce this order and shall refuse to accept for filing any pleading or separate jury demand which does not comply with this order and GCR 1963, 508. Failure to comply with this order and GCR 1963, 508 shall be deemed a waiver of trial by jury by the parties failing to comply."
Thus, in cases commenced in Wayne County after January 3, 1978, the effective date of the order, the problem here should not arise again. However, it could still occur in other counties.
[3] Although we do not need to reach the question of the best construction of GCR 1963, 508 because we have concluded that the court's actions here constitute an abuse of discretion without reaching this issue it seems to us that a careful reading of the rule undercuts the trial court's action. The first and final sentences of GCR 1963, 508.4 are the keys to understanding how the rule should be applied. The final sentence provides that once a party has demanded a jury trial that party cannot withdraw the demand without the consent of all the other parties. This sentence does not require that both the demand be filed and the fee paid before the right to unilaterally withdraw ceases. The first sentence of GCR 1963, 508.4 provides that a party who fails to demand a jury as required by this rule loses the right. However, as noted in the body of this opinion, we reject the idea that once a jury demand has been filed by the opposition the other side is also required to demand a jury. Thus, this portion of the rule applies only to a situation where neither party has filed a demand and one side now seeks a jury. The sentence also provides that failure to timely pay the jury fee also constitutes a waiver of a jury trial. However, as we read this sentence, what this means is that the party who has demanded a jury trial but does not timely pay the fee waives the right. A jury trial must still be had, however, where the opposite party continues to desire a jury, if he or she is willing to immediately pay the fee. To hold otherwise would be to allow the subversion of the final sentence of GCR 1963, 508.4. Instead of actually seeking to withdraw the demand, the demanding party could "withdraw" it simply by failing to pay the fee.
[4] This is particularly true in light of the fact that Michigan has adopted the comparative negligence doctrine. Placek v City of Sterling Heights, 405 Mich. 638; 275 NW2d 511 (1979). | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/2062212/ | 531 Pa. 279 (1992)
612 A.2d 430
COMMONWEALTH of Pennsylvania, Appellee,
v.
Malcolm MEDLEY, Appellant.
Supreme Court of Pennsylvania.
Argued December 5, 1991.
Decided June 17, 1992.
*280 Daniel M. Preminger, Philadelphia, for appellant.
Ronald Eisenberg, Deputy Dist. Atty., Catherine Marshall, Chief, Appeals Div. and Alan Sacks, Philadelphia, for appellee.
Before NIX, C.J., and LARSEN, FLAHERTY, McDERMOTT, ZAPPALA, PAPADAKOS and CAPPY, JJ.
OPINION
ZAPPALA, Justice.
This is an appeal from the Superior Court order affirming the judgment of sentence imposed on Malcolm Medley following his conviction for first degree murder, 18 Pa.C.S. § 2502, two counts of aggravated assault, 18 Pa.C.S. § 2702, carrying firearms on public streets or public property, 18 Pa.C.S. § 6108, criminal conspiracy, 18 Pa.C.S. § 903, and possessing instruments of crime, 18 Pa.C.S. § 907. We reverse.
On December 11, 1987, Michael Sanders was standing with Derval Hughes and Troy Brinkley in an area of the Abbotsford Projects in Philadelphia known as the "gully". The Appellant approached the gully, accompanied by a woman and another man. The Appellant wore a green army jacket and hat. The woman was identified as the Appellant's cousin, Carolyn Franklin.
*281 The unidentified man indicated that they had drugs. Hughes and Brinkley confronted the trio and told them they could not come into the projects to sell drugs. A brief argument ensued. The Appellant and his male companion left, saying that they would be back. The two men walked past Christopher Sanders, Michael's brother, who overheard them say, "Let's get strapped.", i.e., get guns.
Sanders left the gully after the argument to drive around with a friend. He saw the Appellant and the other man leaving in a gold-colored Nissan Maxima from the area where Carolyn Franklin lived. Approximately forty-five minutes later, Sanders saw the vehicle returning to the projects. Three people were in the vehicle, but he could not identify them.
When his friend dropped him off, Sanders walked down a path to where Hughes and Brinkley were standing with several other people. As they all stood talking, they heard gunshots. Hughes pushed Sanders and Sanders fell. When Sanders stood up and looked, he saw that one of the shooters was wearing a green army jacket.
Sanders began to run down the path and was shot in the buttocks. He fell again, but stood back up and continued running. With Hughes running behind him, they ran to the house of one of the neighbors in the project.
Sanders testified that he heard more than one gun. It sounded to him as if two weapons were being fired, one an automatic and the other a revolver. Sanders identified the Appellant as the shooter who wore the green army jacket.
Joel Allen was in the project when the shooting took place, although he did not witness the actual shooting. He heard a lot of gunshots that sounded as if they were fired from more than one weapon. Two men ran past Allen while he was running away. Allen identified one of the men as the Appellant's co-defendant, Shelton Alford. Alford pointed a gun at Allen, pulled the trigger and clicked on an empty chamber twice.
*282 The police were called to the scene. Hughes' gunshot wounds were fatal. Sanders had been shot once. Shannon Muse, another bystander, had been hit by three bullets.
Detective Michael Bittenbender was involved in the investigation of the shootings. From interviews with the victims and other witnesses, Bittenbender was aware that a gold Nissan Maxima had been seen in the area of the project at the time of the shootings. During his interview with Carolyn Franklin on the day after the incident, he learned that Franklin and the Appellant were cousins. He advised other police officers, including Officer Sean Dillon, to be on the alert for the vehicle.
Officer Dillon had been given the description and the license number of the vehicle. Detective Bittenbender specifically identified the Appellant by name as the owner of the vehicle. Bittenbender told Dillon that the Appellant was related to a woman who lived in the project. Bittenbender informed him that the Appellant may have had something to do with the homicide or had knowledge about the incident.
One week after the shooting, Officer Dillon spotted the vehicle while on patrol. The Appellant was driving the vehicle and Alford was in the front passenger seat. Dillon then contacted the Homicide Division.
Detective Bittenbender was not on duty, but another detective told Dillon to stop and hold the vehicle. Dillon was told that the detectives wanted to talk to the men. Dillon saw the vehicle again at a stop sign, pulled up behind and stopped it.
Officer Dillon had previously checked the information on the Appellant and knew that his license had been suspended. He told them that the detectives wanted to talk to them about the homicide. The Appellant did not respond.
The Appellant and Alford got out of the vehicle. Dillon patted them down for weapons. No weapons were found. Both men were then handcuffed and placed into the back of the police car.
They were taken to the police station for questioning by other police officers. Officer Dillon stayed behind with the Appellant's vehicle. The vehicle was subsequently impounded.
*283 Detective Francis Ansel was present when they were brought into the station. The officers informed him that they were looking for a car involved in a shooting, that they had reason to believe that this might be the car or similar car, and they had stopped the two men in the car. Detective Ansel spoke with both men and later took a formal statement from Alford.
The Appellant was placed in a waiting area while Detective Ansel questioned Alford. The door to the waiting area was locked. In order to leave the waiting area, a buzzer system would have to be activated to unlock the door. The buzzer system was controlled by a police detective who stood guard at the front desk.
Approximately four hours had elapsed from the time the Appellant had been stopped by the police until he was interrogated by Detective John Denham. Detective Denham was called into the station from home and arrived shortly after midnight. The Appellant gave a statement in which he said that he went to the project with Michael Couch on December 11, 1987, but left when residents threatened him. He stated that he then went to a party at the Holiday Inn at 18th and Market Street for the remainder of the night.
No Miranda warnings were ever given to the Appellant by any of the police officers. The Appellant was released once he had given a statement. He was informed that his vehicle would be confiscated until he produced his vehicle registration and a driver's license. On December 28, 1988, the police obtained a warrant to search the vehicle. A search of the car produced a green army jacket, a plastic bag containing white powder, and vials. On February 17, 1988, the Appellant and Alford were arrested.
Prior to trial, the Appellant filed a Motion to Suppress Statement and Physical Evidence which was denied. The Appellant argues that the trial court erred in denying his motion to suppress his statement and the physical evidence seized from his vehicle. With regard to his statement, the Appellant contends that his statement was the product of a *284 custodial interrogation and should have been suppressed since no Miranda warnings were given.
In reviewing the trial court's ruling, our initial task is to determine whether the factual findings are supported by the record. In making this determination, we must consider only the evidence of the prosecution's witnesses, and so much evidence of the defense that remains uncontradicted when fairly read in the context of the record as a whole. When the evidence supports the factual findings, we are bound by such findings; we may reverse only if the legal conclusions drawn therefrom are erroneous. Commonwealth v. Johnson, 467 Pa. 146, 151-52, 354 A.2d 886, 889 (1976).
At the hearing on the suppression motion, Detective Bittenbender testified that he had interviewed Carolyn Franklin on December 12, 1987, and Michael Sanders on December 14, 1987. He knew that the Appellant was her cousin and that the Appellant was involved in the argument that had occurred earlier at the project. He also had information that the Appellant's vehicle had been seen in the project at the time of the shooting and was seen leaving the project immediately after the homicide.
Officer Dillon testified that the Appellant's name was given to him as the owner of the gold Nissan Maxima. Detective Bittenbender informed him that the vehicle had been seen in the project on the night of the homicide. He was told that the Appellant may have had something to do with the homicide or may have known something.
The police were specifically on the lookout for the Appellant in connection with the incident. When Officer Dillon stopped the vehicle on December 18, 1987, the Appellant and Alford were told to get out of the car. They were informed that the police wanted to speak with them about a homicide that had occurred.
Both were frisked. Although neither of them was carrying a weapon, they were handcuffed and immediately transported to the police station. The officer never told them that they *285 did not have to go to the police station if they did not want to or that they were free to leave at anytime.
Alford and the Appellant were separated and interrogated at different times. Alford was searched in the interrogation room and asked to empty the contents of his pockets before being questioned. Detective Ansel testified that it would not be normal police procedure to ask a person who is not a suspect to take the contents out of his pockets.
While Detective Ansel questioned Alford, Medley was kept in the waiting area. The door to the waiting area was locked. The buzzer system had to be activated by the detective at the front desk before anyone was permitted to leave.
The Appellant was released after he gave his written statement to the detective. No Miranda warnings were given by the officers prior to questioning and taking the written statements from the Appellant and Alford. During Detective Benham's questioning, the Appellant was never told that he was free to leave.
Before an individual is subjected to custodial interrogation, he must make a knowing and intelligent waiver of his privilege against self-incrimination and right to counsel after adequate warning as to those rights. Miranda v. Arizona, 384 U.S. 436, 86 S. Ct. 1602, 16 L. Ed. 2d 694 (1966); Commonwealth v. Brown, 473 Pa. 562, 375 A.2d 1260 (1977).
The test for determining whether or not a person is in custody for Miranda purposes is whether he ". . . is physically deprived of his freedom of action in any significant way or is placed in a situation in which he reasonably believes that his freedom of action or movement is restricted by such interrogation. . . ." Commonwealth v. O'Shea, 456 Pa. 288, 292, 318 A.2d 713, 715 (1974), cert. denied 419 U.S. 1092, 95 S. Ct. 686, 42 L. Ed. 2d 685 (1974), (emphasis deleted; citation omitted). The test for custodial interrogation does not depend upon the subjective intent of the law enforcement officer interrogator.
It is of no significance that the Appellant was not arrested until February, 1988. ". . . [C]ustodial interrogation does not require that the police make a formal arrest, nor that the *286 police intend to make an arrest. Rather, the test of custodial interrogation is whether the individual being interrogated reasonably believes his freedom of action is being restricted." Commonwealth v. Brown, 473 Pa. at 570, 375 A.2d at 1264 (citations omitted.)
Applying this standard, we conclude that the conduct of the police officers placed the Appellant in a situation in which he could have reasonably believed that his freedom of movement was restricted. The Appellant was frisked, placed in handcuffs, transported to the police station, and placed in a secured waiting area until being interrogated. Indeed, it would be difficult to imagine a situation more likely to produce a belief that one's freedom of movement is restricted than that of being frisked, handcuffed, and transported to a police station.
The Commonwealth cites our decision in Commonwealth v. Horner, 497 Pa. 565, 442 A.2d 682 (1982) as controlling. In Horner, the appellant sought to suppress his written statement to the police on the basis that it was the product of custodial interrogation and had not been preceded by Miranda warnings. The police had arrived at the scene of a shooting. After the police had arrested a woman who told them that she had shot the victim, they told the appellant and several others that they were going to be taken in for questioning as witnesses. The police then transported the men in a van to a police administration building.
The facts underlying the Horner decision are distinguishable in a critical respect. Unlike the instant case, none of the men were frisked or handcuffed before being transported for questioning. Nor were any of the men believed to be involved in the shooting. Unlike the Commonwealth, we do not underestimate the significance of being frisked and handcuffed and the impact of such conduct on one's reasonable belief that freedom of movement has been restricted.
The trial court erred in concluding that the Appellant's statement was not the product of a custodial interrogation and *287 in failing to suppress the statement. The judgment of sentence is vacated and the matter is remanded for a new trial.[1]
McDERMOTT, J., notes his dissent.
NOTES
[1] The Appellant has raised the following additional issues:
(1) whether the physical evidence seized from the vehicle should have been suppressed; (2) whether the trial court improperly admitted the statements made by Shelton Alford; (3) whether the trial court erred in permitting a homicide detective to testify about the packaging and sale of drugs; and (4) whether trial counsel was ineffective. We have examined the additional claims and conclude that they are meritless. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/2062219/ | 417 Pa. Super. 216 (1992)
612 A.2d 450
Richard E. THOMPSON and Darlene I. Thompson, His Wife
v.
The MARYLAND AND PENNSYLVANIA RAILROAD PRESERVATION SOCIETY, Appellant.
Superior Court of Pennsylvania.
Argued April 8, 1992.
Filed June 30, 1992.
*219 Steven M. Hovis, York, for appellant.
Ronald L. Hershner, York, for appellees.
Vincent E. Duane, pro se.
Christopher R. Cook, pro se.
Before OLSZEWSKI, BECK and HOFFMAN, JJ.
HOFFMAN, Judge.
This is an appeal from judgment entered August 8, 1991, denying the Maryland and Pennsylvania Railroad Preservation Society's ["Preservation Society"] post-verdict motions, and upholding a jury verdict finding that Preservation Society did not have an interest in the property which was the subject of the dispute. Preservation Society contends that the trial court erred (1) by not allowing the society to introduce evidence on the issue of whether the railroad owned a fee simple interest; (2) by not granting Preservation Society's motion for a directed verdict; (3) by not entering judgment notwithstanding the verdict; (4) by committing reversible error in its jury instructions; and (5) by mischaracterizing the Preservation Society's predecessor's *220 interest in the disputed property. For the following reasons, we reverse.[1]
The instant dispute involves a portion of land in which the Maryland & Pennsylvania Railroad Company ("M & P") possessed a right of way interest conveyed to them by Elizabeth Shaul in 1872.[2] The property through which the right of way passes is now owned by Richard and Darlene Thompson ["the Thompsons"], appellees herein. Specifically, this dispute arises out of M & P's quitclaiming its interest in an eight-mile stretch of the railroad to Preservation Society, which organized to oppose dismantlement of the railway after M & P had terminated service on the line and begun to remove the tracks.
M & P operated a passenger and freight railway service until the early 1980s, when the service was discontinued. In February 1985, M & P petitioned the Interstate Commerce Commission ("ICC") for permission to abandon service on that line.[3] That petition was granted in 1986. M & P then sought to sell the line, but was unable to do so. Thus, M & P entered into a Salvage Agreement with Pohl Corporation ("Pohl") in September 1986, under which M & P sold to Pohl all of the tracks and rails for scrap value. Pohl began removing the tracks starting from both ends. Additionally, M & P began issuing quitclaim deeds to other land owners adjoining the Thompsons along the length of the right of way, thus clearing itself of the rights of way that it had acquired across private property for operation of its railroad.
During this time, Preservation Society, concerned with maintaining the railroad's historical value, organized to oppose dismantlement of the railroad. Preservation Society *221 approached M & P with a plan to purchase an eight-mile stretch of the railroad, a portion of which is situated on the Thompsons' property. M & P advised Preservation Society to contact Pohl, who agreed to refrain from removing the eight-mile stretch of track if Preservation Society paid Pohl the profit it would have realized from the track's salvage value. On May 18, 1987, M & P executed a quitclaim deed conveying to Preservation Society its interest in the eight-miles of land.
The Thompsons brought an action to quiet title on January 4, 1988, in the Court of Common Pleas of York County. A jury trial was conducted on February 4-6, 1991. At the conclusion, a verdict was rendered for the Thompsons. Preservation Society's post-trial motions were filed and denied. This timely appeal followed.
Preliminarily, we note that when reviewing a trial court's decision in a quiet title action, an appellate court must determine whether the findings of fact that led to the legal conclusion of abandonment of a property interest were supported by competent evidence. Leet v. Vinglas, 366 Pa.Super. 294, 298, 531 A.2d 17, 19 (1987) (citing MacCurdy v. Lindey, 349 Pa. 655, 658, 37 A.2d 514, 516 (1944)), appeal denied, 518 Pa. 626, 541 A.2d 1138 (1988). Ordinarily, an appellate court will not reverse a determination of the trial court in a quiet title action absent an error of law or capricious disregard of the evidence. Klebach v. Mellon Bank, 388 Pa.Super. 203, 207, 565 A.2d 448, 450 (1989), appeal granted, 527 Pa. 647, 593 A.2d 420 (1990).
I.
Preservation Society first contends that the lower court erred by not allowing it to introduce evidence at trial on the issue of whether M & P owned a fee simple interest in the disputed property. The trial court entered an order on October 2, 1990 following a hearing, in which it found as a matter of law that the interest conveyed to M & P was not a *222 fee simple interest, but rather a right of way. See Order, October 2, 1990, at 2.
We cannot consider whether this order was correct, as Preservation Society did not raise the issue in post-trial motions, nor did the trial court address it in its opinion. Thus, Preservation Society has failed to preserve it for our review. See Pa.R.Civ.P. 227.1(b)(2); Pa.R.A.P. 302(b). See also Bryant v. Girard Bank, 358 Pa.Super. 335, 344, 517 A.2d 968, 973 (1986).
II.
Preservation Society next contends that the trial court erred by denying its motion for a directed verdict. Specifically, Preservation Society argues that the Thompsons did not present sufficient evidence to satisfy the two-prong test establishing abandonment. This claim is without merit.
Initially, we note that "[i]n reviewing the grant or denial of a motion for a directed verdict, we must determine if `an abuse of discretion or error of law which controlled the outcome of the case occurred'.... If so, only then will we reverse." Fleck v. Timmons, 374 Pa.Super. 417, 426-27, 543 A.2d 148, 153 (1988) (quoting Bucchianeri v. Equitable Gas Company, 341 Pa.Super. 319, 328, 491 A.2d 835, 840 (1985)). In deciding a motion for a directed verdict, the trial court must consider the facts in the light most favorable to the party against whom the motion is made and must accept as true all evidence which supports that party's contention and must reject all adverse testimony. Cooke v. Travelers Ins. Co., 350 Pa.Super. 467, 471, 504 A.2d 935, 936 (1986) (citations omitted).
Moreover, "[t]he determination of whether a railroad has actually abandoned its right of way by acting upon and effecting its expressed intention to abandon is a question for a jury to decide." Quarry Office Park Assoc. v. Philadelphia Electric Co., 394 Pa.Super. 426, 437, 576 A.2d 358, 363 (1990) (citations omitted). Thus, a directed verdict may be granted only where the facts are clear and there is *223 no room for doubt. Cooke v. Travelers Ins. Co., supra, 350 Pa.Super. at 471, 504 A.2d at 936.
In order to find that a right of way has been abandoned, there must be an intention to abandon, accompanied by external acts by which the intention is carried out. Quarry, supra, 394 Pa.Super. at 437, 576 A.2d at 363. This court has further stated:
It is well established in Pennsylvania law that in order to show an abandonment of a right-of-way or easement created by deed, the evidence must clearly show some conduct on the ground by the holder of the right-of-way which manifests that he intended to abandon and give up permanently his right to use it. Such conduct must consist of some affirmative act on his part which renders use of the easement impossible, or of some physical obstruction of it by him in a manner that is inconsistent with its further enjoyment.
Sabados v. Kiraly, 258 Pa.Super. 532, 535, 393 A.2d 486, 487-88 (1978) (emphasis in original) (quoting Hatcher v. Chesner, 422 Pa. 138, 221 A.2d 305 (1966)).
The Thompsons introduced the following evidence to prove abandonment:
(1) testimony by Alfred Smith, President of M & P, regarding the company's successful application to the ICC to abandon its rail line from Delta to York, the line that is the subject of the instant case. See N.T., February 4-6, 1991, at 54.
(2) testimony of Walter Pohl, President of Pohl Corporation, regarding the salvage agreement between Pohl and M & P. Id. at 127-28.
(3) testimony of Alfred Smith regarding the other property owners along the rail line seeking quitclaim deeds, and the letter that M & P sent to those property owners, as well as to appellees, regarding the procedure to be followed by each respective owner of property through which a right of way ran, in order to obtain a quitclaim deed. Id. at 64-71.
*224 (4) authenticated photographs of the disputed portion of the rail line which had become overrun with weeds and brush. Id. at 338-39.
(5) testimony of Alfred Smith that the salvage agreement was intended to apply to the entire thirty-three miles of track, and that Pohl had begun dismantlement of the M & P tracks pursuant to the salvage agreement. Id. at 58, 61-62.
We must now consider whether this evidence was sufficient to raise a question of fact for the jury as to whether M & P abandoned its interest in the right of way running through the Thompsons' property.
A certificate of abandonment issued by the ICC may be evidence of intent to abandon. Lacy v. East Broad Top R.R. & Coal Co., 168 Pa.Super. 351, 359, 77 A.2d 706, 710 (1951). When such evidence is presented, a question of fact is raised for the jury as to whether the holder of the right of way interest intended to abandon that interest. Quarry, supra, 394 Pa.Super. at 439, 576 A.2d at 364.
Similarly, the evidence that M & P entered into the salvage agreement with Pohl and that it had begun to execute quitclaim deeds to other property owners along the line raises a question of fact as to M & P's intent to abandon. The salvage agreement provided for the purchase, dismantlement and removal of "facilities, equipment, structures, and/or material." Salvage Agreement, September 22, 1986, at 1 ¶ 1. Specifically, Pohl was hired as an independent contractor to remove trackage, cut rails on each side of every public crossing, erect barricades across approaches to each bridge and remove ties from tracks. Id. at 8-9. As removal of the tracks and related facilities would permanently impair M & P's ability to use the right of way for operation of a railroad, such an agreement raises a question of fact for the jury as to M & P's intent to abandon. Further support can be derived from the fact that M & P had begun quitclaiming back to other property owners rights of way running across other land along the line.
*225 Nonetheless, Preservation Society argues that even if a question of fact existed as to M & P's intent to abandon, the question of abandonment should not have been submitted to the jury because there was insufficient evidence to satisfy the second prong of the test an affirmative act of abandonment. We disagree.
We recognize that "[m]ere nonuse of [a] right-of-way by its holder, no matter how long continued, cannot manifest an intention to abandon the right...." Sabados, supra, 258 Pa.Super. at 535, 393 A.2d at 487-88. However, in Hatcher v. Chesner, supra, our Supreme Court examined acts constituting more than mere nonuse:
In the instant case, the plaintiff, or his predecessors in title by whose actions in relation to the property he is bound, planted or permitted a tree to grow on the land now owned by the plaintiff which obstructed use of the easement to a material extent. Further, the same parties placed, or permitted to be placed, a bar across the doors of the garage serving as the only entrance to the easement right of way. These acts, in our opinion, were not mere inaction, but rather affirmative acts on the part of the plaintiff and his predecessors in title, which were sufficiently inconsistent with further use of the easement to constitute an abandonment thereof and to bring the issue squarely within the rule of Eagan v. Nagle [378 Pa. 206, 106 A.2d 222 (1954)] [of external acts].
Hatcher v. Chesner, 422 Pa. at 143, 221 A.2d at 308. This court, in a more recent case, noted, "the crucial feature of the Hatcher case is the purposeful barring of the right-of-way entrance showing an intention on the part of the right-of-way holder to close it, give it up and abandon it . . . ." Sabados, supra, 258 Pa.Super. at 536, 393 A.2d at 488.
Turning to the facts of the instant case, there was sufficient evidence of a purposeful affirmative act to raise a question of fact for the jury, and preclude the granting of a directed verdict. Ordinarily, failure to maintain a railroad line or allowing brush to grow is not considered an affirmative act of abandonment. See Quarry, supra, 394 Pa.Super. *226 at 438, 576 A.2d at 363; Sabados, supra, 258 Pa.Super. at 536-37, 393 A.2d at 488. However, we agree with the trial court that "the salvager beginning to remove the track materials could be sufficient to qualify as an external act." Opinion, July 18, 1991, at 4. See Quarry, supra, 394 Pa.Super. at 439, 576 A.2d at 364 (evidence that railroad had part of its tracks removed was external act raising question for jury as to whether removal was done in furtherance of abandonment). Accordingly, the trial court did not abuse its discretion in denying Preservation Society's motion for a directed verdict.
III.
Preservation Society next contends that the trial court should have granted judgment notwithstanding the verdict ("JNOV") because as a matter of law, M & P could not have abandoned the right of way. Specifically, Preservation Society argues that (1) M & P could not lawfully abandon its interest until it received permission from the Pennsylvania Public Utilities Commission ("PUC") to remove the railway crossings; and (2) M & P engaged in activity that was inconsistent with abandonment.
It is well-settled that JNOV may be entered only in a clear case, where after viewing the evidence in the light most favorable to the verdict winner, no two reasonable minds would disagree that the verdict was improper. Scullion v. EMECO Indus., 398 Pa.Super. 294, 298, 580 A.2d 1356, 1358 (1990) (citation omitted), appeal denied, 527 Pa. 625, 592 A.2d 45 (1991); Robertson v. Atlantic Richfield Petroleum Products Co., 371 Pa.Super. 49, 58, 537 A.2d 814, 819 (1987) (citation omitted), appeal denied, 520 Pa. 590, 551 A.2d 216 (1988). Any doubts should be resolved in favor of the verdict winner. Curran v. Philadelphia Newspapers, Inc., 376 Pa.Super. 508, 516, 546 A.2d 639, 643 (1988) (quoting Geyer v. Steinbronn, 351 Pa.Super. 536, 549, 506 A.2d 901, 908 (1986)), appeal denied, 522 Pa. 576, 559 A.2d 37 (1989). With this standard in mind, we proceed to consider each of Preservation Society's arguments.
*227 A.
Preservation Society first argues that, as a matter of law, M & P could not abandon its right of way until it applied for and received a PUC certificate granting permission to abandon the highway/railroad crossings. Additionally, Preservation Society argues that the trial court erroneously instructed the jury that M & P could abandon its right of way even though it had not obtained PUC authorization to abandon the railroad crossings.[4] These arguments are without merit.
A PUC certificate granting permission to abandon railway crossings is not dispositive of whether or not a railroad has abandoned a right of way, as the certificate, without more, does not constitute abandonment. Lacy v. East Broad Top R.R. & Coal Co., supra, 168 Pa.Super. at 357, 77 A.2d at 710. "At most, the proceedings before the Commission constitute only the expression of the railroad's intention to abandon its right of way, the Commission's conditional approval of the plan of abandonment, and the consent of the Commonwealth thereto." Id., 168 Pa.Superior Ct. at 358, 77 A.2d at 710. Moreover, the PUC does not, "and manifestly could not, determine or adjudicate the property or contractual rights of the parties. . . ." Id. (citation omitted).
Preservation Society relies on New York Central R.R. Co. v. Pennsylvania P.U.C., 188 Pa.Super. 647, 149 A.2d 562 (1959) for the proposition that a railroad is unable to abandon its property interest before obtaining PUC approval. Preservation Society's characterization of New York Central's holding is inaccurate. In New York Central, a panel of this court recognized that it is possible to complete *228 abandonment without obtaining PUC permission, see id., 188 Pa.Superior Ct. at 651, 149 A.2d at 564-565, but noted that the PUC has the power to later reverse the unauthorized abandonment by ordering the railroad to resume operations. Id., 188 Pa.Superior Ct. at 650, 149 A.2d at 564. Thus, we disagree with Preservation Society that, as a matter of law, M & P could not have abandoned the right of way before obtaining a PUC certificate. In light of this conclusion, Preservation Society's argument that the court erroneously instructed the jury that M & P could have abandoned the right of way without first obtaining a PUC certificate is also without merit.
B.
Preservation Society also argues that M & P engaged in conduct that was inconsistent with abandonment and, thus, JNOV should have been granted. Specifically, Preservation Society points to the fact that there was testimony that the tracks were cleared of brush and growth yearly and kept passable until they were removed, and, further, that specially-outfitted rail cars were used to stock the adjoining creek with fish. Thus, Preservation Society argues that in light of this activity, it was impossible for the Thompsons to satisfy the second prong of the abandonment test an external act.
We have already concluded in section II, supra, that sufficient evidence was presented to raise a jury question with respect to both prongs of the test. Contradictory evidence was presented as to the extent of M & P's use of the rail line. The jury, as fact-finder, was free to believe all, some or none of that evidence. See Williamson v. Williamson, 402 Pa.Super. 276, 286, 586 A.2d 967, 972 (1991). Preservation Society's claim must fail because it is not so free from doubt that the jury's verdict was incorrect and thus, that JNOV should have been granted.
IV.
Preservation Society next contends that the trial court committed reversible error with respect to the jury instructions. *229 Specifically, Preservation Society claims that the trial court incorrectly stated the law as it applied to the brush and weeds that had grown on the tracks. We agree.
The standard of review with respect to jury instructions is well-settled in Pennsylvania:
A court's charge to the jury will be upheld if it adequately and accurately reflects the law and was sufficient to guide the jury in its deliberations.... In reviewing the court's charge for error, we must read the charge as a whole; error will not be predicated upon an isolated excerpt, instead it is the general effect of the charge that controls.... Furthermore, if a requested point for charge is already sufficiently and adequately covered in the trial court's jury instructions, it is not error to deny the requested point even though it may contain a correct statement of law.
Brill v. Systems Resources, Inc., 405 Pa.Super. 603, 606, 592 A.2d 1377, 1378-79 (1991) (citations omitted). See also Slavish v. Ratajczak, 277 Pa.Super. 272, 419 A.2d 767 (1980). If a charge inaccurately describes the law, there is error. Summit Fasteners, Inc. v. Harleysville National Bank & Trust Co., Inc., 410 Pa.Super. 56, 61, 599 A.2d 203, 206 (1991) (citations omitted), appeal denied, 606 A.2d 902 (1992).
The court instructed the jury on the issue of the brush and weeds as follows:
Let's look at the respective sides of the case. What does the Plaintiff say shows abandonment?
Well, first thing he shows is that there is a lack of maintenance. The railroad line was deteriorating. It was falling apart. They weren't using it anymore and he gives testimony from the Plaintiffs about the weeds are growing up and there is testimony, I believe, from Mr. Crowl [charter member of appellant Preservation Society] said something or suppose to have said something in the newspaper about it being overgrown and all the other testimony you heard about lack of maintenance.
.....
*230 Now, this lack of maintenance is actually possible. I suppose that strictly from the lack of a maintenance alone, you could find abandonment. The same way if you see a house or a car, you don't even know who owns it, they let it sit there. It sat there for 20 years. It's all rusted out. It was vandalized. It's abandoned as you classically know.
The mere fact alone could convince you alone that the owner of that car has abandoned it. By the same token here, the lack of maintenance, the weeds growing up and trees growing up through the railroad, it [is] grown to the point three feet thick and you couldn't put any railroad car through there no matter how small it was, you say, well hey they have abandoned it.
You will have to determine whether that testimony went to that extent. Even if you don't find it went to that extent, you can still use the testimony of abandonment of lack of maintenance rather along with all the other factors. It could be one piece of a larger total picture or it could be sufficient all by itself.
Obviously, for it to be sufficient by itself, it would have to be pretty overwhelming. There are a lot of other factors that come into play. So, we have with [a] railroad many other factors that go into play, that you wouldn't have with an abandoned car. For example, if you are going to find it strictly on abandonment and find it very [clearly] and take into account that there are other factors [that go] into it.
N.T., February 4-6, 1991, at 442-45.
This instruction significantly misstates the law in this Commonwealth. Specifically, the trial court's repeated statement that evidence of the weeds and brush was sufficient in itself to constitute abandonment is incorrect. In Quarry Office Park Associates v. Philadelphia Electric Co., 394 Pa.Super. 426, 576 A.2d 358 (1990), this court stated that the "failure to operate trains on the line and maintain the line are not indicative of an intent to abandon." Id., 394 Pa.Superior Ct. at 438, 576 A.2d at 363. Moreover, *231 in Sabados v. Kiraly, 258 Pa.Super. 532, 393 A.2d 486 (1978), this court expressly stated:
Defendant argues that permitting the trees and brush to grow up on the right-of-way area, from her house through the woods back to plaintiffs' property line, during the period of nonuse, is an `affirmative act' by the holders of the right-of-way rendering its use impossible, and is an obstruction thereof by the right-of-way owner inconsistent with further use or enjoyment of the right-if-way, evidencing an intention to abandon it. This contention is impossible to accept. Allowing brush and saplings to grow on the right-of-way area which runs through the woods is not an act of active or affirmative character; instead, the growth results from merely doing nothing. These circumstances do not involve an affirmative act or placement of a physical obstruction or barrier, as is legally required for abandonment of a granted right-of-way....
In the present case, none of the owners of plaintiffs' land ever intentionally barricaded the right-of-way. In this case, growth of brush and small saplings in the roadway through the woods was but the natural closing in of nature upon an unused road, not the affirmative or intentional obstruction of the way by the owners of plaintiffs' land.
Id., 258 Pa.Superior Ct. at 536-37, 393 A.2d at 488 (emphasis added). This clearly contradicts the instructions provided by the court. Moreover, the court's example of a car or house left unattended for twenty years was misleading and, in our opinion, could have further confused the jury. There was no testimony in the case at hand that the weeds were left unattended for anywhere near twenty years. Nonetheless, reversal is not warranted unless the error, read in context of the jury charge in its entirety, would have prejudiced Preservation Society. See Schecter v. Watkins, 395 Pa.Super. 363, 374-75, 577 A.2d 585, 590-91 (court will not reverse on basis of isolated inaccuracies if jury charge as whole is not erroneous and did not prejudice complaining *232 party), appeal denied, 526 Pa. 638, 584 A.2d 320 (1990). Here, we find that there was a strong possibility that this inaccuracy could have prejudiced the jury's verdict. First, the trial court repeated three times its incorrect statement that the overgrown weeds were sufficient to constitute abandonment. This repetition served to emphasize the misstatement of the law to the jury. Furthermore, we cannot say that the jury would have found the second prong of the abandonment test to have been satisfied if it had not been incorrectly instructed on this factor. Accordingly, the court committed reversible error and thus, a new trial must be ordered.[5]
V.
Lastly, Preservation Society contends that trial court mischaracterized the interest embodied in M & P's right of way and thus, applied incorrect standards governing abandonment. However, Preservation Society did not raise this issue in its post-trial motions. Thus, it is waived, and we cannot consider it on appellate review. See Bryant v. Girard Bank, supra.
For the aforementioned reasons, we reverse judgment and order a new trial.
Reversed; new trial ordered. Jurisdiction relinquished.
NOTES
[1] Although we ultimately reverse on Preservation Society's jury instruction issue, we must address Preservation Society's two contentions that have been preserved for review because if there is merit to those issues, the required relief would be greater than that called for as a result of the jury instruction error.
[2] M & P is not a party to the instant action.
[3] Application to the ICC was necessary because the railroad crossed the Maryland state line.
[4] Preservation Society applied for and received permission from the PUC to abandon the line approximately one year after the instant complaint was instituted. Although M & P's application exempted the disputed portion of land, because it had conveyed its interest in that land to Preservation Society, that exemption does not affect our result, in light of our conclusion that M & P could lawfully abandon its interest before it received PUC permission, and, thus, that the jury verdict that M & P had no interest to convey at the time it quitclaimed its interest in the right of way to Preservation Society was correct.
[5] In light of our ruling as to this issue, we need not address Preservation Society's remaining allegations of error with respect to the jury instructions. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/2336179/ | 72 F. Supp. 2d 506 (1999)
Christopher W. HUTH, Plaintiff,
v.
HILLSBORO INSURANCE MANAGEMENT, INC., et al., Defendants.
No. CIV. A. 99-2335.
United States District Court, E.D. Pennsylvania.
September 4, 1999.
*507 *508 MEMORANDUM & ORDER
KATZ, Senior District Judge.
Before the court is a motion to dismiss for lack of personal jurisdiction submitted by defendants Hillsboro Insurance Management, Inc., Hillsboro Excess & Surplus Lines, Inc., and C. Edward Hardy. Because the plaintiff has demonstrated sufficient contacts with the forum to exercise jurisdiction over these parties, the motion will be denied.[1]
I. Background
Plaintiff Huth was seriously injured when a vehicle lift in a service station suddenly failed, dropping a motor vehicle onto him. Huth subsequently brought a civil action against E. Forrest & Sons, Inc., alleging improper service of the lift prior to the accident and was awarded $775,000. That award is still unpaid, allegedly because Forrest's insurer, Alpine Assurance, Ltd., was unable to pay the benefits owed because of its own financial problems. Forrest assigned its claims against the insurer to Huth, and he brought the present action in the Chester County Court of Common Pleas, whereupon it was removed to this court.
The present defendants are named because of their relationship to Alpine Assurance, Ltd. Hillsboro Insurance Management (Hillsboro) was authorized by Alpine Assurance to act as its managing agent for the issuance, policy maintenance, and administration of certificates of insurance issued under master policies of insurance. That is, Hillsboro marketed Alpine policies, collected premiums, and paid claims in return for a commission. See Resp. to Mot. to Dismiss at 4. Hillsboro is a corporation organized and doing business under *509 the laws of Wisconsin, with its principal place of business in Wisconsin. Hillsboro Excess & Surplus Lines, Inc., (Hillsboro Excess), is named as the alleged successor to Hillsboro. Hillsboro Excess is also organized under the laws of Wisconsin and has its principal place of business in Wisconsin. Hardy was an insurance agent with Hillsboro and Hillsboro Excess, and he is a citizen of Wisconsin. Hillsboro and Hardy are named in a strict statutory liability count under Pennsylvania insurance law, as well as breach of contract, negligence, and fraud counts. Hillsboro Excess is named in one count alleging successor liability. These defendants now argue that the court has no personal jurisdiction over them.
II. Discussion
When a court sitting in diversity is faced with a challenge to personal jurisdiction by an out-of-state defendant, it "must apply the relevant state long-arm statute to see if it permits the exercise of personal jurisdiction; then, the court must apply the precepts of the Due Process Clause of the Constitution." IMO Indus., Inc. v. Kiekert AG, 155 F.3d 254, 259 (3d Cir.1998). The Pennsylvania long-arm statute permits jurisdiction to be exercised "to the fullest extent allowed under the Constitution of the United States and may be based on the most minimum contact with the Commonwealth allowed under the Constitution of the United States." 42 Pa.C.S.A. § 5322(b); see also Grand Entertainment Group v. Star Media Sales, 988 F.2d 476, 481 (3d Cir.1993) (describing Pennsylvania long-arm statute).
As the defendant has raised jurisdictional defenses, the plaintiff "bears the burden of establishing either that the cause of action arose from the defendant's forum-related activities (specific jurisdiction) or that the defendant has `continuous and systematic' contacts with the forum state (general jurisdiction)." Mellon Bank (East) v. DiVeronica Bros., 983 F.2d 551, 554 (3d Cir.1993) (citations omitted); see also Carteret Savings Bank v. Shushan, 954 F.2d 141, 146 (3d Cir.1992) ("[O]nce the defendant raises the question of personal jurisdiction, the plaintiff bears the burden to prove, by a preponderance of the evidence, facts sufficient to establish personal jurisdiction."). The plaintiff may meet this burden and present a prima facie case for exercising personal jurisdiction by "establishing with reasonable particularity sufficient contacts between the defendant and the forum state." Mellon Bank (East) PSFS v. Farino, 960 F.2d 1217, 1223 (3d Cir.1992) (citations omitted). If a plaintiff has presented a prima facie case for jurisdiction, remaining factual doubts should be resolved in plaintiff's favor. See DiMark Mkt., Inc. v. Louisiana Health Serv. & Indem. Co., 913 F. Supp. 402, 405 (E.D.Pa. 1996).
Plaintiff appears to rely solely on specific jurisdiction.[2] The Third Circuit has explained that a two-part test should be applied to allegations of specific jurisdiction. First, the plaintiff must show that the defendant had constitutionally sufficient minimum contacts with the forum. See IMO Indus., 155 F.3d at 259. These contacts must be such that the defendant should "reasonably anticipate being haled into court there." DiVeronica Bros., 983 F.2d at 554 (internal punctuation omitted), quoting World-Wide Volkswagen Corp. v. Woodson, 444 U.S. 286, 297, 100 S. Ct. 559, 62 L. Ed. 2d 490 (1980); see also Farino, 960 F.2d at 1221 (stressing need to inquire into the relationship among the forum, the defendant, and the litigation). Moreover, the court should examine whether the defendant "purposefully established those minimum contacts.... A court must find that there was some act by which the defendant `purposefully avail[ed] itself of the privilege of conducting activities within *510 the forum." Id. (citations omitted). Second, the court must determine, in its discretion, that exercising jurisdiction would "comport with `traditional notions of fair play and substantial justice.'" IMO Indus., 155 F.3d at 259, citing International Shoe Co. v. Washington, 326 U.S. 310, 66 S. Ct. 154, 90 L. Ed. 95 (1945) (other citations omitted). The court will consider each of the defendants in turn.
A. Hillsboro
Hillsboro argues that there is no personal jurisdiction over it because plaintiff has not included specific allegations of contacts with this forum. The complaint, however, states that Hillsboro solicited, recommended, and negotiated a policy in Pennsylvania, see Compl. ¶ 18, and in response to the motion to dismiss, plaintiff clarifies these points. Plaintiff has supplied a variety of letters and faxes from representatives of Hillsboro to Forrest from 1992 until 1996 negotiating coverage, explaining coverage, and addressing premium payment. These letters are all addressed to Forrest's Pennsylvania address. See generally Plf. Ex. C; see also 42 Pa. C.S. § 4322(a)(6) (stating that jurisdiction exists over parties who contract to provide insurance in Pennsylvania). These contacts are sufficient to exercise personal jurisdiction over the defendant, and the court sees no unfairness or injustice in haling Hillsboro into court. By purporting to provide insurance coverage to a Pennsylvania resident, Hillsboro purposefully availed itself of business opportunities in this state and cannot now claim that it could not anticipate being sued in a Pennsylvania court if it failed to provide coverage. "[T]he Due Process Clause may not be readily wielded as a territorial shield to avoid interstate obligations that have been voluntarily assumed." Burger King, 471 U.S. at 474, 105 S. Ct. 2174.[3]
B. Hillsboro Excess
Plaintiff alleges that Hillsboro Excess is liable on a theory of successor liability. Hillsboro Excess acknowledges that, under Pennsylvania law, the acts of a predecessor corporation may be attributed to its successor for purposes of determining whether jurisdiction over the successor is proper. See Simmers v. American Cyanamid Corp., 394 Pa.Super. 464, 576 A.2d 376, 381 (1990) ("We ... hold that the predecessor's activities may be attributed to the successor or jurisdictional purposes."); see also id. at 384-90 (explaining rationale); Bowers v. NETI Technologies, Inc., 690 F. Supp. 349, 359-61 (E.D.Pa. 1988) (applying successor liability to question of personal jurisdiction). To apply this principle, the Pennsylvania Superior Court looked to the law of successor liability and stated, as Hillsboro Excess notes, that when a company sells or transfers all of its assets to a successor, "the successor does not acquire the liabilities of the transferor merely because of its succession to the transferor's assets." Id. at 386. However, the court continued to explain that this general rule does not apply in a variety of circumstances, including the following: the purchaser impliedly or expressly assumed such obligations; the transaction was a consolidation or a merger; the purchasing corporation is merely a continuation of the selling corporation; the transaction was fraudulent; the transfer was not made for adequate consideration; or the successor undertakes to conduct the same manufacturing operation of the transferor's product lines in an essentially unchanged manner. See id., quoting Dawejko v. Jorgensen Steel Co., 290 Pa.Super. 15, 434 A.2d 106, 107, 110 (1981).
As the court has already ruled that Hillsboro had the requisite contacts, the court must look only to whether Hillsboro Excess can be considered its successor. A certain conundrum is always present *511 in such situations: "Although a court must accept the plaintiff's allegations as true when ruling on most Rule 12(b) motions, the plaintiff must prove jurisdictional facts by a preponderance of the evidence. In the instant case, a finding of jurisdiction turns on the resolution of a substantive issue[.]" National Precast Crypt v. Dy-Core, 785 F. Supp. 1186, 1189-90 (W.D.Pa.1992). In recognition that, at such an early stage in a case, a plaintiff should not be expected to prove such facts with the same degree of certainty required on a summary judgment motion or at a trial, the prima facie burden is satisfied "if the documents submitted demonstrate facts sufficient to support a finding of jurisdiction." Id. at 1190.
In this case, plaintiff has articulated facts from which the court can conclude that Hillsboro Excess was a successor for purposes of a motion to dismiss. Plaintiff alleges that Hillsboro Excess "continued in the same line of business"; took over Hillsboro's accounts, employees and clients; "maintains directory listings and does business as `Hillsboro Insurance Management'"; and "has assumed use of the same telephone number and post office box which formerly were used by defendant Hillsboro[.]" Compl. ¶ 50. Defendant's submissions do not directly contradict these points. The affidavit presented by defendant Hardy states only that Hillsboro Excess did not exist at the time the contract was made and denies that Hillsboro Excess has any common ownership or control with Hillsboro. See Def. Ex. B ¶¶ 8-9 (Aff. of Hardy); see also id. ¶¶ 10-11 (denying that Hillsboro sold its assets to Hillsboro Excess or that Hillsboro Excess assumed Hillsboro's obligations). Plaintiff's allegations combined with the continued difficulties of acquiring the relevant evidence make it premature to dismiss the claims against Hillsboro Excess at this stage.[4]
C. Hardy
Defendant Hardy argues that there are not contacts from which personal jurisdiction may be exercised over him. Three of the counts against Hardy allege contractual causes of actions and one alleges a tort (fraud). While individuals are not ordinarily subject to personal jurisdiction for actions taken in their corporate capacity, as noted in the court's previous order, allegations of tortious behavior may create an exception to that rule. See, e.g., Elbeco, Inc. v. Estrella de Plato Corp., 989 F. Supp. 669, 676 (E.D.Pa.1997); TJS Brokerage & Co., Inc. v. Mahoney, 940 F. Supp. 784, 788-89 (E.D.Pa.1996). In addition, Hardy's alleged actions invoke another exception: individuals may not take refuge behind the corporate shield if they are charged "with violating a statutory scheme that provides for personal, as well as corporate liability[.]" National Precast Crypt, 785 F.Supp. at 1191. The insurance laws under which plaintiff brings suit do provide for personal liability. See 40 Pa. C.S. § 237 (establishing personal liability for insurance agents on "all contracts of insurance or suretyship unlawfully made by or through him, directly or indirectly, for or on behalf of any entity not authorized to do business in this Commonwealth").
These exceptions combined with Hardy's forum contacts make the exercise of personal jurisdiction appropriate. Plaintiff has submitted documents regarding Hardy's solicitation of Forrest's insurance policy indicating that he was personally and *512 directly involved. See Plf. Ex. A ¶¶ 2-4, 10 (Aff. of Forrest describing Hardy's role); Ex. B (noting Hardy's involvement in procurement of contract). Also, Hardy's contacts as an insurance agent are relevant in determining the contacts with Pennsylvania. See Elbeco, 989 F.Supp. at 676 (noting that court's should examine defendant's contacts and participation in alleged tortious behavior). These actions were purposefully directed towards a Pennsylvania corporation, and the behavior was ongoing. See Elbeco, 989 F.Supp. at 677.
III. Conclusion
The plaintiff has met his burden of demonstrating that Hillsboro, Hillsboro Excess, and Hardy have such minimum contacts with this forum that jurisdiction is proper. Hillsboro sold the insurance contract in question and maintained relationships with the insureds. Although Hillsboro Excess may ultimately be able to show that it is not Hillsboro's successor, the evidence presented to the court is enough to permit jurisdiction. Finally, the allegations of Hardy's own involvement are sufficiently documented that this court cannot dismiss him from the case at this stage.
An appropriate Order follows.
ORDER
AND NOW, this day of September, 1999, upon consideration of the Motion to Dismiss for lack of personal jurisdiction submitted by defendants Hillsboro Insurance Management, Inc., Hillsboro Excess and Surplus Lines, Inc., and C. Edward Hardy, and the response thereto, it is hereby ORDERED that the Motion is DENIED without prejudice with leave to renew following the close of discovery.
NOTES
[1] The court previously denied a motion to dismiss for lack of personal jurisdiction submitted by a fourth defendant, Robert Feala. See Order of June 23, 1999.
[2] Plaintiff does not explicitly abandon a claim of general jurisdiction but provides no information from which the court can conclude such jurisdiction exists. Rather, plaintiff focuses on the connections from which the court could find specific jurisdiction.
[3] The court also notes that Hillsboro has pointed to no particular violation of Due Process that would occur if it were subjected to jurisdiction here. It focuses instead on the alleged lack of minimum contacts.
[4] Defendant argues that the court cannot look solely to the actions of Hillsboro to impute minimum contacts to Hillsboro Excess, citing National Precast Crypt, 785 F.Supp. at 1195, but, as the Pennsylvania Superior Court explained in Simmers, "[p]laintiffs must be permitted to establish jurisdiction over successor corporation based upon its predecessor's contacts with the forum. Otherwise, a corporation which voluntarily or by the operation of law assumes its predecessor's liabilities may be able to avoid the jurisdiction of the very forum where the liability accrued simply because it never did business within that forum." Simmers, 576 A.2d at 390. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1151503/ | 622 So. 2d 1253 (1993)
R.C. CONSTRUCTION COMPANY, INC.
v.
NATIONAL OFFICE SYSTEMS, INC.
No. 91-CA-0035.
Supreme Court of Mississippi.
August 12, 1993.
*1254 Dalton McBee, Jr., Thompson Alexander & Crews, Jackson, for appellant.
Glenn F. Beckham, Upshaw Williams Biggers Page & Kruger, Greenwood, for appellee.
Before HAWKINS, C.J., and SULLIVAN and McRAE, JJ.
SULLIVAN, Justice, for the Court:
R.C. Construction Company, Inc. (hereinafter R.C.), a general contractor and Mississippi corporation, sued National Office Systems, Inc. (hereinafter National), a subcontractor and Georgia corporation, for breach of an oral contract and negligent misrepresentation in the County Court of Leflore County, Mississippi. National moved to dismiss, pursuant to M.R.C.P. 12(b)(2), for lack of personal jurisdiction. Affidavits were filed in support of the respective positions on the motion to dismiss. The county court entered an Order of Dismissal, finding that the pleadings and affidavits filed failed to demonstrate the existence of a contract or the commission of a tort, therefore personal jurisdiction could not be exercised pursuant to Miss. Code Ann. § 13-3-57 (Supp. 1990). The Circuit Court of Leflore County, Mississippi, affirmed the county court and found that National had not entered into a contract with R.C., nor had National committed a tort.
On appeal only one issue is presented:
Whether the courts below improperly dismissed R.C. Construction Company's suit on the grounds that the Mississippi long arm statute did not confer jurisdiction over National Office Systems under the attendant facts and circumstances.
DID THE COURTS BELOW IMPROPERLY DISMISS R.C. CONSTRUCTION COMPANY'S SUIT ON THE GROUNDS THAT THE MISSISSIPPI LONG ARM STATUTE DID NOT CONFER JURISDICTION OVER NATIONAL OFFICE SYSTEMS UNDER THE ATTENDANT FACTS AND CIRCUMSTANCES?
The challenge to personal jurisdiction is controlled by Rule 12, Mississippi *1255 Rules of Civil Procedure. Jones v. Chandler, 592 So. 2d 966, 969 (Miss. 1991). That determination of personal jurisdiction "proceeds wholly apart from any thought of the (de)merits of the plaintiff's claim." Id. at 971. The existence of any defense is a matter separate and apart from amenability to personal jurisdiction. Jones, 592 So.2d at 971. The question of personal jurisdiction initially turns on the well-pleaded allegations of the complaint. Id. at 972. On a motion to dismiss for lack of personal jurisdiction, all allegations of the complaint, together with reasonable inferences flowing therefrom, are accepted as true. Mandel v. James Graham Brown Foundation, Inc., 375 So. 2d 1017, 1019 (Miss. 1979).
A non-resident defendant may, on his pre-trial Rule 12(b)(2) motion to dismiss, litigate the inherent factual questions through the use of live testimony or affidavits. Jones, 592 So.2d at 972 n. 5. If the court finds facts that sustain his defense, it should dismiss, as the presumption implicit in the well-pleaded allegations rule has "spent its force and vanished." Id.
The trial court had jurisdiction not only to determine if there was personal jurisdiction of a defendant but also to determine any facts that might sustain a defense. The threshold question, therefore, is whether the complaint alleges National made a contract to be performed in whole or in part by any party in this State or National committed a tort in whole or in part in this State. If so, Miss. Code Ann., § 13-3-57 (Supp. 1990) applies. Camp v. Roberts, 462 So. 2d 726, 727 (Miss. 1985).
The complaint alleges breach of an oral contract by National. Generally, oral contracts are enforceable in Mississippi and we recognize a cause of action grounded on breach of an oral contract. Putt v. City of Corinth, 579 So. 2d 534, 538 (Miss. 1991). The complaint also alleges misrepresentation on the part of National; negligent misrepresentation, as argued by R.C. in its brief, is recognized as a tort in Mississippi. Spragins v. Sunburst Bank, 605 So. 2d 777, 780 (Miss. 1992).
The complaint sufficiently alleged that National made and breached an oral contract to be performed in part by R.C., a party in this state, and that National committed the tort of negligent misrepresentation in part in this state. Pursuant to § 13-3-57 (Supp. 1990), National has subjected itself to personal jurisdiction in Mississippi.
However, National and R.C. litigated factual questions inherent to the determination of personal jurisdiction at the pre-trial motion to dismiss via the affidavits they both submitted. They did so, the county court found, and the circuit court affirmed an order which stated that the pleadings failed to demonstrate the existence of a contract or the commission of a tort. If this is true, then the dismissal was eminently correct.
A. Contract
The existence of an oral contract is a fact issue. Putt, 579 So.2d at 538, citing Harris v. Williams, 43 So. 2d 364, 365 (Miss. 1949). A trial judge's finding is entitled to the same deference as a jury verdict and will not be reversed upon appeal unless manifestly wrong. Walters v. Patterson, 531 So. 2d 581, 583 (Miss. 1988).
It is basic contract law that a contract requires an offer and acceptance. Houston Dairy, Inc. v. John Hancock Mut. Life Ins. Co., 643 F.2d 1185, 1186 (5th Cir.1981). According to both parties, National offered R.C. a bid for the subcontracting work, but even R.C.'s recitation of events fails to mention any acceptance of this offer. R.C. merely said National phoned R.C. with a bid, R.C. used this sub-bid in preparing its own bid, then, after it had been awarded the project, R.C. phoned National asking for a better price. R.C.'s failure to communicate its acceptance of National's offer is fatal to R.C.'s contention that a valid contract existed. Pioneer Box Co. v. Price Veneer & Lumber Co., 132 Miss. 189, 199, 96 So. 103, 105 (1923).
Silence may operate as acceptance where, because of previous dealings, the offeree has given the offeror reason to *1256 understand that silence is intended as a manifestation of assent. Old Equity Life Ins. Co. v. Jones, 217 So. 2d 648, 650-51 (Miss. 1969). Here, however, R.C. has made it clear that it did not even know of National's existence prior to the first telephone call from National to R.C. regarding the Base Supply project. The lower courts were not manifestly wrong in finding there was no contract within the intent and meaning of § 13-3-57 (Supp. 1990).
B. Tort
In order to recover on a negligent misrepresentation theory, the plaintiff must prove by a preponderance of the evidence (1) a misrepresentation or omission of a fact; (2) that the representation is material or significant; (3) that the party charged failed to exercise the degree of diligence and expertise the public is entitled to expect of such parties; (4) that he reasonably relied on the misrepresentation or omission; and (5) that he suffered damages as a direct and proximate result of such reasonable reliance. Spragins, 605 So.2d at 780, citing Bank of Shaw v. Posey, 573 So. 2d 1355, 1360 (Miss. 1990); Shogyo International Corp. v. First National Bank of Clarksdale, 475 So. 2d 425, 427 (Miss. 1985). Misrepresentation of a fact must concern a past or present fact rather than a promise of future conduct. Spragins, 605 So.2d at 780.
R.C. asserts the misrepresentation occurred when National promised to provide the furniture for the Base Supply project at a cost of $170,626.00. We have "made it clear that even in cases where fraud is alleged, a promise of future conduct does not meet the requirement of a `representation' unless the promise was made with the present intent not to perform." Bank of Shaw, 573 So.2d at 1360. R.C. grounded its claim of negligent misrepresentation on National's promise of future conduct and therefore, has failed to prove an essential element of its claim. The lower court was not manifestly wrong in finding that no tort had been committed.
The action of the county court in dismissing the suit of R.C. Construction Company, Inc., and the action of the Circuit Court of Leflore County, Mississippi, in affirming that dismissal, are affirmed.
AFFIRMED.
HAWKINS, C.J., DAN M. LEE and PRATHER, P.JJ., and PITTMAN, BANKS, McRAE, JAMES L. ROBERTS Jr., and SMITH, JJ., concur. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1658929/ | 671 So. 2d 636 (1996)
Mark M. ALLEN
v.
MAC TOOLS, INC., Ernie Christmas, Individually and as Agent, Servant and Employee of Mac Tools, Inc.; and Ronald M. Jenkins, Individually, and as Agent, Servant and Employee of Mac Tools, Inc.; and Nick Tremonte, Individually, and as Agent, Servant and Employee of Mac Tools, Inc.
Mark M. ALLEN
v.
MAC TOOLS, INC.; Ernie Christmas, Individually and as Agent, Servant and Employee of Mac Tools, Inc.; and Ronald M. Jenkins, Individually and as Agent, Servant and Employee of Mac Tools, Inc.; and Nick Tremonte, Individually and as Agent, Servant and Employee of Mac Tools, Inc. and
Mac Tools, Inc.
v.
Mark M. Allen and Sherry A. Allen.
Nos. 92-CA-00840-SCT and 92-CA-01027-SCT.
Supreme Court of Mississippi.
February 8, 1996.
Rehearing Denied April 18, 1996.
*637 James W. Nobles, Jr., Jackson, for appellant.
Ross E. Henley, John H. Henley, Henley Lotterhos & Henley, Jackson, for appellee.
Before SULLIVAN, P.J., and McRAE and JAMES L. ROBERTS, Jr., JJ.
SULLIVAN, Presiding Justice, for the Court:
On or about October 2, 1990, Mark M. Allen (Allen), filed a complaint in the Circuit Court of the First Judicial District of Hinds County, Mississippi. The complaint alleged that Mac Tools, Inc. (Mac Tools), Ernie Christmas (Christmas), Ronald M. Jenkins (Jenkins), and Nick Tremonte (Tremonte), as individuals, willfully, intentionally, maliciously, and wantonly made misrepresentations to him inducing him to enter into a distributorship, and later continue the distributorship for Mac Tools. The complaint demanded judgment for $376,200.00 in actual damages and $5,000,000.00 in punitive damages. On November 29, 1990, Defendants filed their response denying liability. In addition, Mac *638 Tools filed a counterclaim seeking a judgment for approximately $12,000.00 due from Allen for goods he purchased while he was a Mac Tools distributor. On February 28, 1992, Mac Tools filed an Amended Counterclaim joining Mark's wife, Sherry A. Allen (Sherry), as a party to the counterclaim.
On May 29, 1992, Defendants filed their Motion for Summary Judgment or in the Alternative for Partial Summary Judgment, seeking judgment in favor of Defendants on all of Allen's claims and judgment in favor of Mac Tools on its counterclaim.
On June 15, 1992, the trial court granted a Partial Summary Judgment in favor of the Defendants on Allen's claims against Mac Tools, basing its decision on fraudulent inducement. However, the lower court felt that there were material issues of fact with regard to the counterclaim, and set the counterclaim for trial. Allen filed a Motion for Reconsideration of Entry of Summary Judgment on Behalf of Defendants, which the trial court by order denied. The counterclaim of Mac Tools, went to trial on July 20, 1992. The jury returned a verdict and judgment in favor of Mac Tools against Allen and Sherry for $2,805.00. The lower court entered the judgment on July 21, 1992.
On July 30, 1992, pursuant to Rules 50 and 59, Mac Tools filed its Motion for Judgment Notwithstanding the Verdict (JNOV), and its Motion to Amend Judgment to Include Cost of Collection and Pre-Judgment Interest. On September 3, 1992, the trial court entered its order denying Mac Tools' Motion for Judgment Notwithstanding the Verdict. On September 4, 1992, the trial court entered its order awarding attorneys' fees for $9,584.05 to Mac Tools.
On August 12, 1992, before the trial court ruled on Mac Tools' post-trial motions, Allen filed his first Notice of Appeal. This Notice of Appeal designated the orders appealed from as the "Judgment granting defendants' Motion for Summary Judgment dated June 15, 1992, and the Order denying plaintiff's Motion to Reconsider the Entry of the judgment sustaining the Motion for Summary Judgment." On September 28, 1992, Allen filed his second appeal entitled Notice of Appeal from Judgment Awarding Defendant Attorneys Fees. This notice designated the Order appealed from as the Order dated September 4, 1992, awarding attorney fees to Mac Tools, Inc. On October 9, 1992, Mac Tools filed its Notice of Cross-Appeal.
On January 25, 1993, Allen filed with this court a Motion by Appellant to Consolidate Appeals. On January 29, 1993, Appellees filed their Motion to Dismiss Appeal seeking to dismiss Allen's initial appeal of the Partial Summary Judgment and filed an objection to the consolidation of Allen's appeals on the grounds that Allen's Notice of Appeal was prematurely filed. By order entered on March 25, 1993, this Court denied Mac Tools motion to dismiss and consolidated Allen's appeal.
FACTS
Mac Tools, Inc. manufactures and distributes all types of hand and power tools and related products for users in the automotive after market, including service stations, independent garages, car and truck dealerships, and various non-automotive accounts. To market its products to the user, Mac Tools contracts with independent distributors. The primary customers of these distributors are mechanics. Each distributor agrees to display Mac Tools' products and sell the products from a truck approved by Mac Tools. Usually they assign each distributor a territory and are given a current list of potential customers and stops when they sign the original contract. However, that is not true here, as they did not give the assignment sheet to Allen until several months after Allen had signed the contract. Mac Tools requires that distributors purchase products from Mac Tools in an amount equal to at least 80% of the National Distributor Average and that each distributor service the needs, such as broken tools, of the customers of his route weekly.
Before becoming a distributor Allen had been employed as a mechanic at Tune Up Clinic in Jackson, Mississippi for ten years. Allen was recruited to be a distributor by Nick Tremonte during the first part of 1986. Tremonte was the District Sales Manager (DSM) for Mac Tools for an area covering *639 most of Mississippi and small parts of Arkansas and Louisiana. After Allen became a distributor, Tremonte continued as the DSM until the end of 1986. He was succeeded as DSM by Ernie Christmas who himself was succeeded in March 1989 by Ronald Jenkins.
During pre-contract negotiations, there was one face-to-face meeting which involved Allen, his wife, and Tremonte. Then on January 31, 1986, Allen submitted to Mac Tools his application to become a distributor.
On February 24, 1986, Allen executed a Mac Tools Distributor Agreement, in which Mac Tools authorized Allen to sell Mac Tools' equipment, tools, and tool boxes to customers in designated stops. The contract also stated that "[a] current list of potential customers or accounts in Distributor's Territory and the Territory Boundaries are set forth in Appendix A hereto." Mac Tools attached no such appendix to the agreement. Allen states that it was not until August 7, 1986 that Mac Tools furnished the territory assignment and list of stops to him. Allen states that Tremonte, the DSM, made representations to Allen before he entered the contract that there would be at least 250 stops or customers per week available for sales and based on experience, that the average sale per week at each stop was $20.00.
On the same date as they entered the contract, February 24, 1986, Allen purchased an initial inventory package, which Mac Tools financed. Allen and his wife Sherry, in connection with the initial inventory package and the van type truck required by Mac Tools to be purchased by its distributors, executed an agreement entitled Purchase Order and Security Agreement. To acquire additional and replacement inventory for his distributor business, Mac Tools extended Allen a Tool Purchase Account. On February 25, 1986, Allen and Mac Tools also entered a third agreement entitled Financing Agreement Between Mac Tools Distributor and Mac Tools, Inc. where Mac Tools agreed to purchase qualifying accounts from Allen at a discount of nine percent. On April 12, 1986, a new financing agreement known as the Mac Cap Financing Agreement, replaced the previous financing agreement. Under the Mac Cap Agreement, distributors would decide to extend credit to customers based upon a credit report; Mac Tools would extend the credit, and they would require that the distributor collect the payments. If the customer failed to make the payments as required, Mac Tools could "recourse" the distributor for the amounts unpaid. Thus, Mac Tools and Allen established several different accounts. The first was the secured agreement for the initial inventory and truck, which Sherry Allen co-signed. Next, there was the Tool Purchase Account, which allowed Allen to purchase additional inventory. Lastly, there was the Mac Cap Financing Agreement.
When Allen executed all the necessary paper work, he and Tremonte traveled together. Tremonte showed the stops that were in Allen's territory to him when Allen started working. Mac Tools mailed Allen's Official Territory Assignment to him on August 7, 1986.
During 1986, 1987, 1988 and 1989, Allen had several meetings with the different sales managers from Mac Tools, Christmas, Jenkins, and Tremonte, regarding the representation that they would at least provide 250 customers or stops to him. Allen asserts that each of these DSMs assured him that they would assign the additional territory and customers to him. When Allen ventured over into another territory to attempt to make larger sales, Jenkins and Tremonte called and told him in that he would have additional stops added to his territory.
Allen worked as a Mac Tools distributor for three years and eight months from February 24, 1986 until October 26, 1989, when his agreement with Mac Tools was officially terminated. Allen notified Mac Tools of his desire voluntarily to terminate his distributorship until a replacement was found. Allen continued to work as an independent tool distributor after he canceled his agreement with Mac Tools.
Mac Tools, after the termination of the agreement, demanded $11,804.57 from Allen, on the initial secured financing agreement for start up, and Tool Purchase Account, and the Mac Cap accounts which had gone bad. Allen contested these amounts and subsequently he filed the suit in this cause.
*640 The counterclaim of Mac Tools proceeded to trial on July 21, 1992. At trial the only witness to testify was Mr. Scott Goen, the national accounting manager for Mac Tools. He testified on direct as to the various accounts, the initial secured account, the Tool Purchase Account, and the Mac Cap Finance Agreement, the balances, and the transfers between these accounts. He testified that the balance due to Mac Tools from Allen and Sherry for the purchase of Allen's initial start-up inventory under the terms of the Purchase Order and Security Agreement was $10,443.78. Goen also testified that in addition $1,360.79 was due from Allen on his trade account with Mac Tools. The trade account balance included all accounts purchased by Mac Tools pursuant to the Mac Cap Agreement that they have charged back to Allen under the recourse provisions. Goen arrived at a total balance which he claimed due from Allen, which Sherry guaranteed, to be $11,804.57 and $10,443.78 respectively.
On cross-examination, Goen could not tell the jury what the ending balance of Allen's account for the Mac Cap Agreement and the Tool Purchase Account on the date they terminated the relationship. He was unable to find the figures in the stack of paper which was presented to the jury, which consisted of a computer generated accounting records.
Allen rested without putting on any witnesses. The jury returned a verdict and judgment in favor of Mac Tools against Allen for $2,805.00.
Following the verdict, all parties agreed to allow the trial court to assess reasonable attorneys fees' on top of the jury's verdict. On motion by Mac Tools for assessment of attorneys' fees, which it requested to be approximately $38,000.00, the trial court awarded Mac Tools $9,854.05 in attorneys' fees against Allen.
Standard of Review
"It is well settled that a motion for summary judgment challenges the legal sufficiency of all or part of an opponent's case." Dawkins and Co. v. L & L Planting Co., 602 So. 2d 838, 841 (Miss. 1992) (citations omitted). "The motion lies only where there is no genuine issue as to any material fact. A fact is material if it tends to resolve any of the issues properly raised by the parties." Id. (citations omitted).
This Court conducts a de novo review of the record on appeal from a grant of a motion for summary judgment. Pace v. Financial Sec. Life of Mississippi, 608 So. 2d 1135, 1138 (Miss. 1992) (citing Short v. Columbus Rubber and Gasket Co., 535 So. 2d 61, 63 (Miss. 1988)). "When reviewing an award of summary judgment, this Court views all evidence in the light most favorable to the non-movant, including `admissions in pleadings, answers to interrogatories, depositions, affidavits, etc.' and will presume that all evidence in the non-movant's favor is true." Downs v. Choo, 656 So. 2d 84, 85 (Miss. 1995) (quoting Daniels v. GNB, Inc., 629 So. 2d 595, 599 (Miss. 1993)).
Where there is doubt whether a fact issue exists, the non-moving party is the beneficiary of that doubt. Brown v. Credit Ctr., Inc., 444 So. 2d 358, 362 (Miss. 1983). If any triable issues of fact exist, the lower court's decision to grant summary judgment will be reversed. Otherwise, this Court affirms the decision. Brown, 444 So.2d at 362.
I.
WHETHER THE TRIAL COURT ERRED IN GRANTING THE APPELLEE, MAC TOOLS, INC.'S MOTION FOR SUMMARY JUDGMENT ON THE ISSUE OF WAIVER AND ESTOPPEL AS TO THE FRAUD ALLEGED BY MARK ALLEN, TO HAVE INDUCED HIS ENTRY INTO THE CONTRACT FOR A MAC TOOLS DISTRIBUTORSHIP AND WHETHER THERE EXISTED A GENUINE ISSUE OR GENUINE ISSUES OF MATERIAL FACT WHICH PRECLUDED THE ENTRY OF SUMMARY JUDGMENT IN THIS CAUSE.
Allen argues that representations of the number of customers induced him into the Mac Tools Distributorship Contract, which were false and known to be false by the Mac Tools' DSMs. That they gave him a territory *641 which had never had 250 customers or stops and the sales figures quoted him were not based on accurate or true information. He was orally reassured and continuously told by Christmas and Tremonte, that the customers were to be added to make up the deficit which existed in the numbers represented to him to induce him to enter the contract. Allen complains that the trial court missed the aspect of the continuing representations made to him when the court granted the summary judgment in favor of Mac Tools. Mac Tools counters and states that even if there were such fraudulent representations, Allen waived any right to assert a claim or defense of fraudulent inducement based on such representations.
The trial court below granted summary judgment on this Court's decision of Turner v. Wakefield, 481 So. 2d 846 (Miss. 1985). In this decision Turner sued Wakefield for the balance due on a promissory note executed by Wakefield for the purchase of Turner's chiropractic practice. Turner asserted that Wakefield wrongfully misrepresented the value of the equipment and expected business income in the first year. Id. at 847. However, Wakefield discovered the misrepresentations four months after the contract was entered but continued to operate the business and to make note payments for an additional eleven months. Id. at 848. This Court held that if fraud did exist, Wakefield waived his right to allege it by ratifying the contract after discovery of the fraud. Id. This Court stated
Where [sic] one is induced through false and fraudulent representations to enter into an agreement upon discovery thereof, he has an election to either rescind, in which event he must tender back that which he has received, or he may affirm the agreement, and maintain his action in damages for deceit, but his election must be promptly made, and, [sic] when once made, is final. If one elects to affirm the agreement, after full knowledge with the truth respecting the false and fraudulent representation[s], and thereafter continues to carry it out and receive its benefits, he may not thereafter maintain an action in damages for deceit, because this would constitute a ratification if the agreement and condemnation [sic] of the fraud; otherwise one might, with knowledge of fraud, speculate upon the advantages or disadvantages of an agreement, receive its benefits, and thereafter repudiate all its obligations.
Turner, 481 So.2d at 848 (quoting Stoner v. Marshall, 145 Colo. 352, 358 P.2d 1021, 1022-23 (1961)). "A contract obligation obtained by fraudulent representation is not void, but voidable. Upon discovery thereof, the one defrauded must act promptly and finally to repudiate the agreement; however, a continuance to ratify the contract terms constitutes a waiver." Turner, 481 So.2d at 848-49.
The facts clearly show that Allen did not promptly repudiate but instead remained a distributor for Mac Tools for approximately three years and eight months. Allen states that he "became immediately aware of the fact that there were not sufficient customers in said area, as had been represented to him, wherein he could make 200 to 250 sales per week." Also, Allen testified in his deposition that he learned Tremonte's statement regarding sales potential was false in June 1986. Allen also made forty-two monthly installments for his initial inventory and he ordered and purchased additional inventory from Mac Tools. Allen continued to work, and did not take prompt action as required by this Court in Turner to terminate his distributorship with Mac Tools or to declare the contract between himself and Mac Tools void and unenforceable by this Court's holding in Turner.
Allen argues that his case is factually dissimilar to Turner, thus its holding and promulgated rule should not be applicable toward him. According to Allen the difference lies in the fact that the DSMs gave him additional representations or promises and thus his case does not fall within the purview of Turner. It appears that Allen was arguing fraudulent inducement or in the alternative fraud. The lower court merely treated this matter as a fraudulent inducement case and properly found under this Court's ruling in Turner that due to Allen's actions after his discovery of the alleged fraudulent acts that Allen waived any right to assert a claim for *642 damages based upon fraudulent inducement. However, the lower court did not address the merits on the ongoing fraud.
Allen asserts that after signing the agreement he discovered that the Defendants had made false representations which induced him into entering the Distributor Agreement with Mac Tools. Specifically, Allen testified that after signing the Distributor Agreement, he discovered that representations made by Tremonte about the number of available sales were false, and that these false representations, which Tremonte and the subsequent DSMs knew to be false, were continually made to him. Thus the evidence for review for the lower court concerned not only fraudulent inducement but also fraud.
A review of the original complaint filed by Allen reveals, while not artfully plead, the complaint alleges fraud sufficient to meet the standards predicated under Miss.R.Civ.Pro. 9(b). "[T]he circumstances constituting the fraud shall be stated with particularity. Fraud will not be inferred or presumed and may not be charged in general terms. The circumstances of the alleged fraud such as the time, place and contents of any false representations or conduct must be stated." Brabham v. Brabham, 483 So. 2d 341, 342 (Miss. 1986) (citing Miss.R.Civ.P. 9(b); McMahon v. McMahon, 247 Miss. 822, 157 So. 2d 494, 495 (1963); V. Griffith, Mississippi Chancery Practice § 589 (2d ed. 1950)).
The elements of fraud are: (1) a representation; (2) its falsity; (3) its materiality; (4) the speaker's knowledge of its falsity or ignorance of its truth; (5) the speaker's intent that the representation should be acted upon by the hearer and in the manner reasonably contemplated; (6) the hearer's ignorance of its falsity; (7) the hearer's reliance on the representation's truth; (8) the hearer's right to rely thereon; and (9) the hearer's consequent and proximate injury. Franklin v. Lovitt Equip. Co., Inc., 420 So. 2d 1370, 1373 (Miss. 1982). Conditions of mind, such as intent and malice, are required to be averred only generally. Benson v. Hall, 339 So. 2d 570 (Miss. 1976); Edmonds v. Delta Democrat Pub. Co., 230 Miss. 583, 93 So. 2d 171 (1957).
In addressing Allen's complaint, he stated all the nine elements necessary for a fraud claim. He argued (1) that Tremonte made a representation to him concerning the amount of customers, approximately 200 to 250; (2) that this number was indeed false; (3) that the number of customers was much less then represented and there were other Mac Tools' distributors in his territory, which caused a substantial decrease in available sales; (4) that Tremonte, Christmas, and Jenkins all were completely aware of the lack of customers; (5) that the DSMs intended, by making the false representations, to keep him as a distributor; (6) that he believed that the DSMs would work on increasing his territory to rise to the level of 200 to 250 customers; (7) that he relied on the representations of the DSMs when he purchased his initial inventory and later invest in more inventory; (8) that he believed that he had the right to rely on the DSMs' representations and attempted dutifully and faithfully to attempt to perform the provisions of the contract; (9) and that he suffered injury and loss of earning capacity for a total amount of three hundred seventy-six thousand two hundred dollars. Therefore, in Allen's complaint he not only alleges fraudulent inducement but fraud. It is not clear in the record why the trial judge did not consider the complaint as one in fraud, but the judge's order only addressed the issue of fraudulent inducement.
This Court has stated before that "[s]ummary judgment may be inappropriate in most complex cases for example, in cases dealing with fraud." Cunningham v. Lanier, 555 So. 2d 685, 687 n. 2 (Miss. 1989) (citation omitted). In the context of summary judgment when the party has alleged fraud this Court has alluded to the notion that the cases which involve allegations of fraud or misrepresentation generally are inappropriate for disposition at a summary-judgment stage. Great S. Nat'l Bank v. McCullough Envtl. Servs., Inc., 595 So. 2d 1282, 1289 (Miss. 1992); Pursue Energy Corp. v. Perkins, 558 So. 2d 349, 354 (Miss. 1990). Thus, concluded by our jurisprudence is the understanding that triable issues of fact do exist when the facts or evidence support the allegation that fraud and misrepresentation were involved. Great S. Nat'l Bank, 595 So.2d at 1289. It is well *643 established that fraud is never assumed but is essentially a question of facts which clear and convincing evidence must prove. Parker v. Howarth, 340 So. 2d 434, 437 (Miss. 1976). Fraud is essentially a question of fact best left for the jury.
"In an allegation of fraud ... the precise facts which would establish the fraud will often be known only by the party or parties alleged to have committed the fraud. Because the factor of intent which is necessary to establish fraud requires knowledge of the perpetrator's state of mind, it may not be possible for an opponent to reveal detailed precise facts in support of his claim." Crystal Springs Ins. Agency, Inc. v. Commercial Union Ins. Co., 554 So. 2d 884 (Miss. 1989) (citing 10A Charles A. Wright, Arthur R. Miller & Mary Kay Kane, Federal Practice and Procedure: Civil 2d § 2727 (1983)). "[T]he clear and convincing standard required of the evidence to sustain a claim of fraud is certainly met in a summary judgment posture when one witness specifically claims a representation was in fact made." Simmons v. Thompson Machinery of Mississippi, Inc., 631 So. 2d 798, 802 (Miss. 1994) (quoting McMullan v. Geosouthern Energy Corp., 556 So. 2d 1033, 1037 (Miss. 1990)). Finally, in a motion for summary judgment, a genuine issue of material fact is obviously present where one party testifies to one account of the matter in interest and the other party swears otherwise. Simmons, 631 So.2d at 802 (citing Newell v. Hinton, 556 So. 2d 1037, 1041 (Miss. 1990)).
As the record reveals, clearly there exists disputed material facts. "Motions for summary judgment may not be used to determine or decide issues of fact, only to decide whether there are any material fact issues to be tried." Simmons, 631 So.2d at 801 (citing American Legion Ladnier Post Number 42 v. City of Ocean Springs, 562 So. 2d 103, 106 (Miss. 1990)).
Application of the law to the evidence and viewing the facts in the light most favorable to Allen leads to the conclusion that material issues of fact exist. Allen claims that Mac Tools made several representations, know to be false representations, as to the acquirement of more customers, certainly disposition of this issue requires a determination by a finder of fact. The best way and perhaps the only way for Allen to prove fraudulent representations amounting to fraud would be at a trial in which he could test the credibility of the DSMs whom he claims made the fraudulent representations to him.
This opinion should not be construed as resolving the issue of fraud in favor of Allen; rather, from the evidence in the record, Allen should be entitled to an opportunity to prove the merits of his case at a trial by jury. As the benefit of the doubt should go to the party opposing the granting of summary judgment, there were issues that were proper questions for consideration on the merits. In view of the foregoing, the grant of summary judgment in favor of Mac Tools was error, and this case should be reversed and remanded.
II.
WHETHER THE TRIAL COURT ABUSED ITS DISCRETION IN AWARDING THE APPELLEE, MAC TOOLS, INC., NINE THOUSAND EIGHT HUNDRED AND FIFTY-FOUR DOLLARS & 05/100 ($9,854.05) IN ATTORNEY'S FEES WHEN IT RECOVERED ONLY TWO THOUSAND EIGHT HUNDRED FIVE DOLLARS & 00/100 ($2,805.00) BY WAY OF FINAL JUDGMENT ON THE JURY VERDICT ENTERED IN THIS CAUSE, AND AS TO WHETHER OR NOT THE ATTORNEYS' FEES SO AWARDED WERE GROSSLY EXCESSIVE IN PROPORTION TO THE AMOUNT OF THE VERDICT RENDERED BY THE JURY IN THIS CAUSE AS TO THE AMOUNTS OWED BY MARK ALLEN TO MAC TOOLS, INC., UNDER THE CONTESTED CONTRACT.
After the receipt of the jury verdict the parties agreed to allow the lower court to set reasonable attorneys' fees. Mac Tools requested attorneys' fees in the amount of $38,336.21 and submitted time records. The court granted attorneys' fees in the amount *644 of $9,584.05, more than 342% of the amount of the jury verdict. Allen argues that the trial court abused its discretion when it awarded attorneys' fees for more than one-third of the amount of the jury's verdict based on an open account. Mac Tools counters that the award of attorneys' fees was not excessive as the case was based on a contract rather then an open account. However, in their submitted brief Mac Tools states "[i]n order to acquire additional and replacement inventory for his distributor business, Allen was extended an open account by Mac Tools."
This Court has defined an open account as "an account based on continuing transactions between the parties which have not been closed or settled but are kept open in anticipation of further transactions... ." Cox v. Howard, Weil, Labouisse, Friedrichs, Inc., 619 So. 2d 908, 915 (Miss. 1993) (citing Westinghouse Credit Corp. v. Moore & McCalib, Inc., 361 So. 2d 990, 992 (Miss. 1978)). An open account is a "[t]ype of credit extended through an advance agreement by a seller to a buyer which permits the buyer to make purchases without a note of security and is based on an evaluation of the buyer's credit." Black's Law Dictionary 1090 (6th ed. 1990)). An action to recover on an open account is essentially an action to collect on a debt created by a series of credit transactions. H & H Design Builders, Inc. v. Travelers' Indem. Co., 639 So. 2d 697 (Fla. Dist. Ct. App. 1994); Central Ins. Underwriters, Inc. v. National Ins. Co., 599 So. 2d 1371 (Fla. Dist. Ct. App. 1992); Robert W. Gottfried, Inc. v. Cole, 454 So. 2d 695 (Fla. Dist. Ct. App. 1984).
In the present case, the lower court did not address the question whether an open account existed. The cases in Mississippi dealing with the award of attorneys' fees when collecting on open accounts state "[a]n award of attorney's fees that is greater than the recovery on an open account complaint may be an indication that the attorney's fees award is exorbitant." Cox, 619 So.2d at 915. "This Court has, however, traditionally approved as reasonable awards of attorneys' fees in collection matters in the amount of one-third of the indebtedness." Dynasteel Corp. v. Aztec Indus., Inc., 611 So. 2d 977, 986 (Miss. 1992). "This presumption is, of course, rebuttable." Cox, 619 So.2d at 915. "Under the circumstances of any given case, the judiciousness of adhering to this presumption may be impacted by the common factors for determining the reasonableness of an attorneys' fee award:"
(1) The time and labor required, the novelty and difficulty of the questions involved, and the skill requisite to perform the legal service properly; (2) The likelihood, if apparent to the client, that the acceptance of the particular employment will preclude other employment by the lawyer; (3) The fee customarily charged in the locality for similar legal services; (4) The amount involved and the results obtained; (5) The time limitations imposed by the client or by the circumstances; (6) The nature and length of the professional relationship with the client; (7) The experience, reputation and ability of the lawyer or lawyers performing the services; and (8) Whether the fee is fixed or contingent.
Dynasteel, 611 So.2d at 986-87 (citing Kaiser Invs., Inc. v. Davis, 538 So. 2d 427, 430 (Miss. 1989); Jack Cole-Dixie Highway Co. v. Red Ball Motor Freight, 254 So. 2d 734, 741 (Miss. 1971)).
Mac Tools argues that it moved the lower court for attorneys' fees based upon the contracts between the parties and not upon an open account statute, and thus the percentage award cases cited by Allen are irrelevant. See Miss. Code Ann. § 11-53-81 (Supp. 1995).
The record reveals that Mac Tools and the Allens first entered into a contractual agreement which a security agreement guaranteed, obligating the Allens to pay Mac Tools reasonable attorneys' fees and costs for collecting any deficiency remaining on the indebtedness. Thereafter, the account which Allen and Mac Tools established reflected that there was an ongoing balance, there were several continuous transactions and the *645 parties expected future transactions, in order for Allen to purchase replacement equipment. However, the record reflects that Mac Tools established several different types of accounts with the Allens. The first incurred debt consisted of the initial security agreement. This was followed by the Mac Cap Financing Agreement and a Tool Purchase Account which are open accounts. Thus, the Allens ultimately had one secured debt and two unsecured debts in the form of open accounts. Mac Tools admitted as much in their brief.
Mac Tools' attorneys submitted documents and billings to substantiate the fees. Also, this action was not only on an open account but on an initial security agreement and included the defense of Allen's fraud claim against Mac Tools. It is "often stated that in the absence of statute or contract providing expressly therefore ... there can be no recovery of attorneys fees... ." Stanton & Assoc., Inc. v. Bryant Constr. Co., Inc., 464 So. 2d 499, 502 (Miss. 1985) (citing Litten v. Grenada County, 437 So. 2d 387, 388 (Miss. 1983); Bellefonte Ins. Co. v. Griffin, 358 So. 2d 387, 391 (Miss. 1978)). Attorneys' fees were awarded below, under a contractual provision so providing. If this Court had affirmed the judgment of the circuit court Mac Tools would be allowed to attorneys' fees under the contract as awarded by the circuit court because the evidence in the record indicates that the legal fees incurred by Mac Tools were reasonable in light of the issues raised, both in the number of hours billed and the rate charged.
However, the award of attorneys' fees granted to Mac Tools also included the defense of the fraud claim. This Court is reversing and remanding on the matter concerning fraud. Thus the attorneys' fees incurred on this aspect will be on-going ergo this issue has not evolved enough to be determined by this Court. Also, if Allen proves fraud in the lower court there will be no attorneys' fees awarded. Consequently, this issue is reversed and remanded for further action consistent with this opinion.
I.
Cross-Appeal
WHETHER THE TRIAL COURT ERRED IN FAILING TO GRANT A DIRECTED VERDICT OR JUDGMENT NOTWITHSTANDING THE VERDICT IN FAVOR OF MAC TOOLS, INC. ON ITS COUNTERCLAIM AGAINST MARK M. ALLEN AND SHERRY A. ALLEN IN THE FULL AMOUNT DEMANDED, OR IN THE EVENT THE COUNTERCLAIM WAS PROPERLY SUBMITTED TO THE JURY BY THE TRIAL COURT, WHETHER THE VERDICT OF THE JURY WAS SO CONTRARY TO THE GREAT AND OVERWHELMING WEIGHT OF THE EVIDENCE TO THE EXTENT SAID VERDICT DID NOT FIND IN FAVOR OF MAC TOOLS, INC. AGAINST BOTH MARK M. ALLEN AND SHERRY A. ALLEN FOR THE FULL AMOUNT DEMANDED.
Mac Tools' counterclaim against the Allens sought to recover amounts due from them under the terms of the various agreements entered into between the Allens and Mac Tools with regard to the distributorship of Mark Allen. The counterclaim sought to recover the amount of $10,443.78 from both Mark and Sherry Allen which became due under the terms of the Purchase Order and Security Agreement. The security agreement was executed by the Allens in order to finance the purchase of Mark Allen's initial tool inventory for his distributorship. In addition Mac Tools sought to recover an additional $1,360.79 which Mac Tools claims was due from Mark Allen on his accounts. Mac Tools moved for a JNOV at the close of all evidence, which was denied by the lower court.
"[A] motion for J.N.O.V. tests the legal sufficiency of the evidence supporting the verdict. It asks the court to hold, as a matter of law that the verdict may not stand." Goodwin v. Derryberry Co., 553 So. 2d 40, 42 (Miss. 1989) (citing Stubblefield v. Jesco, Inc., 464 So. 2d 47, 54 (Miss. 1984) (quoting Jesco, Inc. v. Whitehead, 451 So. 2d 706, 713 (Miss. 1984))). "In deciding a motion for judgment notwithstanding the verdict, *646 the trial court must consider the evidence in the light most favorable to the non-moving party, giving that party the benefit of all favorable inferences that may be drawn therefrom." Goodwin, 553 So.2d at 42. To review a denial of a JNOV this Court must
consider the evidence in the light most favorable to the appellee, giving that party the benefit of all favorable inference that may be reasonably drawn from the evidence. If the facts so considered point so overwhelmingly in favor of the appellant that reasonable men could not have arrived at a contrary verdict, [this Court is] required to reverse and render. On the other hand if there is substantial evidence in support of the verdict, that is, evidence of such quality and weight that reasonable and fair minded jurors in the exercise of impartial judgment might have reached different conclusions, affirmance is required.
Sperry-New Holland v. Prestage, 617 So. 2d 248, 252 (Miss. 1993) (citing Munford, Inc. v. Fleming, 597 So. 2d 1282, 1284 (Miss. 1992) (citing Litton Systems, Inc. v. Enochs, 449 So. 2d 1213, 1214 (Miss. 1984))). This standard of review is "predicated upon the fact that the trial judge applied the correct law." Sperry-New Holland, 617 So.2d at 252.
Mac Tools argues that the lower court erred in not granting a JNOV because the evidence was clear that no dispute existed as to the amounts due from the Allens. At trial Mac Tools called Mr. Scott Goen, Credit Manager of Mac Tools, who testified regarding the various contracts between the parties and the amount outstanding under the terms of those accounts. Mr. Goen was the only witness to testify and was cross-examined by Allen.
On cross-examination, when asked what the balance of the trade account was on October 5, 1989, the date of the termination of the distributorship agreement, Mr. Goen was unable to give that information because the accounting documents on which he relied at trial were incomplete and did not contain the figure. It is clear that the trade account balance at the end of October was a vital element in the proof which Mac Tools failed to supply. The testimony of Mr. Goen indicated that the claimed balance due on the start-up account as of October 1989, was $7,805.21. In testifying Mr. Goen failed to prove that the accounts were indeed accurate due to the credit and debiting of the various accounts. On cross-examination Allen questioned the accuracy of the accounts and established that he was entitled to certain credits. The jury was allowed to take into consideration all of the credits which could be applied to that account.
Based upon the record, it is apparent that Mac Tools failed to prove the amount owed on the account and the amount of credit Allen was to receive. These items were material. Due to Mac Tool's failure to prove these material facts, the jury properly found in favor of Allen on the counterclaim based on account.
Utilizing the test promulgated by this Court in determining if the lower court erroneously denied the JNOV, it is clear that the testimony of Mr. Goen created issues of fact about which reasonable and fair-minded jurors in the exercise of impartial judgment might have reached different conclusions. "Factual disputes are properly resolved by the jury and do not mandate a new trial." McNeal v. State, 617 So. 2d 999, 1009 (Miss. 1993) (quoting Temple v. State, 498 So. 2d 379, 382 (Miss. 1986)). "The appellate court's role is to see that there is a fair trial given to both sides. We are not result oriented. The Court will not be the thirteenth juror." Walker v. Graham, 582 So. 2d 431, 433 (Miss. 1991) (citing Bell v. City of Bay St. Louis, 467 So. 2d 657, 660 (Miss. 1985)). Matters regarding the weight and credibility to be accorded the evidence are to be resolved by the jury. Neal v. State, 451 So. 2d 743, 758 (Miss. 1984). Thus, the lower court was correct in not granting Mac Tools' motion for JNOV.
However, this Court is requiring that this case be reversed and remanded for the jury to determine if Allen's claim of fraud has merit. If the jury determines that there was fraud the effect would void any judgment obtained against Allen with respect to the debts incurred on the open accounts entered into based on this fraud. Therefore, if Allen was fraudulently coerced into obtaining more *647 tools on open accounts then the debts incurred thereon were void ab initio and Mac Tools would not be entitled to the debts at issue. It therefore remains to inquire whether Mac Tools fraudulently coerced Allen into continuing his distributorship and incurring the debts fraudulently.
However, Mac Tools is entitled to the amount owed under the initial security agreement that was guaranteed before Allen entered into the distributorship. Allen's claim against the initial agreement has no merit since he subsequently waived his opportunity to sue for fraudulent inducement.[1] The amount owed on the initial security agreement, with proper credits given, should be calculated by the jury as the lower court was correct in determining that Allen did not have a case based on fraudulent inducement. The issue of damages owed by Allen is a question that needs to be decided by the jury below as they will determine if he was fraudulently coerced into entering the subsequent open accounts. Thus, this issue is reversed and remanded.
CONCLUSION
Application of the law to the evidence and viewing the facts in the light most favorable to Allen leads to the conclusion that material issues of fact exist as to the issue of fraud and this issue is reversed and remanded. Since the award of attorneys' fees granted to Mac Tools by the lower court also included the defense of the fraud claim this issue has not become ripe and is accordingly reversed and remanded. Lastly, the issue of damages should be calculated by the jury after a determination of whether the open accounts and the expenses incurred were fraudulently encouraged by Mac Tools, thus the counterclaim is reversed and remanded. For the reasons set out above, this case is reversed and remanded to the Circuit Court of Hinds County, Mississippi.
ON DIRECT APPEAL AND ON CROSS-APPEAL: REVERSED AND REMANDED.
DAN M. LEE, C.J., PRATHER, P.J., and PITTMAN, BANKS, McRAE, JAMES L. ROBERTS, Jr., SMITH and MILLS, JJ., concur.
NOTES
[1] See Issue I. for discussion on Allen's fraudulent inducement claim. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1247188/ | 224 Ga. 766 (1968)
164 S.E.2d 790
CLARK
v.
SMITH, Warden.
24802.
Supreme Court of Georgia.
Argued September 10, 1968.
Decided November 7, 1968.
Rehearing Denied November 21, 1968.
*767 Peter E. Rindskopf, Howard Moore, Jr., for appellant.
Arthur K. Bolton, Attorney General, Marion O. Gordon, Assistant Attorney General, B. D. Dubberly, Jr., Courtney Stanton, Deputy Assistant Attorneys General, for appellee.
MOBLEY, Justice.
William Patrick Clark was convicted of the offense of rape and sentenced to death, and on appeal to this court his conviction was affirmed. Clark v. State, 222 Ga. 802 (152 SE2d 692). His sentence was later commuted to life imprisonment. Thereafter he filed a petition for habeas corpus. After a hearing, he was remanded to the custody of the warden, and he appeals from this order, enumerating fourteen alleged errors.
1. Some of the alleged errors are almost identical with some of those enumerated in Massey v. Smith, 224 Ga. 721. The appellant here, as in the Massey case, is a white male. The Massey case decided, adversely to the contentions of the appellant in the present case, questions identical with alleged errors 1 and 2, complaining of the exclusion of persons of the Negro race, indigents, and women from the grand and traverse juries indicting and trying the appellant (see Headnote 1 in the Massey case); and alleged error 14, complaining that the court refused to admit certain evidence relating to the composition of the jury (see Headnote 2 in the Massey case).
2. Alleged error 4, contending that the sentence of death for the crime of rape is unconstitutional; 6, complaining that the Code section fixing the punishment for rape as death, unless the jury recommends mercy, is unconstitutional; and 7, contending that the sentencing of a white man to death for rape is arbitrary and erratic, were all decided, adversely to the contentions of the *768 appellant, by rulings in the Massey case, supra. (See Headnotes 3 and 4). Furthermore, in the present case the appellant's death sentence has been commuted to life imprisonment, and questions in connection with the imposition of a death sentence have no relevancy to his case.
3. In alleged error 3 the appellant contends that his sentence was illegal because the jury which sentenced him was composed exclusively of persons having no scruples against the imposition of capital punishment, all of those with such scruples having been eliminated pursuant to Code § 59-806 (4). In Witherspoon v. Illinois, 391 U.S. 510 (88 SC 1770, 20 LE2d 776), it was held that a death sentence cannot constitutionally be executed if imposed by a jury from which have been removed for cause those who are opposed to capital punishment or have conscientious scruples against imposing the death penalty. This case did not hold that the judgment of conviction was illegal, but only that the sentence of death returned by such a jury could not be executed. The appellant in this case has had his death sentence commuted to life imprisonment, and the sentence under which he is now serving is not illegal under the rulings in the Witherspoon case. See Bumper v. North Carolina, 391 U.S. 543 (88 SC 1788, 20 LE2d 797).
4. In assignments of error 5, 8, and 9, the appellant contends that he was denied due process of law and equal protection of the laws under the Federal Constitution because: he could only have been found fit to stand trial or be convicted under Code § 26-301, which is unconstitutionally vague and uncertain; he was directly tried on the issue of rape, when his confession raised clear inferences of lack of capacity and sanity, instead of being first tried on the issue of sanity alone; and the trial judge failed to charge the jury on the general issue of sanity despite the fact that his confession raised clear inferences of lack of capacity and sanity. Assignment of error 12 contends that his conviction violated the due process and equal protection clauses of the Federal Constitution because the trial judge refused to admit into evidence the deposition of Dr. C. Downing Tait on the question of the appellant's sanity.
The denial to an accused person of the right to an adjudication *769 as to whether he was insane at the time of the commission of an offense, or is insane at the time of the trial, is the denial of due process of law under the Fourteenth Amendment of the United States Constitution. Whelchel v. McDonald, 340 U.S. 122 (71 SC 146, 95 LE 141); Massey v. Moore, 348 U.S. 105 (75 SC 145, 99 LE 135); Pate v. Robinson, 383 U.S. 375 (86 SC 836, 15 LE2d 815). The Habeas Corpus Act of 1967 (Ga. L. 1967, pp. 835, 836; Code Ann. § 50-127) provides: "Rights conferred or secured by the Constitution of the United States shall not be deemed to have been waived unless it is shown that there was an intentional relinquishment or abandonment of a known right or privilege which relinquishment or abandonment was participated in by the party and was done voluntarily, knowingly and intelligently." We will therefore consider these enumerations of error to determine whether the appellant has been denied any right under the Fourteenth Amendment of the Constitution of the United States. See Mobley v. Smith, 224 Ga. 297 (161 SE2d 834).
The appellant was defended by court appointed counsel on his trial for rape. No plea of insanity was filed, no evidence was introduced on the question of his sanity, and no question was made on the appeal to this court as to the sanity of the appellant. There is no allegation in the petition for habeas corpus that the appellant was not adequately represented by counsel at the trial, or that he was insane at the time of the commission of the crime, or insane at the time of his trial. The contention made is that his confession, which was introduced in evidence, raised clear inferences of lack of capacity and sanity, and that it was therefore erroneous for the trial court to fail to try him separately on the issue of his sanity alone, and to fail to charge the jury on the issue of sanity. These assignments pertain only to the legality of the conviction under the evidence before the trial court.
The excerpts from the confession which are asserted to raise clear inferences of the appellant's insanity are as follows: "I refused on the ground that she would call the police and that I had already decided to commit the heinous crimes with which I now stand accused... This part of the crime was committed *770 with the express intention of receiving the supreme penalty of the State of Georgia for this type of crime." Counsel for the appellant argues that these excerpts show that the appellant committed a capital felony for the purpose of receiving a death penalty, and that this suicidal intent raises an inference that he was insane.
This court has held in a civil case that: "Suicide will raise no presumption of insanity, and standing alone will not authorize a finding of insanity." Boney v. Smallwood, 202 Ga. 411, 415 (43 SE2d 271). The appellant made a coherent and intelligent confession of the crime committed. The statement in the confession evidencing a suicidal intent was not, within itself, sufficient to raise an issue of insanity so as to require the trial judge to charge on insanity.
Since there was no evidence of insanity on the appellant's trial, and he does not assert in his habeas corpus petition that he was insane at the time of the commission of the offense, he has no standing to question the constitutionality of Code § 26-301, or to contend that he should have had a separate trial (for which there is no provision in Georgia law) on the issue of sanity at the time of the commission of the crime. Massey v. Smith, Headnote 5, supra.
As previously stated, all of the allegations pertaining to insanity in the petition for habeas corpus relate to alleged errors on the trial for rape, and there is no allegation in the habeas corpus petition that the appellant was insane at the time of the commission of the offense, or at the time of his trial. The deposition of Dr. C. Downing Tait does not relate to any matter on the trial of the case but refers to a sanity hearing conducted after the appellant's conviction. The deposition was excluded from evidence because it had been taken in another case. It is unnecessary to decide whether it was properly excluded on the objection made, since the deposition has no relevancy to the allegations of the petition for habeas corpus.
5. Assignment of error 10 asserts that the appellant's conviction and sentence were unconstitutional, in violation of the due process and equal protection clauses of the Federal Constitution, because his confession was admitted in evidence without *771 the court ruling on its admissibility prior to sending it to the jury. Assignment 11 asserts that his conviction and sentence were unconstitutional under the due process and equal protection clauses of the Federal Constitution in that his confession was erroneously admitted into evidence without a showing that he had been properly apprised of his constitutional rights before making it.
An examination of the transcript of the trial shows that no question was made that the appellant's confession was coerced or involuntary. On his appeal, this court held in connection with his confession that "there was no objection made to such evidence upon the trial of the case, and the State's prima facie showing that the confession was voluntarily made was not rebutted in any way." Clark v. State, 222 Ga. 802 (2), supra.
The transcript of the trial for rape shows, concerning the confession, that: Detective B. S. Ivey testified that he went to North Carolina to return the appellant to DeKalb County, and that he witnessed the confession, which the appellant wrote himself; that no one offered the appellant the slightest hope of reward if he would write or sign the statement, nor was he placed in the slightest fear; that prior to writing the confession the appellant was advised by the witness that "he did not have to make any statement, further that he had the right to legal counsel if he so desired at that time, further, that the statement could be used in a court of law either for or against him"; and that he told the appellant he did not have to discuss his case in any way.
Counsel for the appellant contends that this showing as to the information given the appellant does not conform to the procedure outlined in Miranda v. Arizona, 384 U.S. 436, supra, wherein it was held that in order to make a confession admissible in evidence, a person in custody, prior to interrogation, must "be clearly informed that he has the right to remain silent, and that anything he says will be used against him in court; he must be clearly informed that he has the right to consult with a lawyer and to have the lawyer with him during interrogation, and that, if he is indigent, a lawyer will be appointed to represent him." Hn. 1 (d).
*772 In Johnson v. New Jersey, 384 U.S. 719 (88 SC 1772, 16 LE2d 882), the Miranda case was given prospective application only. The opinion in the Johnson case, at page 732, states: "All of the reasons set forth above for making Escobedo and Miranda nonretroactive suggest that these decisions should apply only to trials begun after the decisions were announced. Future defendants will benefit fully from our new standards governing in-custody interrogation, while past defendants may still avail themselves of the voluntariness test. Law enforcement officers and trial courts will have fair notice that statements taken in violation of these standards may not be used against an accused. Prospective application only to trials begun after the standards were announced is particularly appropriate here. Authorities attempting to protect the privilege have not been apprised heretofore of the specific safeguards which are now obligatory. Consequently they have adopted devices which, although below the constitutional minimum, were not intentional evasions of the requirements of the privilege. In these circumstances, to upset all of the convictions still pending on direct appeal which were obtained in trials preceding Escobedo and Miranda would impose an unjustifiable burden on the administration of justice."
The Miranda case was announced June 13, 1966. The appellant was tried June 14, 1966. We are thus faced with a situation where the accused was accorded all rights announced in Escobedo v. Illinois, 378 U.S. 478, supra, and substantially, but not all all of those announced in Miranda v. Arizona, 384 U.S. 436, supra. His trial was held at a time when the Miranda case had been orally announced, but prior to the time that the authorities attempting to safeguard his rights could have been apprised of those safeguards made obligatory by the Miranda decision. The appellant has never contended, and does not now contend, that his confession was coerced, or that he would not have given the confession if he had been told that he would be furnished a lawyer if he could not employ one because of his poverty.
In this situation, and confining the ruling strictly to the facts of the present case, we hold that the reasons given in Johnson v. New Jersey, supra, for giving prospective application only to *773 Miranda v. Arizona, supra, are applicable in the present case, and the conviction of the appellant will not be upset because of the rulings in Miranda v. Arizona, supra.
(a) There is no merit in the contention that the appellant's conviction was illegal because no separate hearing, outside the presence of the jury, was held on the voluntariness of his confession, as required by Jackson v. Denno, 378 U.S. 368 (84 SC 1774, 12 LE2d 908, 1 ALR3d 1205) (1964). It was held in Pinto v. Pierce, 389 U.S. 31, 32 (88 SC 192, 19 LE2d 31) (1967), that the United States Supreme Court "has never ruled that all voluntariness hearings must be held outside the presence of the jury, regardless of the circumstances. Jackson v. Denno, 378 U.S. 368 [supra] (1964), held that a defendant's constitutional rights are violated when his challenged confession is introduced without a determination by the trial judge of its voluntariness after an adequate hearing." (Emphasis supplied.)
The voluntariness of the appellant's confession was not challenged on the trial of his case, and there was no necessity for a separate hearing before the trial judge on the question of voluntariness.
6. Assignment of error 13 is as follows: "The order of the Superior Court of Tattnall County, dated May 9, 1968, overruling and denying appellant's motion to process his appeal in forma pauperis without payment of cost, in that said order denied appellant his right to due process and equal protection under the Fourteenth Amendment, United States Constitution."
The record does not show what cost the appellant was required to pay before his appeal was transmitted to this court. Obviously he was able in some manner to pay all that was required of him, because his appeal has been transmitted to this court and is proceeding in forma pauperis here. The record does not show that he has been denied due process of law or equal protection of the laws by any requirement that he pay costs in the trial court.
7. It does not appear that the trial judge erred in remanding the appellant to the custody of the warden.
Judgment affirmed. All the Justices concur. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/8326682/ | Fabricant, Judith, J.
INTRODUCTION
This an action under the tips provision of the Massachusetts Wage Act, G.L.c. 149, §152A. Plaintiffs, employees of Dunkin’ Donuts franchises owned or operated by defendant Constantine Scrivanos, claim that their employer has violated the law by preventing them from accepting or keeping tips offered or left for them by customers.1 Before the Court is the defendant-employer’s motion for judgment on the plead*314ings. For the reasons that will be explained, the motion will be denied.
BACKGROUND
The first amended complaint, filed on June 24, 2011, alleges as follows. Plaintiffs and members of the class they seek to represent work as wait staff at Dunkin’ Donuts franchises owned and operated by the defendant through “numerous corporations.” “As is customary in the food and beverage industry,” customers at defendant’s shops “routinely leave, or attempt to leave," tips for service. Wait staff employees at defendant’s shops “have not been permitted to retain the tips that customers leave, or attempt to leave for them,” but instead “have been required to return tips to customers.” “If an employee cannot return a tip to the customer, then the employee is required to put the money in the cash register, to be retained by management.” Based on these alleged facts, the complaint asserts claims of violation of G.L.c. 149; §Í52A (count I); tortioiis interference with contractual and/or advantageous relations between plaintiffs and customers (count II); and unjust enrichment or quantum meruit (count III).
DISCUSSION
A motion for judgment on the pleadings challenges the legal sufficiency of the complaint, and accordingly, is subject to the same standard as amotion to dismiss. Welch v. Sudbury Youth Soccer Ass’n, Inc., 453 Mass. 352, 353 (2009). Taking all factual allegations of the complaint as true, but disregarding legal conclusions, see General Convention of New Jerusalem v. MacKenzie, 449 Mass. 832, 838 (2007), the-Court must determine whether the complaint sets forth allegations “plausibly suggesting (not merely consistent with) an entitlement to relief.” Iannachino v. Ford Motor Co., 451 Mass. 623, 636 (2008) (internal quotations and citations omitted).
Defendant’s motion characterizes the plaintiffs’ claims as “all premised on the novel legal theory that it is illegal for employers in the Commonwealth to have a policy and practice of prohibiting tipping in their establishments.” The statute, he contends, does not prohibit such a policy. As to the common-law claims, defendant contends that the complaint fails to state a claim on which relief may be granted. The Court will address each count in turn.
1. The Tips Act
General Laws c. 149, §152A(b) provides in pertinent part:
No employer or other person shall demand, request or accept from any wait staff employee, service employee, or service bartender any payment or deduction from a tip or service charge given to such wait staff employee, service employee, or service bartender by a patron.
“The Legislature’s intent in enacting the Act can be plainly discerned from its language and histoiy — to ensure that service employees receive the tips, gratuities, and service charges that customers intend them to receive.” DiFiore v. American Airlines, Inc., 454 Mass. 486, 491 (2009); Bednark v. Catania Hospitality Group, Inc., 78 Mass.App.Ct. 806, 809 (2011).
As defendant points out, the statute does not by its terms bar an employer from adopting and enforcing a no-tipping policy. The statute expressly prohibits an employer from requiring or accepting payment from tips “received” by the employee, or any “payment or deduction” from tips “given to” the employee, but it does not say that the employer must permit employees to receive tips, or must permit customers to give tips to employees. Nor does any decision identified by the parties or the Court address the issue. Plaintiffs nevertheless argue that that requirement follows from the statutory purpose, as articulated in DiFiore, supra, “to ensure that service employees receive the tips, gratuities, and service charges that customers intend them to receive.” To effectuate this purpose, plaintiffs contend, the statute must be construed to require employers to permit employees to receive any tips customers may offer, and to permit customers to give them at will. Defendants counter that such a reading would lead to absurd results, in that it would require all employers, including public employers, to permit tipping, despite risks of conflicts of interest, favoritism, and the like.
The Court is not persuaded that the interpretation plaintiffs propose is essential to the statutory purpose recognized in DiFiori and Bednark, supra. In both of those cases, employers imposed service charges in circumstances such that customers might reasonably have expected the charges to go to employees, and on that basis might have refrained from giving other money as tips, even though permitted to do so. See DiFiori, 454 Mass, at 494; Bednark, 78 Mass.App.Ct. at 815-16. In that context, the courts interpreted the statute so as to effectuate customers’ reasonable expectations. It does not follow that the statute prohibits a no-tipping policy that is clearly and conspicuously announced, so as to preclude any such reasonable expectation.2
The Court is similarly unpersuaded, however, that a statutory bar on no-tipping policies would necessarily lead to the results defendant invokes. As to public employees, G.L.c. 268A provides a clear, specific, and unequivocal prohibition on acceptance of gratuities. Any conflict that might exist between that statute and c. 149 would surely be resolved in favor of the former as the more specific, particularly in light of the strong policy interest in public integrity. See Pereira v. New England LNG Co., Inc., 364 Mass. 109, 118 (1973) (“If a general statute and a specific statute cannot be reconciled, the general statute must yield to the specific statute”). As to private sector employees, the statute provides its own limitation in its definition of “service employee” as “a person who works in an occupation in which employees customarily receive *315tips or gratuities.” G.L.c. 149, §152A(a). Application of that part of the definition might require factual determination in some cases, but courts are fully capable of making such determinations.
Nevertheless, the Court recognizes that, with respect to some employees who might meet the applicable statutory definitions, employers might choose to prohibit tipping for legitimate reasons that are consistent with public policy. In the context of private schools, camps, health care facilities, and residences for the elderly or disabled, for example, employers might reasonably determine that tipping would create an undue risk of favoritism, or would place unfair pressure on students, parents, clients, or patients. In certain types of service businesses, such as all-inclusive resorts, spas, or the like, employers might reasonably determine that tipping is inconsistent with the iype of atmosphere desired. And in the context of a coffee shop such as this defendant’s business, an employer might reasonably seek to avoid the administrative burden of accounting for tips and allocating them among those employees entitled to receive them.3
These legitimate employer concerns would not override a statutory prohibition. As discussed supra, however, the statute expresses no prohibition against no-tipping policies, and such policies do not necessarily contravene its purposes. In the face of legislative silence, the Court sees no basis to conclude that a no-tipping policy, if announced with sufficient effectiveness to prevent any misapprehension among customers, is unlawful.
It does not follow, however, that defendant is entitled to judgment as a matter of law on the plaintiffs’ claim of statutory violation. The complaint, as summarized supra, does not allege that the defendant’s no-tipping policy is clearly and effectively announced to defendant’s customers, such that they could not reasonably believe that money left as tips would benefit employees. To the contrary, the complaint alleges that customers at defendant’s shops “routinely leave, or attempt to leave," tips for service. That allegation supports an inference that at least a substantial number of defendant’s customers do expect that money they leave will go to employees.
Moreover, the complaint further alleges that “(i]f an employee cannot return a tip to the customer, then the employee is required to put the money in the cash register, to be retained by management.” Drawing reasonable inferences in the plaintiffs’ favor, as is appropriate at this stage, the Court understands this allegation to mean that customers leave change on the counter intended as tips, and then leave the shop too quickly for employees to return the money, and that the employer then keeps the money. If money left in that manner is “received by” or “given to” employees as tips, the employer’s acceptance of it would constitute a violation of the express statutory prohibition against an employer demanding, requesting, or accepting from wait staff “any payment or deduction from a tip . . . given to such wait staff employee ... by a patron.” G.L.c. 149, §152A(b).
Defendant argues that an employer who prohibits tipping must be allowed to follow this practice, because no other approach could effectively enforce a no-tipping policy. The Court recognizes the challenge of effective enforcement, but that problem does not create an exception to the statute. If an employer chooses to prohibit tipping, it must take responsibility for communicating that policy to its customers effectively. If it does, so that customers could not reasonably expect money left on the counter to be treated as tips, the conclusion may follow that such money is not “received by” or “given to” employees as tips. But the Court cannot make that determination at this stage, on the allegations of the complaint. The Court concludes that the facts pled state a cognizable claim of statutory violation.4
2. Tortious Interference
To state a claim of tortious interference with advantageous relations, a plaintiff must prove that it had or reasonably expected to have an advantageous business relationship with a third party; that the defendant knew of the relationship; that the defendant interfered with it, inducing the third party to terminate the relationship; and that the defendant did so by improper means or for an improper motive. See Draghetti v. Chmielewski, 416 Mass. 808, 816 (1994); United Truck Leasing Corp. v. Geltman, 406 Mass. 811, 816 (1990).
Here, as summarized supra, plaintiffs allege that defendant “interfered with the relationship between customers and wait staff by not allowing customers to tip the wait staff,” and by “diverting to themselves money that customers intended to leave as tips for the employees.” Defendant argues that these allegations are insufficient in two respects: plaintiffs have failed to allege any expectation of financial benefit from their relationships with customers, and have failed to allege that defendant acted for an improper motive or by improper means.
As to expectation of financial benefit, the complaint alleges that tipping “is customary in the food and beverage industry,” and that customers at defendant’s shops “routinely leave, or attempt to leave,” tips for service. That is enough to indicate that, if not for defendant’s policy, plaintiffs would likely receive tips from customers. As to improper motive or means, as discussed supra, plaintiffs have alleged that defendant enforced its no-tipping policy by conduct that violated the statute — that is, by taking from plaintiffs tips received or given to them by customers. A statutoiy violation is an improper means for purposes of a claim for tortious interference. See generally, United Truck Leasing Corp. v. Geltman, 406 Mass. at 816-17 (discussing requirement of conduct that is “wrongful by *316some measure beyond the fact of interference itself’). The Court therefore concludes that count II states a claim.5
3. Unjust Enrichment
Unjust enrichment is the “retention of money or property of another against the fundamental principles of justice or equity and good conscience.” Santagate v. Tower, 64 Mass.App.Ct. 324, 329 (2005). To state a claim for unjust enrichment, a plaintiff must allege facts indicating “unjust enrichment of one party and unjust detriment to another party.” Salamon v. Terra, 394 Mass. 857, 859 (1985). Here, plaintiffs allege that defendant has beenurijustly enriched, at' their expense, by retaining money that customers intended to leave as tips' for employees. Defendant' argues, as it did with respect to'the statutory claim, that its retention of money left as tips is not'inequitá-ble, because it is the only feasible means of enforcing defendant’s lawful no tipping policy. For the reasons' already discussed, the Court is not persuaded. On the facts alleged, defendant’s retention- of money left as tips is a direct violation of the statute. To allow defendant to benefit from that violation would be unjust and inequitable. The Court therefore concludes that the complaint states a claim as to each count.6 .
CONCLUSION AND ORDER
For the reasons stated, Defendant’s Motion for Judgment on the Pleadings is DENIED.
In addition to Constantine Scrivanos, the complaint as filed named “The Scrivanos Group d/b/a Dunkin Donuts.” In an order issued September 9, 2011, the Court dismissed ‘The . Scrivanos Group" on the ground that the complaint “does not provide allegations to indicate that it is a legal entity capable of being sued.”
As will be discussed further infra, whether such a clearly and conspicuously announced policy exists at defendant’s shops remains to be seen.
In this regard, the Court does not view an employer’s interest in avoiding litigation, or the risk of liability, as illegitimate. The volume of litigation in this Court under this statute, and the variety of theories presented, suggest that compliance is not a simple task. The prospect of trials over the question of whether certain occupations fall within the statutory definition of “service employee” only adds to the risks and expense facing employers. On the other side of the scale, employers who choose to prohibit tipping might be expected to incur increased wage costs to compete for labor with employers who allow tipping, at least at times when the labor market is healthier than it is now.
The Court is not persuaded that defendant violates the Act by requiring employees to return tips to customers, or to attempt to do so, as plaintiffs suggest. The statute prohibits employers from taking or accepting tips received by or given to employees. It does not prohibit employers irom requiring employees to refuse to accept tips, or to prevent customers from giving them.
As the Court suggested at argument, it is unclear what count II adds to the complaint. If plaintiffs prevail on the statutory claim, they will recover everything they could on this common-law claim, and more. If not, unless they identify some other basis improper motive or means, they will fall short on that element.
Like count II, count III depends on the statutory violation alleged in count I, and offers no additional relief, raising the question of how it might enhance plaintiffs’ position. Counsel’s answer to that question at argument was that, if the claim is characterized as contract-rather than tort-based, it might extend the statute of limitations. The Court has doubts. See Goldstein v. Savings Bank Life Ins. Co. of Mass., 435 Mass. 760, 761 n.2 (2002) (referring to “tort claims for unjust enrichment”); Cambridge Literary Properties, Ltd. v. W. Goebel Porzellanfabrik G.m.b.H. & Co., 448 F.Sup.2d 244, 263 (D.Mass., 2006) (applying tort statute of limitations to claims for unjust enrichment); but see Williamson v. DT Management, Inc., 17 Mass. L. Rptr. 606 (Mass.Super. March 10, 2004) (treating unjust enrichment claim as quasi-contract); see generally Hendrickson v. Sears, 365 Mass. 83, 85 (1974) (court looks to the “gist of the action or the essential nature of plaintiffs claim” to determine which limitations period applies). | 01-03-2023 | 10-17-2022 |
https://www.courtlistener.com/api/rest/v3/opinions/1404277/ | 347 F. Supp. 1058 (1972)
Martha V. GILBERT et al.
v.
GENERAL ELECTRIC COMPANY.
Civ. A. No. 142-72-R.
United States District Court, E. D. Virginia, Richmond Division.
September 25, 1972.
Seymour Dubow, Richmond, Va., Ruth Weyand, Assoc. Gen. Counsel, Int'l Union of Electrical, Radio & Machine Workers, AFL-CIO and CLC, Washington, D. C., for plaintiffs.
John S. Battle, Jr., Robert H. Patterson, Jr., Richmond, Va., Stanley R. Strauss, Vedder, Price, Kaufman & Kammholz, Washington, D. C., for defendant.
MEMORANDUM
MERHIGE, District Judge.
Plaintiffs, alleging that they are victims of sex discrimination employed by the defendant in violation of Title VII of the Civil Rights Act of 1964, 42 U.S.C. § 2000e, seek relief as a class. The immediate *1059 issues before the Court are premised on a motion by defendant employer for a change of venue, and one by plaintiffs seeking leave to add parties plaintiff to the complaint and to amend said complaint.
It is fairly obvious that the suggested addition of parties plaintiff and an amended complaint is for the primary purpose of overriding any adverse venue or jurisdictional determination that this Court has made or may make against named plaintiffs' stated desire to litigate in this division. It should be noted that the presently named plaintiffs purport to represent a national class, and the Court cannot conceive of any purpose of adding predominantly local named plaintiffs other than an effort to affect venue and jurisdictional requirements.
The Court's consideration of the pending motions requires a brief statement as to the background of this matter, as follows:
On May 10, 1972, upon receipt and consideration of papers and pleadings submitted by defendant on a motion to transfer venue, and upon the response thereto by plaintiffs, this Court ordered sua sponte, without a hearing, having concluded that the issue was ripe for decision, that this action be transferred to the Western District of Virginia. Plaintiffs, contending that they in effect had the right to select this division as their forum, sought review of the Court's order by way of an application for a writ of mandamus to the United States Court of Appeals for this Circuit. On consideration of same the Court of Appeals vacated the order of transfer and remanded the matter for a hearing, which the Court held on July 24, 1972. It was on that date that plaintiffs moved to add parties plaintiff to the complaint and requested the Court to defer its ruling on defendant's motion to transfer until subsequent to a ruling on their motion to add parties, their purpose being reasonably obvious.
The Court in its determination of the motion to add parties plaintiff pursuant to Rule 21, Fed.R.Civ.P., is duty bound to exercise its sound discretion. See Barron & Holtzoff, Federal Practice and Procedure, (Wright Ed.) § 543. While the Court is required to exercise its judicial discretion, it is not inclined to be, and has not in that exercise been, influenced by the efforts of plaintiffs to override its jurisdictional and venue determinations by a technical use of pleadings and motion practice. See Van Dusen v. Barrack, 376 U.S. 612, 624, 84 S. Ct. 805, 11 L. Ed. 2d 945 (1964).
In considering the equities, the Court of necessity gives great weight to the fact that the litigation is presently at an initial stage, hence the addition of parties plaintiff would have no prejudicial effect upon the existing named parties as might occur if the case were at a later stage of litigation. The Court concludes that plaintiffs should be sustained on their motion to add parties plaintiff and amend the complaint. This conclusion is reached only after having determined that regardless of the Court's ruling in that regard the plaintiffs must, in addition, be sustained on their contention that the Court was in error in its prior ruling.
Upon reconsideration of the arguments and pleadings herein, the Court is convinced that its earlier reliance upon Stebbins v. State Farm Mutual Auto. Ins. Co., 134 U.S.App.D.C. 193, 413 F.2d 1100, and its stated construction of 42 U.S.C. § 2000e-5(f) was misplaced. No effort on the part of the Court to explain its original error in this regard would change the fact that simply stated, the Court erred. No longer buttressed by its original misreliance on Stebbins, supra, the issue herein, i. e. construction of 42 U.S. C. § 2000e-5(f), is, the Court being unaware of any case precedent thereto, one of first impression.
The statute in question provides as follows:
(f) Each United States district court and each United States court of a place subject to the jurisdiction of the United States shall have jurisdiction of the actions brought under this subchapter. Such an action may be brought in any *1060 judicial district in the State in which the unlawful employment practice is alleged to have been committed, in the judicial district in which the employment records relevant to such practice are maintained and administered, or in the judicial district in which the plaintiff would have worked but for the alleged unlawful employment practice, but if the respondent is not found within any such district, such an action may be brought within the judicial district in which the respondent has his principal office. For purposes of sections 1404 and 1406 of Title 28, the judicial district in which the respondent has his principal office shall in all cases be considered a district in which the action might have been brought.
Concluding that the above quoted section is one of special venue, see General Electric Credit Corp. v. James Talcott, Inc., 271 F. Supp. 699 (S.D.N.Y. 1966), the Court looks to the legislative history in an effort to ascertain whether any particular venue considerations, apart from 28 U.S.C. § 1404, were intended by Congress to attach thereto.
The confusion with respect to this section arises from the words
. . . may be brought in any judicial district in the State in which the unlawful employment practice is alleged to have been committed. (Emphasis supplied)
If the phrase "in the state" is omitted, the section clearly means that actions shall be brought in the particular district which is the situs of the act complained of. Addition of the phrase "in the state" can result in an interpretation that the action must be brought either (1) anywhere in the appropriate state, or, (2) as if the phrase were omitted, only in the particular judicial district. The latter interpretation treats the phrase "in the state" as surplusage without syntactical effect. General venue considerations would, without more, cause the Court to adopt the latter interpretation and to attribute the equivocal wording to poor draftsmanship. However, as heretofore noted, this is not a general venue statute and usual venue considerations do not apply. See SEC v. Wimer, 75 F. Supp. 955, 963 (W.D.Pa. 1948). Moreover, legislative history shows that the phrase "in the state" was added by the Senate to the original House version which omitted it, 110 Cong.Rec. 2511, col. 3; 110 Cong.Rec. 12814, and said addition was reflected in the remarks of Senator Humphrey during floor debate, 110 Cong.Rec. 12723, col. 3. It is apparent, therefore, that the phrase was purposely added and not merely a product of poor draftsmanship. Accordingly, the Court concludes that the phrase must be given full syntactical weight in upholding plaintiffs' contention that the section provides for a forum in any part of the state.
Two other considerations lend weight to this conclusion. First, while the Court finds disturbing the suggestion that litigants may so blatantly engage in forum shopping, it does not seem inconsistent with Congress' militant approach to affording citizens full redress of civil rights grievances to allow plaintiffs a particularly wide latitude in choosing the situs of their litigation. Such latitude affords greater convenience to plaintiffs and enables them to avoid potential local economic and political pressures which might be believed to serve to hinder a trial judge's efforts to maintain an unfettered, impartial atmosphere.
A second consideration is relevant to the litigation herein. The broad latitude given by the statute is particularly engaging when taken in conjunction with class actions. Such actions, which are particularly appropriate and plentiful under Title VII, are often of interstate or intrastate character, stretching in geographical impact beyond the limits of particular divisions or state districts. In this light, determination of venue merely upon the named litigants would have an arbitrary effect.
Having concluded that venue for the action herein properly lies in this district, the Court now returns to plaintiffs' *1061 motion to add parties plaintiff. Defendants, in their pleadings, have upon affidavits questioned the intention of several of the newly named plaintiffs to be included herein. Said affidavits give rise to serious questions of the personal intent of said parties. The Court will therefore conditionally grant the motion to add parties, with leave to those named to withdraw from the action herein.
An appropriate order shall enter. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1431291/ | 648 F. Supp. 1400 (1986)
Danny FLETCHER
v.
SOUTHERN PACIFIC TRANSPORTATION COMPANY.
Civ. A. No. B-86-1149-CA.
United States District Court, E.D. Texas, Beaumont Division.
December 1, 1986.
Arthur Sadin, Schechter, Eisenman & Solar, Houston, Tex., for plaintiff.
Daniel V. Flatten, Mehaffy, Weber, Keith & Gonsoulin, Beaumont, Tex., for defendant.
MEMORANDUM OPINION
COBB, District Judge.
The plaintiff, Danny Fletcher, filed this FELA action in the United States District Court for the Eastern District of Texas, Beaumont Division, seeking recovery for injuries he sustained in McKinney, Texas, *1401 while working for the defendant, Southern Pacific Transportation Company. Defendant has moved to transfer this case to the Sherman Division of the same District, pursuant to 28 U.S.C. § 1404(a). For the reasons stated below, defendant's motion to transfer is granted.
I. THE STANDARD FOR TRANSFER
28 U.S.C. § 1404(a) sets forth the basis for a transfer of venue, and it provides:
For the convenience of the parties and witnesses, in the interest of justice, a district court may transfer any civil action to any other district or division where it might have been brought.
In determining whether to grant a motion to transfer under § 1404(a), federal courts have considered such factors as:
(1) Plaintiff's choice of forum. Federal Deposit Insurance Corp. v. Citizens Bank & Trust Co., 592 F.2d 364, 368 (7th Cir.1979), cert. denied, 444 U.S. 829, 100 S. Ct. 56, 62 L. Ed. 2d 37 (1979); Wooldridge v. Beech Aircraft Corp., 479 F. Supp. 1041, 1057 (W.D.Mo.1979).
(2) The availability of compulsory process for the attendance of unwilling witnesses. Coons v. American Horse Show Association, Inc., 533 F. Supp. 398 (S.D. Tex.1982); Greiner v. American Motor Sales Corp., 645 F. Supp. 277, 279 (E.D. Tex.1986), citing Coons, supra.
(3) The cost of obtaining the attendance of willing witnesses. Coons, 533 F.Supp. at 400; Morgan v. Illinois Central Railway Co., 161 F. Supp. 119, 120 (S.D.Tex. 1958).
(4) The accessibility and location of sources of proof. American Standard, Inc. v. Bendix Corp., 487 F. Supp. 254, 264 (W.D.Mo.1980). See also, Coons, 533 F.Supp. at 400.
(5) The location of counsel. Norwood v. Kirkpatrick, 349 U.S. 29, 75 S. Ct. 544, 99 L. Ed. 789 (1955); American Can Co. v. Crown Cork & Seal Co., 433 F. Supp. 333 (E.D.Wis.1977); Greiner, Slip Op. at 5. But cf. Solomon v. Continental American Life Insurance Co., 472 F.2d 1043 (3d Cir.1973) (where this factor is given little or no weight).
(6) The relative congestion of the courts' dockets. Gulf Oil Corp. v. Gilbert, 330 U.S. 501, 67 S. Ct. 839, 91 L. Ed. 1055 (1947).
(7) Accessibility of the premises to jury view. Gulf, supra.
(8) Relation of the community in which courts and the jurors are required to serve to the occurrence giving rise to the suit. Gulf, supra.
(9) The time, cost, and ease with which the trial can be conducted, and all other practical considerations relative to the trial. Morgan, 161 F.Supp. at 120.
In weighing the above factors, it is the opinion of the court that the convenience of the parties and witnesses and the interest of justice will be served by transferring this case to the Eastern District of Texas, Sherman Division. For the purposes of this Memorandum Opinion, the court takes judicial notice that the following towns, cities, and counties are situated in or are amenable to process to the Sherman Division:
(1) McKinney, Texas.
(2) Van Alstyne, Texas.
(3) Sherman, Texas.
(4) Dallas, Texas.
(5) Lewisville, Texas.
(6) Ennis, Texas.
(7) Denison, Texas.
(8) Melissa, Texas.
(9) Denton, Texas.
(10) Irving, Texas.
(11) Collin County, Texas.
(12) Grayson County, Texas.
(13) Ellis County, Texas.
At the outset, it should be noted that this case could have been brought in the Sherman Division since this cause of action arose in that Division. See, 28 U.S.C. § 1391(b).
II. THE CONVENIENCE OF WITNESSES
Probably the most important factor in passing on a motion to transfer under 28 *1402 U.S.C. § 1404(a) is the convenience of the witnesses. Sackett v. Denver & Rio Grande Western Railroad Co., 603 F. Supp. 260 (D.Col.1985); WRIGHT, MILLER AND COOPER, FEDERAL PRACTICE AND PROCEDURE, § 3851 (1986). In the present case, defendant has listed the following persons as factual and expert witnesses:
(1) Factual witnesses
C.S. Mattox, Ennis, Texas.
W.L. Gentry, Denison, Texas.
R.L. Lovett, Navasota, Texas (not within the Sherman or Beaumont Divisions).
David W. Fletcher, Melissa, Texas.
E.L. Alcala, Ennis, Texas.
B.P. Baldwin, Ennis, Texas.
M.J. Stoever, San Antonio, Texas (not within the Sherman or Beaumont Divisions).
A.L. Casper, Garland, Texas.
(2) Expert witnesses
Dr. Renshaw, Sherman, Texas (Orthopedist who treated plaintiff)
Dr. Selby, Dallas, Texas (Orthopedist who treated plaintiff)
Dr. Terry, Lewisville, Texas
Dr. Lewis, Sherman, Texas
Dr. Clinton Wainright, Denton, Texas
Joe Friedberg, Irving, Texas
In contrast, plaintiff has listed the following experts whom plaintiff expects to call at trial:
Joseph Kramberg, Houston, Texas (Vocational Expert)
Dr. Michael Wolfe, Houston, Texas (Economist)
Dr. Gary Nelson, College Station, Texas (Safety expert)
James Grimes, Houston, Texas (former railroad employee)
Ky Putnam, Houston, Texas (former railroad employee)
Dr. Hyder, Houston, Texas (consulting physician)
Dr. Cupic, Houston, Texas (present treating physician)
As to the witnesses listed above, it is well established under federal jurisprudence that motions for transfer should not become "a battle of numbers" and that "the party seeking transfer must clearly specify the key witnesses to be called and make a general statement of what their testimony will cover." Young v. Armstrong World Industries, Inc., 601 F. Supp. 399, 401-402 (N.D.Tex.1984), quoting 15 WRIGHT, MILLER AND COOPER, FEDERAL PRACTICE AND PROCEDURE, § 3851 at 270-71 (1976).
In the present case, the court does not intend to funnel this issue down to a "battle of numbers." Moreover, contrary to plaintiff's assertions, the defendant has demonstrated to the court [both in defendant's response to plaintiff's opposition to transfer and on oral argument] the content and relevance of the testimony to be presented by the listed witnesses. Upon a review of the pleadings, motions and supporting briefs in the present case, it is the opinion of the court that the greater number of key witnesses whose testimony will be necessary for trial either reside in or are amenable to process to the Sherman Division. Thus, the Sherman Division will better serve the convenience of the witnesses in this case.
Plaintiff contends that the court should discount the convenience of defendant's expert medical witnesses since their testimony will be repetitive and cumulative as to the issues of causation, diagnosis and treatment of plaintiff's condition. Instead, plaintiff argues that greater weight should be accorded the convenience of plaintiff's treating physician, Dr. Cupic, since Dr. Cupic's live testimony is needed to establish the only key substantive medical evaluation of plaintiff's ailment. James v. Norfolk & Western Railway Co., 430 F. Supp. 1317, 1319 (S.D.Ohio 1976). This position is untenable. Contrary to plaintiff's contentions, the medical witnesses in this case are not unanimous in their assessment of plaintiff's illness, including the necessity for corrective surgery and the ability of plaintiff to return to work. Thus, the availability of differing medical testimony provided by defendant's expert witnesses will be of paramount importance in the present case. *1403 Furthermore, Dr. Cupic is frequently retained by plaintiffs to give medical opinions at trial.[1] Given Dr. Cupic's willingness to become involved in litigation, it is unlikely that amenability to process will play any significant role in determining whether he will testify in person at trial. Thus, lesser weight is placed upon Dr. Cupic's convenience.
As to plaintiff's other expert witnesses, the court also accords little significance to their convenience. In this respect, the court recounts the testimony of plaintiff's attorney at the hearing on this motion:
THE COURT: Of the witnesses you say would be more convenient, Dr. Hyder?
MR. SADIN: Yes, Your Honor.
THE COURT: Where does Dr. Hyder live?
MR. SADIN: Dr. Hyder lives in Houston, and his office is in the Southern Pacific Building. He is the railroad's medical officer. He makes the determination of whether or not an employee can return to duty in the event of a serious injury on the job. He also determines the hiring practices as to the physical examinations and he determines what individuals follow the standards of employment set by the railroad or are employed by Southern Pacific.
THE COURT: Dr. Cupic, whom your firm employed. Who is Dr. Nelson?
MR. SADIN: He is a safety human factors safety engineer.
THE COURT: Who employed him?
MR. SADIN: Our firm, Your Honor.
THE COURT: Who us Joe Kramberg?
MR. SADIN: He is a vocational expert. Employed by our firm.
THE COURT: Michael Wolfe?
MR. SADIN: He is an economist, I think. He is familiar with Southern Pacific Railroad maintenance and way craft, which was hired by our firm to testify.
THE COURT: James Grimes or Ky Putman?
MR. SADIN: Those are former railroad employees who are familiar with railroad safety procedures. They have been retained by our firm. In addition, Mr. Lovette, is the defendant's employee who lives in Navasota and Mr. Stevens, who lives in San Antonio.
THE COURT: I was reading your list of experts. So, basically most of the witnesses that you assert were militating by granting the motion were either recommended or employed by your firm after the plaintiff employed you. Is that correct?
MR. SADIN: That's correct, Your Honor.
Thus, all of plaintiff's expert witnesses have been retained by plaintiff after filing suit, and therefore, their convenience is of little consequence in determining whether trasnfer is proper in the present case. See generally, Morgan v. Illinois Central Railway Co., 161 F. Supp. 119 (S.D.Tex. 1958). Furthermore, other cases which have elaborated upon this principle state:
It is of little value to this court's determination that plaintiff's expert witnesses reside in Ohio; even were this matter to be transferred, expert witnesses could be found and retained in the transferee district ...
Gdovin v. Catawbal Rental Co., 596 F. Supp. 1325, 1327 (N.D.Ohio 1984). Moreover, the court in Jordan v. Delaware and Hudson Railway Co., 590 F. Supp. 997, 998 (E.D.Penn.1984) states:
[T]he testimony of plaintiff's economic expert, construction safety expert, and vocational expert is standard in that it varies little substantively from case to case of this type. If need be, counsel could easily videotape this testimony for purposes of trial. Finally, where virtually all the remaining factors favor a transfer, the fact that the aforementioned three experts have offices in the Eastern District of Pennsylvania is inconsequential. *1404 Therefore, little weight has been given to the convenience of plaintiff's expert witnesses. Thus, the decreased cost, time, and travel expenses for the key witnesses in this case relegate transfer to the Sherman Division.
III. CONVENIENCE OF THE PARTIES
The court concedes that a plaintiff's choice of forum is generally entitled to respect and deference, and that the balance of convenience or interest of justice must clearly preponderate against this choice to justify a transfer under § 1404(a). Greiner, at 281, citing Coons, 533 F.Supp. at 400; Bridgeman v. Bradshaw, 405 F. Supp. 1004 (D.C.Cir.1975). However, where none of the operative facts occur within the forum of plaintiff's original selection, his choice is entitled to only minimal consideration. Morgan, 161 F.Supp. at 120. In the present case, the cause of action arose in McKinney, Texas, which is within the Sherman Division. Furthermore, all key witnesses, evidence, and locus of operative facts are situated in the Sherman Division. Additionally, the problem of producing hospital and accident records in the transferee forum may not be much of a problem. Thus, in light of the foregoing, the court finds that plaintiff's choice of forum should be given minimal consideration in the instant case. Therefore, plaintiff's choice of forum does not preclude transfer of this action to the Sherman Division.
IV. THE INTEREST OF JUSTICE
Under this factor, the court must take into consideration the amount of time and the ease with which this case can be conducted in the Sherman Division. In doing so, the court must ignore the congestion of its own docket in the Beaumont Division. The district court in Mazinski v. Dight, 99 F. Supp. 192, 194 (W.D.Penn.1951) articulated this point so well:
Of course, it would serve the convenience of this court and of other litigants with pending cases to transfer the action to some other less burdened district. No district court may, however, order such a transfer only to serve its personal convenience.
In view of the Sherman Division docket, the court finds that this action may progress more expeditiously in the Sherman Division because of its less crowded docket. Thus, transfer is appropriate in the present case.
V. CONCLUSION
For the reasons stated herein, the court orders this case to be transferred to the Sherman Division for the convenience of the parties and witnesses and in the interest of justice. It is further ORDERED that the District Clerk for the Eastern District of Texas, Beaumont Division, shall not physically transfer this case until ten (10) days after entry of this order, or any time thereafter, to permit plaintiff at his discretion to request a stay of transfer, or move to have the court reconsider its decision to transfer.[2]
NOTES
[1] Dr. Cupic has appeared before the court in the cases of Lands v. St. Louis Railway Co., 648 F. Supp. 322 (E.D.Tex.1986), and Dixon v. Southern Pacific Transportation Co., Civ.A. No. 85-1586 (E.D.Tex.1985).
[2] It has come to the court's attention that the District Clerk for the Eastern District of Texas, Beaumont Division, promptly transfers cases which are ordered transferred to other districts or divisions. The court commends the District Clerk on this quick and professional service. However, in view of the fact that the court loses jurisdiction to reconsider its order once a case is physically transferred, there is a need to delay transfer until the court has fully determined the case to be appropriate for transfer. In this respect, the 10-day delay is necessary for the party opposing the transfer to respond appropriately to the court's order. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/2405723/ | 913 S.W.2d 529 (1995)
Jose Ricardo CASTILLO, Appellant,
v.
The STATE of Texas, Appellee.
No. 1389-93.
Court of Criminal Appeals of Texas, En Banc.
November 29, 1995.
Discretionary Review Denied January 10, 1996.
*530 Robert Udashen, Dallas, for appellant.
Anne B. Wetherholt, Asst. Dist. Atty., Dallas and Robert A. Huttash, State's Atty., Austin, for the State.
Before the court en banc.
OPINION ON APPELLANT'S PETITION FOR DISCRETIONARY REVIEW
CLINTON, Judge.
A jury convicted appellant of possession with intent to deliver cocaine and assessed punishment at confinement for twelve years. On appeal appellant complained, inter alia, that the trial court erred in granting the State's challenge for cause against venireman Noel Blaydes on the ground that he harbored a bias against some aspect of the law upon which the State was entitled to rely. Article 35.16(b)(3), V.A.C.C.P. The trial court had granted the State's challenge that Blaydes was unable to consider convicting an accused on the basis of the testimony of a single witness. Appellant contends that Blaydes' voir dire reveals nothing more than that his threshold for reasonable doubt is higher than the legal minimum to justify conviction, and that granting the State's challenge for cause was error under this Court's opinion in Garrett v. State, 851 S.W.2d 853 (Tex.Cr.App.1993).
The court of appeals rejected appellant's contention, holding that propriety of the trial court's grant of the State's challenge for cause was governed, not by Garrett, but by our earlier opinion in Caldwell v. State, 818 S.W.2d 790 (Tex.Cr.App.1991). Accordingly the court of appeals affirmed the conviction. Castillo v. State, 867 S.W.2d 817 (Tex.App. Dallas 1993). In his petition for discretionary review, appellant now contends that our opinion in Garrett effectively overruled Caldwell, and that the court of appeals therefore erred to dispose of his contention on appeal on the basis of the latter. We granted appellant's petition to address this contention. Tex.R.App.Pro., Rule 200(c)(2) & (3).
I.
During the prosecutor's questioning of the jury panel he asked whether anyone would need more than a single witness to a crime. Blaydes responded, "I have one police officer tell me that a man was guilty: that is all I had, I couldn't say guilty. I couldn't do it." Later during individual questioning, Blaydes reaffirmed his position:
"[Prosecutor]: You had indicated that you would have trouble deciding this case if we brought you testimony of only one police officer. Could you explain what is the genesis of that?
[Blaydes]: Well, I was a drug agent for a couple of years there, and I just ran into and encountered so many things with various law enforcement persons that I worked with, and I have known of more than one *531 to get their storyto not get their stories straight and lie, frankly. I would be able to convict with two, but not with one. It's just no way. No way I could find guilty with just one officer. There would be a reasonable doubt. Be automatic.
[Prosecutor]: Automatic?
[Blaydes]: Automatic reasonable doubt.
The Court: I'm not sure that that is grounds for a challenge.
I would think that, Mr. Blaydes, the question that he asked was if you believed the witness?
[Blaydes]: I wouldn't automatically believe the witness.
The Court: But the way he asked the question was if you believed the witness?
[Blaydes]: `If' is such a big word, I would not believe. If it was just one witness, I would not automatically.
The Court: You would prejudge?
[Blaydes]: Yes, I would prejudge one peace officer; not two or three, but one, yeah. I have a problem with that because drug cases are just so different, as far as I'm concerned, than other types of criminal cases.
* * * * * *
[Defense Counsel]: The scenario that has been painted is that if there was one witness, and that one witness gave testimony, are you saying that no matter how credible, even if you believed him a hundred percent, you would still not be able to fairly decide this case based on just one person's testimony?
[Blaydes]: No. If he convinced me, if he convinced me, and there were other corroborative testimony, that it was crack, you know, and
[Defense Counsel]: You know, the other corroborative evidence might not be another live person, but may be physical evidence; so, if there wasif that one witness convinced you, then you had other things corroborated it, you could believe that one witness?
[Blaydes]: I'll be honest with you, what I would do, I would pray and ask God whether the man was telling me the truth, the police officer, and if God told me, yes, and there was other evidence that it was crack that was taken into, you know, as evidence, yeah, yeah, I would find your man guilty.
[Defense Counsel]: Okay.
The Court: That is with one witness?
[Blaydes]: With one witness right. See, I would be under pressure in there, but if I got thegot the answer when I prayed over it, if the one witness was telling the truth, I would find that man guilty.
* * * * * *
[Prosecutor]: One further question. I don't mean this is in a disrespectful way. You said if you got the answer?
[Blaydes]: Yes, it's possible it might not
[Prosecutor]: What if you prayed over it, and you didn't get an answer?
[Blaydes]: That is why I was doing this. Withwith all I know, if I was under pressure, wasn't given enough time to get an answer, very quick trial, then I would have to acquit because there would be a reasonable doubt there. You see, there is anautomatically reasonable doubt unless I have been given some sort of sign, because anyone could say anything.
[Prosecutor]: I understand that. I understand that.
The Court: [Defense Counsel], do you have additional questions?
[Defense Counsel]: No, Your, Honor.
The Court: I'm going to grant the challenge.
Mr. Blaydes, let me assure you that you have the right to believe as you desire, as you have indicated. It's just that both sides have the right to have twelve jurors come in without some preconceived idea, and able to sit and listen to the evidence before they make up their mind as to whether or not to believe a witness, and here you have indicated to me that you would prejudge the facts; that there is only one peace officer, you can't believe them?
[Blaydes]: No, it doesn't necessarily mean he's telling the truth. That would be prejudging *532 him, to just believe he's a police officer; he's automatically telling the truth.
The Court: What I'm saying, you have already prejudged the facts that you couldn't convict on the testimony of one peace officer, is that correct?
[Blaydes]: Not for this particular offense. For other offenses, yeah, but not for this particular offense.
The Court: So
[Blaydes]: Kind of risky."
The trial court then granted the State's challenge for cause, without articulating a legal basis.
On appeal, appellant contended that the trial court erred to grant the State's challenge for cause against Blaydes, who had indicated nothing more than that he would "set his threshold of reasonable doubt higher than the minimum required to sustain a jury verdict[.]" Castillo v. State, supra, at 823. Conceding that this Court's opinion in Caldwell v. State, supra, had held that a venireman who refuses to consider rendering a guilty verdict on the testimony of only a single eyewitness is subject to a State's challenge for cause, appellant contended that we effectively overruled Caldwell in our subsequent opinion in Garrett v. State, supra. In rejecting this argument, the court of appeals drew a distinction between Garrett and Caldwell:
We do not read Garrett so broadly. Garrett concerns only the venireman's bias or prejudice against the law at the punishment phase of a capital trial. This case involves bias or prejudice against the law at the guilt-innocence phase. The considerations for and evidence adduced at these two phases are different.
At the punishment phase of a capital case, the law does not limit the State to presenting only the facts of the offense. To prove future dangerousness, the State can present evidence of the defendant's background and character, criminal record, psychiatric history, and any other evidence the court deems relevant. [citations omitted.]
However, at the guilt-innocence phase, the State can only present the existing evidence of the offense. If there is only one witness to the offense, the State has the right to have the case tried by jurors who will objectively consider the testimony of that one witness. See Caldwell, 818 S.W.2d at 797. If the only witness is a police officer, the State has the right to have the case tried by jurors who will objectively consider the police officer's testimony. Cf. Leach v. State, 770 S.W.2d 903, 907-08 (Tex.App.Corpus Christi 1989, pet. ref'd).
The Court of Criminal Appeals has always allowed the State to challenge for cause veniremen who express an inability to convict based solely on a class of legitimate evidence. * * * Garrett contains no indication that the Court of Criminal Appeals intended to overrule this line of case law. We conclude Garrett does not apply in this case.
In his petition for discretionary review appellant continues to insist that this Court effectively overruled Caldwell in Garrett. We granted his petition to address the question whether in principle Garrett and Caldwell can be meaningfully distinguished as the court of appeals believed they could. We hold they cannot.
II.
A.
In Caldwell the trial court granted a State's challenge for cause against venireman Hacker. Hacker had acknowledged that "under no circumstances would [he] be able to base a [guilty] verdict on the testimony of one witness." 818 S.W.2d at 797. Analogizing to cases in which we had approved challenges for cause against veniremen who could not convict on the basis of purely circumstantial evidence, this Court held that Hacker had indicated a bias against a phase of the law the State was entitled to rely on:
"since he would have held the State to a higher burden of proof than that required by law. To force the State to prove its case with more than one eyewitness is an even greater burden on the State than was extant in [the circumstantial evidence cases], and such a sentiment clearly subjected [Hacker] to a challenge for cause."
*533 Id. We therefore ruled that the trial court committed no error in granting the State's challenge.
Like Caldwell, Garrett was a capital prosecution. There the trial court granted a State's challenge for cause against venireman Bradley, who had indicated that he could never answer the second special issue at the punishment phase affirmatively based on no more evidence than the facts of the capital offense itself. See former Article 37.071, § (b)(2), V.A.C.C.P. On appeal we observed, however, that a venireman's categorical refusal to find a capital defendant would constitute a continuing threat to society based only on the facts of the offense did not amount to a bias against the law. We reasoned:
"[T]hat the law permits jurors to find future dangerousness in some cases on the facts of the offense alone does not mean that all jurors must do so, or even consider doing so. A particular juror's understanding of proof beyond a reasonable doubt may lead him to require more than the legal threshold of sufficient evidence to answer the second special issue affirmatively. There is nothing unlawful about that; in fact, quite the opposite."
Garrett, supra, at 859 (emphasis in the original). Accordingly we held "that a venireman is not subject to challenge for cause merely because he indicates he would require more evidence than the legal minimum in order to answer special issue two affirmatively." Id., at 860.
In his dissenting opinion in Garrett Judge Campbell observed that the Court's holding was "flatly incompatible" with, inter alia, our earlier holding in Caldwell. Notably, the majority in Garrett did not disagree. We now hold that a venireman who categorically refuses to render a guilty verdict on the basis of only one eyewitness is not challengeable for cause on that account so long as his refusal is predicated on his reasonable understanding of what constitutes proof beyond a reasonable doubt. To the extent it conflicts with this holding, we overrule Caldwell.
Like venireman Bradley in Garrett, a venireman who categorically refuses to render a guilty verdict on the basis of a single eyewitness may only be indicating that his threshold for proof beyond a reasonable doubt is somewhat higher than the minimum that the law recognizes as sufficient. Unless we are prepared to hold that jurors must always convict on the basis of legally sufficient evidence, we cannot say that such a venireman has a bias against the law. We were mistaken in Caldwell to assume that a venireman who will not convict on the basis of one eyewitness is necessarily holding the State to a higher burden than that required by law. As long as the law permits a range of "reasonable doubt," the individual venireman who says he will hold the State to the high end of the range is not requiring anything that the law does not tolerate.[1] Unless reasonable doubt is a fixed pointunless, in other words, the law requires a jury to convict whenever presented with legally sufficient evidencea venireman who will not be convinced beyond a reasonable doubt on the testimony of a single eyewitness is nevertheless a venireman who can follow the law. If the State does not want that venireman on the jury, it is obliged to use one of its statutorily allotted peremptory challenges to remove him. Garrett, supra, at 861.
B.
This is not to say that a venireman who maintains he would never convict on the basis of one eyewitness is never properly the subject of a State's challenge for cause. It depends upon the reason he says he would never convict. A venireman who says, for instance, that he could not convict even if he believed the State's only eyewitness, and that testimony convinced him beyond a reasonable doubt of the defendant's guilt, can be challenged for cause, Garrett notwithstanding. Such a venireman really does hold the State to a higher burden of proof than the law allows. He has an agenda of his own for *534 conviction, but one which bears no relation to the law. If he cannot set his personal agenda aside, he should be excused at the State's demand. Article 35.16(b)(3), V.A.C.C.P.
A ready example of a venireman who is challengeable for cause notwithstanding our opinion in Garrett is, ironically, the venireman in Caldwell itself. In Caldwell Hacker acknowledged during his voir dire that "even if [he] heard one eyewitness and [he] believed the witness beyond a reasonable doubt and that eyewitness' testimony prove[d] the indictment beyond a reasonable doubt, [he] would still require additional evidence before [he] would return a verdict of guilty[.]" 818 S.W.2d at 796. Hacker was therefore challengeable for cause because he would not convict on the basis of a single eyewitness even if that was enough to convince him of guilt beyond a reasonable doubt. His excusal was therefore not inconsistent with our rationale in Garrett. However, to the extent we held in Caldwell that Hacker was necessarily challengeable for cause only because he would not convict on the basis of a single witness, without more, we erred.
It is the burden of the challenging party to demonstrate that the venireman he seeks to challenge is in fact incapable of, or at least substantially impaired from, following the law. Hernandez v. State, 757 S.W.2d 744, 753 (Tex.Cr.App.1988) (Plurality opinion).[2] In the present context this means that before the trial court may sustain a State's challenge for cause on the ground that the venireman will not convict on the testimony of a single eyewitness, it must be demonstrated to the trial court that the venireman's categorical refusal is predicated upon something other than his understanding of proof beyond a reasonable doubt. Otherwise there is no indication the venireman cannot follow the law, and the State has failed to carry its burden to show the venireman should be excused.
C.
Our holding in Garrett is largely unaffected by Geesa v. State, 820 S.W.2d 154 (Tex.Cr. App.1991). In Geesa we mandated that juries in all criminal cases be instructed on a definition of "reasonable doubt." The trial in Garrett occurred well before the prospective holding in Geesa went into effect. Therefore, even though we decided Garrett after Geesa, we had no occasion there to discuss it. The instant cause, by contrast, was tried in July of 1992, well after Geesa was decided. Nevertheless, though we must consider Geesa, it does not change our disposition today.
We held in Geesa that in all criminal cases the trial court should instruct the jury that reasonable doubt, inter alia, "is the kind of doubt that would make a reasonable person hesitate to act in the most important of his own affairs." To the extent that reasonable persons may entertain different thresholds of hesitation in acting in the most important of their own affairs, however, even after Geesa the law continues to recognize a range of "reasonable doubt." So long as it is possible to say that a venireman could reasonably "hesitate to act in the most important of his own affairs" on the basis of minimally sufficient evidence, Geesa, supra, at 162, it is his prerogative to refuse to convict on that evidence. His refusal does not show a bias or prejudice against the law in any respect.
The State could have attempted to demonstrate that Blaydes would not convict on the basis of a single police witness even if that kind of evidence were sufficient to remove whatever reasonable hesitation he might harbor to act in the most important of his own affairs. Had the State successfully demonstrated this, the record would support granting the State's challenge for cause against him. Failing that, the State has not sustained its burden to show he cannot follow the law, Geesa notwithstanding.
D.
Finally, we reject the court of appeals' punishment-phase-versus-guilt-phase dichotomy as the proverbial distinction without a difference. Whether it is deliberating upon a defendant's guilt or deciding how to answer the special issues at the punishment phase, a *535 jury is authorized by law to make a finding detrimental to the accused only if the evidence is convincing to a level of confidence beyond a reasonable doubt. In either context it is up to the individual juror to decide for himself his own understanding of proof beyond a reasonable doubt, within the tolerances of the law. A venireman who indicates he will set his threshold for reasonable doubt higher than the minimum allowed by law does not thereby demonstrate an inability to follow the law. This is true irrespective of the character of evidence presented or the nature of the issues involved in the respective proceedings.[3]
III.
Now that we have resolved the conflict between Caldwell and Garrett, it remains to dispose of the instant cause. Venireman Blaydes at first seemed to indicate his refusal to convict on the basis of one police officer's testimony was a function of his understanding of reasonable doubt. This assertion soon became intermixed, however, with indications that he would automatically disbelieve a police officer's testimony. The State argues that Blaydes' readiness to prejudge the credibility of a police witness provides an altogether different, and independent, support *536 for the trial court's decision to grant its challenge for cause. See Hernandez v. State, 563 S.W.2d 947, 950 (Tex.Cr.App.1978). The court of appeals did not address this contention on direct appeal, having disposed of the cause on the basis of what we have held here to be mistaken reliance upon Caldwell.
We will remand the cause to the court of appeals for at least one of two purposes. First, the court of appeals may address the question whether the State met its burden of showing Blaydes' unwillingness to convict on the basis of a single police witness was the product of something other than his reasonable understanding of proof beyond a reasonable doubt. Cf. Garrett v. State, supra. Having set out the proper legal standard in Part II, ante, we now appropriately remand the cause to the lower appellate court for it to apply that standard to the facts of this case in the first instance. Arcila v. State, 834 S.W.2d 357, 360 (Tex.Cr.App.1992).[4] In any event, even were we to hold that the court of appeals ultimately erred to excuse Blaydes under the standard we have set out ante, we would have to remand the cause for the court of appeals to address the State's alternative argument that Blaydes was properly excused under Hernandez v. State, supra.
Accordingly, we vacate the judgment of the court of appeals and remand the cause to that court for further consideration and disposition consistent with this opinion.
BAIRD, Judge, concurring on appellant's petition for discretionary review.
While I agree the Court of Appeals erred in holding Garrett was not applicable at the guilt/innocence phase of a trial, I do not believe Caldwell v. State, 818 S.W.2d 790 (Tex.Cr.App.1991), and Garrett v. State, 851 S.W.2d 853 (Tex.Cr.App.1993), are irreconcilable.
In Caldwell, the veniremember stated he could not convict based upon the testimony of a single witness, even if that testimony convinced him of the defendant's guilt beyond a reasonable doubt.[1]Id., 818 S.W.2d at 796-797. We held the veniremember was subject to a challenge for cause because "he would have held the State to a higher burden of proof than that required by law." Id., 818 S.W.2d at 797.
In Garrett, the State challenged for cause a veniremember who would not affirmatively answer the "future dangerousness" capital punishment issue based solely on the facts of the capital offense. Id., 851 S.W.2d at 857-859. The trial judge granted the challenge believing the veniremember had a bias or prejudice against the law upon which the State was entitled to rely. Id., 851 S.W.2d at 859. We reversed, holding "an individual juror must determine what proof beyond a reasonable doubt means to him." Ibid. Simply because the veniremember may himself *537 have a higher threshold "than the minimum required to sustain a jury verdict does not indicate he has a bias or prejudice against the law." Id., 851 S.W.2d at 860.
From the voir dire in the instant case it is clear the veniremember did not believe the testimony of a single narcotic agent would normally be sufficient to constitute proof beyond a reasonable doubt. Ante at 531-532. But Garrett guarantees the veniremember the right to his own definition of reasonable doubt. Thus, I agree Garrett controls the resolution of the instant case.
However, it does not necessarily follow that Garrett and Caldwell are in conflict. In Caldwell, the veniremember stated he could never convict upon the testimony of a single witness, even if that testimony convinced the veniremember of guilt beyond a reasonable doubt. Id., 818 S.W.2d at 796-797. In other words, the veniremember would have held the State to a greater burden and therefore was subject to a challenge for cause under Tex.Code Crim.Proc.Ann. art. 35.16(b)(3). But in the instant case, there is no evidence the veniremember would have held the State to a greater burden of proof. On the contrary, the record establishes that if the State convinced the veniremember of appellant's guilt beyond a reasonable doubt, the veniremember would follow the law and convict.[2]
The distinction between these cases is subtle but important: the State is entitled to a jury that will convict if it believes the State has proven its case beyond a reasonable doubt. A veniremember who would require more is subject to a challenge for cause. Caldwell, supra. However, the State is not entitled to challenge for cause veniremembers whose definition of beyond a reasonable doubt is higher than the legal minimum. Garrett, supra.
With these comments, I join only the judgment of the Court.
MANSFIELD, Judge, dissenting.
Because I believe that our opinion in Caldwell v. State, 818 S.W.2d 790 (Tex.Cr.App. 1991) is dispositive of the present case, I respectfully dissent. Furthermore, I believe that Garrett v. State, 851 S.W.2d 853 (Tex.Cr. App.1993) is not applicable and, additionally, was wrongfully decided.
Texas Code of Criminal Procedure article 35.16(a) (1994) defines a challenge for cause as "an objection made to a particular juror, alleging some fact which renders him incapable or unfit to serve on the jury." Under Article 35.16(b)(3), a challenge for cause may be made by the State for the following reason: "(3) that [the juror] has a bias or prejudice against any phase of the law upon which the State is entitled to rely for conviction or punishment."
Appellant was convicted by a jury of the offense of possession with intent to deliver cocaine. The jury assessed punishment at twelve years confinement in the Texas Department of Criminal JusticeInstitutional Division. The Fifth Court of Appeals affirmed appellant's conviction and sentence. Castillo v. State, 867 S.W.2d 817 (Tex.App. Dallas 1993).
During general voir dire, the prosecutor asked the venire whether they could find appellant guilty if there was only one witness to the offense charged. Venireperson Blaydes stated that he could not vote to convict appellant if the only evidence was the testimony of a single police officer. During individual voir dire, Blaydes stated that, due *538 to his background as a drug agent, "No way I could find guilty with just one officer. There would be a reasonable doubt. Be automatic. Automatic reasonable doubt." In response to a later question, Blaydes said, "I'll be honest with you, what I would do, I would pray and ask God whether the man was telling me the truth, the police officer, and if God told me, yes, and there was other evidence that it was crack that was taken into, you know, as evidence, yeah, yeah, I would find your man guilty." Finally, in response to a question from the court, Blaydes stated he couldn't convict on the testimony of one peace officer "for this particular offense." Over appellant's objection, the court granted the State's challenge for cause and Blaydes was struck from the venire.
Article 35.16(b)(3), in effect for many years, has been addressed by this Court on numerous occasions. In Bodde v. State, 568 S.W.2d 344 (Tex.Cr.App.1978), a venireperson testified "repeatedly and unequivocally that in answering the second question at the punishment hearing, Art. 37.071(b)(2), V.A.C.C.P., she would hold the State to a more stringent burden of proof than that required by the statute, `beyond a reasonable doubt.'" Bodde, at 349. We held she was properly excluded for cause under Art. 35.16(b)(3) (1978).
In Hawkins v. State, 660 S.W.2d 65 (Tex. Cr.App.1983), venireperson Pritchard, according to the record, had "great difficulty in understanding the term reasonable doubt." She stated that the State's proof would have to convince her to a certainty before she would find appellant guilty. She further stated that if there was any doubt in her mind, she would consider such a doubt to be reasonable. Hawkins, at 76. We held that the trial court properly sustained the State's challenge for cause as to Pritchard under Art. 35.16(b)(3) as her testimony demonstrated she would have held the State to a higher burden of proof than beyond a reasonable doubt, as she repeatedly stated that proof would have to convince her to a certainty before she would vote to convict.
Also in Hawkins, we held that the trial court properly sustained the State's challenge for cause of venireperson Williams. Williams' testimony indicated she would have voted in such a manner as to avoid the death penalty for the defendant without regard to the evidence which might be developed at trial. Hawkins at 77. She was challengeable under Art. 35.16(b)(3) and also was properly excused under the standards established in Witherspoon v. Illinois, 391 U.S. 510, 88 S. Ct. 1770, 20 L. Ed. 2d 776 (1968).
Similarly, in Franklin v. State, 693 S.W.2d 420 (Tex.Cr.App.1985), we found the trial court properly sustained the State's challenge for cause of venireperson Santana. "In the case at bar, we find that the testimony elicited from prospective juror Santana indicated that she would hold the State to a higher standard of proof than beyond a reasonable doubt. Moreover, we accord some deference to the trial court's determination given that he was in a position to gauge the sincerity and demeanor of the prospective juror's answers." Franklin, at 424.
A prospective juror who stated he could not find appellant guilty of capital murder unless appellant himself did the killing was held to be a proper subject for a challenge for cause by the State under Art. 35.16(b)(3). Phillips v. State, 701 S.W.2d 875 (Tex.Cr. App.1985). Also in Phillips, we found the trial court properly sustained the State's challenge of another prospective juror who stated clearly that she would hold the State to a higher burden of proof, i.e., proof beyond all doubt. Phillips at 888-889.
In White v. State, 779 S.W.2d 809 (Tex.Cr. App.1989) the State challenged for cause:
(1) venireperson Sheppard, who indicated she could not vote to find someone guilty of capital murder absent eyewitness testimony;
(2) venireperson Simmons, who indicated he could vote for the death penalty only for "premeditated" murders;
(3) venireperson Callender, who stated she could not consider the minimum range of punishment (five years) for murder; and
(4) venireperson Moton, who stated he would vote to convict the defendant even if the State did not prove the defendant committed *539 the offense charged on or about the date alleged in the indictment.
We found that the trial court ruled correctly in sustaining the State's challenge for cause under Art. 35.16(b)(3) of each of the four venirepersons listed above, as the law does not require eyewitness testimony for conviction, premeditation is not necessary for imposition of the death penalty, a prospective juror must be willing to consider the entire range of punishment, and a prospective juror who indicates he would not require the State to prove a required element (date of the offense) would have difficulty following his oath. "We note again that when passing on whether a juror was improperly excluded for cause, we must accord due deference to the trial court's determination given its position to assess the juror's sincerity and demeanor." White, at 822.
In Jacobs v. State, 787 S.W.2d 397 (Tex.Cr. App.1990), we held that it is the burden of the party seeking exclusion of a prospective juror for cause to demonstrate that such exclusion is proper. "On appeal, we recognize that great deference must be given to the trial court judge who is in the best position to see and hear the prospective jurors and to evaluate their responses. We will reverse a trial court's ruling on these issues only when the record shows a clear abuse of discretion on the trial court's part." Jacobs, at 402. See also Callins v. State, 780 S.W.2d 176, 194 (Tex.Cr.App.1986) (op. on rehearing).
We found the State did present evidence that venireperson Gilbert could not read or write; the court therefore did not abuse its discretion in granting the State's challenge for cause. The record also showed that venireperson Dupree would never answer yes to Special Issue Two and that venireperson Roark would require the State to prove appellant's guilt beyond all doubt as opposed to beyond a reasonable doubt; accordingly we held the trial court did not abuse its discretion in granting the State's challenges for cause of those two venirepersons.
In the following recent cases, this Court found the trial court properly granted the State's challenge for cause under Art. 35.16(b)(3):
(1) During voir dire a venireperson stated he would require proof higher than beyond a reasonable doubt in order to convict appellant and would require proof of at least two to three hours of premeditation in order to convict the defendant of capital murder. Cantu v. State, 842 S.W.2d 667, 681-2 (Tex. Cr.App.1992). We also held in Cantu that we will reverse such a decision [trial courts's ruling on a challenge for cause of a venireperson] "only for clear abuse of discretion; i.e., only when the trial judge's decision was so clearly wrong as to lie outside that zone within which reasonable persons might disagree." Cantu, at 683.
(2) A prospective juror stated clearly that she would hold the State to a higher burden of proof than proof beyond a reasonable doubt before she could vote to impose the death penalty. Cook v. State, 858 S.W.2d 467, 471 (Tex.Cr.App.1993).
(3) During voir dire the challenged venireperson testified she would consider a defendant's failure to testify to be an admission of guilt. Flores v. State, 871 S.W.2d 714, 719 (Tex.Cr.App.1993), holding that the State may challenge for cause under Art. 35.16(b)(3) a venireperson for bias against any phase of the law even where the bias might have been in favor of the State, and the trial court's granting same is supported, as here, by the record.
(4) Where a prospective juror testified she would hold the State, in a capital case, to a burden of proof higher than that of beyond a reasonable doubt and the record of her entire voir dire testimony supports the trial court's decision to grant the State's challenge for cause. Butler v. State, 872 S.W.2d 227, 235 (Tex.Cr.App.1994).
(5) Where a prospective juror testified he could not vote to convict defendant based on the testimony of only one eyewitness, even if he believed the eyewitness' testimony beyond a reasonable doubt. Caldwell v. State, 818 S.W.2d 790, 791-792 (Tex.Cr.App.1991). See also Barnard v. State, 730 S.W.2d 703, 712-714 (Tex.Cr.App.1987), cert. denied 485 U.S. 929, 108 S. Ct. 1098, 99 L. Ed. 2d 261 (1988); Marquez v. State, 725 S.W.2d 217, 238 (Tex. *540 Cr.App.1987), cert. denied 484 U.S. 872, 108 S. Ct. 201, 98 L. Ed. 2d 152 (1987).
In the present case, the record demonstrates that venireperson Blaydes would not convict appellant based on the testimony of one witness "even if you believed him 100%," unless there was other evidence. The record demonstrates further that venireperson Blaydes could not convict on the testimony of one peace officer "for this particular offense." "To force the State to prove its case with more than one eyewitness is an even greater burden on the State than was extant in Barnard or Demouchette, and such a sentiment clearly subjected the venireperson to a challenge for cause." Caldwell, at 797.
Caldwell is directly on point in the present case and appellant does not present any compelling arguments for us to overrule Caldwell. Furthermore, appellant fails to show in the record any abuse of discretion on the part of the trial court with respect to his granting of the State's challenge for cause to venireperson Blaydes pursuant to Art. 35.16(b)(3). We have held repeatedly that we will not second guess the trial court as to its decisions with respect to venireperson bias absent a showing of abuse of discretion.
Appellant contends that our opinion in Garrett v. State, 851 S.W.2d 853 (Tex.Cr.App. 1993), in effect, overruled Caldwell, as well as Marras v. State, 741 S.W.2d 395, 401-402 (Tex.Cr.App.1987). However, as the court of appeals correctly states, Garrett concerns only the venireperson's bias or prejudice against the law at the punishment phase of a capital trial, where the State is allowed to present evidence of the defendant's character, psychiatric history and other evidence the court deems relevant to prove future dangerousness. At the guilt-innocence phase, the State is limited to presentation of evidence of the offense itself and the State is entitled to have the case tried by jurors who will consider that evidence, even if the evidence consists of the testimony of one witness. Caldwell, at 797. See also Leach v. State, 770 S.W.2d 903, 907-908 (Tex.App. Corpus Christi 1989), pet. refused. I believe that Garrett was wrongfully decided and is inconsistent with our holdings in the cases cited earlier in this opinion. In Garrett we held that a venireperson is not subject to a challenge for cause simply because he could never answer yes to the second special issue based solely on the evidence of the capital offense. In effect, the State would, regardless of the amount of evidence it presented at trial, never be able to meet such a venireperson's individual threshold of reasonable doubt so as to obtain an affirmative answer as to special issue two.
As Judge Campbell stated in his dissent, we interpreted Art. 35.16(b)(3) "in what we thought was a commonsense manner to allow the State to challenge a venireperson for cause if the venireperson indicated `that he could not answer yes to the second special issue based solely on the evidence of the capital offenses.'" Garrett, at 861, citing Marras, at 401-402.
The State is entitled to challenge for cause any venireperson who has a bias or prejudice against "any phase of the law upon which the State is entitled to rely for conviction or punishment." Tex.Code Crim. Proc. art. 35.16(b)(3). We have held, in the cases cited above, that the State may challenge, for cause, a venireperson who states he could not convict based solely on circumstantial evidence, or who states he would hold the State to a burden of proof greater than beyond a reasonable doubt in order to convict as a venireperson who has a bias or prejudice against the law. Furthermore, we have held likewise with respect to a venireperson who states he could not convict based on the testimony of a single witness (even if he believes him beyond a reasonable doubt) or who could not affirmatively answer a special issue based solely on the evidence at trial (prior to Garrett).
The majority opinion in Garrett subverts the doctrine of stare decisis in overruling Marras as no evidence is presented that our opinion in Marras had become unworkable or led to injustice or that our interpretation of Art. 35.16(b)(3) was, somehow, erroneous. Although the majority in Garrett does not specifically overrule them, its opinion appears to be inconsistent with our rulings in Caldwell, Barnard, Phillips and other cases cited above, and should not be interpreted to overrule them.
*541 I respectfully dissent. I would affirm the judgment of the court of appeals.
KELLER, Judge, dissenting on appellant's petition for discretionary review.
This case involves the potential conflict between two lines of precedent: Caldwell v. State, 818 S.W.2d 790 (Tex.Crim.App.1991), cert. denied, 503 U.S. 990, 112 S. Ct. 1684, 118 L. Ed. 2d 399 (1992) on the one hand and our later opinion in Garrett v. State, 851 S.W.2d 853 (Tex.Crim.App.1993) on the other. In Caldwell, we upheld the excusal of a venireman who could never convict solely on the basis of the testimony of one eyewitness. 818 S.W.2d at 797. We reasoned that such a requirement increased the state's burden of proof. Id. In Garrett, a capital murder case, the trial court sustained the State's challenge for cause of a venireman who could never answer "yes" (in favor of the prosecution) to the "future dangerousness" special issue[1] based solely upon the facts of the offense. Id. at 857-861. We reversed the conviction in Garrett, holding that the venireman's position merely expressed a threshold of reasonable doubt that was higher than the legal minimum. Id. at 860.
Appellant does not dispute that if Caldwell remains intact then venireman Blaydes was challengeable for cause. Appellant merely argues that Garrett essentially overruled Caldwell, and therefore, Garrett controls the disposition of this case. The majority agrees, concluding that these decisions are irreconcilable. Because I believe that the decisions can and should be reconciled, I disagree with the majority's assessment.
An important distinction between the voir dire questions contained in Garrett and those in Caldwell centers upon the nature of the category of "evidence" that the respective veniremen were called upon to evaluate. The "facts of the offense," as described in Garrett, is a category defined by the content of evidence. For example, one may ascertain the "facts of the offense" by hearing testimony, reading documentary evidence, etc. A statement that the circumstances of the offense constitute the only evidence of future dangerousness in a given case is an observation about the content of the evidence in that case. Essentially, the venireman is asked to assume that a certain set of facts is proved at trial (i.e. that the only facts relevant to punishment are the circumstances of the offense itself), and then the venireman is asked whether he can draw a desired inference (i.e. future dangerousness) from that set of facts. A juror is not obligated to draw such inferences even when the evidence would be sufficient to support such inferences on appeal. A juror who refuses to do so merely expresses a reasonable doubt threshold that is higher than the legal minimum.
The question in Garrett is in this respect similar to issues concerning mitigating evidence in capital murder prosecutions. We have held consistently that a venireman is not challengeable for cause simply because he will not consider a particular kind of evidence to be mitigating. Morrow v. State, 910 S.W.2d 471, (Tex.Crim.App.1995) ("Veniremembers are not challengeable for their particular views about particular [mitigating] evidence."). Allridge v. State, 850 S.W.2d 471, 481-482 (Tex.Crim.App.1991), cert. denied, ___ U.S. ___, 114 S. Ct. 101, 126 L. Ed. 2d 68 (1993) (age, family background, and criminal history offerred as mitigating). Our holding in Garrett is consistent with this position, in that the mitigating nature of a particular circumstance is an observation about the content of evidence. After being offered a particular set of facts (e.g. regarding age, family background, limited mental capacity), a venireman is asked to infer that such facts are of mitigating character.
By contrast, the "testimony of a witness" is a category defined by the source of evidence. The content of a witness' testimony may vary widely depending upon the nature of the case. In the Caldwell situation, the venireman is not asked to draw an inference from a certain set of facts: disclosing that all relevant facts come from a single witness does not disclose what those facts are. Because the statement that testimony of a single witness constitutes the only evidence in the case *542 says nothing about the content of that witness' testimony, a venireman must be able to consider the possibility that the content of that testimony will meet his threshold of reasonable doubt, whatever that may be.[2] A venireman who fails to consider such a possibility has in essence drawn an inference about what the facts show without knowing what the facts are.
Moreover, a venireman should not be permitted to add a corroboration requirement similar to the accomplice witness rule to the State's burden of proof. See Texas Code of Criminal Procedure, Article 38.14 ("A conviction cannot be had upon the testimony of an accomplice unless corroborated by other evidence tending to connect the defendant with the offense committed; and the corroboration is not sufficient if it merely shows the commission of the offense.") Essentially, the accomplice rule increases the State's burden by requiring the State to submit additional evidence to corroborate an accomplice witness' testimony. See Boozer v. State, 717 S.W.2d 608 (Tex.Crim.App.1984) (State increased its burden of proof by failing to object to accomplice witness instruction in jury charge). This rule was imposed because an accomplice's testimony was considered inherently suspect. Cast v. State, 296 S.W.2d 269, 271 (Tex.Crim.App.1956) ("An accomplice witness is a discredited witness"). Because the legislature has not determined that the testimony of a "single" witness is similarly suspect, a venireman should not be permitted to increase the State's burden of proof by imposing a corroboration requirement.
The State may challenge for cause any venireman who "has a bias or prejudice against any phase of the law upon which the State is entitled to rely for conviction or punishment." Texas Code of Criminal Procedure, Article 35.16(b)(3). One "phase of the law" upon which the State is entitled to rely is that the jury will not require a greater burden of proof than "beyond a reasonable doubt." Cook v. State, 858 S.W.2d 467, 471 (Tex.Crim.App.1993). Because excluding the possibility of conviction based upon one witness increases the State's burden of proof, I would hold that the Court of Appeals did not err in its reliance upon Caldwell in upholding the challenge for cause against venireman Blaydes.
I respectfully dissent.
McCORMICK, P.J., and WHITE, J., join.
NOTES
[1] Of course, a venireman who requires proof to a level of confidence "beyond all doubt" is still challengeable for cause on the basis of inability to follow the law. E.g., Coleman v. State, 881 S.W.2d 344, 359-60 (Tex.Cr.App.1994); Narvaiz v. State, 840 S.W.2d 415, 427 (Tex.Cr.App.1992); cf. Geesa v. State, 820 S.W.2d 154, 162 (Tex.Cr. App.1991) (jury to be instructed, inter alia, that prosecution need not prove guilt "beyond all possible doubt").
[2] Although Hernandez was overruled in part in Fuller v. State, 829 S.W.2d 191, 200 (Tex.Cr.App. 1992), rumors of its demise were greatly exaggerated. For in Riley v. State, 889 S.W.2d 290 (Tex.Cr.App.1994), we revived Hernandez to the extent Fuller had overruled it.
[3] Judge Keller suggests another distinction by which she believes that Garrett and Caldwell can be reconciled. If we are paraphrasing her correctly, she believes that it was acceptable in Garrett for the venireman to assert that he would not answer the special issue regarding future dangerousness affirmatively based upon the facts of the offense alone (a "content"-based reasonable doubt). But it is somehow unacceptable for a venireman to assert, as in Caldwell, that he would not convict based upon the testimony of a single witness (a "source"-basedand therefore, says Judge Keller, un reasonabledoubt). The very analogy the she provides to illustrate this supposed distinction only serves to demonstrate its fallacy.
The analogy is to the accomplice witness rule. Article 38.14, V.A.C.C.P. This provision essentially constitutes a legislative judgement that a reasonable doubt exists if the only evidence the State presents in satisfaction of its burden of proof is the testimony of an uncorroborated accomplice witness. In other words, as a matter of statutory law, an uncorroborated accomplice witness cannot by itself persuade to a level of confidence beyond a reasonable doubtor, at least, even if it persuades a particular jury to that level of confidence, a conviction will not be permitted. A venireman who maintains he will convict even though the State has presented nothing more than the uncorroborated testimony of an accomplice witness is subject to a defendant's challenge for cause for harboring a bias against the law.
The Legislature, however, is free to repeal Article 38.14 at any time. Presumably Judge Keller would say that were the Legislature to repeal Article 38.14 tomorrow, a venireman who testifies that his understanding of reasonable doubt would prevent him from convicting on the uncorroborated testimony of an accomplice witness would suddenly become subject to a State's challenge for cause. Likewise challengeable, we suspect she would say, is the venireman who would require more than the testimony of a single witness.
We concede that if the accomplice-witness venireman in Judge Keller's analogy is properly subject to a State's challenge for cause, then so is the single-witness venireman in Caldwell, and in this cause. But we cannot agree that the accomplice-witness venireman is in fact subject to a State's challenge for cause. Reluctance or even flat-refusal to convict on the basis of uncorroborated accomplice testimony is not objectively reasonable solely because the Legislature is willing to codify it. The widely prevailing view that accomplice testimony is "inherently suspect" would certainly survive the repeal of Article 38.14! Repeal of Article 38.14 could only mean that the Legislature had decided no longer to hold that uncorroborated accomplice witness testimony is insufficient to meet a standard of proof beyond a reasonable doubt as a matter of law, but instead to submit to jurors on a case-by-case basis the decision whether naked accomplice testimony may convince them beyond a reasonable doubt, notwithstanding their suspicions. This just gives the question of what doubt is reasonable in this context back to the jury, where in practically every other context it already resides.
Of course there is no statute that requires jurors to harbor a reasonable doubt any time the State presents only a single witness in satisfaction of its burden of proof. Certainly a single witness is not ipso facto "inherently suspect," as is an accomplice witness. Moreover, the jury is allowed to convict on the basis of a single witness, if that evidence is legally sufficient. Even so, the law does not require the jury to convict unless each juror is convinced beyond a reasonable doubt. The venireman who says he will never convict based on the testimony of a single witness does not hold the State to an increased burden of proof if by that he is simply predicting that the testimony of a single witness will never be weighty enough in his mind to convince him to a level of confidence beyond a reasonable doubt. Unless and until he maintains that even in the event a single witness did convince him beyond a reasonable doubt, he would still refuse to convict, he has not yet proven himself to be subject to challenge for cause because biased against the law. And it is the State's burden, as proponent of the challenge, to demonstrate that this is what he means.
[4] In Arcila we observed:
"Our principal role as a court of last resort is the caretaker of Texas law, not the arbiter of individual applications. When different versions of the law, including unsettled applications of the law to significantly novel fact situations, compete for control of an issue, it is finally the job of this Court to identify and elaborate which is to control. But, except under compelling circumstances, ultimate responsibility for the resolution of factual disputes lies elsewhere."
Id. We have discharged "our principal role" in this cause in settling the conflict between Garrett and Caldwell. It is appropriate that we now remand the cause to the court of appeals to reconsider its resolution of the issue raised in this cause accordingly.
[1] The veniremember in Caldwell testified:
PROSECUTOR: You understand what I am talking about, that even if you heard one eyewitness and you believed the witness beyond a reasonable doubt and that eyewitness' testimony proves the indictment beyond a reasonable doubt, you would still require additional evidence before you would return a verdict of guilty?
VENIREMEMBER: Yes.
* * * * * *
DEFENSE ATTORNEY: Would you really not be able toare you saying that under no circumstance would you be able to base a verdict on the testimony of one witness?
VENIREMEMBER: No.
DEFENSE ATTORNEY: Would it depend on the quality of the testimony of that one witness and the credibility of that one witness?
VENIREMEMBER: No.
DEFENSE ATTORNEY: What are you telling me?
VENIREMEMBER: That I would require more evidence than one witness.
Id., 818 S.W.2d at 796-797.
[2] The following occurred during the instant voir dire:
DEFENSE COUNSEL: The scenario that has been painted is that if there was one witness, and that one witness gave testimony, are you saying that no matter how credible, even if you believed him a hundred percent, you would still not be able to fairly decide this case based on just one person's testimony?
VENIREMEMBER: No. If he convinced me, if he convinced me, and there were other corroborative testimony....
... and there was other evidence that it was crack that was taken into, you know, as evidence, yeah, yeah, I would find your man guilty.
* * * * * *
THE COURT: That is with one witness?
VENIREMEMBER: With one witness right....
[1] The issue reads: "whether there is a probability that the defendant would commit criminal acts of violence that would constitute a continuing threat to society." Art. 37.071 § 2(b)(1).
[2] A venireman who states that he could never convict on the basis of the testimony of a single witness because he would never believe such a witness expresses a bias in favor of the defendant and shows an inability to evaluate impartially the witness" credibility. The State may challenge such a venireman for cause because he is biased in the defendant's favor. Art. 35.16(a)(9). | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/2406815/ | 385 S.W.2d 456 (1964)
FURR'S, INC., et al., Appellants,
v.
UNITED SPECIALTY ADVERTISING COMPANY et al., Appellees.
No. 5664.
Court of Civil Appeals of Texas, El Paso.
November 25, 1964.
Rehearing Denied December 30, 1964.
*457 Turpin, Kerr, Smith & Dyer, Kerr, Fitzgerald & Kerr, Midland, Crenshaw, Dupree & Milam, James H. Milam, Cecil C. Kuhne, Lubbock, for appellants.
*458 Stubbeman, McRae, Sealy & Laughlin, Milton L. Bankston, W. B. Browder, Jr., Rush Moody, Jr., Midland, Passman & Jones, Dallas, and Hindin & Susman, Los Angeles, Cal., for appellees.
PRESLAR, Justice.
This is a "trade secret" case which also involves unfair competition and conspiracy. After a trial by jury, appellees (as plaintiffs) recovered judgment against appellants Furr's and the Webster, Harris & Welborn Advertising Agency for damages in the amount of $60,000.00, and a permanent injunction by which the appellant-defendants were enjoined from making, using or distributing a system and device known as the "Cash Circle Card" program, or any other advertising program, scheme or device the same, or substantially the same, as plaintiffs' Bonus Card program or system. Plaintiffs obtained a temporary injunction which was reversed by this court in Furr's Inc. v. United Speciality Advertising Company, Tex.Civ.App., 338 S.W.2d 762 (1960), writ of error refused, n. r. e., and reference is made to that case for greater details.
Appellants present some 48 assignments of error, grouped for convenience of argument. We do not feel it necessary to discuss each individually, as the disposition of some will make the consideration of others unnecessary. The case will be reversed and rendered.
We first take up appellants' contention that this court's prior decision on the temporary injunction phase of the case determined, as the law of the case, that no trade secret existed and no confidential relationship existed between the parties. We feel that those issues were so distinctly put into issue and so fully developed and brought forward on appeal as to make their determination final as to the parties here involved and their privies. They were so tried and determined as to come within the rule followed by this court in Texaco Inc. v. Parker, Tex.Civ.App., 373 S.W.2d 870 (err. ref., n. r. e.), which held that, even though in the strict sense, the decision on appeal from the granting or refusal of a temporary injunction may not be res judicata of the issues on final hearing, it may become the law of the case as to the legal principles declared. This is an exception to the general rule that an interlocutory judgment will not support a plea of res judicata, but it is a well-founded exception where the parties elect to distinctly put in issue a right or question of fact, as a ground of recovery or defense, and have it directly determined by the courts. It is supported by the authorities. Birchfield v. Bourland, Tex.Civ.App., 187 S.W. 422; International Longshoremen's Ass'n., Independent v. Galveston Mar. Ass'n., Tex.Civ.App., 358 S.W.2d 607; Baker v. Hill, Tex.Civ.App., 35 S.W.2d 779 (wr. dism.); Hayden v. City of Houston, Tex.Civ.App., 305 S.W.2d 798 (wr. ref., n. r. e.); Hudspeth v. Guggenheim, Tex.Civ. App., 12 S.W.2d 238 (wr. dism.) Its application depends in each case on what was done. Wilson v. Abilene Independent School Dist., Tex.Civ.App., 204 S.W.2d 407 (err. ref., n. r. e.). In the case before us, the parties fully litigated the two issues in question. This is reflected by this court's prior opinion:
"We believe that the issues that are here decisive are: Do the Cash Surprise Bonus Cards of appellees constitute a trade secret; and, if so, was such obtained unfairly by appellant by means of a breach of confidence?"
The opinion then reviews the evidence and wealth of exhibits and the applicable law, and reaches the conclusion which was decisive of the appeal:
"Therefore, because we do not believe there is a trade secret here involved, and because we do not believe that any information that appellant's advertising agency might have used was improperly obtained or obtained through breach of confidence, we must hold that there was not sufficient reason or justification to *459 warrant the trial court in granting the injunction."
Appellees seek to avoid this holding by urging that they have now obtained jury findings as to ultimate facts, and that an additional party defendant has been added. We do not think that has any particular bearing on the res judicata question, because the evidence and established facts being the same, what matter if found by the court or the jury? On the issue of trade secret, the evidence is more voluminous, but its quality is unchanged, and no contention is made that there have been any additional developments or changes in the factual set-up which brought about the suit. On the issue of confidential relations the evidence is unchanged. And the addition of a party privy, appellant Furr's advertising agent, has not brought about any change in the facts passed on, and it does not in any way alter the question or issues of trade secret and confidential relationship.
In addition to our holding that the law of the case has been established, we are of the further opinion that the facts of the present trial do not permit appellees to recover on the theory of what they call "theft of trade secrets", or any other theory of protection of trade secrets, for the evidence on the present hearing fails to establish any confidential relationship existing between the parties for the breach of which an action would lie. Assuming a trade secret, the existence of some duty owed in connection therewith, and its breach, becomes our pertinent inquiry.
One who does not wish to make disclosure of his secret in return for the term protection of the patent laws, or otherwise protect it specifically by contract, can still be protected if his disclosure is made in confidence so as to place the other party under a duty to keep his secret. It is a well-settled rule that equity will grant relief when one breaches his confidential relationship in order to unfairly use a trade secret. Luccous v. J. C. Kinley Company, 376 S.W.2d 336 (S.Ct.1964); Hyde Corporation v. Huffines, 158 Tex. 566, 314 S.W.2d 763; K & G Oil Tool & Service Co. v. G & G Fishing Tool Serv., 158 Tex. 594, 314 S.W.2d 782. The owner of the secret must do something to protect himself. He will lose his secret by its disclosure unless it is done in some manner by which he creates a duty and places it on the other party not to further disclose or use it in violation of that duty. The rule of the American Law Institute Restatement of the Law, as set forth in Hyde v. Huffines, supra, by the Supreme Court, is:
"`One who discloses or uses another's trade secrets, without a privilege to do so, is liable to the other if (a) he discovers the secret by improper means, or (b) his disclosure or use constitutes a breach of confidence reposed in him by the other in disclosing the secret to him * * *.' 4 Restatement of Torts § 757." (Emphasis ours).
Hyde v. Huffines granted protection to the owner of a trade secret who had granted another the right to manufacture his secret, which was done for some two years, under a written licensing agreement. The contract was silent as to the secret being kept confidential, but the court held that an express agreement was not necessary where the actions of the parties, the nature of their arrangement, the "whole picture" of their relationship established the existence of a confidential relationship. It was noted that they were, under the licensor-licensee arrangement, "co-adventurers". The facts of the case left no doubt that a confidential relationship existed and that all parties understood that it existed when disclosure was made. Hyde v. Huffines says no express agreement is necessary, but it stands to reason that the confidence reposed in the other person must, in some way, be manifest if not by words, then by the acts of the parties or the whole picture of their relationship. Confidential relationship is a twoway street: If the disclosure is made in confidence, the "disclosee" should be aware of it. He must know that the secret is being revealed to him on the condition he is *460 under a duty to so keep it. We belabored the point in this discussion because we do not believe that such was done in the case before us. We do not believe that the whole picture of the parties' dealings shows the existence of a confidential relationship. Further, if the owner of the secret intended that the disclosure be treated in confidence, such fact was not made known to the "disclosee", Furr's. There is no evidence to support the jury finding that there existed between the parties "a relation of trust and confidence at the time of the transactions had between them in 1959". Mrs. Hoese who, with her husband, owns the appellee companies, testified that she had confidence in Furr's and relied on their integrity. This we can well accept as true, but the fact remains that she did not in some manner make it known to Furr's that her secret was being revealed to them in trust. And, she did not participate in the 1959 transactions. The only person Furr's had dealings with was the salesman, and he testified (and the jury so found) that he did not ask them to treat his statements as statements made in confidence. The record reflects a salesman working hard to make a salea sale with no strings attached, so far as confidence was concerned. There was nothing about the transactions and dealings of the parties which would establish a confidential relationship, nor put Furr's on notice that such was intended. It was an arm's-length transaction which the jury found to be that of buyer-seller. Under such state of facts, we are of the opinion that such relationship as existed between the parties ended with the delivery of the materials purchased and the payment for them. That was in 1959, while this lawsuit is for breach of confidential relations alleged to exist in 1960. As stated, assuming a trade secret we are of the opinion that no confidential relationship existed between the parties; and absent such, appellees were not entitled to judgment for appropriation of a trade secret.
Appellees contend that there are other bases on which the judgment is supportable, but we are of the opinion that if we are correct in our determination that no confidential relationship existed between the parties, then the record does not substantiate any actionable wrongs. The judgment cannot be supported on the basis of unfair competition, for while unfair competition can be actionable where a confidence is violated, or where there is a palming-off of one's goods for that of another, neither theory will stand here. The first we have already ruled out, and the palming-off theory is not in this case. Nor do we think that Gilmore v. Sammons, Tex.Civ.App., 269 S.W. 861, is applicable to the facts of this case. The wrong condemned in Gillmore v. Sammons was the conduct of Sammons in appropriating the news items of Gilmore and selling them in competition with Gilmore. Without going into the standing of that case in the light of more recent pronouncements, we simply note its inapplicability here, for there is no contention that Furr's ever sold or attempted to sell that which it is alleged to have appropriated, and we fail to see how it could make any difference that Furr's hired Webster to prepare the product for them. That brings us to another matter, that of substantiating the judgment on the theory of a conspiracy of Furr's and the Webster agency. "A civil conspiracy is a combination of two or more persons by concerted action to accomplish an unlawful purpose, or to accomplish some purpose not in itself unlawful by unlawful means." Bartelt v. Lehman, Tex.Civ.App., 207 S.W.2d 131 (err. ref.); Kingsbery v. Phillips Petroleum Co., Tex.Civ.App., 315 S.W.2d 561 (ref., n. r. e.). The necessary elements are not present in this case. It cannot be said that Furr's and Webster acted together in the use of the Cash Circle Card. Furr's hired Webster to produce the Cash Circle Card for them and paid him for it. After that, Furr's owned it outright and had sole control of its use. How they used it or whether they ever used it was not for Webster to say. It is the use of the card in 1960 which is the cause of action alleged *461 by appellees, as plaintiffs, and Webster was not acting with Furr's in such use.
The judgment of the trial court is reversed, the injunction dissolved, and judgment here rendered that appellees take nothing by their suit. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/2427855/ | 960 S.W.2d 227 (1997)
Virgene SCHWENKE, Appellant,
v.
The STATE of Texas, Appellee.
No. 13-96-379-CV.
Court of Appeals of Texas, Corpus Christi.
November 26, 1997.
*228 Nathan A. East, Portland, for appellant.
David Aken, Co. Atty., Sinton, for state.
Before DORSEY, YANEZ and RODRIGUEZ, JJ.
OPINION
DORSEY, Justice.
Virgene Schwenke, appellant, was removed from his elected office of constable for the sole reason that he failed to obtain certification as a law enforcement officer as required by section 415.053 of the Texas Government Code. He appeals the judgment removing him from office claiming the section is inapplicable to him, but if it is, it is unconstitutional. He also challenges the trial court's failure to submit his proposed question to the jury and exclusion of evidence. We affirm.
Appellant was elected Constable of Precinct 6, San Patricio County, in the general election of November, 1992, taking office January 1, 1993. During the next two years, Schwenke accomplished the training required by the Texas Commission on Law Enforcement Officer Standards and Education (TCLEOSE). However, he did not pass all of the required tests and did not receive a license from the commission. On April 10, 1995, the State filed suit to remove him from office, alleging Schwenke had not obtained a license as a law enforcement officer from TCLEOSE and that such failure rendered him incompetent to hold his elected office. Section 415.053 of the Texas Government *229 Code is the applicable paragraph the State relies on to remove appellant from office. It provides:
An officer, including a sheriff, elected under the Texas Constitution or a statute or appointed to fill a vacancy in an elective office must be licensed by the commission not later than two years after the date that the officer takes office. The commission shall establish requirements for licensing and for revocation, suspension, cancellation, or denial of a license of such an officer. It is incompetency and a ground for removal from office under Title 100, Revised Statutes, or any other removal statute if an officer to whom this section applies does not obtain the license by the required date or does not remain licensed.
Act of June 19, 1993, 73rd Leg., R.S., ch. 985, § 2, sec. 415.053, 1993 Tex. Gen. Laws 4261 (emphasis added).
I. APPLICABILITY OF THE STATUTE TO APPELLANT.
Appellant complains the State based its case against him on a government code provision that does not apply to him. He argues the Legislature did not grant authority to TCLEOSE over the licensing of constables. He claims the statute specifically exempts application of section 415.053 to constitutionally elected officers such as constables. Appellant points to what he describes as a conflict between sections 415.053 and 415.060 as proof of the legislature's intent to exclude constables from the dominion of TCLEOSE.
Constables are constitutional officers elected under the provisions of Article V, section 18 of the Texas Constitution.[1] To remove a constable from office, the constitution provides: "... constables, and other county officers, may be removed by the Judges of the District Courts for incompetency, official misconduct, habitual drunkenness, or other causes defined by law, upon the cause therefor being set forth in writing and the finding of its truth by a jury." TEX. CONST. art. V, § 24 (emphasis added).
The State relies on section 415.053 of the government code to provide a statutory definition of incompetence. Schwenke, however, points to the predecessor of the current version of section 415.053, which is chapter 198 of the General and Special Laws of 1989. He claims that Act specifically exempts officers elected under the Texas Constitution, and that the exemption has not been repealed.
That chapter reads in its entirety[2]:
CHAPTER 198
S.B. No. 691
AN ACT
relating to a requirement that certain persons serving in elective offices as peace officers be licensed by the Commission on Law Enforcement Officer Standards and Education.
Be it enacted by the Legislature of the State of Texas:
SECTION 1. Section 415.053, Government Code, is amended to read as follows:
Sec. 415.053. LICENSING OF CERTAIN LAW ENFORCEMENT OFFICERS ELECTED UNDER TEXAS CONSTITUTION OR STATUTE. An officer elected under the Texas Constitution or a statute or appointed to fill a vacancy in an elective office must be licensed by the commission not later than two years after the date that the officer takes office. The commission shall establish requirements for licensing[,] and [procedures] for revocation, suspension, cancellation, or denial of a license[,] of such an officer. It is incompetency and a ground for removal from office under Title 100, Revised Statutes, or any other removal statute if an officer to whom this section applies does not obtain the license by the required date or does not remain licensed.
SECTION 2. This Act applies to officers, other than an officer elected under the Texas Constitution, who are elected, *230 reelected, or appointed on or after the effective date of this Act.
SECTION 3. The importance of this legislation and the crowded condition of the calendars in both houses create an emergency and an imperative public necessity that the constitutional rule requiring bills to be read on three several days in each house be suspended, and this rule is hereby suspended, and that this Act take effect and be in force from and after its passage, and it is so enacted.
Passed the Senate on April 6, 1989, by the following vote: Yeas 30, Nays 0; passed the House on May 2, 1989, by the following vote: Yeas 137, Nays 0.
Approved May 26, 1989.
Effective May 26, 1989.
Act of May 26, 1989, 71st Leg., R.S., ch. 198, §§ 1-3, 1989 Tex. Gen. Laws 846.
Appellant contends section 2 of the Act expressly exempts officers who are elected under the Texas Constitution, because it states the Act applies "to officers, other than an officer elected under the Texas Constitution." However, such a construction is directly contrary to the express language of the amendment of the government code stated in section 1, where an officer elected or appointed under the Texas Constitution is explicitly required to obtain a license by the commission.
We note at the outset that our primary concern when interpreting statutes is to comply with the intent of the legislature that passed them. Our first, best tool in ascertaining this intent is the language of the statute itself. Our quest can be guided, however, by the rules of statutory construction found in common law and as codified in the Texas Government Code chapters 311 and 312. When interpreting the intent and meaning of a statute, the court focuses on, and will follow, the plain language of the statute unless doing so leads to absurd and unintended consequences. Lundy v. State, 891 S.W.2d 727, 729 (Tex.App.Houston [1st Dist.] 1994, no pet.). Words will be given their ordinary meanings unless otherwise defined in the statute. Dallas County v. Sweitzer, 881 S.W.2d 757, 763 (Tex.App.Dallas 1994, writ denied). We must presume the entire statute is intended to be effective, and that a just and reasonable result is intended. Davis v. Zoning Bd. of Adjustment of La Porte, 853 S.W.2d 650, 652 (Tex.App.Houston [14th Dist.] 1993), rev'd on other grounds, 865 S.W.2d 941 (1993). We further presume the legislature intended its act to be constitutional. Lo-Vaca Gathering Co. v. M-K-T R. Co., 476 S.W.2d 732, 739 (Tex.Civ.App.Austin 1972, pet. ref'd n.r.e.). The court may consider legislative history as an indication of legislative intent. Collins v. Collins, 904 S.W.2d 792, 797 (Tex.App.Houston [1st Dist.] 1995), writ denied per curiam, 923 S.W.2d 569 (1996).
Appellant's proposed construction, that section 2 provides a specific exemption for constitutionally elected officers, does not withstand analysis. Such a construction is directly contrary to the express language of section 1: "An officer elected under the Texas Constitution...." To explicitly include a class in section 1 and then to exempt it from coverage in the next paragraph is absurd. Appellant's interpretation overlooks that only section 1 amends section 415.053, while sections 2 and 3 of the amendatory act address the effective date of the amendment. We find it significant that section 1 is the only section of Senate Bill 691 addressing itself to section 415.053. Section 1 of the 1989 Act makes minor amendments to the existing law. Specifically, section 1 added officers elected under a statute or appointed to fill a vacancy in an elective office to the extant code provision governing constitutionally elected officers. No change regarding constitutionally elected officers was contemplated by the Act. The 1989 legislation, then, was not directed at changing the regulatory nature of TCLEOSE as related to constitutionally elected officers established by prior legislation. Before enactment of Senate Bill 691, TCLEOSE had been granted all authority necessary to regulate constables.
What, then, of section 2? Given that constitutionally elected officers were already governed by section 415.053 and the only changes contemplated by the 1989 amendment were to include statutorily elected officers and appointed officers to the sweep of *231 TCLEOSE's governance, it is apparent the function of section 2 was to provide an effective date for application of the law to the newly regulated officers. Constitutionally elected officers, not being affected by the amendment, were specifically exempted from the date of its applicability in an attempt to avoid confusion. The legislature exempted statutorily elected officers who took office prior to the effective date of S.B. 691 from the requirement of certification. No such exemption was available to constables because they were already required to certify before passage of the bill. The clear purpose of section 415.053, both before and after the 1989 amendment, is the regulation of Texas law enforcement officers, including constables. Conflicting Provisions
Schwenke also points to an apparent conflict between the terms of section 415.053, if read to apply to constitutionally elected officers, and section 415.060(a), the code provision on revocation, probation, and suspension of licenses. Section 415.060(a) states, "The commission may establish procedures for the revocation of any license that it grants under this chapter, except a license of an officer elected under the Texas Constitution." TEX. GOV'T CODE ANN. § 415.060 (Vernon 1994). The Attorney General has issued a written opinion on this point. We find his opinion persuasive and a proper analysis of the law:
[W]e believe that sections 415.053 and 415.060 can be harmonized; they do not conflict irreconcilably. The 1985 amendments to article 4413(29aa), section 2(a)(18) and (21) indicate that the legislature intended to split the commission's authority to revoke licenses into two sections, one that authorized the commission to revoke the licenses of nonconstitutional law-enforcement officers and one that authorized the commission to revoke the licenses of constitutional law-enforcement officers. First, TCLEOSE was to establish procedures by which it may revoke the license of a nonconstitutional law-enforcement officer. This mandate now is found in section 415.060(a) of the Government Code. Section 415.060(b) articulates the reasons for which the commission may revoke a nonconstitutional officer's license: violation of chapter 415 or of a TCLEOSE rule. (citation omitted)
Second, TCLEOSE was to articulate requirements for the revocation of a license belonging to a law-enforcement officer elected under the constitution, except a sheriff. This requirement ... no longer excepts sheriffs. Unlike section 415.060, section 415.053 does not articulate reasons for the revocation of a license.... The fact that the legislature expressly excepted from section 415.060 "a license of an officer elected under the Texas Constitution" does not indicate the legislature intended constitutional law-enforcement officers' licenses to be irrevocable; rather, it indicates that the legislature intended such licenses to be revoked pursuant to section 415.053.
Moreover, to the extent of any conflict between the two provisions, section 415.053, which pertains specifically to the licenses of constitutional law-enforcement officers, prevails over section 415.060, which applies generally to any license that TCLEOSE grants under chapter 415. (citation omitted) We therefore conclude that TCLEOSE is required, pursuant to section 415.053 of the Government Code, to establish requirements for revocation of licenses of law-enforcement officers elected under the constitution, including both a sheriff and a constable. (footnote omitted).
Op. Tex. Att'y Gen. No. DM-323 (1995).
We do not find conflict between government code sections 415.053 and 415.060. By their own terms, section 415.060 deals with revocation of licenses granted to non-constitutional officers while section 415.053 deals with the licensing of all officers and revocation of licenses granted to constitutionally elected officers.
Having construed section 415.053 in accordance with the rules of construction, we find no conflict or ambiguity between the sections of the statute or subsequent acts. Appellant's first point of error is overruled.
II. CONSTITUTIONAL CHALLENGE
Appellant's second point of error challenges the constitutionality of government code section 415.053. A 1995 Attorney General's Opinion addressed this issue squarely:
*232 As a preliminary matter, we will consider the constitutionality of § 415.053. Where the constitution prescribes the qualifications for holding a particular office, the legislature lacks the power to change or add to those qualifications unless the constitution provides that power. Luna v. Blanton, 478 S.W.2d 76, 78 (Tex.1972); Dickson v. Strickland, [114 Tex. 176] 265 S.W. 1012, 1015-16 (Tex.1924). Article V, section 18(a) of the Texas Constitution provides for the office of constable.... The constitution does not dictate qualifications for holding the office of constable, and the legislature is therefore free to establish such qualifications by statute. See Luna, 478 S.W.2d at 78; Dickson, 265 S.W. at 1015-16. Moreover, we do not interpret section 415.053 of the Government Code to specify a qualification for office; (footnote omitted) rather, section 415.053 specifies a qualification for remaining in office once an individual has been elected or appointed to the office. (footnote omitted). Accordingly, section 415.053 of the Government Code does not contravene the constitution by adding to or changing the qualifications for holding the office of constable.
Op. Tex. Att'y Gen. No. DM-322 (1995). The Strickland rule (cited in Luna v. Blanton, but only in dicta) is yet the law in Texas where the constitution establishes qualifications for an elected office, the legislature is powerless to change those qualifications. Dickson v. Strickland, 114 Tex. 176, 265 S.W. 1012, 1015-16 (1924); Burroughs v. Lyles, 142 Tex. 704, 181 S.W.2d 570 (1944). The constitution establishes qualifications for certain constitutional offices, but leaves it to the legislature to prescribe qualifications for many other offices. Oser v. Cullen, 435 S.W.2d 896, 899 (Tex.Civ.App.Houston [1st Dist.] 1968, writ dism'd). As the court in Cullen explained:
The Texas Supreme Court pointed out in Shepherd v. San Jacinto Junior College District, (citation omitted):
`A state constitution, unlike the federal constitution, is in no sense a grant of power but operates solely as a limitation of power. `All power which is not limited by the constitution inheres in the people, and an act of a state legislature is legal when the Constitution contains no prohibition against it.' ... All intendments are against restrictions upon the legislative power and the applicable rule was stated by this Court in State v. Brownson:
"The legislative department of the state government may make any law not prohibited by the constitution of the state or that of the United States. Therefore the rule is that, in order for the courts to hold an act of the legislature unconstitutional, they must be able to point out the specific provision which inhibits the legislation. If the limitation be not express, then it should be clearly implied." (citation omitted).
Since the Constitution does not specifically limit the Legislature in enacting provisions as to eligibility for statutory offices (as opposed to constitutional offices) the Legislature is empowered to do so.
Cullen, 435 S.W.2d at 899-900.
While we disagree with the Attorney General's opinion to the extent that we find section 415.053 clearly specifies a qualification for holding office, we agree it is not an unconstitutional qualification. As stated in the Attorney General's opinion and noted previously in this opinion, the constitution prescribes no qualifications for the office of constable. Absent constitutional preemption, the legislature was free to act.
PROCEDURAL DUE PROCESS
Schwenke complains section 415.053 violates his rights to procedural due process. The requirements of procedural due process apply only to the threatened deprivation of liberty and property interests deserving the protection of the federal and state constitutions. Board of Regents v. Roth, 408 U.S. 564, 569, 92 S. Ct. 2701, 2705, 33 L. Ed. 2d 548 (1972). Therefore, any assessment of proper procedural safeguards necessarily begins with a consideration of whether the particular interest at stake is a protected interest. As noted by the Texas Supreme Court, an officer's interest in his elected position, though not "property" in the conventional sense, is a recognizable interest for purposes of procedural due process analysis. Tarrant County v. Ashmore, 635 S.W.2d 417, 422 *233 (Tex.1982); Paris v. Cabiness, 44 Tex.Civ. App. 587, 98 S.W. 925, 927 (1906, no writ).
Having determined Schwenke has an interest deserving due process protection, we must define the amount of process due. At the very least, deprivation of a protected interest requires notice and an opportunity to be heard. The type of notice and hearing required varies according to the facts of the situation. Bell v. Burson, 402 U.S. 535, 540, 91 S. Ct. 1586, 1590, 29 L. Ed. 2d 90 (1971). The full procedural protections afforded in a criminal trial proceeding are not required every time there is a right to a hearing. Cafeteria & Restaurant Workers Union v. McElroy, 367 U.S. 886, 894, 81 S. Ct. 1743, 1748, 6 L. Ed. 2d 1230 (1961); Tarrant County, 635 S.W.2d at 422.
In applying these principles to the instant case, we note, "... constables, and other county officers, may be removed by the Judges of the District Courts for incompetency, official misconduct, habitual drunkenness, or other causes defined by law, upon the cause therefor being set forth in writing and the finding of its truth by a jury." TEX. CONST. art. V, § 24. Government code section 415.053 defines failure to attain a license in the prescribed fashion as incompetence. In making this determination, the trial court provided appellant a full trial on the relevant issues. He was represented by counsel, was afforded an opportunity to present evidence and cross-examine witnesses, and his cause was heard before a jury. It is true the only adjudicative fact to be determined under the circumstances was whether Schwenke had complied with the statute.[3] We cannot conclude appellant was wrongfully deprived of due process. Given the circumstances of the case and the issue to be decided, Schwenke received the due process protection to which he was entitled.
DELEGATION OF RULE MAKING POWER
Appellant complains the legislature unconstitutionally delegated rule making authority to the commission by allowing TCLEOSE to promulgate additional qualifications for an elected officer. As previously stated, we do not find section 415.053 to place additional unconstitutional qualifications on the office of constable.
Citing article V, section 24 of the Texas Constitution, Schwenke contends the power of removal of an elected officer rests with the people in a republican form of government. As previously stated, section 24 clearly vests the power of removal of constables in district court judges for, among other reasons, incompetency and "other causes defined by law". Section 24 further requires the fact finding in such cases be accomplished by a jury. This is precisely the procedure afforded Schwenke.
Appellant further argues the legislature, by vesting in TCLEOSE the power to define the term "incompetence," has wrested from the voters of San Patricio County a right guaranteed them by the constitution. We cannot agree. "When given the power to implement constitutional provisions, the Legislature may define terms which are not defined in the constitution itself, provided its definitions constitute reasonable interpretations of the constitutional language and do not do violence to the plain meaning and intent of the constitutional framers." Swearingen v. City of Texarkana, 596 S.W.2d 157, 160 (Tex.Civ.App.Texarkana 1979, writ ref'd n.r.e.); In re Sheppard, 815 S.W.2d 917, 920 (Tex.Spec.Ct.Rev.1991); cf. 12 TEX. JUR.3d Constitution § 15 (1981). Leaving aside a detailed study of the power of the legislature to define terms and delegate power, we note the very constitutional provision Schwenke cites affords the legislature its power to act. Incompetence is merely one of the four grounds for removal from office set out in article V, section 24. Each of these grounds: incompetence, official misconduct, habitual drunkenness, or other causes defined by law, requires interpretation. That interpretation is left to the legislature and the courts. The final ground, "other causes defined by law", clearly calls on legislative action. The right of the people to determine not only who will be elected to office, but also *234 who can remain in that office has been protected and preserved by constitutionally prescribed procedure. Those very procedures were afforded Schwenke. Appellant's second point of error is overruled.
III. PROPOSED QUESTION AND INSTRUCTION; INTRODUCTION OF EVIDENCE
Appellant's last three points of error address the trial court's refusal to admit Schwenke's evidence as to his competence in the performance of his duties and rejection of Schwenke's proposed question and instruction to the jury. As these issues all turn on the single question of relevance, we address them together.
Schwenke's proposed charge question asked, "Do you find, by a preponderance of the evidence, that VIRGENE SCHWENKE, elected Constable of Precinct Six of San Patricio County, Texas, by failing to obtain the TCLEOSE license was incompetent and should be removed from office?" The Texas Rules of Civil Procedure provide: "[t]he court shall submit the questions, instructions and definitions in the form provided by Rule 277, which are raised by the written pleadings and evidence." TEX.R. CIV. P. 278. This rule provides 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).
In order to determine whether Schwenke's question should have been presented to the jury, we must determine if the question was raised by the pleadings or the evidence. A review of the record reveals there was no evidence before the court in support of Schwenke's question. In light of the pleadings and the law, the State timely objected to Schwenke's attempts to introduce irrelevant evidence and the court properly sustained each such objection. Appellant's attempt to prove his competence through character testimony was clearly irrelevant to the issue presented, and the record reflects all such evidence was rejected by the court. The jury was asked, "As of today, April 2nd, 1996, has Virgene Schwenke failed to obtain a license as a law enforcement officer from the Texas Commission on Law Enforcement Officer Standard and Education?" The issue in this case was whether Schwenke was incompetent to hold the office of constable as defined by government code section 415.053. The Texas Constitution provides incompetence as a ground for removing a constable from office. The government code provides failure to obtain a license from TCLEOSE in the specified time constitutes incompetence. The controlling question was asked. No additional instructions, definitions, or questions were necessary to resolve the issues presented by the evidence. Likewise, appellant complains the trial court erred in granting the State's motion in limine and in denying Schwenke the right to put on evidence relating to his competence outside that defined in section 415.053. For the reasons stated above, such evidence was irrelevant to the issue raised by the pleadings and was properly rejected. Appellant's third, fourth, and fifth points of error are overruled and the judgment of the trial court is AFFIRMED.
NOTES
[1] ... in each such precinct there shall be elected one Justice of the Peace and one Constable, each of whom shall hold his office for four years and until his successor shall be elected and qualified... TEX. CONST. art. V, § 18(a).
[2] Italics indicate additions made by this Act, while a strike through indicates language removed by this Act.
[3] The single question presented to the jury was:
"As of today, April 2nd, 1996, has Virgene Schwenke failed to obtain a license as a law enforcement officer from the Texas Commission on Law Enforcement Officer Standard and Education?" | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1494190/ | 963 S.W.2d 52 (1998)
The TEXAS MEXICAN RAILWAY COMPANY, Petitioner,
v.
Lawrence P. BOUCHET, Respondent.
No. 96-0194.
Supreme Court of Texas.
Argued November 21, 1996.
Decided February 13, 1998.
*53 Leonard H. Bucklin, Corpus Christi, Donato D. Ramos, Laredo, W. Wendell Hall, Renee A. Forinash, San Antonio, Guy H. Allison, Corpus Christi, for Petitioner.
Robert E. Valdez, Linda L. Daniels, San Antonio, for Respondent.
ABBOTT, Justice, delivered the opinion of the Court, in which PHILLIPS, Chief Justice, GONZALEZ, HECHT, ENOCH, OWEN, BAKER and HANKINSON, Justices, join.
The issue in this case is whether employers that are nonsubscribers to the Texas Workers' Compensation Act can be sued for acts of discrimination that violate Texas Revised Civil Statute article 8307c. Because we hold that they cannot, we reverse the judgment of the court of appeals and render judgment that Bouchet take nothing on his article 8307c claim.
I
Lawrence Bouchet injured his back on June 29, 1987, while in the course and scope of his employment with the Texas Mexican Railway Company (Railway). Bouchet continued to work until his condition worsened and he underwent surgery. After surgery, Bouchet returned to work on a restricted *54 schedule and light-duty basis. Based on its internal policies, the Railway paid Bouchet's medical bills, transportation costs for medical care, and full salary while the parties negotiated settlement of Bouchet's claim.
On December 23, 1991, Bouchet sued the Railway in state district court under the Federal Employers Liability Act (FELA), 45 U.S.C. § 51, for the personal injuries he had suffered on the job. After Bouchet filed suit, the Railway discontinued the salary and transportation payments, but continued paying Bouchet's medical expenses. In September 1992, Bouchet amended his petition to add a claim that the Railway had violated Texas Revised Civil Statute article 8307c by denying Bouchet benefits and discharging him in retaliation for his filing of the FELA lawsuit.
At trial, the jury determined that Bouchet suffered $100,000 in damages on his FELA claim, that Bouchet was 80% responsible for his injury, and that the Railway was 20% responsible for Bouchet's injury. The jury also found that the Railway did not wrongfully retaliate against Bouchet. The trial court rendered judgment on the verdict that the Railway pay $20,000 to Bouchet on the FELA claim and that Bouchet take nothing on his article 8307c claim.
Bouchet appealed, arguing that the trial court should have found an article 8307c violation as a matter of law. He also argued that the jury's failure to find such a violation was against the great weight and preponderance of the evidence. The Railway responded that Bouchet could not recover under 8307c because he was not entitled to workers' compensation benefits and, alternatively, that the jury correctly found against Bouchet on that claim.
The court of appeals concluded that the anti-retaliation provision[1] protects employees of both subscribers and nonsubscribers to the Texas Workers' Compensation Act. The court held that an employee who files a claim under FELA, or hires an attorney to assist in a FELA claim, is protected from retaliation by Texas Labor Code section 451.001. 915 S.W.2d 107, 110-12. Because the court of appeals also held that the jury's finding that the Railway had not discriminated against Bouchet was against the great weight and preponderance of the evidence, it reversed and remanded on Bouchet's retaliation claim. The Railway filed an application for writ of error with this Court, asserting that the court of appeals erred by applying the anti-retaliation provision to a nonsubscribing employer and by incorrectly applying the standard of review for a great weight and preponderance of the evidence challenge.[2]
II
As a threshold matter, Bouchet asserts that the Railway waived any error concerning its nonsubscriber status by not assigning error with requisite specificity in its motion for rehearing in the court of appeals.[3] Bouchet argues that the Railway's motion for rehearing was limited to whether the Federal Employers Liability Act preempted Bouchet's state law claim, and did not address whether the anti-retaliation provision applied to nonsubscribing employers.
A point of error is "sufficient if it directs the attention of the appellate court to the error about which complaint is made." Anderson v. Gilbert, 897 S.W.2d 783, 784 (Tex.1995). Courts should liberally construe briefing rules. See Williams v. Khalaf, 802 *55 S.W.2d 651, 658 (Tex.1990). The court of appeals in this case jointly discussed the Railway's argument that Texas Labor Code section 451.001 does not apply to FELA claims and its argument that section 451.001 does not apply to nonsubscribers generally. The issue framed by the court of appeals was "whether a Labor Code § 451.001 question on wrongful discrimination is proper in an FELA case." 915 S.W.2d at 110. Under that framing of the issue, the court of appeals pronounced its holding regarding nonsubscriber liability. Id. at 112.
The Railway challenged that holding by arguing in its motion for rehearing that the court of appeals erred by applying the anti-retaliation provision to a railroad governed by FELA. Thus, the Railway's motion for rehearing was consistent with the wording used by the court of appeals to frame the issue and was sufficient to inform the appellate court of the nonsubscriber argument presented here. Even applying the narrow interpretation urged by Bouchet requires analysis of whether a nonsubscribing entity can be liable under the anti-retaliation provision. Accordingly, we conclude that we have jurisdiction to consider the merits of the Railway's argument.
III
Bouchet argues that the Railway retaliated against him because he filed a claim under FELA and hired a lawyer to represent him in that claim. Bouchet does not allege that he ever (1) filed a claim under the Texas Workers' Compensation Act, (2) was entitled to any benefits under the Act, or (3) that the Railway was a subscriber to that Act. Nevertheless, he contends that the language of article 8307c is broad enough to protect employees from retaliation by their nonsubscribing employers for any type of claim that employees may assert against their employer, including claims unrelated to workers' compensation. Thus, he argues that article 8307c precludes the Railway from discriminating against him because he filed a FELA claim.
Before the 1993 recodification, the part of article 8307c relevant to this case provided:
No person may discharge or in any other manner discriminate against any employee because the employee has in good faith filed a claim, hired a lawyer to represent him in a claim, instituted, or caused to be instituted, in good faith, any proceeding under the Texas Workmen's Compensation Act, or has testified or is about to testify in any such proceeding.
TEX.REV.CIV. STAT. ANN. art. 8307c (emphasis added), recodified at TEX. LAB.CODE § 451.001.
The plain and common meaning of the statute's language provides protection only for claimants proceeding or testifying under the Workers' Compensation Act. The phrase "under the Texas Workmen's Compensation Act" modifies all of the employee actions specifically protected by the statute: the good faith filing of a claim, hiring a lawyer to represent an employee in a claim, instituting a proceeding, and testifying in a proceeding.
Bouchet's interpretation of article 8307c arbitrarily applies the phrase "under the Texas Workmen's Compensation Act" only to "instituting or causing a proceeding to be instituted" under the Act and testifying in a proceeding under the Act. Under Bouchet's interpretation, even if an employee filed, or hired a lawyer to represent him in, a claim against the employer that was not related to an injury suffered at work, article 8307c would protect that activity from employer retaliation.
That interpretation, as well as the position taken by the concurring and dissenting opinion, is directly at odds with the Legislature's express purpose for enacting article 8307c. The Legislature enacted article 8307c in 1971 to protect "persons who file a claim or hire an attorney or aid in filing a claim or testify at hearings concerning a claim under the Texas Workmen's Compensation Act," see Act of April 22, 1971, 62d Leg., R.S., ch. 115, 1971 Tex. Gen. Laws 884, because those persons "are alleged to be often fired or discriminated against by employers for such claims." HOUSE COMM. ON JUDICIARY, BILL ANALYSIS, Tex. H.B. 113, 62d Leg., R.S. (1971); see also Carnation Co. v. Borner, 610 S.W.2d 450, 453 (Tex.1980)("The Legislature's purpose in enacting *56 article 8307c was to protect persons who are entitled to benefits under the Worker's Compensation Law and to prevent them from being discharged by reason of taking steps to collect such benefits.").
The concurring and dissenting opinion reviews general definitions provided by the Texas Workers' Compensation Act for terms such as "employee," "subscriber," and "person," and concludes that the "Legislature's use of the term `person,' rather than `subscriber,' thus suggests that the Legislature did not intend to exclude nonsubscribers from the Anti-Retaliation Law."[4]Post, at 57. We need not speculate, however, about the Legislature's intent. The bill analysis from the House Committee on the Judiciary noted that the purpose of article 8307c was to protect "persons who bring Workmen's Compensation claims or testify in such actions." HOUSE COMM. ON JUDICIARY, BILL ANALYSIS, Tex. H.B. 113, 62d Leg., R.S. (1971). Although the term "person" may have different meanings in different contexts under the Workers' Compensation Act, there can be no doubt that only employees of subscribers to the Act can bring workers' compensation claims. Because the Legislature stated article 8307c was intended to protect "persons who bring Workmen's Compensation claims," only subscribers can be subject to article 8307c claims.
The court of appeals relied heavily on the Legislature's extensive revisions to the Workers' Compensation Act in 1989 as support for its conclusion that Bouchet could maintain an article 8307c claim. The court of appeals concluded that, because article 8307c was not included in Senate Bill 1, which completely overhauled the state's workers' compensation law, the anti-retaliation provision was "no longer tied to the workers' compensation scheme or statute" after the 1989 revisions. 915 S.W.2d at 110. We fail to see any significance in the Legislature's failure to include article 8307c in Senate Bill 1. The language of article 8307c was not changed at all by the 1989 revisions to the Workers' Compensation Act, and the Legislature clearly did not intend to make a substantive change in 8307c. See Tex. S. Con. Res. 28(7-9), 71st Leg., 2d C.S., 1989 Tex. Gen. Laws 133; Tex. H.R. Con. Res. 46(5-7), 71st Leg., 2d C.S., 1989 Tex. Gen. Laws 168.
That the Legislature did not intend a substantive change to article 8307c with the 1989 revisions to the Workers' Compensation Act is confirmed by a debate in the House of Representatives. In response to a question about the continuing viability of an employee's cause of action for retaliation for filing a workers' compensation claim, Representative Seidlits stated that, "[W]e have gone back to current law, [article] 8307c, which is current law, operating in, in essence, we have reinstated current law."
When considering the entire legislative history of article 8307c, the Legislature's intent is unmistakable: article 8307c is intended to apply only to employees and employers who act under the Texas Workers' Compensation Act. Accordingly, we hold that any alleged retaliation by the Railway against Bouchet for filing a FELA claim and hiring a lawyer to assert that claim is not actionable under article 8307c. This conclusion is consistent with our statement in City of LaPorte v. Barfield, 898 S.W.2d 288, 293 (Tex.1995): "Forbidding retaliation against an employee for seeking monetary benefits under the Worker's Compensation Law presupposes that the employer is a subscriber."
IV
Although Bouchet filed his article 8307c lawsuit against the Railway before that article was recodified in 1993 as Texas Labor Code section 451.001, the court of appeals analyzed Bouchet's claim under that Labor Code section. Even if Labor Code section 451.001, rather than article 8307c, governed the disposition of this case, we would reach the same result. As recodified, the statute provides:
Discrimination Against Employees Prohibited. A person may not discharge or in *57 any other manner discriminate against an employee because the employee has:
(1) filed a workers' compensation claim in good faith;
(2) hired a lawyer to represent the employee in a claim;
(3) instituted or caused to be instituted in good faith a proceeding under Subtitle A [Texas Workers' Compensation Act]; or
(4) testified or is about to testify in a proceeding under Subtitle A.
TEX. LAB.CODE § 451.001. As we have previously recognized, the recodification of article 8307c was not a substantive revision. See Barfield, 898 S.W.2d at 293 ("The provision [article 8307c] has never been amended but has since been recodified without substantive change as sections 451.001-.003 of the Texas Labor Code.").
V
Bouchet asserts that a decision reversing the court of appeals is inconsistent with Hodge v. BSB Investments, Inc., 783 S.W.2d 310 (Tex.App.-Dallas 1990, writ denied), and Texas Health Enterprises, Inc., v. Kirkgard, 882 S.W.2d 630 (Tex.App.-Beaumont 1994, writ denied). For the reasons already stated, we disapprove Hodge and Texas Health Enterprises to the extent that they hold that an employee can assert an article 8307c claim against an employer that does not subscribe to the Texas Workers' Compensation Act.
* * * *
We hold that Bouchet cannot recover under either article 8307c or Texas Labor Code section 451.001. We therefore reverse the court of appeals' judgment and render judgment that Bouchet take nothing on his article 8307c claim. Because neither the Railway nor Bouchet appealed the trial court's judgment on Bouchet's FELA claim to the court of appeals, we do not disturb the trial court's judgment in that respect. Additionally, because of our holding, we do not reach the issue of whether the court of appeals correctly applied the "great weight and preponderance of the evidence" standard of review.
SPECTOR, Justice, concurring and dissenting.
Instead of giving a remedial statute a comprehensive and liberal construction, as our caselaw requires, the majority concludes that the Anti-Retaliation Law, former article 8307c, protects only employees of workers' compensation insurance subscribers. I concur in the majority's judgment, but I cannot join its opinion. The majority's construction of the Anti-Retaliation Law is contrary to sound statutory construction principles and undermines the Legislature's policy of encouraging participation in the workers' compensation system.
I.
Lawrence Bouchet initially sued his employer, the Texas Mexican Railway Company, under the Federal Employers Liability Act, 45 U.S.C.A. §§ 51-60 (West 1986 & Supp.1997), and the Safety Appliance Act, 49 U.S.C.A. §§ 20301-903 & 21301-04 (West 1997). Bouchet alleged that he was injured as a result of the railway's negligence while he was acting in the course and scope of his employment. After he sued, the railway reduced certain benefits that it had been providing. Bouchet then amended his petition to allege a claim for wrongful retaliation under article 8307c.[1]
The Court holds today that Bouchet is not entitled to pursue a claim under that statute because his employer was not a subscriber to workers' compensation insurance. Under the majority's view, article 8307c applies only to employees of subscribers to workers' compensation insurance. I disagree. The mere fact that Bouchet's employer was a nonsubscriber does not deprive Bouchet of the protection of the Anti-Retaliation Law.
Article 8307c provides that
[n]o person may discharge or in any other manner discriminate against any employee because the employee has in good faith *58 filed a claim, hired a lawyer to represent him in a claim, instituted, or caused to be instituted, in good faith, any proceeding under the Texas Workmen's Compensation Act, or has testified or is about to testify in any such proceeding.
Act of May 7, 1971, 62nd Leg., R.S., ch. 115, § 1, 1971 Tex. Gen. Laws 884 (presently codified at Tex. Lab.Code § 451.001) (emphasis added). I believe that the precise terminology employed by the Legislature in this statute, under appropriate statutory construction principles, reveals that the majority's narrow construction is erroneous.
The majority considers article 8307c in isolation, without regard to other provisions of the Act of which it was a part at the time it was enacted. In construing a statute, we have warned that "courts must examine the entire statute or act and not merely an isolated portion thereof." State v. Terrell, 588 S.W.2d 784, 786 (Tex.1979) (citing Calvert v. Texas Pipe Line Co., 517 S.W.2d 777 (Tex. 1974)). The language of article 8307c, read in context with other portions of the workers' compensation law, strongly suggests a broader application.
At the time article 8307c was enacted, the term "employee" was broadly defined. The term included "every person in the service of another under any contract of hire, expressed or implied, oral or written." Act of March 28, 1917, 35th Leg., R.S., ch. 103, Pt. IV, § 1, 1917 Tex. Gen. Laws 269, 291 (former article 8309, § 1, repealed 1989). The term was not limited to persons employed by workers' compensation insurance subscribers.[2] Although the pre-1989 Act defined the term "subscriber" to mean employers participating in the workers' compensation insurance program, see id., it did not define the term "person." The Legislature's use of the term "person," rather than "subscriber" thus suggests that the Legislature did not intend to exclude nonsubscribers from the Anti-Retaliation Law. See City of LaPorte v. Barfield, 898 S.W.2d 288, 295 (Tex.1995) (noting that the term "person" in the Anti-Retaliation Law is broader than the terms "association," "subscriber," or "employer."). Other provisions of the workers' compensation law strongly reinforce that suggestion.
The majority concludes that "[t]he plain and common meaning of the statute's language provides protection only for claimants proceeding or testifying under the Workers' Compensation Act." 963 S.W.2d at 55. I do not necessarily disagree with that statement. Where I depart from the majority is in my understanding of what it means to "proceed[]... under the Workers' Compensation Act."
At the time the Legislature enacted the Anti-Retaliation Law, the Workmen's Compensation Act governed the rights of employees of both subscribers and nonsubscribers. Section 4 of article 8306 of the former Act provided that "[e]mployes whose employers are not at the time of the injury subscribers... shall be entitled to bring suit and may recover judgment against such employers... for all damages, sustained by reason of any personal injury received in the course of employment." See Act of March 28, 1917, 35th Leg., R.S., ch. 103, Pt. I, § 4, 1917 Tex. Gen. Laws 269, 271 (repealed 1989). Section 4 also provided that certain common-law defenses, such as contributory negligence and assumed risk, were not available to employers in the suits it authorized.[3]Id. §§ 1, 4. The Act not only specifically authorizes suits by employees of nonsubscribers, it largely governs the employer's ultimate liability. See David W. Robertson, The Texas Employer's Liability in Tort for Injuries to an Employee Occurring in the Course of the Employment, 24 St. Mary's L.J. 1195, 1199 (1993) ("The unavailability of the contributory negligence defense means that an employer whose fault, however slight, was a proximate cause of the [employee's] injuries will owe full damages, notwithstanding any perception that the injured employee was also at fault in a way that was a proximate cause of the injuries."). Accordingly, an employee suing *59 a nonsubscribing employer to recover damages for an on-the-job injury is "proceeding... under the Act." The legislative history cited by the majority must be viewed in the context of the full range of remedies that was available under the Act at the time the Legislature enacted the Anti-Retaliation Law, including the right to pursue a common-law claim.
The majority's narrow construction of article 8307c contravenes the fundamental principle that requires courts to broadly construe remedial statutes. See Burch v. City of San Antonio, 518 S.W.2d 540, 544 (Tex.1975); City of Mason v. West Tex. Utils. Co., 150 Tex. 18, 237 S.W.2d 273, 280 (1951). "If a statute is curative or remedial in its nature, the rule is generally applied that it be given the most comprehensive and liberal construction possible." City of Mason, 237 S.W.2d at 280 (emphasis added). The majority acknowledges the statute's remedial purpose. 963 S.W.2d at 55. Nevertheless, the majority gives the statute the narrowest possible effect. In my view, that construction is erroneous in light of the statute's broad language and context.
The majority's error is particularly significant because the construction it imposes on the statute undermines the Legislature's intent to encourage participation in the workers' compensation insurance program. See Act of March 28, 1917, 35th Leg., R.S., ch. 103, Pt. I, §§ 1, 4, 1917 Tex. Gen. Laws 269, 271 (repealed 1989) (preserving common-law remedies of nonsubscribers' employees and eliminating certain common-law defenses); Robertson, supra, at 1199 (noting that the loss of the common-law defenses of assumed risk, contributory negligence, and fellow servant is a significant penalty for nonsubscription). As a result of the majority's decision, subscribing employers are subject to anti-retaliation suits, while nonsubscribers face no penalty for discharging or discriminating against workers who seek compensation for on-the-job injuries.
I would hold that a worker who files a claim against a nonsubscribing employer to recover damages for an on-the-job injury is entitled to sue under article 8307c.
II.
Despite my strong disagreement with the majority's opinion, I concur in its judgment. I base that conclusion, however, on totally different grounds. I would hold that Bouchet was not entitled to sue under article 8307c because his FELA lawsuit against the railway was not a claim under the Act.
At the time Bouchet filed this lawsuit, employees of "a person covered by a method of compensation established under federal law" were not subject to the Act. TEX. LAB. CODE § 406.091(a)(2). Bouchet filed his lawsuit under FELA, 45 U.S.C. §§ 51-60. That federal law provides that common carrier railroads engaged in interstate commerce "shall be liable in damages to any person suffering injury while he is employed by such carrier ... for such injury or death resulting in whole or in part from the negligence of the officers, agents, or employees of such carrier." 45 U.S.C. § 51 (West 1986). Under section 53 of FELA, an employee's contributory negligence does not bar recovery, although it does reduce the damages recoverable. Id. § 53. FELA thus establishes a "method of compensation ... under federal law." FELA, and not the Texas Workers' Compensation Act, authorized Bouchet's lawsuit and governs the extent of his employer's liability. Accordingly, Bouchet's lawsuit did not assert a claim under the Texas Workers' Compensation Act.
III.
In light of the Anti-Retaliation Law's language and context, the majority errs in holding that the statute does not protect employees of nonsubscribers. I concur in the majority's judgment, however, because Bouchet's suit arose under FELA, not the Texas Workers' Compensation Act.
NOTES
[1] Bouchet sued in 1992 under TEX.REV.CIV. STAT. ANN. article 8307c, which was recodified in 1993 as TEX. LAB.CODE § 451.001-.003. The court of appeals analyzed Bouchet's claim under TEX. LAB. CODE § 451.001.
[2] The Railway did not raise in its application for writ of error the argument that Justice Spector utilizes as the basis to concur with our judgment that Bouchet take nothing on his article 8307c claim. The Railway's sole argument regarding the anti-retaliation provision was that the court of appeals erred "by holding that employees of nonsubscribers can recover under Article 8307c" and "by holding that nonsubscribers are subject to Article 8307c." See Petitioner's Application for Writ of Error at 4-5.
[3] See TEX.R.APP. P. 100(a), 131(e)(repealed 1997); Oil Field Haulers Ass'n v. Railroad Comm'n, 381 S.W.2d 183, 189 (Tex.1964). The recently-enacted Rules of Appellate Procedure do not require a party to file a motion for rehearing in the court of appeals before filing a petition for review in this Court. See TEX.R.APP. P. 53.7.
[4] Oddly, the concurring and dissenting opinion cites City of LaPorte v. Barfield, 898 S.W.2d 288, 293 (Tex.1995), for that proposition. Barfield stated: "Forbidding retaliation against an employee for seeking monetary benefits under the Worker's Compensation Law presupposes that the employer is a subscriber." Id. at 293.
[1] Article 8307c has since been recodified without substantive change. See TEX. LAB.CODE §§ 451.001-003. Because the majority refers to article 8307c, this opinion also focuses on the uncodified statute.
[2] The present version of the Texas Workers' Compensation Act retains that broad definition. TEX. LAB.CODE § 401.012(a).
[3] The current Workers' Compensation Act contains similar provisions limiting the common-law defenses available to nonsubscribers and establishing the employee's burden of proof. See TEX. LAB.CODE § 406.033. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1675747/ | 596 F. Supp. 367 (1984)
Joseph THURMON, Plaintiff,
v.
MARTIN MARIETTA DATA SYSTEMS, Defendant.
Civ. A. No. 84-0908.
United States District Court, M.D. Pennsylvania.
October 26, 1984.
Melville G.M. Walwyn, Dade, Harris & Walwyn, Harrisburg, Pa., for plaintiff.
*368 David H. Allshouse, Harrisburg, Pa., and Francis M. Milone, Philadelphia, Pa., for defendant.
MEMORANDUM
CALDWELL, District Judge.
Before the court is defendant's motion to transfer the above-captioned matter to the United States District Court for the District of Colorado pursuant to 28 U.S.C. § 1404(a). For the reasons discussed below, this case will be transferred but the transfer is grounded in the venue provisions of 42 U.S.C. § 2000e-5(f)(3) and is a mandatory rather than a discretionary act by this court.
Plaintiff, Joseph Thurmon ("Thurmon"), who currently resides in Harrisburg, Pennsylvania, alleges in his complaint that defendant Martin Marietta Data Systems ("Martin Marietta") terminated his employment on September 2, 1983, for racial motivations in violation of, inter alia, Title VII of the Civil Rights Act of 1964, 42 U.S.C. § 2000e et seq., and 42 U.S.C. §§ 1981, 1983 and 1985. After filing its answer to the complaint, Martin Marietta moved to transfer this action to Colorado, where the alleged discriminatory termination occurred at Martin Marietta's facility located in Littleton, Colorado.
Initially, this court notes that it is disturbed that neither party discussed or even referred to the body of clearly controlling case law in this matter. Our own independent research, and examination of the statutory provisions and of the relevant case law, however, convinces us that venue is not proper in the Middle District of Pennsylvania but rather lies in the District of Colorado under § 706(f)(3) of Title VII of the Civil Rights Act of 1964, 42 U.S.C. § 2000e-5(f)(3), which sets forth four judicial districts where an employment discrimination action may be brought: (1) where "the unlawful employment practice is alleged to have been committed"; (2) where "the plaintiff would have worked but for the alleged unlawful employment practice"; (3) where "the employment records relevant to such practice are maintained and administered"; and (4) where the employer "has his principal office" if he cannot be found within the district where "the plaintiff would have worked but for the alleged unlawful employment practice." See Stebbins v. State Farm Mutual Automobile Insurance Company, 413 F.2d 1100, 1102 (D.C.Cir.), cert. den., 396 U.S. 895, 90 S. Ct. 194, 24 L. Ed. 2d 173 (1969); Kravec v. Chicago Pneumatic Tool, 579 F. Supp. 619 (N.D.Ga.1983).
We are persuaded that the reasoning of the Stebbins court, as followed in Kravec, should guide our decision here and we have found no authority in the Third Circuit to the contrary. Plaintiff Stebbins made the identical jurisdictional claim as the plaintiff in the instant action, i.e., that since the defendant employer was licensed to do, and was doing business in, the judicial district where the plaintiff brought suit, venue was proper there. The Stebbins court held that "[t]he venue of the right of action here in suit was limited by the statute which created the right," in accordance with the Congressional intent "to limit venue to the judicial districts concerned with the alleged discrimination." 413 F.2d at 1102.
Thurmon is therefore incorrect in arguing that the general venue provisions of 28 U.S.C. § 1391 control and he cannot seriously contend that the specific judicial districts where his action may have been brought under 42 U.S.C. § 2000e-5(f)(3) should be ignored. The Stebbins court specifically held that 28 U.S.C. § 1391, the general venue statute, did not provide an additional place of venue when the provisions of 42 U.S.C. § 2000e-5(f)(3) were not satisfied. The Kravec court likewise reiterated the Stebbins view that for the kind of employment discrimination action presented by the present matter, the Title VII venue provisions are exclusive. Among other cases reaching the same conclusion are Donnell v. Nat'l Guard Bureau, 568 F. Supp. 93 (D.D.C.1983); Templeton v. Veterans Administration, 540 F. Supp. 695 (S.D.N.Y.1982); and Dubnick *369 v. Firestone Tire and Rubber Co., 355 F. Supp. 138, 141 (E.D.N.Y.1973).
Having concluded that venue in the present matter is governed by 42 U.S.C. § 2000e-5(f)(3), we find that venue does not properly lie in the Middle District of Pennsylvania. The alleged unlawful employment practice occurred in Colorado, where the relevant records are maintained. Moreover, plaintiff would have worked in Colorado were it not for the purported discriminatory act of defendant, and defendant is found within that district. Accordingly, defendant's motion to transfer is granted on the grounds discussed in this memorandum and an appropriate order will be entered to effect the transfer. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1693050/ | 213 Wis. 2d 156 (1997)
570 N.W.2d 384
STATE of Wisconsin, Plaintiff-Respondent,[]
v.
Ricky McMORRIS, Defendant-Appellant-Petitioner.
No. 95-2052-CR.
Supreme Court of Wisconsin.
Oral argument September 4, 1997.
Decided October 30, 1997.
*159 For the defendant-appellant-petitioner there were briefs and oral argument by Walter W. Stern, Union Grove.
For the plaintiff-respondent the cause was argued by Stephen W. Kleinmaier, assistant attorney general, with whom on the brief was James E. Doyle, assistant attorney general.
¶ 1. SHIRLEY S. ABRAHAMSON, CHIEF JUSTICE.
This is a review of an unpublished decision of the court of appeals, State v. McMorris, No. 95-2052-CR, unpublished op. (Wis. Ct. App. Oct. 2, 1996), affirming in part and reversing in part an order of the Circuit Court for Racine County, Dennis J. Barry, Judge. The circuit court denied the motion of the defendant, Ricky McMorris, to suppress two identifications: (1) the eyewitness's in-court identification of the defendant and (2) the eyewitness's identification of the defendant in a post-indictment, pre-trial lineup conducted without notice to and in the absence of his counsel in violation of his Sixth Amendment right to counsel.
¶ 2. The court of appeals affirmed that part of the circuit court order denying the defendant's motion to suppress the in-court identification. The defendant *160 seeks review of this part of the court of appeals decision. The court of appeals reversed that part of the circuit court order denying the defendant's motion to suppress the constitutionally defective lineup identification. Neither the State nor the defendant challenges this part of the court of appeals decision.[1] The court of appeals remanded the cause to the circuit court for further proceedings, and the parties agree that the cause must be remanded.
¶ 3. The only issue before this court is the admissibility of the eyewitness's in-court identification of the defendant after an identification in a lineup that violated the defendant's Sixth Amendment right to counsel. We hold that the eyewitness's in-court identification should be suppressed because the State has not shown by clear and convincing evidence that the eyewitness's in-court identification of the defendant had an "independent origin," that is, that the source of the in-court identification was the eyewitness's observation of the robber during the robbery and was independent of a lineup that violated the defendant's Sixth Amendment right to counsel. See United States v. Wade, 388 U.S. 218 (1967). Accordingly, we reverse that part of the court of appeals decision admitting the eyewitness's in-court identification.
I.
¶ 4. The facts are undisputed for purposes of this review. On December 3, 1994, Patricia Jordan, a 67-year-old *161 white woman, was robbed at knife-point as she was working alone at a grocery store in Mt. Pleasant, WI.
¶ 5. According to Jordan, a man entered the store, walked up to the cash register where she was working and asked her for some change. Jordan was standing behind the counter, and the man was standing a couple of feet across from her on the other side. When Jordan opened the cash register to provide the change, the man pointed a knife at her, told her to leave the cash drawer open and took money from the drawer. As the robber removed the cash from the drawer, Jordan backed away about 10 feet from the cash register and hid behind a meat slicer, while continuing to watch the robber. Jordan was wearing her eyeglasses at the time of the robbery, and the store was well lit. After the robber left the store, Jordan called the police.
¶ 6. About 15 to 20 minutes after the robbery, Officer Jason Wortock of the Mt. Pleasant Police Department arrived at the store. He interviewed Jordan and took down the physical description she gave of the robber. Jordan testified that the robber was an African-American male, at least six feet tall, wearing a white golfer's cap and a tan jacket. She said that she had never seen the robber before. She described the knife he used as a tapered, single-edged knife about 12 inches long. Jordan was the sole eyewitness to the robbery and is hereafter referred to as the eyewitness. The police never recovered, by search warrant or otherwise, the knife, cap or jacket of the robber.
¶ 7. Later on the day of the robbery Officer Fulton Bell and Investigator Jayn Long showed the eyewitness six photographs of potential suspects, including one of the defendant. All the photographs were of African-American men, some with facial hair, *162 some without. Apparently the police were uncertain at this time whether the robber had facial hair. The eyewitness did not identify the defendant or anyone else from the photo array as the robber.
¶ 8. A store surveillance camera taped the robbery in its entirety. According to the tape, the robbery lasted approximately 25 seconds. The eyewitness viewed the videotape shortly after the robbery and turned it over to Officer Wortock who viewed the videotape with several other officers, including Officer Bell and Investigator Long.
¶ 9. After seeing the videotape, Officer Bell concluded that the robber looked like the defendant with whom Bell was familiar because they had grown up in the same neighborhood. Officer Bell testified that he had seen the defendant on November 29, 1994, four days before the robbery while responding to a civil disturbance call, and had observed that at that time the defendant had full facial hair and was wearing a tan jacket and a cap. (The defendant was not involved in the civil disturbance.)
¶ 10. Based upon her observation of the videotape and her subsequent in-person observation of the defendant at the Racine County Jail where he was incarcerated on an unrelated charge, Investigator Long concluded that the defendant was the robber. Prior to the robbery, Investigator Long had not been acquainted with the defendant.
¶ 11. On January 4, 1995, the defendant was charged with armed robbery, and a public defender was appointed the defendant's counsel. Five days later on January 9, 1995, Investigator Long, with the assistance of Corporal James Stratman, staged a lineup with five African-American males, including the defendant, all of whom were approximately the same weight *163 and age as the defendant and all of whom had facial hair. Apparently the police at this time were operating on the premise that the robber had facial hair. After initially asking another man in the lineup to step forward, the eyewitness identified the defendant as the robber.
¶ 12. The defendant's counsel did not attend the lineup, and at no time did the defendant waive his right to have his counsel present. Investigator Long and Corporal Stratman failed to notify the defendant's counsel about the lineup, saying they were unaware that the defendant was entitled to have counsel present at a post-indictment lineup procedure. The officers did not photograph the lineup, either by video or still camera.
¶ 13. The eyewitness subsequently identified the defendant at the preliminary hearing on January 24, 1995, when he was wearing an orange jail uniform and was seated next to an attorney at a table. At the preliminary hearing the eyewitness testified that she knew the robber had long sideburns but was not sure if he had a mustache or beard. When asked at the preliminary hearing why she had selected the defendant at the lineup, the eyewitness testified that she chose him, in part, because he was tall.
¶ 14. The defendant filed a pre-trial motion to suppress the lineup identification on the ground that the lineup had been improperly conducted in the absence of his counsel. He also filed a pre-trial motion to suppress the in-court identification, claiming that it was tainted by the unconstitutional out-of-court lineup and that the in-court identification did not have an origin independent of the lineup.
¶ 15. The circuit court refused to suppress the lineup identification, concluding that the police had acted in good faith and that the lineup procedure was *164 not otherwise impermissibly suggestive. The circuit court ruled that the jury would be instructed that the defendant had been deprived of his right to counsel at the lineup.
¶ 16. The court of appeals granted the defendant leave to appeal the suppression order and ordered the lineup identification suppressed. This part of the court of appeals decision is not before us.
¶ 17. In addition, the court of appeals affirmed the circuit court decision admitting the in-court identification on the ground that the State had shown by clear and convincing evidence that an independent source existed for the eyewitness's in-court identification and that the in-court identification had not been tainted by the lineup identification.[2] This part of the court of appeals decision is before us on review.
II.
¶ 18. This court has not previously discussed the applicable standard of review in determining whether an independent source exists for an in-court identification made after a lineup that violated an accused's Sixth Amendment right to counsel. The court has, however, considered the standard of review applicable to an analogous issue of attenuation in the Fourth Amendment context. In State v. Anderson, 165 Wis. 2d 441, 447-48, 477 N.W.2d 277 (1991), this court characterized as a constitutional fact the question whether evidence should be suppressed as the fruit of a prior illegal search or whether the evidence was sufficiently *165 attenuated so as to be purged of the taint. Adhering to the Anderson analysis, we characterize as a constitutional fact the question whether an independent source exists for an in-court identification made after a lineup that violated an accused's Sixth Amendment right to counsel, and we apply the standard of review ordinarily applied to questions of constitutional fact.[3]
¶ 19. Questions of constitutional fact are sometimes referred to as mixed questions of fact and law, requiring the court to determine what happened and whether the facts found fulfill a particular legal standard.[4] Ordinarily, when reviewing a mixed question of fact and law, appellate courts engage in a two-part inquiry. The first inquiry relates to the circuit court's findings of fact. Neither the court of appeals nor this court will reverse a circuit court's findings of historical or evidentiary fact unless they are clearly erroneous. The second inquiry relates to the question whether the historical or evidentiary facts satisfy the relevant constitutional standard. Such an inquiry is made by this court independent of the circuit court and court of appeals. However, in deciding whether the facts satisfy the constitutional standard this court may benefit from and draw upon the reasoning of the circuit court and court of appeals and may draw upon the circuit court's *166 observational advantage. Nevertheless, this court independently measures the facts against a uniform constitutional standard.
[1]
¶ 20. The principal reason for independent appellate review of matters of constitutional fact is to provide uniformity in constitutional decision making.[5] In applying the skeletal constitutional rule, appellate courts flesh out the rule and provide guidance to litigants, lawyers, and trial and appellate courts.
[2]
¶ 21. We conclude, as did the parties, that whether an independent source exists for an in-court identification made after a lineup that violated an accused's Sixth Amendment right to counsel is a question of constitutional fact which we determine independent of the circuit court and court of appeals, benefiting from their analyses.
III.
¶ 22. Our analysis begins with a summary of the law relating to the admissibility of an in-court identification of an accused after identification in a lineup is suppressed because the accused was deprived of the right to counsel at the lineup.
¶ 23. The parties acknowledge, and we agree, that the controlling United States Supreme Court decision in this case is United States v. Wade, 388 U.S. 218 (1967).
*167 [3, 4]
¶ 24. In Wade, the Court held that an in-court identification subsequent to a constitutionally defective lineup in violation of an accused's Sixth Amendment right to counsel is not per se inadmissible. See Wade, 388 U.S. at 240. Once such a constitutionally defective lineup is established, the in-court identification is admissible if the State carries the burden of showing "by clear and convincing evidence that the incourt identifications were based upon observations of the suspect other than the lineup identification." Wade, 388 U.S. at 240. The in-court identification is admissible if made "`by means sufficiently distinguishable to be purged of the primary taint.'" Wade, 388 U.S. at 241 (quoting Wong Sun v. United States, 371 U.S. 471, 488 (1963)). Thus, if the in-court identification has an independent source, the in-court identification is admissible.[6] The Wade test has been referred to as the "independent origin" test and as the "independent source" test. See United States v. Crews, 445 U.S. 463, 473 n.18 (1980).
[5]
¶ 25. The Wade test places on the State the heavy burden of producing clear and convincing evidence for admission of in-court identification after identification in a lineup in which an accused's counsel was not present and no waiver of counsel occurred. Two reasons support imposing this burden on the State: First, Wade warns of the "vagaries of eyewitness identification" and "[t]he hazards of such [eyewitness identification] testimony." Wade, 388 U.S. at 228. Second, the lineup is a critical stage of the prosecution at which, as Wade explains, a lawyer can make a difference. Wade, 388 *168 U.S. at 236-37. Any lesser burden on the State would disregard the difficulties inherent in eyewitness identification and would render meaningless the Sixth Amendment right to counsel at a lineup.
[6]
¶ 26. According to the Wade Court, to determine whether the in-court identification is "`sufficiently distinguishable to be purged of the primary taint,'" a court should consider various factors including the following: (1) the prior opportunity the witness had to observe the alleged criminal activity; (2) the existence of any discrepancy between any pre-lineup description and the accused's actual description; (3) any identification of another person prior to the lineup; (4) any identification by picture of the accused prior to the lineup; (5) failure to identify the accused on a prior occasion; (6) the lapse of time between the alleged crime and the lineup identification; and (7) the facts disclosed concerning the conduct of the lineup. See Wade, 388 U.S. at 241.
¶ 27. The court has applied the Wade test to determine the admissibility of in-court identifications subsequent to lineups that violated the accused's Sixth Amendment right to counsel. See, e.g., State v. Harper, 57 Wis. 2d 543, 546, 205 N.W.2d 1 (1973).[7]
IV.
¶ 28. Applying the Wade factors, the defendant argues that the constitutionally defective lineup taints the eyewitness's subsequent in-court identification.
*169 The State, also applying the Wade factors, argues that the eyewitness's in-court identification is sufficiently distinguishable from the lineup to be purged of the taint of the lineup. Our independent review of the record persuades us that the State has not shown by clear and convincing evidence that the eyewitness's in-court identification of the defendant is independent of the lineup.
¶ 29. The first Wade factor considers the witness's opportunity to observe the perpetrator at the time of the crime. In this case, it is arguable that the eyewitness had sufficient opportunity to observe the robber. The store was adequately lighted to permit the eyewitness a clear view of the robber; the eyewitness was wearing her eyeglasses at the time of the robbery; when the robber first approached the eyewitness, he was standing only a couple of feet away from her, directly across the counter.
¶ 30. On the other hand, the eyewitness's opportunity to observe the robber was limited. The entire incident lasted a mere 25 seconds. While a court cannot specify a minimum amount of time necessary to demonstrate a sufficient opportunity to observe, the length of time for observation of the perpetrator is important.[8] Moreover, as the robber took the money out of the cash register, the eyewitness moved back about 10 feet and hid behind a meat slicer while still observing him. The eyewitness, therefore, was not directly facing the robber throughout the entire 25-second incident. After reviewing the surveillance videotape, the circuit court found that the eyewitness's *170 opportunity to observe the robber lasted approximately 20 seconds.
¶ 31. The court has also viewed the surveillance videotape, and it is difficult to determine from the tape how much time the eyewitness spent looking at the knife or the robber's face. At the suppression hearing, the eyewitness acknowledged that she concentrated on the knife during the robbery. She was able to give a detailed description of the knife. Furthermore, in this case, the usual dangers inherent in eyewitness identification may have been exacerbated because this was a cross-race identification.[9]
¶ 32. Under these circumstances, 25 seconds may not have provided sufficient time for the eyewitness to observe the robber's features so that she could make an in-court identification independent of the unconstitutional lineup.
¶ 33. The second Wade factor considers any discrepancy between a pre-lineup description and the accused's actual appearance. The eyewitness testified *171 that shortly after the robbery, she gave the police the following description of the robber: African-American male, at least six feet tall, wearing a white golfer's cap and tan jacket. This description was presumably given at a time when the eyewitness would have retained the sharpest image of the robber. The description offered no detail about the robber's facial features, coloring, build, age or other distinguishing characteristics. The description could fit many African-American men.
¶ 34. Although the eyewitness testified that she told Officer Wortock that the robber was at least six feel tall, Officer Wortock testified that the eyewitness merely told him that the robber was taller than she. The eyewitness is five feet tall. Thus the eyewitness and Officer Wortock offered conflicting accounts of her description of the robber's height.
¶ 35. Testimony about the eyewitness's recollection of the robber's facial hair varied. The eyewitness first testified that she knew the robber had long sideburns but was not sure if he had a mustache or beard; she later testified that she did not notice any facial hair on the robber. Officer Wortock first testified that the eyewitness informed him that the robber did not have facial hair; Wortock then testified that she did not say one way or another whether the robber had facial hair; still later, Wortock testified that he did not recall whether he had specifically asked her if the robber had facial hair. The defendant's niece testified that the defendant, on or around the date of the robbery, had a goatee and full mustache. Officer Bell saw the defendant four days before the robbery and at that time the defendant had full facial hair.
¶ 36. Thus the eyewitness's descriptions of the robber varied, and a significant discrepancy exists between the eyewitness's initial description of the robber *172 and the defendant's actual appearance. The eyewitness's inconsistent statements about the robber's facial hair, the discrepancy between the initial description of the robber and the defendant's actual appearance, together with the minimal description furnished by the eyewitness, cast doubt on the eyewitness's ability to make an in-court identification independent of the unconstitutional lineup.
¶ 37. The third Wade factor considers whether the witness identified any other person prior to the lineup. The defendant argues that the eyewitness's request that another man in the lineup step forward constitutes a prior identification. This argument, however, is untenable. The eyewitness testified that she asked the other man to step forward so she could get a better look at him. She never identified him as the robber. Witnesses participating in a lineup identification should be encouraged to examine carefully all participants to ensure an accurate identification. The fact that the eyewitness did not identify any other person as the robber supports the conclusion that the eyewitness's observation of the robber at the robbery would enable her to identify the defendant independent of the unconstitutional lineup.
¶ 38. The fourth Wade factor is whether the witness identified the accused's photograph from a photo array prior to the lineup. The fifth Wade factor is whether the witness failed to identify the accused on occasions prior to the in-court identification. In this case, the two factors are interrelated. The eyewitness failed to identify the defendant in photographs she viewed on the day of the robbery. Ordinarily, a witness's failure to identify an accused from a photograph only hours after the crime might demonstrate that the witness's in-court identification of the accused was not *173 independent of an illegal lineup. However, in this case, the eyewitness's failure to identify the defendant's photo is of limited significance. The eyewitness testified that looking at a photograph is different from looking at the person. Furthermore, the circuit court found that the defendant's photograph did not bear a reasonable resemblance to his appearance in the courtroom and was therefore misleading enough to preclude the eyewitness from accurately identifying him as the robber.
¶ 39. The sixth Wade factor provides that a court consider the impact of the time lapse between the crime and the lineup identification. The longer the time between the initial observation and the lineup, the greater the likelihood that the initial observation at the crime will have dimmed and that the second image from the lineup will play an important role at the in-court identification. The robbery in the present case occurred on December 3, 1994, and the lineup identification occurred about five weeks later on January 9, 1995. The five-week period between the robbery and the lineup was arguably long enough to obscure the eyewitness's memory of her brief encounter with the robber at the time of the robbery and to increase the importance of her having seen the defendant in the lineup.
¶ 40. The seventh Wade factor addresses those considerations which, despite the absence of counsel, are disclosed concerning the conduct of the lineup. The conduct of the lineup may have a bearing upon whether the in-court identification is independent of the lineup or tainted by it. In this case, the police failed to take a photograph or a video of the lineup. The record contains photographs of the men in the lineup but does not disclose when the photographs were taken. Thus, the *174 only information we have about the physical staging of the lineup comes from the testimony of Investigator Long, Corporal Stratman and the eyewitness.
¶ 41. The law enforcement officers testified that all the men in the lineup were similar to the defendant in terms of race, size, height, age and facial hair. The State asserts that using men who had facial hair demonstrates the fairness of the lineup. The defendant argues that staging the lineup using only men with facial hair suggested to the eyewitness that the robber had facial hair.
¶ 42. Although both the State's and the defendant's interpretations of the lineup are reasonable and the circuit court found that the lineup was not unduly suggestive, we are mindful of the concerns the United States Supreme Court expressed in Wade about "the dangers inherent in eyewitness identification and the suggestibility inherent in the context of the pretrial identification." Wade, 388 U.S. at 235. Considering the dangers described by the Court, we conclude that the physical staging of the lineup may have affected the eyewitness's memory of the robber by adding the detail of facial hair, a detail not present in her initial description. As the Court stated in Wade, "[s]uggestion can be created intentionally or unintentionally in many subtle ways... and increase[s] the dangers inhering in eyewitness identification." Wade, 388 U.S. at 229. The lineup, although not suggestive, and properly administered except for the absence of counsel, in this case could have crystallized the eyewitness's identification of the defendant for future reference because of the facial hair.
[7]
¶ 43. After examining the seven factors set forth in Wade, we conclude that the State has not demonstrated *175 by clear and convincing evidence, as Wade requires, that the in-court identification had an origin independent of the lineup or was "`sufficiently distinguishable to be purged of the primary taint.'" Wade, 388 U.S. at 241. The eyewitness's opportunity to observe the robber was limited to, at most, 25 seconds; she had never seen the robber prior to the robbery; she gave a general description of the robber; there was a discrepancy between her description of the robber immediately after the robbery and the defendant's actual physical appearance; there was a lapse of five weeks between the robbery and the lineup identification.
¶ 44. The State asks the court to consider another factor in addition to the seven Wade factors, namely the witness's level of certainty in making the in-court identification. The eyewitness in this case said at the suppression hearing that she was positive the defendant was the robber and that she would be able to identify him even if he had not been in the lineup and she had seen him on the street. The State argues that a witness's certainty in making an in-court identification is a proper factor for determining whether an in-court identification is independent of a tainted lineup.
¶ 45. This "certainty" factor is not mentioned in Wade but is set forth in Neil v. Biggers, 409 U.S. 188, 199 (1972). In Biggers, 409 U.S. at 201, the Court upheld the admission of testimony concerning a showup identification by a witness who had been raped several months earlier.[10] The Biggers Court promulgated *176 a "totality of circumstances" test for trial courts to apply in evaluating the reliability of pre-trial, out-of-court identifications.
¶ 46. The "totality of circumstances" test includes five factors: (1) the opportunity of the witness to view the criminal at the time of the crime; (2) the witness's degree of attention; (3) the accuracy of the witness's prior description of the criminal; (4) the level of certainty demonstrated by the witness at the confrontation; and (5) the length of time between the crime and the confrontation. Id. at 199-200. Thus the Biggers "totality of circumstances" test overlaps to a large extent with the factors set forth in the Wade "independent origin" test.
¶ 47. Judges differ about whether to treat the Wade and Biggers tests as functionally equivalent.[11] We conclude that notwithstanding the similarity of the *177 two tests, they are not functionally equivalent, and the Biggers "certainty" factor should not be included in the Wade test.
¶ 48. The Wade and Biggers tests are derived from different constitutional amendments and are intended to achieve different purposes. The Wade test focuses on the Sixth Amendment right to counsel at post-indictment lineups and on the exclusionary remedy for a constitutional violation of the Sixth Amendment. The Wade test is used to exclude evidence tainted by an unconstitutional lineup. Exclusion of derivative evidence is intended to deter unlawful police conduct and preserve judicial integrity.
¶ 49. The inquiry in Biggers, on the other hand, evaluates the reliability of a pre-trial identification when it is claimed that the pre-trial identification was made under impermissibly suggestive circumstances. Biggers uses a witness's certainty at a suggestive pretrial identification procedure to measure the reliability of the witness's identification in that procedure. Biggers is based on due process considerations, not on a Sixth Amendment violation or the Wong Sun exception to the fruit of the poisonous tree doctrine. Under Biggers, the "totality of the circumstances" test is applied to determine whether a pre-trial out-of-court identification was unreliable as a matter of law.
¶ 50. The case at bar is a Wade case. The issue is not whether a witness's observation of a perpetrator of a crime or an in-court identification of an accused was reliable. The issue is whether a witness's observation of a perpetrator of a crime constitutes an independent source for that witness's in-court identification of an accused.
*178 [8]
¶ 51. The primary concern in a Wade case is whether an unconstitutional lineup tainted a subsequent in-court identification. In a Wade case, the degree of certainty displayed by a witness at an incourt identification is not relevant in determining whether the in-court identification is independent of a tainted lineup. As the Wade court stated, "`[I]t is a matter of common experience that, once a witness has picked out the accused at the line-up, he is not likely to go back on his word later on, so that in practice the issue of identity may (in the absence of other relevant evidence) for all practical purposes be determined there and then, before the trial.'" Wade, 388 U.S. at 229.[12]
[9]
¶ 52. Considering all the evidence, we hold that the eyewitness's in-court identification in the case at bar should be suppressed because the State has not shown by clear and convincing evidence that the eyewitness's in-court identification of the defendant had an "independent origin," that is, that the source of the in-court identification was the eyewitness's observation of the robber during the robbery and was independent of a lineup that violated the defendant's Sixth Amendment right to counsel.
¶ 53. Accordingly, we reverse that part of the decision of the court of appeals admitting the in-court identification and remand the cause to the circuit court for further proceedings not inconsistent with this opinion.
*179 By the Court.The decision of the court of appeals is reversed in part, and the cause is remanded.
¶ 54. N. PATRICK CROOKS, J. (dissenting).
I dissent because I conclude the State has met its burden of establishing, by clear and convincing evidence, that the in-court identification is based upon observations of the eyewitness independent of the line-up identification. I further conclude that the certainty of the eyewitness is an appropriate consideration when determining whether the in-court identification is admissible under United States v. Wade, 388 U.S. 218 (1967).
I.
¶ 55. My review of the record, in accordance with the factors set forth in Wade, leads me to conclude that the in-court identification is based on the eyewitness's observations at the time of the robbery, independent of the line-up identification.
¶ 56. The first Wade factor considers the witness's opportunity to observe the perpetrator at the scene of the crime. In this case, the robbery occurred in a well-lit environment, and the eyewitness was wearing her eyeglasses at the time. The video tape indicates that the eyewitness was within a few feet of and directly facing the robber. The cash register was on the counter directly between the eyewitness and the robber; therefore, the eyewitness did not turn away from the robber to retrieve the requested change. In fact, at no time did the eyewitness turn away from the robber, even when she eventually backed away from him. There was nothing obstructing the eyewitness's view, and the robber made no attempt to conceal his face.
*180 The robber was the only individual in the store at the time of the robbery, and there is no evidence that the eyewitness was otherwise distracted.
¶ 57. Although the confrontation lasted approximately twenty seconds, courts have concluded that similar periods of time have provided witnesses with a sufficient opportunity to observe. See United States v. Goodman, 797 F.2d 468, 470 (7th Cir. 1986) (fifteen to twenty second observation); United States v. Jarrad, 754 F.2d 1451, 1455 (9th Cir. 1985) (three to four second observation), cert. denied, 474 U.S. 830 (1985); Government of the Canal Zone v. Waldron, 574 F.2d 283, 285 (5th Cir. 1978) (opportunity to view assailant twice, for two to three seconds on each occasion); United States ex rel Phipps v. Follette, 428 F.2d 912, 916 (2nd Cir. 1970) (twenty to thirty second observation), cert. denied, 400 U.S. 908 (1970). Furthermore, the time period is not the only element to consider in assessing whether the witness had a sufficient opportunity to observe. Rather, the time period must be considered within the context of the additional circumstances surrounding the confrontation. Based on the circumstances as they exist in this case, I conclude that the eyewitness had a sufficient opportunity to observe the robber.
¶ 58. The second Wade factor considers any discrepancy between the eyewitness's pre-lineup description and the accused's actual appearance. In this case, there is no significant variance in the eyewitness's statements, and there is no discrepancy between her statements and the defendant's actual appearance.
¶ 59. The eyewitness initially stated the robber had sideburns, but later testified she did not notice or did not know if the robber had facial hair. The significance of this factor is lessened when viewed in light of *181 the circumstances. In the video tape of the robbery, it is not apparent whether the robber did or did not have facial hair. It is apparent, however, that even if the robber had facial hair, it was neither voluminous nor lengthy.
¶ 60. Officer Wortock's testimony demonstrates no significant variance in the eyewitness's description of the robber's facial hair either. Officer Wortock consistently indicated that the eyewitness did not tell him whether or not the robber had facial hair. There may be some confusion because Office Wortock's initial testimony at the suppression hearing seemingly indicated that the eyewitness stated the robber did not have facial hair. However, Officer Wortock later clarified his testimony:
Q ... the victim in this case, indicated that the assailant did not have facial hair, correct...?
A She did not say one way or the other.
Q In your report ... it indicates the following: The assailant in this incident did not have any facial hair. Was that not told to you by the [eyewitness]?
A She did not say that to me. That was my personal observation from the video tape.
Q And was it not, didn't you testify earlier today that she informed you that there was no facial hair on this [sic] assailant?
A When she gave me a description of the party?
Q Yes.
A She did not say that the party had or had not any facial hair.
(R. 19 at 4-5.) (emphasis supplied.) Furthermore, Officer Wortock's failure to recall whether he directly *182 asked the eyewitness if the robber had facial hair provides no support for the contention that there is any variance in her description.
¶ 61. There is also no significant variation in the eyewitness's statements regarding the robber's height. The eyewitness testified that she described the robber as "at least six feet tall." (R. 18 at 11.) Officer Wortock testified that the eyewitness described the robber as "taller than her." (R. 27 at 12.) These statements vary somewhat but are consistent because the eyewitness is five feet tall. Thus, an individual who is taller than five feet could also be at least six feet tall. Furthermore, although the defendant's actual height is not noted in the record, there is no evidence that the eyewitness's statements create a discrepancy with the defendant's actual appearance.
¶ 62. Just as there is no significant variance in the description, there is no discrepancy between the description and the defendant's actual appearance. The majority finds compelling the testimony of the defendant's niece indicating the defendant had a goatee and full mustache on or about the date of the robbery, as well as Officer Bell's testimony that the defendant had facial hair approximately four days prior to the date of the robbery. This testimony does not evince a discrepancy.
¶ 63. The trial court made no findings of fact regarding the defendant's actual appearance on the date of the robbery. Facial hair is an easily modifiable physical feature, and the defendant may or may not have had facial hair on the date of the robbery. The majority's conclusion that a discrepancy exists assumes as true the defendant's niece's testimony that the defendant had facial hair on or about the date of the robbery. This is an improper assumption, as any issues *183 surrounding inconsistent witness statements implicate considerations of credibility and are issues to be resolved by the trier of fact. See Boyer v. State, 91 Wis. 2d 647, 672, 284 N.W.2d 30 (1979); Kohlhoff v. State, 85 Wis. 2d 148, 154, 270 N.W.2d 63 (1978). Even assuming arguendo that the defendant's niece's statements are true, it does not create a discrepancy because the eyewitness did not specifically state that the robber did not have facial hair.
¶ 64. The third Wade factor considers whether the witness identified any other individual prior to the line-up. The eyewitness in this case has not identified anyone other than the defendant as the robber.
¶ 65. The fourth Wade factor considers whether the witness identified the accused from a photo array prior to the line-up. As the majority notes, in this case the fourth Wade factor is closely related to the fifth Wade factor, which considers whether the witness failed to identify the accused prior to the in-court identification. The eyewitness did fail to identify the defendant from a photo array; however, the circuit court found the photo presented to the eyewitness was not a reasonable resemblance of the defendant. (R. 23 at 51.)
¶ 66. The sixth Wade factor considers the length of time between the date of the crime and the date of the line-up identification. I conclude the five-week period did not obscure the eyewitness's recollection. Courts have held that even a two-month lapse of time does not require suppression of an in-court identification where the witness does not identify an individual other than the defendant in the interim. See United States v. Monks, 774 F.2d 945, 957 (9th Cir. 1985); United States v. Barron, 575 F.2d 752, 755 (9th Cir. 1978). As previously noted, the eyewitness in this case *184 did not identify any individual other than the defendant as the robber.
¶ 67. The seventh Wade factor considers the facts disclosed relating to the conduct of the line-up. The line-up procedures were not suggestive in this case. The defendant was the suspect, and the defendant had facial hair at the time of the line-up. The additional men included in the line-up also had facial hair, just as they were also the same race and approximately the same size, height, and age as the defendant. It is reasonable that individuals with physical features similar to that of the defendant were included, so that attention was not inappropriately drawn to the defendant, and such procedures were not unduly suggestive. See Messer v. Roberts, 74 F.3d 1009, 1016 (10th Cir. 1996) ("men shown possessed sufficient similarities in size, coloration, height, complexion, hair color, full mustaches, somewhat receding hairlines, dress and weight to pass constitutional muster."). It is also not unduly suggestive that all individuals in the line-up had facial hair, even though the eyewitness's description did not include facial hair. See United States v. Schoels, 685 F.2d 379, 385 (10th Cir. 1982)(photo array of seven black men, all with noticeable facial hair, not unduly suggestive even though eyewitness described criminal as clean-shaven), cert. denied, 462 U.S. 1134 (1983). In addition, after reviewing the facts surrounding the line-up, the trial court determined the line-up procedures were not unduly suggestive. (R. 23 at 71.)
¶ 68. An analysis of the Wade factors under the circumstances as they exist in this case leads me to conclude that there is clear and convincing evidence that the eyewitness's in-court identification has an independent origin apart from the line-up identification.
*185 II.
¶ 69. I also conclude that the certainty of a witness is a proper factor to consider in determining whether the in-court identification is independent of a tainted line-up identification. The "independent basis" test in Wade and the "totality of circumstances" test in Neal v. Biggers, 409 U.S. 188 (1972) are derived from different constitutional amendments; however, they are both premised on concerns of accurate and reliable witness identification.
¶ 70. The Biggers test is derived from due process considerations and is primarily based upon the need to avoid the "`very substantial likelihood of irreparable [eyewitness] misidentification.'" Biggers, 409 U.S. at 381 (quoting Simmons v. United States, 390 U.S. 377, 384 (1968)). Although the Wade test is derived from the Sixth Amendment right to counsel, the Court's concern in Wade was similarly that of "mistaken identification" and protecting the accused from pre-trial identification procedures replete with "innumerable dangers." Wade, 388 U.S. at 228.
¶ 71. The Court's primary concern in Wade was not, as the majority argues, deterring unlawful police conduct and preserving judicial integrity. In fact, the Wade Court noted that "[w]e do not assume that these risks are the result of police procedures intentionally designed to prejudice an accused. Rather we assume they derive from the dangers inherent in eyewitness identification and the suggestibility inherent in the context of the pretrial identification." Wade, 388 U.S. at 235.
¶ 72. In assessing eyewitness identification, "[i]t is the reliability of identification evidence that primarily determines its admissibility." Watkins v. Sowders, 449 U.S. 341, 347 (1981). Numerous state and federal *186 courts have held that the level of certainty is relevant to a witness's reliability. See Manson v. Brathwaite, 432 U.S. 98, 114 (1977); United States v. Barron, 575 F.2d 752, 755 (9th Cir. 1978); State v. Figueroa, 665 A.2d 63, 73 (Conn. 1995); Shaw v. State, 846 S.W.2d 482, 484 (Tex. Ct. App. 1993). Because the Wade and Biggers decisions are both premised on concerns regarding the reliability of witness identification, the certainty factor considered in Biggers is equally relevant in a Sixth Amendment Wade analysis.
¶ 73. The witness's certainty is particularly relevant where, as here, it is expressed within the context of the observations at the time of the crime. At the preliminary hearing in this case, the eyewitness identified the defendant during the prosecution's examination regarding the crime itself. Without waiver, the eyewitness positively identified the defendant as the man who asked her for change, pointed the knife at her, and robbed her. (R. 18 at 6-7.) Even more convincing was the eyewitness's testimony at the suppression hearing, wherein she stated she was "positive" and "one hundred percent" certain that the defendant was the armed robber. (R. 19 at 25.) The eyewitness additionally testified at the suppression hearing that she would be able to identify the defendant as the robber even if she saw him on the street, irrespective of the line-up. (R. 19 at 26.)
¶ 74. Undoubtedly, the majority would argue that the eyewitness's certainty at the preliminary hearing and the suppression hearing was irreparably tainted by the line-up identification. Yet, "[t]his difficulty has not prevented courts from finding sufficient certainty even when the evidence of certainty comes from confrontations that took place after the invocation *187 of suggestive procedures." United States ex rel Kosik v. Napoli, 814 F.2d 1151, 1159 (7th Cir. 1987).
¶ 75. The majority emphasizes the unreliable nature of eyewitness identification; however, the Wade test is utilized to remedy such concerns and combat any inherent unreliability. It cannot be discounted that eyewitness identification is relevant and extremely valuable to criminal convictions. Therefore, such identification evidence should not be hastily suppressed. As Justice Black noted in reference to testimony given by a criminally accused at a suppression hearing:
The value of permitting the Government to use such testimony is, of course, so obvious that it is usually left unstated, but it should not for that reason be ignored. The standard of proof necessary to convict in a criminal case is high, and quite properly so, but for this reason highly probative evidence ... should not lightly be held inadmissible.
Simmons v. United States, 390 U.S. 377, 397 (1968) (Black, J., dissenting).
¶ 76. The language of Wade indicates the factors enumerated were proffered as a guidelinenot an allinclusive list of factors to be utilized to the exclusion of any other relevant considerations. See Wade, 388 U.S. at 241. The extent of the witness's certainty would not be dispositive in a Wade analysis. Rather, it would merely be a factor to be considered in addition to those outlined in Wade. See Biggers, 409 U.S. at 199.
¶ 77. I conclude that a review of the record pursuant to Wade provides clear and convincing evidence that the eyewitness's in-court identification is independent of the line-up identification. The eyewitness had a sufficient opportunity to observe the robber; there was no discrepancy between the eyewitness's description *188 and the defendant's actual appearance; the eyewitness did not identify any other individual as the robber other than the defendant; the time period between the crime and the line-up did not obscure the eyewitness's recollection of the robber; the line-up procedures were not unduly suggestive. I further conclude that the certainty of the witness is a relevant and appropriate consideration when determining whether there is an independent basis for an in-court identification.
¶ 78. For these reasons, I respectfully dissent.
¶ 79. I am authorized to state that Justice DONALD W. STEINMETZ and Justice JON P. WILCOX join this dissent.
NOTES
[] Motion for reconsideration denied December 16, 1997.
[1] The State did not seek review of this part of the decision of the court of appeals because, as the State's brief explains, the United States Supreme Court has declared that evidence of an identification made at a lineup which was held without notice to and in the absence of counsel must be excluded from the trial. See Gilbert v. California, 388 U.S. 263, 272-73 (1967).
[2] In reaching this conclusion, the court of appeals considered the certainty of the eyewitness's testimony at the preliminary hearing and the suppression hearing. See State v. McMorris, No. 95-2052-CR, unpublished op. at 11 n.5 (Wis. Ct. App. Oct. 2, 1997).
[3] For a similar analysis, see Tomlin v. Myers, 30 F.3d 1235, 1241 n.12 (9th Cir. 1994).
The State's brief asserts that not all courts use this standard of review in deciding identification issues. The cases the State cites, however, do not involve the identification issue posed in this case, namely an in-court identification after an identification in a lineup that violated the Sixth Amendment. See Brief for State at 14 n.1.
[4] See State v. Santiago, 206 Wis. 2d 3, 17-18, 556 N.W.2d 687 (1996).
[5] See State v. Fry, 131 Wis. 2d 153, 171, 388 N.W.2d 565, cert. denied, 479 U.S. 989 (1986) ("The reason for independent appellate review of constitutional facts is [that] `[t]he scope of constitutional protections, representing the basic value commitments of our society, cannot vary from trial court to trial court, or from jury to jury.'").
[6] See United States v. Wade, 388 U.S. 218, 241 (1967); United States v. Crews, 445 U.S. 463, 473 n.18 (1980).
[7] The court has also applied the Wade test in a case in which the accused's unlawful arrest was followed by a lineup identification and an in-court identification. See State v. Walker, 154 Wis. 2d 158, 188-89, 453 N.W.2d 127, cert. denied, 498 U.S. 962 (1990).
[8] See State v. Harper, 57 Wis. 2d 543, 546, 205 N.W.2d 1 (1973) (in-court identification based on independent origin when witness observed perpetrator for two or three minutes).
[9] See Elizabeth F. Loftus & James M. Doyle, Eyewitness Testimony: Civil and Criminal 97 (1992) ("It is well-established that there exists a comparative difficulty in recognizing individual members of a race different from one's own."); Neil Colman McCabe, The Right to a Lawyer at a Lineup: Support from State Courts and Experimental Psychology, 22 Ind. L. Rev. 905, 914 (1989) ("Several reviews of the literature on eyewitnesses have concluded that cross-race identifications are less reliable than when the witness and suspect are members of the same race.").
For a discussion of the dangers inherent in eyewitness identification and the desirability of using a detailed cautionary jury instruction regarding the fallibility of eyewitness identifications, see State v. Waites, 158 Wis. 2d 376, 383-84, 462 N.W.2d 206 (1990); Hampton v. State, 92 Wis. 2d 450, 465, 285 N.W.2d 868 (1979)(Abrahamson, J., concurring); Wis JICriminal 141 (1991).
[10] A show-up is a pre-trial, out-of-court identification procedure in which a suspect is viewed by a witness or victim of a crime. A show-up commonly occurs within a short time after a crime or under circumstances which would make a lineup impracticable or impossible.
[11] For opinions treating the two tests as functionally equivalent, see, e.g., Solomon v. Smith, 645 F.2d 1179, 1188 (2nd Cir. 1981) ("The tests of `independent origin' set forth in Wade appear to be functionally identical to the reliability tests articulated in Neil v. Biggers"); Graham v. Solem, 728 F.2d 1533, 1549 (8th Cir. 1984) (McMillian, J., dissenting), cert. denied, 469 U.S. 842 (1984) ("concepts of `purged taint' and `independent origin' have been blended into, and superseded by, the two-step process of weighing reliability against suggestiveness articulated in Biggers"). The Wisconsin Judicial Benchbook lists level of certainty as to identification as a factor. 1 Wisconsin Judicial Handbook: Criminal and Traffic CR14-4 (1992).
For opinions treating the two tests as distinct, see, e.g., United States v. Batista Ferrer, 842 F. Supp. 40, 42 (D. Puerto Rico 1994) (stating that Biggers relates to an accused's due process rights, rather than the Sixth Amendment right to counsel); Webster v. State, 474 A.2d 1305, 1316 (Md. 1984) (concluding that independent origin test and totality of circumstances test derive from distinct constitutional guarantees, call for different standards and are separate and distinct).
[12] The Wade Court quoted Glanville Williams & H.A. Hammelmann, Identification Parades, Part I, [1963] Crim. L. Rev. 479, 482. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1634915/ | 101 S.W.3d 619 (2003)
STANDARD CONSTRUCTORS, INC., Appellant,
v.
CHEVRON CHEMICAL COMPANY, INC., Appellee.
No. 01-00-01250-CV.
Court of Appeals of Texas, Houston (1st Dist.).
February 26, 2003.
Rehearing Overruled March 28, 2003.
*621 Roger Townsend, Hogan Dubose & Townsend, L.L.P., Houston, for Appellant.
Collyn A. Peddie, Jeffrey Parsons and Jeff Nobles, Beirne, Maynard & Parsons, L.L.P., Houston, for Appellee.
Panel consists of Justices HEDGES, JENNINGS, and MIRABAL.[*]
OPINION
TERRY JENNINGS, Justice.
In this breach of contract action, appellant, Standard Constructors, Inc. (Standard), challenges a judgment entered after a jury verdict in favor of appellee, Chevron Chemical Company, Inc. (Chevron). In three issues, Standard contends that the trial court erred in (1) ruling, as a matter of law, that the contract unambiguously barred Standard's claim for "equipment overtime charges," (2) excluding relevant evidence, and (3) awarding Chevron interest and attorneys' fees. We affirm.
Factual Background and Procedural History
Standard, a construction company specializing in work at petrochemical plants, provided construction, maintenance, and repair services at Chevron's Cedar Bayou refinery from the mid-1970s to 1997, when Chevron terminated its last contract with Standard. Standard had worked for Chevron under a series of one-year contracts, but, in December 1994, the parties entered into a three-year contract, which is the subject of this suit. Chevron entered into the three-year contract with Standard in order to lock in Standard's rates for personnel and equipment.
A few weeks before the new contract took effect, the refinery was severely damaged by a flood, and Standard was responsible for rebuilding approximately 33 buildings on an emergency basis. During the repairs, Chevron conducted a routine audit of Standard's billing. The initial audit revealed that Standard had overcharged Chevron $97,784 for employee overtime. Standard admitted to overcharging Chevron and agreed to repay Chevron for its mistake. However, after completing the audit, Chevron claimed that Standard owed Chevron a total of $531,424, which included the $97,784 and, by letter dated December 18, 1996, Chevron demanded payment from Standard. Standard did not pay on Chevron's demand, and Chevron terminated the contract.
Standard subsequently sent Chevron a bill for $647,666, claiming that from April 1994 through March 1996 it failed to charge Chevron for "equipment overtime" and that under the three-year contract, Chevron was responsible for the these charges. Chevron refused to pay on Standard's demand.
Standard then sued Chevron for (1) the equipment overtime, (2) its lost profits from the premature termination of its exclusive contract, and (3) its attorneys' fees. Chevron counterclaimed for breach of contract, demanding $97,784 as damages, and its attorneys' fees.[1]
*622 Before the trial began, the trial court held an evidentiary hearing on the issue of the contract's ambiguity. The trial court ruled that the contract was unambiguous and barred Standard's claim for equipment overtime charges. The remaining issues were tried to a jury. The jury determined that Standard did not have an exclusive contract and awarded Chevron $97,784 in overcharges and $80,000 in attorneys' fees. The trial court then rendered judgment on the verdict and added prejudgment and post-judgment interest.
Contract Interpretation
In its first issue, Standard contends that the trial court erred in ruling, as a matter of law, that the three-year contract unambiguously barred Standard's claim for the previously unbilled equipment overtime.
Whether a contract is ambiguous is a question of law for the court to decide. See Columbia Gas Transmission Corp. v. New Ulm Gas, Ltd., 940 S.W.2d 587, 589 (Tex.1996); see also Nat'l Union Fire Ins. Co. v. CBI Indus., Inc., 907 S.W.2d 517, 520 (Tex.1995); Markert v. Williams, 874 S.W.2d 353, 356 (Tex.App.-Houston [1st Dist.] 1994, writ denied). We review questions of law de novo. See generally El Paso Natural Gas Co. v. Minco Oil & Gas, Inc., 8 S.W.3d 309, 312 (Tex.1999); MCI Telecomm. Corp. v. Texas Util. Elec. Co., 995 S.W.2d 647, 651 (Tex.1999); Tex. Private Employment Ass'n v. Lyn-Jay Int'l, Inc., 888 S.W.2d 529, 531 (Tex.App.-Houston [1st Dist.] 1994, no writ).
The determination of whether a contract is ambiguous is made by looking at the agreement as a whole in light of the circumstances present when the parties entered into the contract. Nat'l Union, 907 S.W.2d at 520. We examine and consider the entire writing in an effort to harmonize and give effect to all the provisions of the contract so that none will be rendered meaningless. Id. No single provision will control; rather, all the provisions must be considered with reference to the whole instrument. Id.
The primary concern of a court when construing a written contract is to ascertain the true intent of the parties as expressed in the instrument. Id. If a written contract is worded in a way that it can be given a definite or certain legal meaning, then it is not ambiguous. Id. A contract will only become ambiguous if its meaning is uncertain or it is subject to two or more reasonable interpretations. Id. An ambiguity does not arise simply because the parties advance conflicting interpretations of the contract. Forbau v. Aetna Life Ins. Co., 876 S.W.2d 132, 134 (Tex.1994).
Chevron contends that the trial court did not err in ruling that the contract unambiguously precluded Standard from charging overtime for equipment used during its construction and maintenance work. Conversely, Standard contends that the trial court erred in so ruling because the terms of the contract, specifically Exhibit "F," are ambiguous and that overtime charges for equipment are permitted under the agreement.
The contract provides, in pertinent part, as follows:
[Chevron] shall pay [Standard] a compensation in accordance with attached Terms and Conditions, Exhibit "B" entitled "Compensation Schedule", and Exhibit "F" entitled "Contractor Owned Equipment".
*623 Exhibit "F" was prepared by Standard and is a six-page list of different types of equipment with corresponding billing rates in a format, reproduced in part, as follows:
EXHIBIT "F"
CONTRACTOROWNED EQUIPMENT
Equipment Name Hourly (1) Daily (8) Weekly (40) Monthly (176)
AIR COMPRESSOR N/A $ 35.00 $140.00 $420.00
AIR COMPRESSOR 100-600CFM N/A $150.00 $450.00 N/A
AIR DRILL N/A $ 20.00 $ 60.00 $180.00
AIR HOSE N/A $ 10.00 $ 30.00 N/A
AIR IMPACT WRENCH 3/4" N/A $ 24.00 $ 79.00 $169.00
AIR NAIL GUN N/A $ 40.00 $120.00 $360.00
AIR SPADE N/A $ 12.00 $ 16.00 $ 24.00
APPLIANCE DOLLY (HAND MULE) N/A $ 12.25 $ 36.75 $110.25
AUGER-GAS POWERED 12" N/A $100.00 $300.00 $900.00
BACKHOE-HITACHI 270 $38.00 N/A N/A N/A
BACKHOE-RUBBERTIRE 580K&E $25.00 N/A N/A N/A
For each piece of equipment, the chart provides a column for an "Hourly (1)," "Daily (8)," "Weekly (40)," and "Monthly (176)" rate charge. Under the hourly column, no hourly rate is specified for the vast majority of the equipment listed. Where no such rate is specified in the hourly column, the term "N/A" is used.[2] For example, in regard to ladders, the hourly column contains the term "N/A," the daily column reads "$17.95," the weekly column reads "$53.85," and the monthly column reads "$161.55." In some instances, a rate is specified in the hourly column, but the term "N/A" is used in the daily, weekly, and monthly columns. For example, in regard to a "Backhoe-Hitachi 270," the hourly column provides a rate of "$38.00," but the term "N/A" is used in the daily, weekly, and monthly columns.
Chevron contends that the term "N/A," as it is used in the contract, "clearly demonstrates [the parties'] intention that hourly rates were not to be appliedor chargedfor those items with an `N/A' in their `hourly' rate column, whether that hourly rate would have been for `straight' time or for `overtime.'"
On the other hand, Standard contends that the abbreviation "N/A" should be interpreted to mean variable or dependant. Standard argues that, because the contract is silent regarding whether it could charge overtime for equipment, the contract is ambiguous on its face and the abbreviation "N/A" means something other than its natural definition.
In support of its argument, Standard notes that the construction industry has general practices that govern the rental rates of equipment. Standard directs us to the Associated Equipment Distributors' (AED) Green Book,[3] which sets forth rental *624 rates for various types of equipment used in the construction industry. Standard maintains that the Green Book explains how construction companies, like Standard, can charge for overtime use of equipment.
The Green Book is extrinsic evidence which was not expressly incorporated into the parties' contract. In Texas, extrinsic evidence is not admissible to contradict or vary the meaning of unambiguous language in a written contract and may not be considered by this Court in order to create an ambiguity. Nat'l Union, 907 S.W.2d at 521-22 (holding evidence of industry-wide discussions inadmissible to demonstrate intent behind unambiguous absolute pollution exclusion); Sears, Roebuck and Co. v. Commercial Union Ins. Corp., 982 S.W.2d 151, 154 (Tex.App.-Houston [1st Dist.] 1998, no pet.). Rather, an "ambiguity must become evident when the contract is read in context of the surrounding circumstances, not after parol evidence of intent is admitted to create an ambiguity." Nat'l Union, 907 S.W.2d at 521 (emphasis added). Only after a contract is first determined to be ambiguous may this Court then consider the parties' interpretations, through extrinsic evidence, of the contract. See Friendswood Dev. Co. v. McDade + Co., 926 S.W.2d 280, 283 (Tex. 1996) (holding only after contract is found to be ambiguous may parol evidence be admitted for purpose of ascertaining parties' true intentions).
Here, a plain reading of the contract demonstrates the parties' intention that Chevron was not to be charged an hourly rate for Standard's use of equipment listed in Exhibit "F" with a "N/A" in its hourly column. In its brief, Standard concedes that:
On its face, [Exhibit "F"] simply provides fixed rates for Standard's equipment classified as "[H]ourly," "[D]aily," "[W]eekly," and "[M]onthly." The "Daily" column has an "(8)" next to the word "Daily," which represents an 8-hour day. Similarly, the "(40)" in the "Weekly" column and the "(176)" in the "Monthly" column represent a 40 hour week and a 176-hour month. Therefore, the daily rate was based upon an 8-hour day, the weekly rate was based upon a 40-hour week, and the monthly rate was based upon a 176-hour month.... That much of the contract is indeed unambiguous.
(Emphasis added.) In regard to the use of equipment during regular hours, Chevron would be charged $17.95 for the daily use of a ladder, based on an 8 hour day, but it would not be charged for the hourly use of a ladder. The contract does not become ambiguous in regard to the rates for overtime use of equipment merely because it does not, on its face, address "overtime."
It makes sense that one might consent to paying $38.00 an hour for the use of a backhoe, but would be unwilling to pay for the use of a ladder on an hourly basis. It also makes sense that some types of equipment, like a backhoe, may be available for use only on an hourly basis and that the parties would agree that rates for daily, weekly, and monthly use would not be applicable. It makes no sense that the term "N/A" under the daily, weekly, and monthly columns for a backhoe would be subject to only one meaning, i.e., "no rate charge," but under the hourly column for a ladder could be subject to two interpretations, i.e., "no rate charge" for use during regular hours or "variable rate charge" in regard to overtime use.
The dissenting opinion agrees with Standard's argument that the term "N/A" should be interpreted in conjunction with the numbers (1), (8), (40), and (176), which appear at the top of Exhibit "F." The *625 dissent points out that, in the Green Book, the numbers (8), (40), and (176) have a distinct meaning within the construction industry and quotes the Green Book regarding a calculation to be used in assessing charges for the overtime use of rental equipment. It concludes that the Green Book`s interpretation of the numbers (8), (40), and (176), as they were used in Exhibit F, supports Standard's construction that would allow it to charge overtime for equipment usage and, thus, the contract is subject to two reasonable interpretations.
However, as noted above, extrinsic evidence, such as the Green Book, is not admissible to contradict or vary the meaning of unambiguous language in a written contract and it will not be considered by this Court in order to create an ambiguity. Nat'l Union Fire Ins., 907 S.W.2d at 521-22. Nevertheless, the Green Book provided in the record simply does not discuss hourly rates or the term "N/A." Nor does the Green Book discuss numbers as placed beside the terms "Daily," "Weekly," and "Monthly" or suggest that such placements manifest an intent that the contracting parties have agreed to special compensation for overtime use of equipment. In fact, the very language quoted by the dissenting opinion as demonstrating an ambiguity in the contract applies to situations where "the equipment is rented."[4] Exhibit "F" is entitled "CONTRACTOR-OWNED EQUIPMENT."
Whatever the substance and meaning of the provisions of the Green Book, the parties in this case chose the language used in the contract.[5] Standard prepared Exhibit "F" and chose to use the term "N/A." If Standard meant that the rates for hourly overtime use of certain types of equipment to be "variable," it could have used that term or an asterisk with a simple explanation. A contract is not ambiguous merely because a party believes the contract does not mean what it actually says.
The term "N/A" has one clear, plain meaning throughout the chart labeled Exhibit "F""no rate charge"and is not ambiguous. Thus, we hold that the trial court did not err in ruling that the contract unambiguously barred Standard's claim for payment for overtime use of equipment on an hourly basis.
We overrule Standard's first issue.
Exclusion of Evidence
In its second issue, Standard contends that the trial court erred in excluding relevant evidence. During Standard's bill of exception, Bob Gulledge, Standard's president, testified that Richard Weaver, a Chevron representative, told him that Chevron had forced him to fabricate its original claim for $531,424 in order to offset Standard's claim for equipment overtime charges. Specifically, Gulledge stated,
He [Weaver] told me that he just wanted to let me know before he left that the $531,000that the bulk of, that $531,000 was not owed to ChevronI mean, not owed by us to Chevron.... He just said the bulk of it was thrown in there to counteract equipment.
Chevron objected to Gulledge's testimony on the grounds that it was irrelevant and any probative value was outweighed by its potential prejudicial effect. See Tex.R. Evid. 401, 402, 403. Standard argues that this "admission" was relevant to *626 show why it was excused from repaying Chevron the $97,784.
The decision to exclude evidence is reviewed under an abuse of discretion standard. City of Brownsville v. Alvarado, 897 S.W.2d 750, 753 (Tex.1995). A court abuses its discretion only when it acts in an unreasonable and arbitrary manner, or when it acts without reference to any guiding rules and principles. E.I. du Pont de Nemours and Co., Inc. v. Robinson, 923 S.W.2d 549, 558 (Tex.1995); Downer v. Aquamarine Operators, Inc., 701 S.W.2d 238, 241-42 (Tex.1985). This Court may not reverse a trial court's ruling for an abuse of discretion merely because we disagree with its decision. See Robinson, 923 S.W.2d at 558; Downer, 701 S.W.2d at 242.
In addition to showing an abuse of discretion, Standard must also show that the trial court's error was reasonably calculated to cause, and probably did cause, the rendition of an improper judgment. See Tex.R.App. P. 44.1; see also Alvarado, 897 S.W.2d at 753-54; GT & MC, Inc. v. Tex. City Ref., Inc., 822 S.W.2d 252, 257 (Tex. App.-Houston [1st Dist.] 1991, writ denied). In other words, the "judgment [must] turn[] on the particular evidence excluded." Alvarado, 897 S.W.2d at 753-54.
Here, Gulledge's testimony was not relevant to Standard's claim that it was "excused" from reimbursing $97,784 to Chevron. The pertinent jury question read as follows:
Do you find from a preponderance of the evidence that on or before February 19, 1997, Standard was excused from repayment to Chevron of the $97,784 over-billing?
You are instructed that Standard's failure to repay the $97,784 was excused only if you find that Chevron clearly indicated to Standard that any tender of repayment by Standard of $97,784 would be refused.
Answer "Yes" or "No" in the space below.
Answer: NO.
(Emphasis added.)[6]
Gulledge's proffered testimony was irrelevant to the issue before the jury. Evidence is only relevant if it has "any tendency to make the existence of any fact that is of consequence to the determination of the action more probable or less probable than it would be without the evidence." Tex.R. Evid. 401 (emphasis added). Here, even if Gulledge's testimony was true, it would not have provided Standard with a legal "excuse," as defined by the jury charge, to forego reimbursing $97,784 to Chevron. As noted above, Chevron originally alleged that Standard owed Chevron a total of $531,424. However, Chevron non-suited its claim for $433,640, leaving only its claim for the $97,784 reimbursement. Thus, the issue of whether Chevron created a bogus bill for $433,640 is irrelevant to the current litigation. As noted by the trial court,
But he acknowledgesMr. Gulledge acknowledges thathe did acknowledge that the same portion was going to include the $97,000 was, in fact, appropriate for payment. And so, what you're asking me to let the jury hear is a conversation pursuant to which Mr. Weaver is apparently saying that we have, in effect, a bogus bill. It doesn't help us with that part of the bill [the *627 $97,784], the charges that aren't [unsubstantiated].
(Emphasis added.)
We hold the trial court did not abuse its discretion in excluding, as irrelevant, Gulledge's proffered testimony as indicated above.
We overrule Standard's second issue.
Attorneys' Fees and Interest
In its third issue, Standard argues that the trial court erred in awarding Chevron attorneys' fees and prejudgment interest because Chevron made no pretrial demand on Standard specifically for reimbursement of the $97,784 in overcharges for overtime, and Chevron's initial demand for payment of $531,424 was excessive and made in bad faith. Standard also contends that post-judgment interest should be deleted from the judgment.
Attorneys' Fees
In order to recover attorneys' fees under chapter 38 of the Civil Practice and Remedies Code, a claimant must comply with the following requirements:
(1) the claimant must be represented by an attorney;
(2) the claimant must present the claim to the opposing party or to a duly authorized agent of the opposing party; and
(3) payment for the just amount owed must not have been tendered before the expiration of the 30th day after the claim is presented.
Tex. Civ. Prac. & Rem.Code Ann. § 38.002 (Vernon 1997) (emphasis added); Hermann Hosp. v. Vardeman, 775 S.W.2d 866, 868 (Tex.App.-Houston [1st Dist.] 1989, no writ). No particular form of demand or presentment is required. Jones v. Kelley, 614 S.W.2d 95, 100 (Tex.1981); Adams v. Petrade Int'l, Inc., 754 S.W.2d 696, 719 (Tex.App.-Houston [1st Dist.] 1988, writ denied).
Standard argues that "because Chevron never demanded the $97,784 until trial began, Standard had no chance to avoid litigation." However, in a letter dated December 18, 1996, Chevron presented Standard with a demand for payment of $531,424. It is undisputed that Chevron's claim for reimbursement of $97,784 for overtime overcharges was included as part of that demand. Bob Gulledge, Standard's president, described the December 18th demand as "a one-page letter ... saying that we owed them [Chevron] $531,000," and stated that he refused to pay the amount because there was no substantiation for it. As noted above, section 38.002 does not require any particular form of presentment; all that is necessary is that a party show that its assertion of a debt or claim and a request for compliance was made to the opposing party, and the opposing party refused to pay the claim. Panizo v. Young Men's Christian Ass'n of the Greater Houston Area, 938 S.W.2d 163, 168 (Tex.App.-Houston [1st Dist.] 1996, no writ). Thus, Standard's argument that it was never properly presented with Chevron's demand is without merit.
Standard next contends that Chevron was precluded from recovering attorneys' fees and prejudgment interest because Chevron's demand was excessive and made in bad faith. As a general rule, a creditor who makes an excessive claim upon a debtor is not entitled to attorneys' fees for subsequent litigation required to recover the debt. Findlay v. Cave, 611 S.W.2d 57, 58 (Tex.1981). A claimant is not required to make a presentment for the exact amount it is entitled to recover at trial. Panizo, 938 S.W.2d at 169. The dispositive question in determining whether a demand is excessive is whether the *628 claimant acted unreasonably or in bad faith. Id.
Standard argues that Chevron's demand was unreasonable and made in bad faith because (1) its supervisor of purchasing contracts told Bob Gulledge that its claim for $531,424 was fabricated to offset Standard's claim, and (2) Chevron never provided supporting documentation for its demand. In essence, Standard is arguing that Chevron, as a matter of law, was precluded from recovering attorneys' fees and prejudgment interest. However, there was no jury finding that Chevron acted in bad faith. From the record before us, we cannot conclude that Chevron's conduct in making its initial demand of $531,424 and subsequently proceeding to trial solely on its claim for $97,784 constituted bad faith as a matter of law.[7]
Additionally, a party must affirmatively assert excessive demand as a defense to a claim for attorneys' fees. Essex Crane Rental Corp. v. Striland Constr. Co., Inc., 753 S.W.2d 751, 758 (Tex.App.-Dallas 1988, writ denied); Tuthill v. Southwestern Pub. Serv. Co., 614 S.W.2d 205, 212 (Tex.App.-Amarillo 1981, writ ref'd n.r.e.). Furthermore, that party must request and obtain findings of facts on the essential elements of excessive demand. Essex, 753 S.W.2d at 758; Tuthill, 614 S.W.2d at 212. Standard has failed to do both.
Post-Judgment Interest
Finally, Standard argues that Chevron should not receive post-judgment interest because Standard was "willing to tender payment of the entire $97,784" to Chevron after the judgment was signed. However, the record demonstrates that Standard never actually tendered payment of the $97,784 to Chevron or deposited that amount into the registry of the trial court in lieu of an appeal bond. See Tex.R.App. P. 24.1, 24.2. Thus, Standard's argument is without merit.
We overrule Standard's third issue.
Conclusion
We affirm the judgment of the trial court.
Justice MARGARET G. MIRABAL dissenting.
MARGARET G. MIRABAL, Justice, dissenting (Assigned).
I respectfully dissent. In my opinion, the trial court erred in ruling that, as a matter of law, the contract in question barred appellant's claim for payment for overtime use of equipment on an hourly basis. Accordingly, we should sustain appellant's first issue and reverse and remand this case for a new trial.
Analysis
It is clear from the contract that Exhibit "F" is an alphabetical list of the different types of equipment Standard could use during its construction and maintenance work, and that it breaks down the rates Standard can charge for each type of equipment into four categories, which include, "Hourly (1)," "Daily (8)," "Weekly (40)," and "Monthly (176)." (Emphasis added.) In some instances, the parties agreed to assign certain types of equipment a "daily," "weekly," and "monthly" rate, and in others, the parties assigned only "hourly" rates. This is undisputed.
*629 However, for a majority of the types of equipment, the parties inserted the abbreviation "N/A," or "not applicable," in the "hourly" column. Chevron argues that the term "N/A," as it is used in the contract, demonstrates the parties' intention that hourly rates were not to be charged for those items with an "N/A" in their "hourly" rate column, whether that hourly rate would have been for "straight" time or for "overtime." Standard contends that the abbreviation "N/A" should be interpreted in conjunction with the numbers (1), (8), (40), and (176), which appear at the top of Exhibit "F." Standard claims that the contract permits charges for the overtime use of equipment, regardless of the term "N/A," because the applicable overtime rates will depend entirely on how long a particular piece of equipment is used.
In support of its argument, Standard points to the construction industry's general standards and trade practices in order to define what the term "N/A" means in connection with the numbers (1), (8), (40), and (176). The Associated Equipment Distributor's (AED) Green Book,[1] which sets forth rental rates for all types of equipment used in the construction industry, was admitted into evidence at the pretrial hearing. The Green Book is a nationally publicized information booklet that compiles the general industry practices of thousands of construction companies in the United States and Canada.
According to the Green Book, the numbers (8), (40), and (176) have a distinct meaning within the construction industry. The Green Book states that "[i]t is the general practice in the industry to base rates upon one shift of 8 hours per day, 40 hours per week, or 176 hours per month of a 30-day consecutive period."[2] This explanation gives the numbers at the top of Exhibit "F" a definite meaning and supports Standard's interpretation of the contract.
In addition, the Green Book establishes a general practice in the construction industry that companies normally charge for overtime use of equipment. Specifically, the Green Book provides as follows:
If the equipment is rented by the day, the rate for overtime is one-eighth of the daily rate for each hour in excess of eight. If it is rented by the week, the rate for overtime is 1/40 of the weekly rate for each hour in excess of 40. If it is rented by the month, the overtime rate is 1/176 of the monthly rate for each hour in excess of 176 hours in any one 30-day consecutive period.[3]
Chevron put on evidence that, during the three years before this contract, when Chevron and Standard operated under a similar contract, Standard had never charged Chevron for overtime use of equipment. Standard responded with evidence that the overtime use of equipment never came up until the flood of October 1994, which severely damaged Chevron's plant and required rebuilding on an emergency basis under the contract at issue.
Extrinsic evidence may "be admissible to give the words of a contract a meaning consistent with that to which they are reasonably susceptible, i.e., to `interpret' contractual terms." Mescalero Energy, Inc. v. Underwriters Indem. Gen. Agency, Inc., 56 S.W.3d 313, 320 (Tex.App.-Houston [1st Dist.] 2001, pet. denied) (quoting Nat'l Union Fire Ins. Co. v. CBI Indus., Inc., 907 S.W.2d 517, 521 (Tex.1995)). "[A] specialized *630 industry or trade term may require extrinsic evidence of the commonly understood meaning of the term within a particular industry." Mescalero Energy, 56 S.W.3d at 320; see also Nat'l Union, 907 S.W.2d at 521 n. 6 (holding extrinsic evidence may be considered when interpreting meaning of terms used in particular "place, vocation, trade, or industry"). Courts may refer to extrinsic evidence such as industry dictionaries to determine the commonly understood meaning of an industry term. Mescalero Energy, 56 S.W.3d at 323. Many courts have used expert definitions to determine the meaning of specialized terms before deciding whether an instrument is ambiguous. Id.
In this case, the Green Book's interpretation of the numbers (8), (40), and (176), as they were used in Exhibit "F," supports Standard's construction of the parties' contract that would allow it to charge for overtime use of equipment. I would hold that the contract is therefore subject to two reasonable interpretations. Thus, the trial court erred in ruling, as a matter of law, that the contract unambiguously barred Standard's claim for equipment overtime charges. This error probably caused the rendition of an improper judgment, and therefore is reversible error. See Tex.R.App. P. 44.1(a).
Accordingly, I would sustain Standard's first issue and not reach the merits of the remaining issues.
Conclusion
I would reverse the judgment and remand the case to the trial court.
NOTES
[*] The Honorable Margaret G. Mirabal, former Justice, Court of Appeals, First District of Texas at Houston, participating by assignment.
[1] In its counterclaim, Chevron originally alleged that Standard owed Chevron a total of $531,424, which included the previously discovered $97,784. However, prior to trial, Chevron non-suited its claim for $433,640, leaving only $97,784 at issue.
[2] The parties agree that "N/A" stands for "not applicable."
[3] THE AED GREEN BOOK, COMPILATION OF NATIONALLY AVERAGED 1995 RENTAL RATES & MODEL SPECIFICATIONS FOR CONSTRUCTION EQUIPMENT (47th ed.1996) [hereinafter "GREEN BOOK"].
[4] Green Book, supra at 3.
[5] We note that the Green Book advises its readers as follows: "To avoid disagreements... the terms [of a contract] should be spelled out in a written agreement...." Id.
[6] On appeal, Standard does not challenge either the wording or the submission of this question.
[7] Moreover, Standard did not argue to the trial court that Gulledge's testimony that Chevron's representative told him that its claim for $531,424 was fabricated was relevant on the issue of making a bad faith demand.
[1] The AED Green Book, Compilation of Nationally Averaged 1995 Rental Rates & Model Specifications for Construction Equipment (47th ed.1996) [hereinafter "Green Book"].
[2] Id. at 3.
[3] Id. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1693059/ | 213 Wis. 2d 189 (1997)
570 N.W.2d 249
IN the MATTER OF DISCIPLINARY PROCEEDINGS AGAINST John W. GIBSON, Attorney at Law.
No. 97-1402-D.
Supreme Court of Wisconsin.
Filed November 4, 1997.
¶ 1. PER CURIAM.
We review the referee's recommendation that the license of John W. Gibson to practice law in Wisconsin be suspended for 60 days as discipline for professional misconduct. That misconduct *190 consisted of continuing to practice law while suspended from membership in the State Bar, misrepresenting to an opposing party in litigation that his client had filed for bankruptcy, having clients sign blank bankruptcy petitions and forms, delegating to nonlawyer staff the decision whether and when to file bankruptcy petitions on behalf of clients and failing to supervise that staff properly, and opposing motions by the bankruptcy trustee to dismiss bankruptcy petitions for failure to include repayment plans.
¶ 2. We determine that the recommended license suspension is appropriate discipline to impose for Attorney Gibson's professional misconduct established in this proceeding. This is the second occasion we have had to discipline him for professional misconduct. The misconduct here concerns his dishonesty in respect to parties in litigation and to the bankruptcy court.
¶ 3. Attorney Gibson was admitted to practice law in Wisconsin in 1961 and practices in Madison. In 1985, the court suspended his license for 90 days as discipline for having made sexual advances to a woman client. In re Disciplinary Proceedings Against Gibson, 124 Wis. 2d 466, 369 N.W.2d 695.
¶ 4. Attorney Gibson and counsel for the Board of Attorneys Professional Responsibility (Board) stipulated that the pleadings, including Attorney Gibson's admissions and no contest pleas in his answer to the complaint, set forth a sufficient basis for a recommendation for discipline and that a 60-day license suspension would be appropriate. The referee, Attorney Norman Anderson, recommended a 60-day license suspension based on his review of the matters set forth in the pleadings.
¶ 5. While his membership in the State Bar was administratively suspended for failure to pay membership *191 dues, Attorney Gibson appeared in court representing clients and engaged in the practice of law while ineligible to do so, in violation of SCR 10.03(4) and (6)[1] and 20:8.4(f).[2] While representing a client in an eviction proceeding, Attorney Gibson told the plaintiff that a bankruptcy proceeding had been filed on behalf of his client. In response, the plaintiff canceled the eviction proceeding and told his counsel to pursue the matter in the bankruptcy proceeding. When the plaintiff learned later that no bankruptcy petition had *192 been filed by the defendant, the plaintiff's attorney contacted Attorney Gibson, who then immediately filed his client's bankruptcy petition. That conduct constituted deceit or misrepresentation, in violation of SCR 20:4.1(a)[3] and 20.8.4(c).[4]
¶ 6. In another bankruptcy proceeding, Attorney Gibson signed pleadings by which he affirmed that, after reasonable inquiry, they were well grounded in fact and not interposed for any improper purpose. However, Attorney Gibson had delegated the decision whether and when to file those pleadings to a nonlawyer employee, whom he failed to supervise properly. He or his staff had the client sign blank petitions, plans and schedules that were later filled in by himself or by his staff, and the petition was filed while he was vacation. Attorney Gibson and his staff failed to file timely a repayment plan and complete schedules. His subsequent opposition to a motion by the bankruptcy trustee to dismiss the bankruptcy petition for failure to file a plan was deemed frivolous by the court, and Attorney Gibson was ordered to pay a penalty and make restitution.
¶ 7. In another bankruptcy proceeding, Attorney Gibson allowed his nonlawyer employee to decide to file *193 a petition on behalf of the client, but that was done without the inclusion of a repayment plan or the necessary schedules. Attorney Gibson or his staff had that client sign blank petitions, plans and schedules, notwithstanding that the bankruptcy rules specified that the signature of a party certifies that the party has read the document and that it is well grounded in fact. A repayment plan was not filed timely for this client, and the bankruptcy court held Attorney Gibson's objection to the bankruptcy trustee's motion to dismiss the proceeding for failure to file the plan frivolous and required Attorney Gibson to reimburse the bankruptcy trustee and pay a penalty.
¶ 8. Attorney Gibson's conduct in these bankruptcy matters violated the rules requiring his supervision of nonlawyer assistants, SCR 20:5.3 (b) and (c).[5] In addition, his advancement of non-meritorious claims and contentions in opposing the bankruptcy trustees' dismissal motions violated SCR 20:3.1(a)(1) *194 and (2),[6] he failed to give competent representation to the clients, in violation of SCR 20:1.1,[7] and he made misrepresentations, in violation of SCR 20:8.4(c).
¶ 9. As discipline for his misconduct in these matters, the parties stipulated and the referee recommended that Attorney Gibson's license to practice law be suspended for 60 days. We accept that recommendation as the appropriate response to this misconduct.
¶ 10. IT IS ORDERED that the license of John W. Gibson to practice law in Wisconsin is suspended for 60 days, commencing December 8, 1997, as discipline for professional misconduct.
¶ 11. IT IS FURTHER ORDERED that within 60 days of the date of this order John W. Gibson pay to the Board of Attorneys Professional Responsibility the costs of this proceeding, provided that if the costs are not paid within the time specified and absent a showing to this court of his inability to pay the costs within that time, the license of John W. Gibson to practice law in Wisconsin shall remain suspended until further order of the court.
*195 ¶ 12. IT IS FURTHER ORDERED that John W. Gibson comply with the provisions of SCR 22.26 concerning the duties of a person whose license to practice law in Wisconsin has been suspended.
¶ 13. SHIRLEY S. ABRAHAMSON, CHIEF JUSTICE, did not participate.
NOTES
[1] SCR 10.03 provides, in pertinent part:
Membership.
...
(4) Only active members may practice law. No individual other than an enrolled active member of the state bar may practice law in this state or in any manner purport to be authorized or qualified to practice law. A judge in this state may allow a nonresident counsel to appear in his or her court and participate in a particular action or proceeding in association with an active member of the state bar of Wisconsin who appears and participates in the action or proceeding. Permission to the nonresident lawyer may be withdrawn by the judge granting it if the lawyer by his or her conduct manifests incompetency to represent a client in a Wisconsin court or by his or her unwillingness to abide by the rules of professional conduct for attorneys and the rules of decorum of the court.
...
(6) Penalty for nonpayment of dues. If the annual dues of any member remain unpaid 120 days after the payment is due, the membership of the member may be suspended in the manner provided in the bylaws; and no person whose membership is so suspended for nonpayment of dues may practice law during the period of the suspension.
[2] SCR 20:8.4 provides, in pertinent part:
Misconduct
It is professional misconduct for a lawyer to:
. . .
(f) violate a statute, supreme court rule, supreme court order or supreme court decision regulating the conduct of lawyers;
[3] SCR 20:4.1 provides, in pertinent part:
Truthfulness in statements to others
In the course of representing a client a lawyer shall not knowingly:
(a) make a false statement of a material fact or law to a third person;
[4] SCR 20:8.4 provides, in pertinent part:
Misconduct
It is professional misconduct for a lawyer to:
. . .
(c) engage in conduct involving dishonesty, fraud, deceit or misrepresentation;
[5] SCR 20:5.3 provides, in pertinent part:
Responsibilities regarding nonlawyer assistants
With respect to a nonlawyer employed or retained by or associated with a lawyer:
. . .
(b) A lawyer having direct supervisory authority over the nonlawyer shall make reasonable efforts to ensure that the person's conduct is compatible with the professional obligations of the lawyer; and
(c) A lawyer shall be responsible for conduct of such a person that would be a violation of the Rules of Professional Conduct if engaged in by a lawyer if:
(1) the lawyer orders or, with the knowledge of the specific conduct, ratifies the conduct involved; or
(2) the lawyer is a partner in the law firm in which the person is employed, or has direct supervisory authority over the person, and knows of the conduct at a time when its consequences can be avoided or mitigated but fails to take reasonable remedial action.
[6] SCR 20:3.1 provides, in pertinent part:
Meritorious claims and contentions
(a) In representing a client, a lawyer shall not:
(1) knowingly advance a claim or defense that is unwarranted under existing law, except that the lawyer may advance such claim or defense if it can be supported by good faith argument for an extension, modification or reversal of existing law;
(2) knowingly advance a factual position unless there is a basis for doing so that is not frivolous;
[7] SCR 20:1.1 provides:
Competence
A lawyer shall provide competent representation to a client. Competent representation requires the legal knowledge, skill, thoroughness and preparation reasonably necessary for the representation. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1541956/ | 76 B.R. 508 (1987)
In re G & H STEEL SERVICE, INC., Debtor.
In re WHALEN ERECTING CO. OF OHIO, INC. d/b/a Whalen Erecting Co., Inc., Debtor.
In re FAIRFIELD CONSTRUCTORS, INC., Debtor.
Bankruptcy Nos. 86-05169S to 86-05171S.
United States Bankruptcy Court, E.D. Pennsylvania.
August 18, 1987.
David R. Rosenfield, Philadelphia, Pa., for original movant Anthony Do'Ambra, etc.
Gary Schildhorn, Philadelphia, Pa., for defendant Ernest Dana.
Edward J. DiDonato, Philadelphia, Pa., for debtors.
Kenneth F. Carobus, Philadelphia, Pa., for Creditors' Committee.
Herbert A. Fogel, Broomall, Pa., Special Counsel.
J. Scott Victor, Philadelphia, Pa., for defendant Anthony Doria.
OPINION
DAVID A. SCHOLL, Bankruptcy Judge.
Before us is a Motion by the Defendants in a lawsuit initiated by the Debtors requesting us to vacate our Order appointing, as special counsel for the Debtors in these cases, an attorney who is admittedly not a "disinterested party" due to his close past relationship with the Debtors and whose alleged "intimate and involved" relationship with the Debtors allegedly may result in his being called as a witness by the Defendants. Finding that special counsel need not be "disinterested" and that the policy of allowing a litigant, as opposed to his opponent, to choose his counsel outweighs any ethical considerations requiring exclusion of the chosen special counsel here, we shall deny the Motion.
On May 28, 1987, we granted the Debtors' ex parte Application to Appoint Herbert A. Fogel, Esquire, formerly a United States District Judge (hereinafter referred to as "Fogel"), in this case as special counsel to the Defendants for the sole purpose of representing the three Debtors, whose estates are being jointly administered, in Adversary No. 87-0321S in this Court, a proceeding brought against the Defendants, former employees of the Debtors and a corporate entity which they formed, for damages resulting from alleged theft of services and loss of corporate opportunities. The only connection between Fogel *509 and the Debtors alleged in the original Application was that Fogel has been involved with the operations of the Debtors for several years and was familiar with the history surrounding the relationships between the Debtors and the Defendants.
On June 17, 1987, four of the six Defendants in the Adversary proceeding filed the instant Motion, and thereafter they were joined by the other Defendants. The Debtors answered, indicating their opposition to the Motion on July 2, 1987. A hearing was scheduled on July 14, 1987, but was continued to July 28, 1987, by agreement of the parties. On the latter date, a hearing at which Fogel was the sole witness was conducted.
At that hearing, it was established that Fogel had been a stockholder and officer of G & H STEEL SERVICES, INC., one of the Debtors, and of a subsidiary, Con-Tech Service Group, until February, 1986. Also, he is a guarantor and indemnitor of certain corporate obligations, along with other principals of the Debtors and one of the Defendants. A guaranty to Fidelity Bank provides that, if collateral is liquidated, it should be assigned to Fogel. There were and are several business transactions in which Fogel and principals of the Debtor are involved, and Fogel previously received office space and secretarial services for his private law practice from the Debtors.
The Defendants attempted to establish that Fogel had some significant role in the particular operations of the Debtors which are the subject of the lawsuit, but, although Fogel admitted having some knowledge of these operations and related events, and stated that he was "outraged" when he was informed of the Defendants' alleged conduct, the Defendants failed to establish that he was instrumental in these matters.
The hearing was attended by counsel for the Official Unsecured Creditors' Committee, as well as counsel for the Debtors and various counsel for the Defendants. The Committee's counsel supported the continued appointment of Fogel.
Progress on litigation of the underlying Adversary proceeding was halted in this Court by the alleged filing of a Motion to withdraw the reference of this proceeding to the district court by one of the Defendants, which all the other Defendants have joined. Although the Defendants' Brief further advises us that this Motion is pending before the Honorable John P. Fullam, Chief Judge of the District Court, and the Debtors, at the hearing, concurred with this recitation of its status, we note no such Motion on the Docket. Counsel all agreed that, even were the Adversary proceeding removed, we were obliged to resolve this Motion rather than the District Court, because it related directly to the main bankruptcy cases.
At the hearing, the Debtors conceded that Fogel was not a "disinterested person," as defined by 11 U.S.C. § 101(13)(D), as he clearly was, "within two years before the date of the filing of the petition, a director [or] officer . . . of the debtor . . .;" Further, they conceded their failure to totally comply with Bankruptcy Rule 2014, which requires that an application for employment of professional persons must state "all of the person's connections with the debtor, creditors, or any other party in interest, their respective attorneys and accountants." It is clear to us that the fact that Fogel was not a "disinterested person," and the specific reason why he did not enjoy this status, should have been disclosed in the Application.[1]
The operative provisions of the Code are 11 U.S.C. §§ 327(a), (e), which provide as follows:
Section 327. Employment of professional persons.
(a) Except as otherwise provided in this section, the trustee, with the court's approval, may employ one or more attorneys, accountants, appraisers, auctioneers, or other professional persons, that *510 do not hold or represent an interest adverse to the estate, and that are disinterested persons, to represent or assist the trustee in carrying out the trustee's duties under this title.
. . . . .
(e) The trustee, with the court's approval, may employ, for a specified special purpose, other than to represent the trustee in conducting the case, an attorney that has represented the debtor, if in the best interest of the estate, and if such attorney does not represent or hold any interest adverse to the debtor or to the estate with respect to the matter on which such attorney is to be employed. . . .
Our principal concern was whether, interrelating these two subsections of 11 U.S.C. § 327, the requirement of appointment of "disinterested persons" set forth in § 327(a) carried over to § 327(e). We noted that nothing in the language of § 327(e) implies that counsel appointed under that section may be exempted from the requirements of § 327(a), and that the prohibitions of § 327(a) appear to apply "[e]xcept as otherwise provided in this section." If this concern were well-placed, and "special counsel" within the scope of § 327(e) indeed had to be a "disinterested person," Fogel would of course have to be disqualified.
However, no authority supports this reading of § 327(e), and even the Defendants do not so argue. Collier specifically states that "special counsel" "need not be `disinterested,' as is otherwise required by section 327(a), provided that the attorney represents or holds no interest adverse to the debtor or to the estate in the matter upon which the attorney is to be engaged." 2 COLLIER ON BANKRUPTCY, ¶ 327.03[6], at 327-38 (15th ed. 1987). All of the cases that we were able to locate support this interpretation of § 327(e). See In re Leisure Dynamics, Inc., 32 B.R. 753, 755 (D.Minn.1983), aff'd, 33 B.R. 121 (D.Minn. 1983); In re Fondiller, 15 B.R. 890, 892 (9th Cir. BAP 1981); In re Inslaw, Inc., 55 B.R. 502, 504 (Bankr.D.D.C.1985); In re Sally Shops, Inc., 50 B.R. 264, 265-67 (Bankr.E.D.Pa.1985); In re Roberts, 46 B.R. 815, 824 (Bankr.D.Utah 1985); In re Iorizzo, 35 B.R. 465, 468 (Bankr.E.D.N.Y. 1983); and In re Hemstead Realty, Inc., 34 B.R. 624, 626 (Bankr.S.D.N.Y.1983). Therefore, we conclude that our initial concern that special counsel need be "disinterested" was not well-placed, and that Fogel should not be disqualified on that basis.
Rather than relying on § 327(a), the Defendants suggest that Fogel's appointment fails to meet either prong of the following proposed two-pronged test: (1) Retention should be in the best interests of the estate; and (2) Counsel cannot have any interest adverse to the estate. The invocation of this test, while nowhere provided for in § 327(e) or anywhere else in § 327, nevertheless seems logical. Therefore, arguendo, we will assume that these two requirements must be met.
The first prong is alleged by the Defendants to be lacking because of the lack of proof on this point, and on the basis of the holding in In re Bohack Corp., 607 F.2d 258 (2d Cir.1979).
We disagree that the Debtors have failed to present sufficient evidence that Fogel's employment would be in the estate's best interest. The mere fact that the Debtors chose him, and the Creditors' Committee concurred in this choice, is sufficient, in our view, to meet this requirement. It would be absurd to posit that a party wishing to employ counsel must provide affirmative, independent evidence of the efficacy of counsel to be able to hire same. The fact that the Debtors' opponents are pressing this Motion, and thus attempting to get Fogel off the case as opposing counsel, is further testimony to his perceived efficacy in the estate's interests.
The Bohack case persuasively rebuts the Debtors' argument that the Defendants have no standing to raise the instant motion. 607 F.2d at 261-62. However, the facts of that case are enormously diverse from those here. In that case, an action was instituted against certain corporate directors of the debtor to recover damages for alleged mismanagement. Omitted as a *511 defendant was the chairman of the debtor's board of directors. The firm of which appointment as special counsel to litigate the case was sought had previously represented the debtor; its senior partner was himself a board member; and the said senior partner continued to have a close personal and business relationship with the board chairman.
Clearly, these facts put counsel directly in the midst of the very controversy in issue in the lawsuit. Special counsel was a member of and was closely related to the very board of directors whose differences led to the lawsuit, and it appeared, at least to the Court of Appeals, that a party who potentially could have been co-defendant was being shielded by special counsel. Here, there is no allegation that Fogel's appointment is shielding either himself or anyone else from joinder in the lawsuit. The record also lacks sufficient evidence that Fogel was, to any significant degree, a player in the underlying controversy. As the Iorizzo opinion points out, Bohack's result depends on the perceived conflict of interest between counsel and the litigants. 35 B.R. at 468-69. Here, the alleged close relationship of Fogel to the debtors does not raise the spectre of a conflict, but rather suggests that he will be an unusually warm advocate for the Debtors.
Therefore, we conclude that the reasoning of the Bohack case is inapplicable and that the Debtors have established that Fogel's appointment is in the best interests of the estate.
The Defendants claim that the second prong of § 327(e) is not met, in that Fogel allegedly has "interests adverse" to the Debtors on two general grounds: (1) He has potential claims against, and liabilities to, the Debtors; and (2) He may be called as a witness by the Defendants. The latter ground was amplified at argument by a contention that, if the Defendants would in fact call Fogel, he would be disqualified and the Debtor would have the added financial burden of hiring new counsel.
At the outset, we are struck with the hyprocrisy in hearing such "concerns" with the cause of the Debtors coming from the mouths of the Defendants. Obviously, they are not opposing Fogel's retention out of concern for the Debtors, but out of their own concern that Fogel will be formidable adversary.[2]
Regarding the potential financial conflicts between Fogel and the Debtors arising from the guaranty and indemnity agreements between them, a potential claim of one of the Debtors against him for the subscription price of stock, and Fogel's alleged involvement with Con-Tech, which may owe certain amounts to the Debtors, we would make three comments. First, these hypothecized conflicts are highly speculative. There is no evidence that any of these potential claims in any way constitute ripened claims. Secondly, these matters have no connection with the controversy at hand in the Adversary proceeding. And, thirdly, these conflicts, assuming arguendo their existence and significance, would have no perceptable effect except to heighten Fogel's interest in having the Defendants prevail in this action.
In support of their final contention that Fogel's potential status as a witness for the Defendants creates a disqualifying conflict of interest, the Defendants quote Disciplinary Rule (hereinafter referred to as "DR") 5-102, which provides as follows:
DR 5-102. Withdrawal as Counsel When the Lawyer Becomes a Witness
*512 (A) If, after undertaking employment in contemplated or pending litigation, a lawyer learns or it is obvious that he or a lawyer in his firm ought to be called as a witness on behalf of his client, he shall withdraw from the conduct of the trial and his firm, if any, shall not continue representation in the trial, except that he may continue the representation and he or a lawyer in his firm may testify in the circumstances enumerated in DR 5-101(B)(1) through (4).
(B) If, after undertaking employment in contemplated or pending litigation, a lawyer learns or it is obvious that he or his lawyer in his firm may be called as a witness other than on behalf of his client, he may continue the representation until it is apparent that his testimony is or may be prejudicial to his client.
There is no contention that the Debtors intend to call Fogel as a witness. Therefore, the mandate of DR 5-102(A) that a lawyer "shall withdraw" in such a circumstance is inapplicable. By way of contrast, all that is purportedly applicable is DR 5-102(B), which expressly provides that the lawyer "may continue the representation until it is apparent that his testimony is or may be prejudicial to his client." Thus, in this circumstance, representation need not cease until the lawyer's testimony becomes detrimental to his client. All that presents itself here is the Defendants' bald assertion that they may call Fogel as a witness and no indication whatsoever as to how his testimony would adversely affect the Debtors.
It is well-established that DR 5-102(B) "`was not designed to permit a lawyer to call opposing counsel as a witnes and thereby disqualify him as counsel.'" Kroungold v. Triester, 521 F.2d 763, 766 (3d Cir.1975) (quoting a Comment by the Special Committee for the Evaluation of Ethical Standards, which drafted the Disciplinary Rules). Opposing parties have the burden, and we believe it to be a stiff burden, of proving that retention of chosen counsel by the adverse party would violate the Disciplinary Rules. See, e.g., Zions First Nat'l Bank v. United Health Clubs, Inc., 505 F.Supp. 138, 140 (E.D.Pa.1981) (per LUONGO, CH. J.); In re Abbotts Dairies of Pennsylvania, Inc., 61 B.R. 156, 159-60 (Bankr.E.D.Pa.1986) (per GOLDHABER, CH. J.); and Sally Shops, supra, 50 B.R. at 267-68 (per KING, J.). We totally agree with the observation of former Chief Judge Goldhaber of this Court that, to carry the concept of disqualification upon "the appearance of impropriety" to the extent of requiring disqualification whenever a party threatened to call a debtor's counsel as the party's own witness would "severely hamper" administration of estates and "would be unworkable." Abbotts Dairies, supra, 61 B.R. at 159, 160. The appointment here is in distinct contrast to that ultimately disapproved in In re Philadelphia Athletic Club, Inc., 20 B.R. 328 (E.D.Pa.1982), relied upon by the Defendants. There, proposed general counsel for the Trustee had a prior involvement with one of two factions struggling for control of the Debtor, and was disqualified under § 327(a).
We believe that disqualification of Fogel, on the basis of the record here, is clearly not required by DR 5-102(B) or any other disciplinary rule. We again observe that Fogel's involvement with the Debtor creates additional incentives for him to provide vigorous advocacy on their behalf. Certainly, defendants to a lawsuit should not be able to choose or even veto the plaintiffs' choice of counsel in all but the most extraordinary situations. The instant record falls far short of a showing of any such a situation.
We therefore must proceed to deny the Defendants' Motion, and allow Fogel to continue to serve as special counsel in Adversary No. 87-0321S, whether here or in the district court. We do, however, add two comments. First, we do not condone the Debtors' disregarding of Bankruptcy Rule 2014, and repetition of such conduct would warrant sanctions. We admit that this element weighed heavily on our initial impression that § 327(a) did apply here and the Debtors chose to obfuscate this issue by failing to comply therewith. Secondly, the vigor and potential financial interest of Fogel in the outcome may justify a reduction *513 in any subsequent request for compensation from the Debtors' estates on his part. We trust that this factor will be considered by Fogel in any future fee Applications.
An Order consistent with our conclusions expressed herein shall be entered.
NOTES
[1] We also note that the new version of Bankruptcy Rule 2014, in effect on August 1, 1987, requires that the person employed must file an affidavit setting forth all of the "connections" which must be disclosed under the Rule. We are not applying the new version of the Rule to this Motion.
[2] This observation is reminiscent of the statement, quoted by us in In re Fleet, Fleet v. United States Consumer Council, Inc., 76 B.R. 1001, 1010 (Bankr.E.D.Pa.1987), of Judge Davis in Muth v. Dechert, Price & Rhoads, 70 F.R.D. 602, 604 (E.D.Pa.1976), concerning objections by defendants in a class action to a contention that the class plaintiffs' counsel could provide adequate representation to the class:
"as other courts have done, we note that `it is always rather anomalous that the defendants should concern themselves with the adequacy of plaintiff's representation of the class.' Fox v. Prudent Resources Trust, 69 F.R.D. 74, at p. 79 (E.D.Pa.1975); see also, Umbriac v. American Snacks, Inc., 388 F.Supp. 265, 275 E.D.Pa. 1975)." | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1541957/ | 76 B.R. 338 (1987)
In re LONGFELLOW INDUSTRIES, INC., Debtor.
LONGFELLOW INDUSTRIES, INC., Debtor-in-possession and Statutory Committee of Unsecured Creditors, Plaintiffs,
v.
Ira BLUMBERG, Elisa K. Blumberg Stanley Kaufman and Michael A. Farina, Defendants.
Bankruptcy No. 85 B 10451 (TLB), Adv. Proceeding No. 86-5434A.
United States Bankruptcy Court, S.D. New York.
July 31, 1987.
*339 Rosenberg, Rosenberg & Koral, Brooklyn, N.Y. by Louis P. Rosenberg, for debtor-in-possession.
Hahn & Hessen, New York City by David Blejwas, David A. Berger, for Statutory Committee of Unsecured Creditors.
Dominic F. Amorosa, New York City, for Elisa K. Blumberg.
Lawrence F. Ruggiero, New York City, for Michael Farina.
MEMORANDUM DECISION DENYING MOTIONS TO DISMISS THE STATUTORY COMMITTEE OF UNSECURED CREDITORS AS A PARTY-PLAINTIFF
TINA L. BROZMAN, Bankruptcy Judge.
Defendant, Elisa K. Blumberg ("E. Blumberg"), joined by defendant Michael A. Farina ("Farina"), moves to dismiss the statutory committee of unsecured creditors (the "Committee"), an intervening plaintiff, as a party in this adversary proceeding. E. Blumberg contends that the Committee's intervention was improper because a committee lacks standing to institute a lawsuit seeking recovery for the benefit of the estate unless the debtor-in-possession negligently failed or refused to bring the suit.
FACTS
On April 4, 1985 an involuntary petition for relief was filed pursuant to Chapter 11 of the Bankruptcy Code, 11 U.S.C. §§ 1101 et seq., against Longfellow Industries, Inc., (the "Debtor"). Since entry of the order for relief the Debtor had operated as a debtor-in-possession. The Committee was appointed on May 8, 1985.
This adversary proceeding was initiated by the Debtor against Ira Blumberg ("I. Blumberg"), the former controller of the Debtor, on June 4, 1986. The complaint alleged that he has converted at least $750,000 of the Debtor's funds and certain of the Debtor's assets to his own use. He answered, invoking his Fifth Amendment privilege against self-incrimination and alleging that the complaint should be dismissed for lack of subject matter and personal jurisdiction and for failure to state a claim. At a hearing held on January 12, 1987 the court permitted the Committee to intervene. The Committee and the Debtor urged the court to allow the intervention primarily because the Debtor's counsel had insufficient personnel to staff a case of this magnitude and because the Committee was understandably concerned that the litigation be conducted to its satisfaction. I. Blumberg, through his attorney, Dominic F. Amorosa, Esq., (who also now represents E. Blumberg) consented to the intervention. No appeal was taken.
Later investigations uncovered additional facts regarding the alleged conversion. As a result, the Committee moved to amend the original complaint to amplify the facts alleged in the original complaint, to name additional defendants and to set forth alternative legal theories for recovery. Because the original complaint gave I. Blumberg notice of all allegations contained in the amended complaint, and because the new facts came to light only after the filing of the original complaint, we granted the motion. On May 7, 1987, the Debtor and the Committee served a summons and amended complaint, naming E. Blumberg, Stanley Kaufman and Farina as additional defendants.
*340 E. Blumberg filed her answer to the amended complaint on June 5, 1987. It was identical to I. Blumberg's except that it also alleged the statute of limitations as a defense. By motion dated July 6, 1987, she sought an order dismissing the Committee as a party plaintiff in this case. Farina joined in her motion without submitting any papers in support.
DISCUSSION
The defendants urge that we should dismiss the Committee because it is the statutory duty of the trustee or debtor in possession to initiate an adversary proceeding; only in the event the debtor in possession has "unjustifiably failed to bring suit or abused its discretion in not suing . . ." can the committee institute an action for the benefit of the estate. Unsecured Creditors Committee v. Noyes (In re STN Enterprises), 779 F.2d 901, 904 (2d Cir.1985). STN Enterprises is not dispositive of this motion for it concerns the right of a committee to initiate an adversary proceeding which the debtor in possession had, for some reason, not seen fit to commence. What the court there held, in essence, is that the decision of the debtor in possession not to sue is entitled to deference unless that decision is unjustifiable or an abuse of discretion. The reason for that result is that the statutory right to commence such actions is unequivocally reposed in the debtor in possession pursuant to 11 U.S.C. §§ 1106 and 1107. But intervention in an action which the debtor in possession does commence is an entirely different matter. The decision of the repository of the power to sue is in no way compromised or abrogated. Particularly where, as here, the debtor in possession asks that the committee intervene, we would be remiss in extending STN Enterprises to foreclose that intervention.
Resolution of this motion begins with an examination of 11 U.S.C. § 1109(b), which provides that "a party in interest, including . . . a creditors' committee . . . may raise and may appear and be heard on any issue in a case under this chapter."
Two circuits have to date considered whether section 1109(b) permits a creditors' committee to intervene in an adversary proceeding. The Third Circuit held that the right to intervene is absolute, Official Unsecured Creditors' Committee v. Michaels (Matter of Marin Motor Oil, Inc.) 689 F.2d 445 (3rd Cir.1982), cert. denied, 459 U.S. 1206, 103 S.Ct. 1196, 75 L.Ed.2d 440 (1983), the Fifth that the right is permissive only and may be granted only in accordance with the standards of Fed.R. Civ.P. 24, Fuel Oil Supply and Terminaling v. Gulf Oil Corporation, 762 F.2d 1283 (5th Cir.1985).
In Marin, the chapter 11 trustee instituted two adversary proceedings in which the creditors' committee later sought to intervene. The creditors' committee's motion was based almost entirely on the theory that section 1109 provided them "an absolute right to intervene regardless of the Trustee's performance." 689 F.2d at 447. The trustee and the debtor opposed the motion, arguing that the committee has an absolute right to intervene in a chapter 11 case, but not in an adversary proceeding. The court carefully analyzed (i) the definition of adversary proceeding as set forth in former Bankruptcy Rule 701, (ii) section 206 of Chapter X (the predecessor to section 1109(b)), and (iii) the legislative history to section 1109(b). The court agreed with the committee, noting that section 1109(b) allows a committee to be heard "on any issue in a case" and not, simply, in a case.
The court did not ignore the theoretical problem that might result from such a broad and absolute reading of section 1109, specifically, that many creditors and stockholders might seek to invoke their right to intervene. But the court concluded that as a practical matter "relatively few individuals would have enough interest in the outcome of an adversary proceeding to seek to intervene." Id. at 453. The court noted that even in the event that difficulties did arise from such intervention, the Federal Rules of Civil Procedure and of Bankruptcy Procedure provide the means to handle them.
In Fuel Oil, the creditors' committee filed a motion to intervene as of right in an adversary proceeding pursuant to Fed.R. *341 Civ.P. 24(a).[1] The committee contended that 11 U.S.C. § 1109(b) "is `a statute confer[ring] an unconditional right to intervene' within the meaning of rule 24(a)(1), Fed.R.Civ.P. 762 F.2d at 1284. The Fifth Circuit observed that the legislative history and the Bankruptcy Code alone seem to create an absolute right to intervene in an adversary proceeding but found that "when § 1109(b) is juxtaposed with the procedural rules" this interpretation "loses much of its force." Id. at 1286. The court's conclusion was based on the unwillingness of judges to read Rule 24(a) broadly and on the distinction which Congress drew in Title 28 of the United States Code between bankruptcy cases and the proceedings relating to them.
Thus, the court concluded that Congress did not intend by section 1109(b) to create an absolute right for a creditors' committee to intervene in an adversary proceeding but intended courts to apply Rule 24(a)(2) and (b) and consider whether intervention is proper. The court reasoned that if a tribunal scrutinizes a request to intervene, all of Congress' concerns will be adequately dealt with. The liberal right to be heard will remain intact, while in circumstances where the would-be intervenor's interest is already being adequately protected or is inconsistent with the proceeding, the court is at liberty to deny intervention.
Fuel Oil was criticized by two respected commentators who reasoned that the clear language of section 1109(b), which grants a substantive right, should not have been read by the Fifth Circuit to be modified or limited by procedural rules. See 28 U.S.C. §§ 2072 and 2075. Gross & DeNatale, The Right of the Creditors' Committee to be Heard Under § 1109(b): an Update, Norton Bankruptcy Law Adviser, p. 5 (November, 1985).
Although we believe the Marin approach to be the preferable one,[2] it matters little here, because the intervention is appropriate under both standards. Obviously, under Marin, the intervention was proper. In Kenan v. Federal Deposit Insurance Corp. (In re George Rodman, Inc.), 33 B.R. 348 (Bankr.W.D.Okl.1983) the creditors' committee moved to intervene in an adversary proceeding instituted by the trustee to avoid transfers under section 547 of the Bankruptcy Code. Although that case was decided after Marin and before Fuel Oil, the court held that there was no absolute right to intervene, and then considered whether the committee had a permissive right to intervene pursuant to Fed. R.Civ.P. 24(b). The court found that Congress intended this subsection to be discretionary, with the primary consideration being "whether the intervention will unduly delay or prejudice the adjudication of the rights of the original parties." 33 B.R. at 350, quoting C. Wright and A. Miller, Federal Practice and Procedure, § 1913 at 552. The intervention was allowed because the trial would not be delayed, the committee would not raise any new issues, the trustee supported the intervention and there would be no prejudice to the defendant. Moreover, the court found the "most compelling argument [to be] the trustee's statement requesting assistance of the committee." 33 B.R. at 350.
The facts of that case are similar to this. The Debtor instituted its adversary proceeding and afterwards realized that it needed assistance in prosecuting the suit. Together with the Committee, the Debtor requested that the Committee be permitted to intervene. From entry of the order in *342 January until now, the Committee has participated fully in the litigation. The intervention raised no new issues and has not unduly delayed or prejudiced the adjudication of the proceeding. On the other hand, vacating the order permitting the intervention may well impair the interests of the Committee. The Debtor has expressed the need for assistance in order to adequately and sufficiently prosecute this suit. Without the Committee's participation, the Debtor may not recover for its creditors everything to which it may be entitled. The defendants have not articulated any cognizable prejudice which may befall them if the intervention order stands. Accordingly we find that the intervention was proper and we deny the motions to dismiss the Committee as a party-plaintiff.
IT IS SO ORDERED.
NOTES
[1] Fed.R.Civ.P. 24(a) provides:
(a) Intervention of Right. Upon timely application anyone shall be permitted to intervene in an action: (1) when a statute of the United States confers an unconditional right to intervene; or (2) when the applicant claims an interest relating to the property or transaction which is the subject of the action and the applicant is so situated that the disposition of the action may as a practical matter impair or impede the applicant's ability to protect that interest, unless the applicant's interest is adequately represented by existing parties.
The rule is applicable to adversary proceedings by virtue of Fed.R.Bankr.P. 7024.
[2] See In re Overmyer, 30 B.R. 123, 125 (Bankr.S. D.N.Y.1983) (citing Marin with approval); A.H. Robins Co., Inc. v. Piccinin, 788 F.2d 994, 1015 (4th Cir.1986) cert. denied, ___ U.S. ___, 107 S.Ct. 251, 93 L.Ed.2d 177 (1986) (citing Marin with approval). | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1832473/ | 753 So.2d 349 (2000)
GAYLORD CHEMICAL CORPORATION
v.
PROPUMP, INC., Ingersoll-Rand Company, Dresser Industries, Inc., and Ingersoll-Dresser Pumps.
No. 98 CA 2367.
Court of Appeal of Louisiana, First Circuit.
February 18, 2000.
*351 Craig J. Robichaux, Paul J. Mayronne, Talley, Anthony, Hughes & Knight, L.L.C., Mandeville, for Plaintiff/Appellant Gaylord Chemical Corporation.
Paul L. Peyronnin, Owen B. St. Amant, Phelps Dunbar, L.L.P., New Orleans, for Defendants/Cross-Plaintiffs/Appellants Ingersoll-Rand Company, Dresser Industries, Inc., and Ingersoll-Dresser Pumps.
Paul H.F. Baker, Lafayette, for Defendant/Cross-Defendant/Appellee Commercial Union Ins. Co.
Before: LeBLANC, PARRO, and KUHN, JJ.
PARRO, J.
This is an appeal from the trial court's granting of a motion for summary judgment in favor of Commercial Union Insurance Company, finding it did not provide coverage under its commercial general liability policy for the claims made against its insured, ProPump, Inc. We reverse and remand.
FACTUAL AND PROCEDURAL BACKGROUND
The facts underlying this claim, as alleged in the petition and amending petition, are as follows. On January 30, 1992, Gaylord Chemical Corporation (Gaylord) took delivery of an Ingersoll-Rand pump purchased from ProPump, Inc. (ProPump). The pump was manufactured by Ingersoll-Rand Company, which allegedly was associated with Dresser Industries, Inc. in a joint venture partnership, Ingersoll-Dresser Pumps, for the manufacture of such pumps. At the time of the sale, ProPump had a comprehensive general liability policy issued by Commercial Union Insurance Company (Commercial Union). The pump allegedly did not perform to Gaylord's expectations, and on January 28, 1993, Gaylord filed this lawsuit. The suit named ProPump as a defendant, as well as Ingersoll-Rand Company, Dresser Industries, Inc., and Ingersoll-Dresser Pumps (collectively, Ingersoll). A supplemental and amending petition named Commercial Union as an additional defendant.[1]
Gaylord's suit claimed ProPump and Ingersoll represented to Gaylord that the pump would perform according to certain stated specifications and design capacities; however, it failed to perform according to those specifications and achieved only 66% of the represented design capacity under acceptable operating conditions. Gaylord alleged the declaration of the defendants concerning the design capacity and performance of the pump was the principal motive for Gaylord's purchase, and the pump's failure to perform to specifications rendered its use so inconvenient and imperfect that Gaylord would not have purchased it, had it known of this vice. Gaylord sought rescission of the sale, refund of the entire purchase price, lost profits and *352 additional expenses incurred due to the failure of the pump to perform as represented,[2] attorney fees, and costs.
Ingersoll filed a cross-claim against Commercial Union, alleging ProPump had a duty to inform Ingersoll of the exact uses to which Gaylord intended to put the pump, and ProPump's failure to communicate such information to Ingersoll was a breach of that duty. Ingersoll claimed that, should it be determined that Gaylord had a valid claim against Ingersoll, Commercial Union would be obligated to indemnify Ingersoll under the terms of the policy issued to ProPump. Commercial Union moved for summary judgment, admitting it provided a comprehensive general liability insurance policy to ProPump for the time period in question, but claiming its policy did not provide coverage to ProPump for Gaylord's redhibition claims and Gaylord's and Ingersoll's claims of negligent misrepresentation or breach of contract. After a hearing on the motion, the trial court granted the motion and dismissed all claims against Commercial Union. The court certified the judgment as final[3] and this appeal followed.
APPLICABLE LAW
Summary judgment shall be rendered if there is no genuine issue as to material fact and the mover is entitled to judgment as a matter of law. LSA-C.C.P. art. 966(B). A summary judgment may be rendered on the issue of insurance coverage alone, although there is a genuine issue as to liability or the amount of damages.[4]See LSA-C.C.P. art. 966(E); Bilbo for Basnaw v. Shelter Ins. Co., 96-1476 (La.App. 1st Cir.7/30/97), 698 So.2d 691, 694, writ denied, 97-2198 (La.11/21/97), 703 So.2d 1312. Summary judgment declaring a lack of coverage under an insurance policy may not be rendered unless there is no reasonable interpretation of the policy, when applied to the undisputed material facts shown by the evidence supporting the motion, under which coverage could be afforded. Reynolds v. Select Properties, Ltd., 93-1480 (La.4/11/94), 634 So.2d 1180, 1183. The burden of proof on a motion for summary judgment is on the movant. LSA-C.C.P. art. 966(C)(2). An insurer seeking to avoid coverage through summary judgment must prove that some exclusion applies to preclude coverage. Jackson v. Frisard, 96-0547 (La.App. 1st Cir.12/20/96), 685 So.2d 622, 629, writs denied, 97-0193 and 97-0201 (La.3/14/97), 689 So.2d 1386 and 1387.
An insurance policy is an agreement between parties and should be interpreted using ordinary contract principles. Ledbetter v. Concord Gen. Corp., 95-0809 (La.1/6/96), 665 So.2d 1166, 1169, rehearing denied, amended on other grounds, 95-0809 (La.4/18/96), 671 So.2d 915. If the language in an insurance contract is clear and unambiguous, the agreement must be enforced as written. LSA-C.C. art.2046; Dunn v. Potomac Ins. Co. of Illinois, 94-2202 (La.App. 1st Cir.6/23/95), 657 So.2d 660, 663. The court should not strain to find ambiguity where none exists. Strickland v. State Farm Ins. Cos., 607 So.2d 769, 772 (La.App. 1st Cir.1992). However, if there is any doubt or ambiguity as to the *353 meaning of a provision in an insurance policy, it must be construed in favor of the insured and against the insurer. See LSA-C.C. art. 2056. When the ambiguity relates to an exclusionary clause, the law requires that the contract be interpreted liberally in favor of coverage. Borden, Inc. v. Howard Trucking Co., Inc., 454 So.2d 1081, 1090 (La.1983); Ledbetter, 665 So.2d at 1169. Whether a contract is ambiguous is a question of law. Strickland, 607 So.2d at 772.
POLICY INTERPRETATION ISSUES
Gaylord concedes that its purely redhibition claims are not covered by the policy.[5] In fact, at oral argument, Gaylord acknowledged that it no longer seeks rescission of the sale, because it augmented the Ingersoll pump with another pump and currently needs both pumps in its operation. Therefore, Gaylord's claims are limited to the other losses it incurred. Because ProPump represented that the pump would conform to Gaylord's specifications and would meet its performance needs, Gaylord characterizes its claims as negligent misrepresentation, breach of contract, and breach of warranty. In its crossclaim, Ingersoll alleges ProPump failed to provide complete and accurate information to Ingersoll concerning the intended use of the pump, thereby stating a negligent misrepresentation claim. Obviously, because Ingersoll did not purchase anything from ProPump, its claims against ProPump are not based on redhibition or failure to provide a workman-like product. Ingersoll claims Commercial Union should indemnify it for any damages it may have to pay Gaylord as a result of the incorrect information provided to it by ProPump, because as a result of that misinformation, it sold a pump that purportedly did not meet Gaylord's specifications and caused damage to Gaylord.
The Commercial Union policy states it provides ProPump with coverage for property damage liability if caused by an "occurrence" during the policy period. According to the policy, "property damage" means:
a. Physical injury to tangible property, including all resulting loss of use of that property. All such loss of use shall be deemed to occur at the time of the physical injury that caused it; or
b. Loss of use of tangible property that is not physically injured. All such loss shall be deemed to occur at the time of the "occurrence" that caused it.
There is no real dispute that Gaylord suffered various types of property damage as a result of the less-than-adequate performance of the pump. The parties also do not dispute that the incident giving rise to the claims, as well as Gaylord's losses, occurred during the policy period.
However, the claims against Commercial Union as ProPump's insurer must allege property damage arising out of an "occurrence" for coverage to attach. "Occurrence" is defined in the policy as "an accident, including continuous or repeated exposure to substantially the same general harmful conditions." The parties dispute whether Gaylord's property damage was caused by an "occurrence."
Commercial Union argues that the pure failure to meet a contractual obligation to provide a workman-like product to a customer is not an "occurrence," citing Aetna Ins. Co. v. Grady White Boats, Inc., 432 So.2d 1082 (La.App. 3rd Cir.1983). However, the court in that case did not deal with the issue of what constitutes an "occurrence," *354 but found that damage to the product itself was the only claim and such damage was unambiguously excluded under the policy at issue. Similarly, if the only losses claimed in this case were for damage to the pump or for the repair or replacement of that defective unit, coverage would be excluded under the "work" or "product" exclusions.[6] However, Gaylord has claimed other losses, such as those for damage to its physical plant and loss of use of some of its other equipment.
Further, despite Commercial Union's argument that failure to provide a workmanlike product is not an "occurrence," we note that the claims in this case involve something other than and in addition to a failure to provide a workman-like product. The product in this case was not defective; it worked in accordance with its design and capacity, even though that design and capacity did not meet Gaylord's requirements. The claimed damages in this case are allegedly the result of ProPump's negligence in communicating information concerning its customer's needs and its product's ability to meet those needs. At least one Louisiana court has held that claims of negligent misrepresentation may constitute an "occurrence" for the purpose of triggering the duty to defend. Colomb v. United States Fidelity & Guar. Co., 539 So.2d 940 (La.App. 4th Cir.1989).
A leading authority on insurance contracts suggests that when, as in this policy, the word "occurrence" is defined as an "accident," whether there has been an occurrence depends upon whether there has been an accident, not upon the legal cause or consequence of that accident. See William Shelby McKenzie and H. Alston Johnson III, Louisiana Civil Law Treatise: Insurance Law and Practice 370 (1996). Accident is defined from the viewpoint of the victim; losses that were unforeseen and unexpected by the victim are the result of an accident. Id. at 373; see also Nelson v. Want Ads of Shreveport, Inc., 31,168 (La.App. 2nd Cir.10/30/98), 720 So.2d 1280, 1282-83; Korossy v. Sunrise Homes, Inc., 94-473 (La.App. 5th Cir.3/15/95), 653 So.2d 1215, 1223-24, writs denied, 95-1522 and 95-1536 (La.9/29/95), 660 So.2d 878. We conclude that the occurrence of an unforeseen and unexpected loss, whether the result of a defective product or an insured's negligent communication of misleading, incomplete, or incorrect information during the policy period, constitutes an "accident," and thus, an "occurrence," as that term is defined in the policy at issue in this case.[7]
Our inquiry does not end at this point. We must examine the policy to determine whether other provisions limit or exclude coverage for the type of claims alleged by Gaylord and Ingersoll. As previously noted, losses based on damage to the pump itself are excluded from coverage by either the "work" or "product" exclusions. However, Gaylord contends the policy covers its claims for damages to its other property under the "products-completed operations hazard" coverage, which is defined as follows:
"Products-completed operations hazard" includes all ... "property damage" occurring away from premises you [ProPump] own or rent and arising out of "your product" or "your work" except:
(1) Products that are still in your physical possession; or
*355 (2) Work that has not yet been completed or abandoned.
This type of coverage is described by the above-referenced authority on insurance contracts as follows:
Any insured who manufactured, sold, handled or distributed goods or products was exposed to the products hazard, which is risk of liability arising out of products after they have left the hands of the insured. The completed operations hazard refers to the insured's exposure to liability arising out of completed work performed away from his premises.
McKenzie & Johnson, supra, at 379. In its brief to this court, Commercial Union acknowledges that the purpose of this provision is to afford coverage for "property damage" to property other than to the insured's work or product itself.
The damages claimed in this case occurred on Gaylord's premises, not ProPump's, and allegedly arose out of ProPump's completed work or product, including both the inadequate pump and the inaccurate representations made to Gaylord and Ingersoll. Some of these claims are for damages to property other than the insured's work or product itself. Therefore, the claims in this case meet the definition for property damage covered under the products-completed operations hazard.
However, the cited authority adds a caveat, stating that "[i]n policies providing coverage for the products and completed operations hazards, there are exclusions which temper this coverage." McKenzie & Johnson, supra, at 380. Commercial Union claims the "work" and "product" exclusions, as well as the "impaired property" exclusion, preclude coverage for the type of claims asserted in this case.[8]
We note first that the "impaired property" exclusion only excludes damage to property that has not been physically injured or for which the claimed damages are only for loss of use of that property. Therefore, any damages based on actual physical injury to Gaylord's plant, equipment, or other property would not be excluded under this provision.
With reference to the "work" and "product" exclusions, as previously noted, the damages claimed in this case go beyond damage to the pump itself. Commercial Union cites several Louisiana cases for the proposition that not only the damage to the work or product of the insured is excluded by similar policies, but also any consequential damages directly resulting from the allegedly defective workmanship. See Swarts, 610 So.2d at 890-91; Old River Terminal Co-op v. Davco Corp. of Tennessee, 431 So.2d 1068, 1071 (La.App. 1st Cir.1983); Breaux v. St. Paul Fire Marine Ins. Co., 345 So.2d 204, 207-08 (La.App. 3rd Cir.1977). However, each of these cases involved purely redhibition claims, in which the only consequential damages were those directly resulting from defects in the insured's "work" or "product" itself, such as damages for inconvenience, engineering fees, and repair *356 costs. In each of these cases, the courts also recognized that damages to other property would not be excluded by the "work" and "product" exclusions. See Swarts, 610 So.2d at 891 n. 2; Old River, 431 So.2d at 1071; Breaux, 345 So.2d at 205. The cases cited by Commercial Union do not support its arguments that the policy exclusions unambiguously eliminate all coverage in this case.
We are further influenced by Gaylord's argument that if the policy exclusions are enforced in the manner suggested by Commercial Union, the products-completed operations hazard protection would be virtually worthless for ProPump's business, despite its payment of a premium of almost $5000 per year for this coverage. A similar situation was addressed by the Fourth Circuit, which observed:
[I]f we were to adopt [the insurer's] argument we would, in effect, be negating the "Completed Operations" coverage which [the insured] apparently sought and paid for. It would be illogical, and perhaps against public policy, to provide a specific coverage, collect a premium, then by way of endorsement, totally exclude that coverage.
Orleans Parish School Bd. v. Scheyd, Inc., 95-2653 (La.App. 4th Cir.4/24/96), 673 So.2d 274, 279. The court there determined it could not say the policy provisions unambiguously precluded coverage; therefore summary judgment was inappropriate.
In Mike Hooks, Inc. v. JACO Services, Inc., 95-1485 (La.App. 3rd Cir.5/8/96), 674 So.2d 1125, writ denied, 96-1924 (La.11/1/96), 681 So.2d 1264, a contractor's insurer moved for summary judgment on the grounds that its policy's work product exclusion precluded coverage for the claims brought against its insured. The work product of the insured consisted of installing ten main bearings in the engine of a dredge, and the plaintiff alleged the insured had not performed the work properly, causing monetary losses and other damages. The court noted that the only explanation concerning what was covered under the products-completed operations hazard provision was in the definitions section of the policy, and stated, "We are unable to find an unambiguous provision in this policy addressing what the products-completed operations coverage, as found on the declarations page, encompasses." Mike Hooks, 674 So.2d at 1127-28. Concluding the insurer had failed to meet its burden of proving an unambiguous coverage exclusion, the court reversed the lower court's summary judgment.[9]
In reaching its conclusion that summary judgment was not appropriate in the Mike Hooks case, the Third Circuit relied on this court's observations concerning identical policy provisions in Kidd v. Logan M. Killen, Inc., 93-1322 (La.App. 1st Cir.5/20/94), 640 So.2d 616, superseded by statute on other grounds.[10] This court noted in the Kidd case:
While the language in the policy contains numerous provisions regarding the coverage, exclusions, and exceptions to the exclusions and may suggest that the damages sustained by the [plaintiffs] fall under the "products-completed operations" coverage of the policy, there are no provisions in the policy regarding this coverage, other than that contained in the definitions section of the policy.
*357 Kidd, 640 So.2d at 622. This court concluded summary judgment was not appropriate, and remanded the case to the trial court for further proceedings. The Commercial Union policy issued to ProPump in this case is similar in that respect to the policies in the Mike Hooks and Kidd cases.
In the case we are currently reviewing, we note that the trial court observed in oral reasons for judgment:
It's been my experience that this particular type of policy is not designed to cover this particular type of claim. I would grant the motion for summary judgment by [Commercial Union]. That will give us time to get it up to the Court of Appeal and have the case sorted out and give us some clear guidance.
It is obvious from this comment that the trial court felt "some clear guidance" was necessary concerning the policy provisions. If those provisions were not ambiguous, no guidance from this court would be needed.
Our review of this policy, the applicable jurisprudence, the comments of the trial court, and the opinions of noted authorities convinces us that Commercial Union's policy exclusions are ambiguous when construed with the products-completed operations hazard coverage and applied to the type of claims asserted in this case. Additionally, we conclude that some of the damages claimed by Gaylord, particularly losses due to physical injury to its other equipment and property, are not unambiguously excluded by the Commercial Union policy. Accordingly, we find that Commercial Union did not meet its burden of proof on its motion for summary judgment, alleging its policy did not cover any of the losses claimed by Gaylord. Also, because there may be coverage under the policy for some of the damages allegedly caused by ProPump's negligent communication of information to Ingersoll concerning Gaylord's needs, summary judgment on Ingersoll's claims was also inappropriate.
CONCLUSION
Based on the foregoing, we reverse the judgment of the trial court in favor of Commercial Union, and remand this matter for further proceedings. All costs of this appeal are assessed to Commercial Union.
REVERSED AND REMANDED.
NOTES
[1] Although the record is not clear concerning the status of ProPump, briefs to the trial court and this court represent that it ceased doing business some time during 1993.
[2] The precise nature of these additional expenses is not alleged. However, in oral argument, Gaylord mentioned loss of use of the pump and related equipment, damage to piping and other plant components due to the pump's excessive vibration, lost sales of its product during repair efforts, and the costs of those repair efforts.
[3] See LSA-C.C.P. art. 1915.
[4] Before 1997, Louisiana Code of Civil Procedure article 966(F) specifically listed the insurance coverage issue as one which was appropriate for a partial summary judgment. Act 483 of the 1997 legislative session repealed paragraph (F) and incorporated its principle in the more general provisions of amended and reenacted paragraph (E), which now states summary judgment may be rendered disposing of a particular issue or defense in favor of one or more parties, although its granting does not dispose of the entire case. See 1997 La. Acts, No. 483, § 1, eff. July 1, 1997.
[5] There is consistent jurisprudence interpreting similar commercial general liability policies, holding that these unambiguously exclude coverage for damage to the work or product itself or for repair or replacement of the insured's defective work or product. This is based on the principle that general liability policies are not intended to serve as performance bonds. See Swarts v. Woodlawn, Inc., 610 So.2d 888, 890-91 (La.App. 1st Cir.1992), and cases cited therein.
[6] The policy excludes coverage for:
k. "Property damage" to "your product" arising out of it or any part of it.
l. "Property damage" to "your work" arising out of it or any part of it and included in the "products-completed operations hazard."
[7] Although we have found an "occurrence" in this case, we note that this court, in Superior Steel, Inc. v. Bituminous Cas. Corp., 415 So.2d 354 (La.App. 1st Cir.1982), indicated that regardless of the insurance company's "occurrence" argument, coverage existed under the "completed operations hazard" and "products hazard" provisions of the policy in question, and the only remaining issues were whether any policy exclusions absolved the insurance company of liability in the case.
[8] The "impaired property" exclusion excludes coverage for:
"Property damage" to "impaired property" or property that has not been physically injured, arising out of:
(1) A defect, deficiency, inadequacy or dangerous condition in "your product" or "your work"; or
(2) A delay or failure by you or anyone acting on your behalf to perform a contract or agreement in accordance with its terms.
* * * * * *
"Impaired property" means tangible property, other than "your product" or "your work", that cannot be used or is less useful because:
a. It incorporates "your product" or "your work" that is known or thought to be defective, deficient, inadequate or dangerous; or
b. You have failed to fulfill the terms of a contract or agreement;
if such property can be restored to use by:
a. The repair, replacement, adjustment or removal of "your product" or "your work"; or
b. Your fulfilling the terms of the contract or agreement.
[9] Criticizing this decision, the above-cited commentator suggests the court "failed to recognize that the insurer covered risks unrelated to repair or replacement of the insured's work, such as claims for injury to persons and other property that commonly are asserted to arise out of defective work or products." McKenzie & Johnson, supra, at 51 (1999 Pocket Part)(emphasis added).
[10] Certain statements concerning summary judgments in the Kidd decision were superseded by the amendments to Article 966 of the Louisiana Code of Civil Procedure, which stated summary judgment is now favored. However, the substantive principles concerning the interpretation of insurance policies have not been superseded. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/2008054/ | 244 B.R. 353 (2000)
In re Teddie J. SNODGRASS, Delores S. Snodgrass, Debtors.
Teddie J. Snodgrass, Plaintiff,
v.
Department of Veterans Affairs, Defendant.
Bankruptcy No. 7-97-04225-RKA-7.
United States Bankruptcy Court, W.D. Virginia, Abingdon Division.
January 19, 2000.
*354 John J. Gifford, Browning & Lamie, Abingdon, VA, for debtor.
S. Randall Ramseyer, Assistant U.S. Attorney, Abingdon, VA, for defendant.
DECISION AND ORDER
ROSS W. KRUMM, Chief Judge.
The matter before the Court arises as a result of a motion for summary judgment filed by the Department of Veterans Affairs (herein the VA). The issue to be determined in the complaint proceeding is whether the recoupment by the VA of a special separation benefit (herein SSB) by deduction of disability compensation to which Teddie J. Snodgrass (herein Snodgrass) is entitled is a claim by the VA against Snodgrass which was discharged in his no asset Chapter 7. Snodgrass also seeks to recover from the VA its recoupment of the SSB within 90 days of the date of the filing of his petition for relief on the ground on the ground that it is a voidable preference under 11 U.S.C. § 547(b). For the reasons stated in this Decision and Order, the Court grants the VA's motion for summary judgment.
FACTS:
By stipulation of facts filed on April 14, 1999, all of the material facts necessary for a decision on the motion for summary judgment are before the court. The undisputed facts are: (1) Prior to August 26, 1996, Snodgrass was separated from the military and received a special separation benefit in the amount of $40,583.27; (2) On August 26, 1996, Snodgrass was granted service connected disability compensation by the VA, said compensation to be effective February 1, 1996, in the amount of $596.00 per month (herein referred to as the VA benefit); (3) The VA notified Snodgrass that it would recoup the SSB previously paid to Snodgrass from the VA benefits; (4) Snodgrass filed his chapter 7 proceeding on October 29, 1997, and listed the VA as an unsecured creditor with a claim in the amount of the SSB ($40,583.00); (5) The VA paid no benefits to Snodgrass for the months of July, August, September or October 1997, which benefits total $2,240.00 (the prepetition recoupment). (6) The VA did not make any VA benefit payments to Snodgrass after the filing of his chapter 7.
LAW AND DISCUSSION:
In support of its motion for summary judgment, the VA relies on 10 U.S.C. § 1174(h)(2). In relevant part, the statute states:
[A] member who has received separation pay under this section or severance pay or readjustment pay under any other provision of law, based on service in the Armed Forces, shall not be deprived by reason of his receipt of such separation pay, severance pay, or readjustment pay, of any disability compensation to which he is entitled under the laws administered by the Department of Veterans Affairs, but there shall be deducted from that disability compensation an amount equal to the total amount of separation pay, severance pay, and readjustment pay received. . . .
Snodgrass submitted authority which he argues supports his position that the V.A. had a claim against him in the amount of the SSB as of the date of the filing of his petition for relief.[1] Snodgrass relies on In re Burson, 107 B.R. 285 (Bankr.S.D.Cal. 1989); but, that reliance is misplaced. *355 Burson involved a re-enlistment bonus received by the debtor. The re-enlistment bonus was subject to the terms of an agreement between the debtor and the Marine Corps which required repayment of the re-enlistment bonus under certain conditions.
In the case at bar, there is no agreement between the VA and Snodgrass for the repayment of the SSB. Further, all parties agree that Snodgrass cannot be sued by the VA for recovery of the SSB. Therefore, no matter how broadly you read 11 U.S.C. § 101(5)(A), the VA has no claim against Snodgrass.
The VA sites In re Boyd, 223 B.R. 536 (Bankr.D.Ark.1998) as authority for the proposition that it is entitled to recoup under 10 U.S.C. § 1174(h)(2) and that recoupment is not a violation of the discharge injunction of 11 U.S.C. § 524 because there is no debt to discharge under 11 U.S.C. § 727. The facts of Boyd are substantially similar, if not identical, to the facts in the case at bar. The analysis in Boyd of the law is applicable to the case at bar. In granting the motion for summary judgment in favor of the VA, this court adopts the reasoning and holding in Boyd.
CONCLUSION:
For the reasons stated in this Decision and Order, this Court holds that the VA is entitled to recoup the special separation benefit paid to Snodgrass from the disability compensation awarded to Snodgrass from the VA, that there is no debt of Snodgrass to VA to have been discharged under 11 U.S.C. § 727 in his no asset case, that the VA's recoupment pre-petition does not constitute a voidable preference under 11 U.S.C. § 547, and that its post-petition recoupment does not constitute a violation of the discharge injunction imposed by 11 U.S.C. § 524. Based on the foregoing, it is
ORDERED:
That the motion for summary judgment of the Department of Veteran Affairs is GRANTED and this complaint proceeding is DISMISSED.
NOTES
[1] Snodgrass points to the definition of claim found in 11 U.S.C. § 101(5)(A) "claim" means (A) right to payment, whether or not such right is reduced to judgment, liquidated, unliquidated, fixed, contingent, matured, unmatured, disputed, undisputed, legal, equitable, secured, or unsecured. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1851808/ | 239 Miss. 644 (1960)
124 So. 2d 849
HARTFORD ACCIDENT & INDEMNITY COMPANY
v.
LOCKARD
No. 41564.
Supreme Court of Mississippi.
December 5, 1960.
P.D. Greaves, Gulfport, for appellant.
*645 Merle F. Palmer, Pascagoula, for appellee.
*646 KYLE, J.
The appellee, Jacob T. Lockard, instituted this suit in the Chancery Court of Jackson County against the appellant, Hartford Accident and Indemnity Company, seeking to recover sums of money which the appellee *647 had become legally obligated to pay to third persons as damages because of bodily injuries and property damage caused by accident and arising out of the ownership and use by the appellee of a motor vehicle, for which coverage was claimed under an automobile liability policy issued by the appellant; and from a decree overruling a demurrer to the bill of complaint and awarding to the appellee a money judgment the appellant has prosecuted this appeal.
The bill of complaint in this case was filed by the said Jacob T. Lockard, complainant, against the said Hartford Accident and Indemnity Company, defendant, on January 26, 1959. In his bill the complainant alleged that on May 28, 1956, he was the owner of a 1953 Ford F-600 truck, which was being driven by Roosevelt Tanner, an employee of the complainant, north on Highway 59, about one mile south of Vancleave, Mississippi, and was pulling a bobtail log trailer owned by the complainant, when said trailer came loose and ran into a 1952 two-ton Chevrolet truck which was owned and was being driven by Gaston Fairley, who had a passenger, Manson Littlefield, with him in the truck; that the loose trailer struck the truck of Gaston Fairley and damaged same, and that Fairley and Littlefield sustained personal injuries as a result of the collision.
The complainant further alleged that at the time of the accident he carried liability insurance with the defendant, Hartford Accident and Indemnity Company, on said 1953 Ford truck, under Policy No. 20K 117229, issued by the said defendant; that the complainant immediately gave notice of said accident to Moran's Insurance Agency at Ocean Springs, Mississippi, who was the general agent of the defendant herein; and complainant was assured by Moran's Insurance Agency that he was fully covered under the policy and the defendant would take over the investigation and defense of any claims against the complainant as a result of said accident; that the defendant proceeded to investigate the *648 accident, and had the truck of Gaston Fairley taken to a garage in Biloxi, Mississippi, for repairs; that in the meantime the said Gaston Fairley and Manson Littlefield employed an attorney to represent them in actions against the complainant for personal injuries and property damage arising out of said accident; that the said attorney notified the complainant in writing of his representation of Fairley and Littlefield in the matter; that the complainant forwarded said letter to the defendant; and that on July 3, 1956, C.B. Corban, a duly authorized representative of the defendant, wrote the attorney for said Fairley and Littlefield a letter in which the defendant's representative stated: "We carry Mr. Lockard's insurance and your letter was forwarded on for my attention. I will be in touch with you within the next few days to discuss this matter with you." The complainant further alleged that the said C.B. Corbin contacted both Fairley and Littlefield and assured them that the matter would be settled by the defendant, and the complainant, acting under the assurance that he was fully covered, made no effort to investigate the claims of the said Fairley and Littlefield or negotiate a settlement of said claims. The complainant further alleged that the complainant had no notice from the defendant that he was not fully covered under the liability policy, until September 26, 1956, when the complainant received a letter from Moran's Insurance Agency enclosing a letter which the defendant had written to Moran's Insurance Agency, dated September 24, 1956, in which the defendant denied coverage under said policy. Copies of said letters were attached as exhibits to the bill of complaint and made a part thereof.
The complainant further alleged that a few days after the complainant received the above mentioned letter dated September 24, 1956, in which the defendant denied coverage under said policy, Gaston Fairley and Manson Littlefield filed suits in the Circuit Court of Jackson County against the complainant for personal injuries *649 and property damage, and process was served on the complainant in each of said cases on October 5, 1956, returnable to the November 1956 term of said court; that both suits came within the protection of the policy of insurance issued to the complainant by the defendant, and that it was the duty of the defendant to defend the complainant in both cases or make settlement of same; that notwithstanding such duty to defend said suits, after leaving the complainant in a position of false security for a period of almost four months, the defendant advised the complainant that, although the defendant had the insurance coverage on the truck, there was no coverage on the trailer, and since the trailer had caused the damage and injuries complained of the defendant owed the complainant no duty to settle or defend said suits. The complainant further alleged that the amount demanded by Fairley in the declaration filed by him was $13,609 and the amount demanded by Littlefield in his suit was $15,248.70; that as a result of the defendant's refusal to defend said suits, the complainant was forced to employe an attorney to defend said suits, and that he employed an attorney at Pascagoula to defend said suits and paid him a fee of $500 for his services; that because of the serious injuries involved in the suits filed against the complainant and the prejudicial position in which he had been placed as a result of the defendant's action in failing to notify the complainant promptly that there was no coverage on the trailer and the defendant would not defend said suits, the complainant was compelled to settle the two cases by paying to Fairley the sum of $1,617.50 and to Littlefield the sum of $2,208.70.
The complainant further alleged that "at the time the insurance policy here in question was issued he was assured and advised by the defendant, acting through its duly authorized agent, that said policy covered his trailers that would be attached to the trucks under the policy," and that the letter of Moran's Insurance Agency *650 dated September 26, 1956, was the first notice that he had that the defendant was denying coverage of the accident under the policy; that the complainant had made no effort to investigate the accident, or contact witnesses, or secure medical reports during the four month period which had intervened since the date of the accident; and that the defendant's actions during said four month period, as set forth above, had greatly prejudiced the position of the complainant; and the defendant was estopped to deny coverage of said accident. The complainant attached to his bill of complaint copies of the declarations filed in the two suits mentioned above as exhibits to said bill of complaint.
The complainant prayed that on the final hearing of the cause the court decree that the actions of the defendant, as set forth above, were such as to estop the defendant from denying coverage of said accident under said liability policy, or in the alternative that the court decree that the actions of the defendant constituted negligence, and that damages be awarded to the complainant in such amount as might be shown by the evidence to be due him for money expended by the complainant for the settlement of said claims of Fairley and Littlefield, and that the court grant such other relief as the court might deem proper.
The defendant filed a general demurrer to the bill of complaint, and assigned as ground for demurrer that there was no equity on the face of the bill. The chancellor overruled the demurrer. The defendant then filed its answer to which there was attached a copy of the liability insurance policy sued on, but the answer was later withdrawn and the defendant declined to plead further. A final decree was then entered overruling the defendant's general demurrer and awarding judgment in favor of the complainant for the sum of $4,326.20, together with all costs.
The policy of insurance, upon which the plaintiff's action is based, and which has been made a part of the *651 record on this appeal, provided that the insurer agreed with the insured, "in consideration of the payment of the premium and in reliance upon the statements in the declarations and subject to the limits of liability, exclusions, conditions and other terms of this policy," as follows:
"INSURING AGREEMENTS
"I. Coverage A Bodily Injury Liability: To pay on behalf of the insured all sums which the insured shall become legally obligated to pay as damages because of bodily injury, sickness or disease, including death at any time resulting therefrom, sustained by any person, caused by accident and arising out of the ownership, maintenance or use of the automobile.
"* * *
"Coverage C Property Damage Liability: To pay on behalf of the insured all sums which the insured shall become legally obligated to pay as damages because of injury to or destruction of property, including the loss of use thereof, caused by accident and arising out of the ownership, maintenance or use of the automobile.
"II. Defense, Settlement, Supplementary Payments: With respect to such insurance as is afforded by this policy for bodily injury liability and for property damage liability, the company shall:
"(a) defend any suit against the insured alleging such injury, sickness, disease or destruction and seeking damages on account thereof, even if such suit is groundless, false or fraudulent; but the company may make such investigation, negotiation and settlement of any claim or suit as it deems expedient; * * *."
Under the heading "EXCLUSIONS", the policy expressly provided as follows:
"This policy does not apply:
"* * *
"(c) under coverages A and C, while the automobile is used for the towing of any trailer owned or hired *652 by the insured and not covered by like insurance in the company; or while any trailer covered by this policy is used with any automobile owned or hired by the insured and not covered by like insurance in the company;
"* * *."
On the Declarations page of the policy, the description of the automobile covered is as follows: "53 Ford F600 Cab & Chas. F6OR-3M16375, Classification CA-4." The occupation of the named insured is listed as "Pulp-wood hauling." The purpose for which the automobile is to be used is "Commercial." Under the heading "CONDITIONS", the policy provided as follows:
"19. Declarations. By acceptance of this policy the named insured agrees that the statements in the declarations are his agreements and representations, that this policy is issued in reliance upon the truth of such representations and that this policy embodies all agreements existing between himself and the company or any of its agents relating to this insurance."
The appellant has assigned and argued only one point as ground for reversal of the decree of the lower court, and that is that the court erred in overruling the defendant's general demurrer. It is contended that the policy of insurance under which the appellee seeks to recover did not insure the appellee's trailer which was involved in the accident referred to in the bill of complaint, or the vehicle described in the policy while being used to pull a trailer, but instead, specifically excluded coverage while the vehicle was being used in the manner and for the purpose for which it was being used at the time of the accident; and the appellant's attorney says that under the facts alleged in the bill of complaint, there is no room for the application of the doctrine of waiver or equitable estoppel.
It is first contended on behalf of the appellee that both the truck and the trailer were covered under the liability policy, and that the trailer referred to in the exclusion clause of the policy meant a trailer designed *653 for use with a private passenger automobile, and had no reference to a trailer used for commercial purposes only. It is next contended that the appellant's general agent, Moran's Insurance Agency, knew that the truck was to be used for pulpwood hauling, and that the appellant was therefore estopped to deny that the policy covered both truck and trailer; that, from the facts pleaded, it clearly appears that the intention of the parties, at the time the contract of insurance was entered into, was that the contract should cover the vehicle described therein and the trailer attached thereto. And finally, it is argued on behalf of the appellee that, if the court should hold that the appellee was not entitled to recover on the insurance contract itself, since the appellant had taken over the complete control of the investigation and negotiations for settlement of the claims and demands being made against the appellee, the appellant was under a duty to continue with the defense and was estopped to deny liability under the policy four months after the date of the accident.
(Hn 1) We think the chancellor erred in overruling the appellant's general demurrer. The contract of insurance is clear and unambiguous. The motor vehicle covered was particularly described in the policy. The trailer was not mentioned in the policy; and it was expressly provided that the policy did not apply under coverages A and C, while the automobile was being used for the towing of any trailer owned or hired by the insured and not covered by like insurance in the company.
This case, in our opinion, is controlled by the decision rendered by the Court in Maryland Casualty Company v. Adams, 159 Miss. 88, 131 So. 544, in which the Court held that a waiver by the insurer growing out of an agent's acts cannot be relied on so as to extend the indemnity of an insurance contract to cover a vehicle not specifically covered by the policy. The policy involved in that case contained an express condition that no vehicle covered thereby should be used for towing or propelling *654 any trailer or any vehicle used as a trailer, and expressly provided further that the policy did not cover a motor vehicle therein described while being used for towing or for propelling any trailer or any vehicle used as a trailer. In overruling the demurrer in that case the lower court held that there was a waiver of the provisions of the policy forbidding the use of a trailer in connection with the truck covered by and described in the policy. On appeal this Court reversed the judgment of the lower court, and in its opinion said:
"The contract of insurance here sued on particularly described the motor vehicle covered thereby, and contained the express condition that no automobile covered thereby should be used for towing or propelling any trailer or any vehicle used as a trailer, and expressly provided that the policy of insurance did not cover the automobile therein described while being used for towing or propelling any trailer or any vehicle used as a trailer, and by means of an asserted waiver it is now attempted to write a new contract between the parties and extend the indemnity of the contract to cover a vehicle not covered by the original contract. There is not here involved merely a forfeiture condition or provision of the policy contract, which it is sought to avoid by reason of the acts of an agent of the insurance company constituting a waiver thereof, but it here sought to make, by waiver, a contract for the parties which they never made themselves, and by waiver to extend the contract to cover vehicles not covered thereby, and which the insurance company expressly refused to insure, and this result cannot be accomplished by means of any alleged waiver growing out of the acts of the agent of the company. Massie v. Washington Fidelity National Insurance Co., 153 Miss. 436, 121 So. 125."
From the opinion rendered in the Adams Case, it appears that the bill of complaint in that case, as in this case, alleged that the agent who issued the policy was a general agent, and that "said general agent" knew *655 that the policy was called for and issued to protect the insured against damages for injuries to third persons in the operation of his truck and trailer. It also appears that the bill of complaint in that case alleged that "said policy was issued and delivered to him (the insured) as aforesaid without giving him an opportunity to read it, and upon the assurance to him by the said agent that it would protect him against loss and damage growing out of any accident or injuries to third persons, whatever * * *."
The decision rendered by this Court in the Adams case was reaffirmed by the Court in Adams et al. v. Maryland Casualty Company, 162 Miss. 237, 139 So. 453.
In discussing the matters as to which waiver or estoppel may be asserted in cases of this kind, the text-writer in 45 C.J.S., p. 616, Insurance, par. 674a, says:
"As a general rule, the doctrines of waiver or estoppel can have a field of operation only when the subject matter is within the terms of the contract, and they cannot operate radically to change the terms of the policy so as to cover additional subject matter. Accordingly, it has been held by the weight of authority that waiver or estoppel cannot create a contract of insurance or so apply as to bring within the coverage of the policy property, or a loss or risk, which by the terms of the policy is expressly excepted or otherwise excluded. As has sometimes been said, the doctrines of waiver or estoppel cannot be successfully invoked to create a primary liability, or a liability for a benefit not contracted for at all, or to supply a failure of proof that a loss was covered by the policy."
The rule thus stated has been applied by the courts under varying circumstances and different factual situations in the following cases: Lumber Underwriters of New York v. Rife, 1915, 237 U.S. 605, 35 S. Ct. 717, 59 L. Ed. 1140; C.E. Carnes & Co. v. Employers' Liability Assurance Corporation (C.C.A. 5th, 1939), 101 F.2d *656 739; Standard Accident Ins. Co. v. Roberts (C.C.A. 8th, 1942), 132 F.2d 794; United Pac. Ins. Co. v. Northwestern Nat. Ins. Co. (C.C.A. 10th, 1950), 185 F.2d 443; Patterson v. Woodmen of the World Life Ins. Soc., (Ala. 1955), 84 So. 2d 127; Conner v. Union Automobile Ins. Co. (Cal. 1932), 9 P.2d 863; Hartford Fire Ins. Co. v. Smith, 1940, 200 Ark. 508, 139 S.W.2d 411.
In the case of C.E. Carnes & Co. v. Employers' Liability Assurance Corporation, supra, the Court held that the coverage on an automobile liability policy, as to personal injury and property damage covering a truck used for the transportation of materials and uses incidental thereto in connection with the insured's business of handling farm machinery and plumbing equipment, did not extend to the truck while used in transporting butane gas, and that knowledge of the agent of the insurer under such policy when the policy was renewed that the truck was used to haul butane gas could not bind the insurer so as to extend the coverage of the policy to such use of the truck. In its opinion in that case the court said:
"It is well settled that conditions going to the coverage or scope of a policy of insurance as distinguished from those furnishing a ground for forfeiture, may not be waived by implication from conduct or action. The rule is that while an insurer may be estopped by its conduct or its knowledge from insisting upon a forfeiture of a policy, the coverage or restrictions on the coverage cannot be extended by the doctrine of waiver or estoppel. The substance of the doctrine of waiver as applied in the law of insurance is that if the insurer with knowledge of facts which would bar an existing primary liability recognizes such primary liability by treating the policy as in force, he will not thereafter be allowed to plead such facts to avoid his primary liability.
"This is a case where the coverage is sought to be extended. The doctrine of waiver cannot be invoked to create a primary liability, and bring within the coverage *657 of the policy risks not included or contemplated by its terms. Estoppel through the knowledge of Guy L. White, the agent of the insurance company, could operate in favor of the insured, Carnes & Company, only to relieve as against the consequences of violation of the terms of the policy and not to extend coverage. H.D. Foote Lumber Co., Inc., et al. v. Svea Fire & Life Ins. Co., 179 La. 779, 155 So. 22; Annotation, 113 A.L.R. 857-871."
In the case of Waddey v. Maryland Casualty Co., (1937), 171 Tenn. 100 S.W.2d 984, 109 A.L.R. 654, the Court held that the provisions of an automobile liability or indemnity policy to the effect that the policy did not cover the automobile described therein while being used for propelling any trailer or any vehicle used as a trailer, applied so as to negative liability where the insured permitted boys to attach to the car a homemade wagon constructed from the frame of a small buggy and equipped with four old T-Model Ford wheels with no tires, the accident having happened when the insured, on reaching the top of a hill, instead of stopping the car, continued to drive downgrade as a consequence of which the boy who was riding in the wagon lost control thereof and crashed into a telegraph pole. The Court in its opinion in that case said:
"The use of a trailer is an additional hazard, and for this reason an extra premium is charged for the privilege of its use. In Berry on Automobiles, Vol. 6, p. 690, it is said: `An attachment of a trailer to an automobile is an added hazard justifying an insurance company in limiting its liability to the operation of the insured automobile free from the use of an attached automobile.'
"The policy here sued on expressly provides that it does not cover the automobile described while being used for purposes other than those specified in the Statements, or while being used for towing or propelling any trailer or any vehicle used as a trailer. During the period *658 the Waddey vehicle was attached as a trailer, the automobile was not covered by the policy."
The appellee cites in support of his contention that the appellant is estopped to deny coverage on the trailer and the tractor while pulling the trailer the case of Calvert Fire Insurance Company v. Swain, 224 Miss. 85, 79 So. 2d 537, in which the court held that the knowledge of the insurer's agent that the truck in that case was being used on regular 80-mile runs between two designated towns would be imputed to the insurance company, and that the company was estopped to plead a violation of a 50-mile limitation of use endorsement contained in the policy. But the decision of the court in that case is not controlling here, for the reason that the limitation of use endorsement in the policy was entirely different from the exclusions provisions of the policy which we have before us in this case. No attempt was made in that case to extend the coverage of the policy to a vehicle expressly excluded from the coverage by the terms of the policy.
In its letter dated September 24, 1956, denying coverage on the policy sued on in this case, a copy of which was attached as an exhibit to the appellee's bill of complaint, the appellant stated: "Our investigation discloses that Mr. Lockard owned at least three log trailers and that he had at no time elected to insure any of them." After a careful examination of the bill of complaint and the exhibits attached thereto, it seems clear to us that the doctrine of waiver or estoppel cannot be invoked in this case to extend coverage of the liability policy sued on to a vehicle which was not included in the policy, or to bring within the coverage of the policy a risk which was expressly excluded by the terms of the policy. We also think there is no merit in the appellee's contention that the provisions of paragraph (c) of the exclusions section of the policy are applicable only in cases where the insured motor vehicle *659 is used for the towing of "a trailer designed for use with a private passenger automobile."
We are also of the opinion that under the facts alleged in the bill of complaint the appellant was not estopped to deny coverage under the policy because of the alleged action of the appellant's claim agent in having the Fairley truck taken to a garage for repairs before completing his investigation of the accident. The mere fact that the appellant's claim agent at the beginning of his investigation had the truck of Gaston Fairley taken to a garage for repairs, under the mistaken belief that the damage to the truck was covered by the liability policy, did not prejudice the rights of the appellee under the policy or estop the appellant from asserting its right to deny liability under the policy after its investigation had been completed. Conner v. Union Automobile Ins. Co. (Cal. 1932), 9 P.2d 863.
Finally, it is argued on behalf of the appellee that since the appellant had taken over the investigation of the accident, without giving notice of a reservation of its right to deny coverage, and had permitted four months to pass before notifying the appellee that the claims of Fairley and Littlefield were not covered under the policy, the court should hold that appellant was estopped to deny coverage under the policy.
(Hn 2) But we think the facts stated in the appellee's bill of complaint were insufficient to create an estoppel by conduct, which would render the insurer liable to the insured for its refusal to defend the suits. "In order to create an estoppel in pais the party pleading it must have been misled to his injury, or the party pleading it must have been misled to his hurt or prejudice, * * * by the conduct or representations of another on which he relied and by which he was influenced and induced to act, or to refrain from acting, or to change his position; that is, he must have suffered a loss of a substantial character or have been induced to alter his position for the worse in some material respect." 31 C.J.S., 276, *660 Estoppel, par. 74. The general rule is that an insurer who withdraws from the defense of an action is estopped to deny liability under the policy if its conduct results in prejudice to the insured; but it is not estopped to do so if its action does not result in any prejudice to the insured. Southern Farm Bureau Casualty Insurance Company v. Logan (Miss. 1960), 119 So. 2d 268.
No facts were alleged in the appellee's bill of complaint to show that the appellee was misled or harmed by any act of the appellant or that he was induced to act in a manner different from that in which he otherwise would have acted. No facts were alleged in the appellee's bill to show that any prejudice resulted to the appellee because of the appellant's delay in notifying the appellee that there was no coverage of the claims. No suit had been filed by Fairley or Littlefield at the time notice was given to the appellee that there was no coverage of the claims under the policy; and the appellee, after receiving notice that the appellant denied coverage under the policy, had ample time to employ an attorney, make his own investigation of the claims and negotiate a settlement of the claims before the convening of the November 1956 term of the circuit court.
The chancellor in our opinion should have sustained the general demurrer filed by the appellant. The decree of the lower court overruling the appellant's general demurrer and entering final judgment against the appellant is therefore reversed and the cause remanded.
Reversed and remanded.
McGehee, C.J., and Lee, Holmes, Ethridge and Gillespie, JJ., concur.
HALL, J., dissenting:
I am unable to bring myself in accord with the majority opinion in this case. The policy involved herein shows that there was insured a 1956 600 Cab and Chasis to be used for commercial purposes only. The question *661 may immediately be asked, "What in the world could a person do with a cab and chasis which contains no other mechanism for hauling other than the attachment for a trailer?"
The policy in this case was written by Moran Insurance Agency of Ocean Springs, Mississippi, and that agency was a general agent of Hartford Accident & Indemnity Company. The accident of this vehicle occurred on May 28, 1956, and Mr. Lockard immediately gave notice to Moran's Insurance Agency. It is undenied that he was assured by Moran's Insurance Agency that he was fully covered under the policy and that the liability carrier would take over the investigation, negotiation and defense of any claims against him as a result of the accident. The accident in question occurred about 18 miles north of Biloxi, Mississippi, and the insurance company had the truck which was damaged in the accident carried to a garage in Biloxi, selected by it, for repairs. In fact, the insurance company took over the matter and negotiated toward a settlement of all claims arising out of the accident and so notified the appellee.
In the meantime, Gaston Fairley and Manson Littlefield employed an attorney to represent them in causes of action for personal injuries and property damage against him. The appellee forwarded the letter notifying him of the employment of an attorney to appellant's agent and the appellee notified the attorney for Fairley and Littlefield. This notice was to Mr. C.B. Corban, who was unquestionably the representative of appellant, on the payroll of appellant, and acting within the scope of his authority to investigate, negotiate, settle and dispose of claims. Mr. Corban notified the attorney for Fairley and Littlefield that the matter had been referred to him and that the claims were fully covered by insurance and that he would shortly see them to adjust the matter. From the date of the accident on May 28, 1956, through the succeeding months of June, July and August and up until the 26th day of September the appellee had no *662 notice from the appellant other than he was fully and completely covered under the insurance policy issued by the appellant. Because of this action on the part of appellant appellee was lulled into a belief that he was fully protected and he made no effort to investigate, negotiate and settle the claims because he was acting upon the assurance of appellant that he was fully covered under the policy.
On September 24, 1956, after the appellee had been lulled into this sense of security, the insurance company addressed a letter to the Moran Insurance Agency and denied coverage under the policy and two days later the Moran Insurance Agency mailed to the appellee a copy of the letter of September 24th. Throughout this period the appellee had been led to believe that he was fully covered, had been assured that the insurance company would adjust the matter and he now contends that the actions of the appellant conclusively estop the appellant from denying coverage in the case in question. The appellee has most assuredly been placed at a great disadvantage by the conduct of the insurance company. See Izard v. Mikell, 173 Miss. 770, 163 So. 498; Martin v. Hartley, 208 Miss. 112, 43 So. 2d 875; In Re Stoball's Will, 211 Miss. 15, 50 So. 2d 635; Stokes v. American Central Ins. Co., 211 Miss. 584, 52 So. 2d 358; Crooker v. Hollingsworth, 210 Miss. 636, 46 So. 2d 541, 50 So. 2d 355.
Arrington and McElroy, JJ., join in this dissent. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1904143/ | 206 N.J. Super. 540 (1985)
503 A.2d 340
ANDREW J. GUSTAVSON AND JOANN MARIE GUSTAVSON, PLAINTIFFS-APPELLEES,
v.
ANDREW C. GAYNOR AND SANDRA R. GAYNOR, DEFENDANTS-APPELLANTS.
Superior Court of New Jersey, Appellate Division.
Argued September 18, 1985.
Decided December 16, 1985.
*542 Before Judges BRODY and GAYNOR.
John R. Leith argued the cause for appellants (Mattson, Madden & Polito, attorneys; John R. Leith on the briefs).
Mark A. Infante argued the cause for appellees.
PER CURIAM.
This appeal raises the issue of the relevancy of a driver's consumption of alcoholic beverage several hours prior to an accident in the absence of proof that his driving ability had thereby been affected. While there have been allusions to the inadmissibility of such evidence, our appellate courts have not as yet squarely dealt with the issue.
At approximately 1:30 a.m. on June 26, 1982 plaintiff, Andrew J. Gustavson, was proceeding in his automobile in a northerly direction on Pleasant Valley Way, West Orange, and defendant, Andrew C. Gaynor, was driving his vehicle in a southerly direction on that street. As the cars attempted to pass each other, they collided, with the point of impact being the left front fenders of both vehicles. Each driver claimed that the other had veered into the opposite lane thereby causing *543 the collision. The investigating officer's testimony regarding the physical evidence observed by him at the scene, while tending to support defendant's version, was not without some qualification as to the trustworthiness of that evidence. However, he unequivocally indicated that his observations of both drivers led him to conclude that the accident was not in any way causally related to the consumption of alcoholic beverages.
Some five to six hours before the accident, defendant had met with several of his friends in a park and consumed two or three bottles of beer. Subsequently, and shortly before the accident, he had stopped at a nightclub to visit a friend who was playing in the band. However, he denied drinking any alcoholic beverages while at the club, or at any other time during the course of the evening after leaving the park, and there was no evidence to the contrary. Prior to defendant's testimony, an application was made to the trial court to bar any reference to the consumption of alcoholic beverages by defendant. It was argued that such evidence was not relevant, but if so, it should be excluded under Evid. R. 4 as its probative value was substantially outweighed by the potential for undue prejudice created by its admission. While ruling that he would not allow any suggestion that defendant was drunk or couldn't drive because of having had a couple of beers, the trial judge nevertheless denied the application, considering that such evidence, although not admissible to show negligent operation of the car, was relevant as it pertained to the prior activities of a party to an automobile accident and provided a continuity in the narrative leading to the point of the actual collision. In accord with this ruling, and over the continued objection of defendants' counsel, plaintiffs' attorney was permitted to pursue extended cross-examination concerning the consumption of beer in the park and defendant's admission to a club where liquor was served despite his being only 17 years of age at the time, and to highlight this testimony in the summation. This emphasis upon defendant's prior conduct appears to have been an attempt to suggest that drinking had affected his driving ability. The allowance of *544 such testimony together with the summation comments conceivably permitted the jury to consider that defendant was under the influence of alcohol at the time of the accident and that this condition caused him to veer into plaintiff's lane. Both drivers were found negligent and the jury apportioned the negligence 55% to defendant and 45% to plaintiff.
Whether the asserted relevance of such evidence is founded upon narrative completeness or negligent operation of the vehicle, we are satisfied the admission of the challenged testimony constituted reversible error. Thus, a new trial is required.
Clearly, evidence of intoxication is relevant to the issue of negligent driving. Maladowitz v. Coley, 47 N.J. 55 (1966); Roether v. Pearson, 36 N.J. Super. 465 (App.Div. 1955); see also Damchug v. Public Serv. R. Co., 5 N.J. Misc. 365, 136 A. 604 (Sup.Ct. 1927). While Maladowitz only dealt with the admissibility of evidence bearing upon an issue not set forth in the pretrial order, in the course of the court's opinion it stated that "[a] reference to liquor with respect to a driver is relevant only if it is asserted that it affected his ability to drive." 47 N.J. at 57. The Roether court, in upholding a verdict for the defendant despite his admitted guilty plea to a criminal charge of drunk driving arising out of the accident involving the plaintiff, considered that "[t]he fact that a driver of an automobile has been drinking and gives physical appearance of being under the influence of liquor and even pleads guilty to a charge of drunken driving is all proper evidence of negligence to be submitted to the jury." 36 N.J. Super. at 467. The corollary argument flowing from these pronouncements, as advanced by defendant, is that unless there is proof of intoxication the prior consumption of alcoholic beverages by a driver has no relevancy to the claimed negligent operation of the vehicle.
In those jurisdictions which have considered this question the rule followed is that evidence of prior drinking is admissible as being relevant to the issue of the driver's fitness only when there is some supplementary evidence from which the trier of *545 the fact may reasonably conclude that the drinking affected the safe operation of the vehicle. Rovegno v. Geppert Bros., Inc., 677 F.2d 327 (3 Cir.1982); Cameron v. Boone, 62 Wash.2d 420, 383 P.2d 277 (Sup.Ct. 1963); Fortin v. Hike, 205 Neb. 344, 287 N.W.2d 681 (Sup.Ct. 1980); Maland v. Tesdall, 232 Iowa 959, 5 N.W.2d 327 (Sup.Ct. 1942); Boehm v. St. Louis Pub. Serv. Co., 368 S.W.2d 361 (Sup.Ct.Mo. 1963); Billow v. Farmers Trust Co., 438 Pa. 514, 266 A.2d 92 (Sup.Ct. 1976). Ballard v. Jones, 21 Ill. App.3d 496, 316 N.E.2d 281 (App.Ct., 1st 1974). See also 11 Blashfield, Automobile Law and Practice, (3 ed. 1968), § 427.3 at 514-525. The required supportive evidence includes conduct such as excessive drinking, driving at an excessive speed, recklessness or erratic driving, drunken behavior at the accident scene, or similar acts suggestive of an unfitness to drive. Rovegno v. Geppert Bros., Inc., supra, at 330-331.
The mere fact that a driver had consumed some alcoholic beverages is by itself insufficient to warrant an inference that the driver was intoxicated and that the intoxication was of such a degree as to render him unfit to drive at the time of the accident. The admission of such testimony without supporting evidence is unduly prejudicial in view of its capacity to inflame the jury. As stated in Ballard v. Jones, supra.
... drinking, standing alone, cannot be equated with intoxication, nor can the use of alcoholic liquor, standing alone, characterize a person as intoxicated [citation omitted]. Accordingly, questions cannot be asked which intimate to the jury that a party was intoxicated at the time of the accident unless there is supporting evidence [citation omitted]; in the absence of supporting evidence, testimony concerning the drinking of intoxicants should be striken [citation omitted], and under certain circumstances, may constitute reversible error notwithstanding a sustained objection. [citation omitted; 316 N.E.2d at 286].
The application of this general rule to the instant case compels the conclusion that, under the factual pattern presented, the testimony concerning Gaynor's prior drinking was improperly admitted as permitting an inference of negligence. There was substantial proof that neither driver was under the influence of alcohol at the time of the accident. Further, there was an absence of any supplementary evidence of Gaynor's unfitness *546 to drive which would have justified the admission of Gaynor's prior consumption of beer and permitted an inference of intoxication. Certainly, the veering of two or three feet out of one's lane while driving on a curving road at night is not so erratic as to suggest that the driver was probably intoxicated. In Rose v. Brozman's Tavern, 102 Ill. App.3d 1087, 430 N.E.2d 282 (App.Ct., 2d 1981), it was concluded that the driver's consumption of four or five drinks over four hours before the accident and his failure to negotiate an "S" curve were not sufficient to support submission of the issue of his intoxication to the jury, as the accident could just as easily be attributed to a sober miscalculation with regard to speed or braking. And, in Rovegno v. Geppert Bros., Inc., supra, the swerving into another lane of traffic was not considered to be such reckless driving as to constitute the necessary supplementary evidence warranting the admission of the driver's blood alcohol content.
While there can be no rigid standard for categorizing the various maneuvers which might be classified as erratic operation of a motor vehicle in order to qualify as the necessary supplementary evidence, the controlling consideration is whether "the evidence and offers of proof present a picture of unfitness to drive sufficiently clear that the probative value of the evidence of drinking or intoxication outweighs its potential for unfair prejudice." Id. at 331. We are satisfied that no such picture was presented in this case by the evidence pertaining to Gaynor's driving and his prior consumption of alcoholic beverages.
We also are convinced that the admission of the challenged testimony was not justified as providing a more complete narrative of defendant's activities leading up to the time of the accident. In our view, the evidence of prior drinking was so potentially prejudicial that it clearly outweighed any possible probative value of a continuity of the narrative of Gaynor's conduct during the hours prior to the accident, and accordingly should have been excluded. Evid.R. 4. While an effective *547 presentation of the incident to the jury might have required testimony concerning the prior activities of the parties, this objective could have been attained by general rather than specific references to those activities. Thus, the testimony could have been limited to Gaynor's being at a park with some friends and subsequently meeting another friend who played in a band. In this manner, the inflammatory potential of the fact of drinking or his illegal presence in an establishment where liquor was served would have been eliminated while the narrative continuity was preserved. Clearly, the value of the testimony for the purpose of providing a narrative was "so significantly outweighed by [its] inherently inflammatory potential as to have a probable capacity to divert the minds of the jurors from a reasonable and fair evaluation" of the basic issue in the case. State v. Thompson, 59 N.J. 396, 421 (1971).
Our conclusion that the admission of testimony concerning defendant's prior activities related to the consumption of alcoholic beverages constitutes reversible error renders it unnecessary to consider the other point advanced on this appeal.
The judgment dated December 6, 1984 is reversed and the matter is remanded to the Superior Court, Law Division, Essex County, for a new trial on all issues. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1491957/ | 970 S.W.2d 549 (1998)
Eric Charles NENNO, Appellant,
v.
The STATE of Texas
No. 72313.
Court of Criminal Appeals of Texas.
June 24, 1998.
*551 Brian W. Wice, Houston, for appellant.
Carol M. Cameron, Assistant District Attorney, Houston, Matthew Paul, State's Attorney, Austin, for State.
OPINION
KELLER, Judge, delivered the opinion of the Court in which McCORMICK, Presiding Judge, and MEYERS, MANSFIELD, HOLLAND, and WOMACK, Judges, joined.
Appellant was convicted in January 1996 of capital murder, committed on or about *552 March 23, 1995. TEX. PENAL CODE § 19.03(a)(2).[1] Pursuant to the jury's answers to the special issues set forth in Texas Code of Criminal Procedure Article 37.071 §§ 2(b) and 2(e), the trial judge sentenced appellant to death. Article 37.071 § 2(g).[2] Direct appeal to this Court is automatic. Article 37.071 § 2(h). Appellant raises nineteen points of error. We will affirm.
A. SUFFICIENCY OF THE EVIDENCE
1. Future dangerousness
In point of error two, appellant contends that the evidence is legally insufficient to support the jury's answer to the future dangerousness special issue.[3] A legal sufficiency review of that issue is governed by the standard set out in Jackson v. Virginia, 443 U.S. 307, 319, 99 S. Ct. 2781, 61 L. Ed. 2d 560 (1979); the question is whether, in the light most favorable to the prosecution, any rational trier of fact could have returned an affirmative answer. Moore v. State, 935 S.W.2d 124, 126 (Tex.Crim.App.1996), cert. denied, ___ U.S. ___, 117 S. Ct. 1711, 137 L. Ed. 2d 835 (1997). The facts of the offense, alone, can be sufficient to support an affirmative answer to the special issue. Walbey v. State, 926 S.W.2d 307, 310 (Tex.Crim.App. 1996).
The facts of the present offense were egregious. Appellant raped and choked to death a seven-year-old girl. However, we need not determine whether such facts, by themselves, would support an affirmative answer to the future dangerousness issue. The State also presented expert testimony that appellant would be a threat to society. This testimony came from Kenneth Lanning, a Supervisory Special Agent in the Behavioral Science unit of the FBI who specialized in studying the sexual victimization of children. From information given about appellant, Lanning concluded that appellant was a pedophile. Lanning testified that such a person was difficult to rehabilitate. After being given a lengthy hypothetical matching the facts shown by the evidence, Lanning testified that an individual matching the hypothetical "would be an extreme threat to society and especially children within his age preference." This evidence, along with the circumstances of the crime, is sufficient for a rational jury to conclude that appellant poses a future danger to society. Point of error two is overruled.
2. Mitigation
In point of error three, appellant contends that the evidence is legally insufficient to support the jury's answer to the mitigation special issue.[4] But this Court does not conduct a sufficiency review of that issue. McGinn v. State, 961 S.W.2d 161, 166 (Tex. Crim.App.1998). Point of error three is overruled.
B. GUILT/INNOCENCE
1. Motion to suppress
In point of error ten, appellant contends that the trial court erred in failing to draft findings of fact and conclusions of law regarding his motion to suppress. We granted the State's motion to abate, and the case was remanded to the trial court to make such written findings and conclusions. The trial court has done so, and the written findings and conclusions have been forwarded to this Court as a supplemental transcript. Because appellant obtained the appropriate relief on this matter, point of error ten is now moot.
*553 In points of error seventeen through nineteen, appellant contends that the trial court erred in overruling his motion to suppress. He contends that the trial court's admission of his oral statements to Detective Taber violated Article 38.22 and that his oral and written statements were involuntary under the United States Constitution.
a. Facts[5]
Detective Johnson received the defendant's name as a possible suspect and referred it to Detectives Wedgeworth and Taber for a follow-up investigation. Detectives Wedgeworth and Taber went to the defendant's home at 17602 Bullis Gap several times on the afternoon of March 25, 1995. The defendant lived one to one-and-a-half blocks from where the complainant had last been seen. On the third visit, the defendantdressed only in a white bath towel around his waist finally answered the door. The defendant indicated he was willing to talk about the missing child and permitted the detectives to come inside. The defendant appeared very cooperative and willing to talk. When asked whether he knew the child, the defendant became visibly nervous and shook and denied knowing or seeing her ever before. The defendant permitted the detectives to search his house and Detective Wedgeworth conducted a superficial search but found nothing out of the ordinary.
The detectives asked the defendant why somebody in the neighborhood asked for him to be checked out and the defendant replied there was an incident in the spring when he was accused of attempting to lure a child into his house and pull off her pants. The defendant was visibly shaking and appeared extremely nervous. Detectives Wedgeworth and Taber visited with the defendant at his house for a total of approximately ten minutes. The detectives then asked the defendant if he would come to the command post and make a written statement and the defendant stated he had no problem with that. The detectives informed the defendant that several blocks away a trailer had been set up as a command post. The detectives then returned to the command post. The detectives made no promises or threats to the defendant during this initial encounter.
Five to ten minutes later, the defendant arrived at the command post. Detective Taber led the defendant into a small interview room. Detective Taber read the defendant the following rights from the blue card provided by the Harris County District Attorney's Office:
You have the right to remain silent and not make any statement at all. Any statement you make may be used against you and probably will be used against you at your trial. You have a right to have an attorney present to advise you prior to and during any questioning. If you're unable to hire a lawyer, you have the right to have a lawyer appointed to advise you prior to or during any questioning. You may terminate the interview at any time.
Detective Taber asked the defendant if he understood the warnings and the defendant indicated he understood. Detective Taber asked the defendant if he wanted to waive his rights and talk about the missing child and the defendant agreed to talk to the detectives. The defendant appeared to understand the course of the conversation. The conversation was relaxed, very soft-spoken, and very low-tone. Detective Taber spoke with the defendant for approximately an hour. During the interview, the defendant was offered something to eat and drink. Detective Taber made it clear from the beginning that the defendant was not under arrest and that he could go at any time.
When Detective Taber asked the defendant if he knew why he was there, the defendant replied: "You think I'm a suspect in the little girl case where she's missing." Detective Taber asked the defendant why he thought he would be a suspect; the defendant stated because of his past incident involving trying to get a little girl in the residence and removing her pants and because he liked children. When asked what the defendant had done the night the complainant *554 had disappeared, the defendant stated he arrived home, changed clothes, went outside, talked to his neighbor, and then went inside. The defendant stated he had had a six-pack of beer. When asked if there was any reason why a neighbor would say they had seen the defendant on the same street from which the complainant had disappeared, the defendant responded: "Well, maybe I could have been outside my house by the fence, but I just don't remember." Detective Taber asked the defendant again the same question about would it have been possible for him to have been down the street and if he had heard about the missing girl; the defendant stated: "Well, it might have been possible but I don't remember."
Detective Taber asked the defendant what he thought had happened to the child and the defendant said he thought somebody had kidnapped, raped, and killed her. Detective Taber asked the defendant what kind of person he thought would do something like that to a little girl and the defendant said someone like him. When asked why he responded in that manner, the defendant answered because of the other incident, the other child, that he had always thought about being with children and that he had fantasized about them sexually. The defendant said he fantasized or dreamed about a former girlfriend and her child and teaching the child about sex and having sex with the child. The defendant stated he masturbated several times a week while fantasizing and masturbated while looking at the neighborhood children through his window.
Detective Taber asked the defendant what he thought someone would do with the body of a child if they had killed the child. The defendant said that after they were finished with the body of the child, the person would probably take the child and dump their body on a construction site on 290 just before Hockley and dump the child's clothes at another location. When asked whether he had ever thought about doing something like that, the defendant stated he had thought about it before but he had never done it. Detective Taber asked the defendant what he thought should happen to a person responsible for attacking a little girl and the defendant said the person should be put to death. Detective Taber asked the defendant what he thought the result of the police investigation would turn up and the defendant said it didn't look good for him right now but he hoped that everything would turn out all right.
Detective Taber asked the defendant if he were the detective how would he pursue the investigation. The defendant stated he would look for somebody in the neighborhood, somebody close by who knew the child and liked children, and he would concentrate on them. When asked directly whether he had taken, or was involved in taking, the complainant, the defendant denied it. The defendant never directly incriminated himself. The defendant was free to leave. No promises or threats had been made to the defendant.
Detective Taber asked the defendant if he would take a polygraph examination and he said: "Sure, I'll take a polygraph." Detective Taber asked the defendant how he thought the polygraph would turn out and the defendant said he hoped it would turn out all right. Detective Taber terminated his interview with the defendant.
Special Agent Young asked the defendant if he was willing to cooperate. Special Agent Young explained the polygraph examination and the defendant's right to refuse. The defendant said it would be no problem and that he would take a polygraph examination. Officers then made arrangements for a polygraph examination. Appellant also executed a consent to search his residence. Officers searched the residence but found nothing of value to the investigation.
Lt. Raney, a licensed polygraph examiner, met the defendant at approximately 9:30 p.m. at the command post. Lt. Raney conducted a two-and-one-half hour pre-test interview. Lt. Raney reviewed the standard Texas Polygraph Examination Release Form, State's Exhibit 6, which the defendant voluntarily signed and which states: "I, Eric Charles Nenno, voluntarily, without threats, duress, coercion, force, promises of immunity or reward, agree and stipulate to take a polygraph examination, lie detector test, for the mutual benefit of myself and the Harris County *555 Sheriff's Department." Lt. Raney informed the defendant that the purpose of the examination is to measure and test him to find out if he has any knowledge or involvement in the disappearance of the complainant. The defendant asked no questions and indicated he understood. The defendant indicated he had not consumed alcohol or smoked marijuana. The defendant appeared cooperative. The defendant never indicated that he wanted to conclude the interview; if he had, the defendant would have been allowed to leave. Lt. Raney testified the defendant was not in his custody.
Lt. Raney administered the polygraph examination at approximately 1:00 a.m. and it lasted thirty minutes. Lt. Raney explained the examination process and placed attachments on the defendant. The defendant made no complaints and cooperated. Lt. Taney read the charts and found there had been numerous deceptions in the polygraph examination and the defendant had failed the examination on the relevant issue questions but said nothing to the defendant. The defendant eventually said: "I failed it, didn't I?" Lt. Raney told the defendant: "Yes, you had some difficulty on it" and that he was going to have to tell the police where the body was. Lt. Raney reminded the defendant that he had told him prior to the examination that when the defendant finished the examination he would know whether or not the defendant was telling the truth. Lt. Raney told the defendant the examination indicated deception when the defendant had been asked if he knew the complainant was missing before he had been told about it Friday morning. Lt. Raney told the defendant he needed to tell where the complainant is because he knows. The defendant stated: "I think she's still in the attic." When asked further, the defendant stated: "They're going to kill me for this, aren't they?"
Lt. Raney asked for further details and the defendant stated he had taken the complainant to his bedroom and attempted to have sex with her but could not and he strangled her and then had sex with her. The defendant asked: "Is there anything here, anything you can give me, that I can take my life with?" and Lt. Raney said no. Lt. Raney made no threats or promises to the defendant during their encounter.
After waiving his rights, appellant executed a second consent to search his residence. He accompanied officers to his home, the victim's body was recovered, and appellant was arrested.
At 2:30 a.m., Special Agent Young advised the defendant of his rights from his Federal Bureau of Investigations form, State's Exhibit 3, which reads as follows:
Before we ask you any questions, you must understand your rights.
You have the right to remain silent.
Anything you say can be used against you in court.
You have the right to talk to a lawyer for advice before we ask you any questions and to have a lawyer with you during questioning.
If you cannot afford a lawyer, one will be appointed for you before any questioning if you wish.
If you decide to answer questions now without a lawyer present, you will still have the right to stop answering at any time. You also have the right to stop answering at any time until you talk to a lawyer.
The defendant said he understood his rights. The defendant did not ask Special Agent Young to explain anything nor did he ask for an attorney. The defendant appeared cooperative and willing to talk. The defendant freely and voluntarily signed the following waiver of rights:
I have read this statement of my rights and I understand what my rights are. I am willing to make a statement and answer questions. I do not want a lawyer at this time. I understand and know what I am doing. No promises or threats have been made to me and no pressure or coercion of any kind has been used against me.
The defendant did not ask any questions nor ask to terminate the interview.
Detective Johnson asked the defendant if he were willing to give a written statement and the defendant agreed. State's Exhibit 4 is captioned: "Statement of Person in Custody *556 of Eric Charles Nenno" and is dated March 26, 1995, at 2:50 a.m., and recites:
PRIOR TO MAKING THIS STATEMENT I HAVE BEEN WARNED BY DETECTIVE JOHNSON, THE PERSON TO WHOM THIS STATEMENT IS MADE THAT:
1) I HAVE THE RIGHT TO REMAIN SILENT AND NOT MAKE ANY STATEMENT AT ALL AND ANY STATEMENT I MAKE MAY AND PROBABLY WILL BE USED AGAINST ME AT MY TRIAL;
2) ANY STATEMENT I MAKE MAY BE USED AS EVIDENCE AGAINST ME IN COURT;
3) I HAVE THE RIGHT TO HAVE A LAWYER PRESENT TO ADVISE ME PRIOR TO AND DURING ANY QUESTIONING;
4) IF I AM UNABLE TO EMPLOY A LAWYER I HAVE THE RIGHT TO HAVE A LAWYER APPOINTED TO ADVISE ME PRIOR TO AND DURING ANY QUESTIONING; AND
5) I HAVE THE RIGHT TO TERMINATE THIS INTERVIEW AT ANY TIME.
PRIOR TO AND DURING THE MAKING OF THIS STATEMENT I KNOWINGLY, INTELLIGENTLY, AND VOLUNTARILY WAIVE THE RIGHTS SET OUT ABOVE AND MAKE THE FOLLOWING VOLUNTARY STATEMENT.
The defendant initialed each of the above written warnings, the above written waiver, and each of the paragraphs of his statement.
Detective Johnson asked the defendant questions, he answered, and Detective Johnson typed what the defendant said into a laptop computer. Detective Johnson, Special Agent Young, and the defendant were present in the interview room. The defendant never asked to terminate the interview. The defendant never asked for an attorney. Neither Detective Johnson nor Special Agent Young promised or threatened the defendant. The defendant never appeared hesitant about giving the statement. The defendant indicated he wanted to give an accurate and truthful statement. The defendant appeared to give a logical and chronological narration of the events. The defendant did not hesitate to sign the statement. The defendant freely and voluntarily waived his rights and signed the Statement at 4:45 a.m.
b. Article 38.22
Appellant contends that Detective Taber's testimony regarding oral statements made by appellant are inadmissible under Article 38.22 because appellant was in custody and because the exception in Article 38.22 § (3)(c) does not apply. § 3(c) provides circumstances in which an oral statement may be admissible if the admissibility requirements in § 3(a) are not met. Appellant does not, however, explain which requirement contained in § 3(a)(1)-(5) was not complied with. The trial court makes no reference to any electronic recording of appellant's statements even though that is a requirement under § 3(a)(1). Assuming without deciding that no electronic recording was made, we find that appellant's claim must nevertheless fail.[6]
Appellant concedes, as he must, that Article 38.22 applies only to persons in custody. See Article 38.22 § 5. "A person is in `custody' only if, under the circumstances, a reasonable person would believe that his freedom of movement was restrained to the degree associated with a formal arrest." Dowthitt v. State, 931 S.W.2d 244, 254 (Tex.Crim.App.1996)(citing Stansbury v. California, 511 U.S. 318, 114 S. Ct. 1526, 128 L. Ed. 2d 293 (1994)). "The reasonable person standard presupposes an innocent person." Id. (citing Florida v. Bostick, 501 U.S. 429, 111 S. Ct. 2382, 115 L. Ed. 2d 389 (1991))(emphasis in original).
The trial court's findings show that appellant was not in custody. Appellant was never told, before or during his interviews with Detective Taber, that he was in custody; in fact, he was told at the beginning of the *557 command post interview that he was not in custody. Any finding of custody would have to be inferred from the combination of circumstances present. We inferred custody in Dowthitt when the circumstances consisted of: (1) a very long time period during which interrogation occurred, (2) the exercise of police control over the defendant, and (3) the manifestation of probable cause after the defendant admitted to being present at the scene of the crime. 931 S.W.2d at 257. None of the factors present in Dowthitt are present in the case at bar. The time period of interrogation was short: appellant had been subject to questioning at the command post for only an hour after he was told he was not under arrest. No element of coercion or control appears in the record. When officers arrived at appellant's door, they were simply following one of many leads in the investigation. They did not indicate that appellant had to come to the command post, but merely asked him to go. The officers left for the command post without appellant, who followed on his own about ten minutes later. Unlike in Dowthitt, in the present case, there is no evidence that officers attempted to restrict appellant's movements at the command post or that they ignored any requests made by him. Finally, although appellant made a number of suspicious statements during the command post interview, he denied having any connection to or involvement in the offense. A reasonable person in appellant's position would not have believed he was restrained to the degree associated with a formal arrest. Hence, appellant was not in custody when he made oral statements to Detective Taber.
Appellant next contends that his oral statements to Detective Taber and his written statement were involuntary. To determine whether the circumstances render an accused's statement involuntary, we ultimately must determine whether his will was "overborne" by police coercion. Armstrong v. State, 718 S.W.2d 686, 693 (Tex.Crim.App. 1985). Relevant circumstances with regard to this question include the "length of detention, incommunicado or prolonged detention, denying a family access to a defendant, refusing a defendant's request to telephone a lawyer or family, and physical brutality." Id.
The present case includes none of the factors listed in Armstrong. In fact, aside from the two complained-of comments from the polygraph operator (addressed below) the record contains no evidence of coercion, even of a subtle nature. Appellant suggests that some evidence of police coercion was shown because one of the law enforcement officers briefly showed a firearm and because the authorities apprised appellant that they wanted him to answer questions about the disappearance and likely death of an seven-year-old girl. We find that suggestion completely untenable. Further, appellant contends that the record is silent about whether he was ever apprised of the seriousness of the crime. But the record clearly shows that appellant was aware he could receive the death penalty for his crime.
Appellant also contends that the polygraph examiner made two comments that, alone or in combination with other factors, rendered his written statement involuntary. These comments occurred after his oral statements to Detective Taber; therefore, the comments could not have contributed to the involuntariness of those statements. Because there is no evidence in the record that even remotely suggests that the oral statements were involuntary, we dispense with that aspect of appellant's arguments and focus on his written statement.
Appellant contends that, before the polygraph examination, Lt. Raney told him that the results could be used "for his benefit as well as for the benefit of the [police]." Appellant claims that this warning is prohibited under Dunn v. State, 721 S.W.2d 325 (Tex.Crim.App.1986) and rendered his written confession inadmissible as involuntary. But Dunn's holding regarding the use of "for or against" language is a construction of Article 38.22 rather than a constitutional rule of involuntariness. Creager v. State, 952 S.W.2d 852, 855 (Tex.Crim.App.1997). A statement is inadmissible if the statutorily required warning that "any statement he makes may be used against him" is altered into a warning that says that the statement may be used "for or against" him. But, when the correct statutory warning is given, *558 and a "for or against" type comment is made at a different time during the course of interrogation, no statutory violation is present. Id. Such a remark may be a circumstance bearing upon the voluntariness of a defendant's statement, but does not necessarily render the statement inadmissible. Id. In the present case, the proper warning was given a number of times, both before and after the complained-of comment by the polygraph operator. The correct warning is set out in the written warnings contained in appellant's written statement. While the polygraph operator's comment is a factor to take into account in a voluntariness analysis, it does not in itself require an involuntariness finding.
Appellant also contends that the polygraph operator coerced his confession by commanding him to tell the police what happened. We do not, however, interpret the polygraph operator's comment that appellant would "have to tell" the police what happened as meaning that he was legally obligated to do so. Instead, the polygraph operator's statement conveys that appellant was morally obligated to give the information. Such moral urging does not in itself render an accused's statement involuntary but is another circumstance to consider.
Even considering these two comments together and in connection with all other circumstances, we are not convinced that appellant's will was overborne. Appellant had already agreed to take the polygraph examination before the examiner commented that the statements could be made for the mutual benefit of appellant and the sheriff's department. Moreover, the ostensible purpose of the polygraph test was to determine appellant's truthfulness about his lack of involvement in the crime. In fact, the stated object of any polygraph examination is not to obtain statements to be used but to determine whether, in fact, the person tested is an appropriate target of investigation. Hence, the polygraph operator's statement that the examination may be for appellant's benefit appears appropriate for that context. In any event, appellant voiced his awareness before the polygraph examination that he would likely fail the test but hoped he would pass. Appellant knowingly and voluntarily assumed the risk that he would fail the test.
Even if we assumed that a danger might exist that the polygraph operator's "for or against" warning would improperly elicit incriminating statements during the examination that are later used in court, nothing in the record suggests that appellant made any statements during the polygraph examination that he had not already made during interviews. Only after the examination, while the polygraph examiner remained silent, did appellant blurt out that he had "failed" the test. That admission was not in response to interrogation and appellant must have realized that it would not be used to benefit him. Furthermore, it was made after the conclusion of the test, which was the only subject of the "for or against" warning.
As for the comment that appellant would "have" to tell the police the location of the body, Lt. Raney did not promise or threaten appellant in any way when he made the statement. Appellant was simply confronted with the fact that the authorities knew he was guilty. Lt. Raney may have inflated the significance of the polygraph results by telling appellant that he would know whether appellant was guilty after the test. But inflated evidence of guilt is the tactic least likely to render a confession involuntary. Green v. State, 934 S.W.2d 92, 100 (Tex.Crim. App.1996), cert. denied, ___ U.S. ___, 117 S. Ct. 1561, 137 L. Ed. 2d 707 (1997). The use of such a tactic, which capitalizes on an accused's "moral sense of right and wrong, and his judgment regarding the likelihood that the police have garnered enough valid evidence linking him to the crime," does not cause the accused's will to be overborne because it does not distort "an otherwise rational choice of whether to confess or remain silent." Id. Lt. Raney simply used the discovery of appellant's guilt as leverage to urge the appellant to reveal the location of the body. Such a tactic does not deprive an accused of the ability to make a free and rational choice on whether to remain silent. We conclude that the circumstances present in this case do not show that appellant's written statement was involuntary. Points of *559 error seventeen through nineteen are overruled.
2. Closing argument
In points of error seven through nine, appellant complains that, during closing argument, the prosecutor referred to facts outside the record. Appellant complains about three different arguments. First, the prosecutor argued that people do not die quickly from strangulation:
[The medical examiner] also stated that there was significant trauma in [the decedent's] genital area which occurred after she was dead. That means that Eric Nenno strangled her and did what he did for as long as it took. I would submit to you that you don't die quickly from your oxygen being cut off.
(Emphasis and bracket material as added by appellant). Moments later, the prosecutor argued that appellant killed his victim in order to prevent his sexual assault from being discovered:
How could [appellant] lure [decedent] into the house, have sexual intercourse with her to such an extent that she was literally apart, and then just let her go? That makes no sense at all. Use your common sense. He had to know that once he got her in that [sic] there was nothing he could do but kill her because that was his only hope of getting away with it.
(Emphasis and bracket material as added by appellant). Finally, the prosecutor argued that appellant must have contemplated killing the victim before committing sexual assault:
[Appellant] knew that if he ever lived out his fantasies, if he ever went through the steps and took the chance to do what he wanted to do, that he was going to have to kill the victim.
(Emphasis and bracket material as added by appellant). Appellant objected to all three arguments. The trial court sustained his objection to the first argument but overruled his objections to the others.
We conclude that none of the above arguments were improper references to matters outside the record. First, all of these arguments were simply statements of common knowledge. Common knowledge is an exception to the prohibition against arguing facts outside the record. Sawyers v. State, 724 S.W.2d 24, 37 (Tex.Cr.App.1986); Carter v. State, 614 S.W.2d 821, 823 (Tex.Cr. App.1981). Second, evidence existed in the record to substantiate the prosecutor's arguments. Appellant's written confession contained a detailed account of appellant's actions in choking the victim:
I remember her kicking and trying to fight back. I grabbed her up and put my left arm around her neck from behind. I started choking her to keep her quiet. She continued to struggle so I took her into the bathroom in my bedroom with her standing on her feet but with me dragging her. After we got into the bathroom, she stopped screaming but was still struggling. Then she stopped struggling in the bathroom. I think that she was dead.
The jury could have inferred from that account that the victim's death was not immediate. Appellant also discussed with Detective Taber the possible fate of the victim and the killer's motivation for murder:
Q. Detective Taber, you asked the defendant what he thought had happened to [the victim]?
A. Yes, I did.
Q. What was the response?
A. He said he felt that she was kidnapped, raped, and murdered.
Q. Did he make any statements about why a person would murder her?
A Yes.
Q. What did he say?
A So no one would find out who did it.
(Bracketed material inserted). Points of error seven through nine are overruled.
C. PUNISHMENT
1. Expert testimony
In point of error one, appellant contends that the trial court erred in admitting expert testimony from Kenneth Lanning during the punishment stage of the trial. As explained in connection with point of error two, Lanning testified with regard to appellant's *560 future dangerousness. Appellant contends that Lanning's testimony was inadmissible under Tex.R.Crim. Evid. 702[7] because it failed to meet the three-pronged test announced in Kelly v. State, 824 S.W.2d 568 (Tex.Crim.App.1992). He also contends that the testimony was inadmissible under Tex. R.Crim. Evid. 403[8] because it merely duplicated the jury's knowledge and carried the prospect of unduly influencing the jury with an "expert" label.
Appellant contends that the State failed to show the validity of the scientific theories underlying Lanning's testimony or the validity of the method used for applying the theories. Appellant argues that this validity is lacking because the State failed to produce any evidence (1) that the theories underlying Lanning's testimony are accepted as valid by the relevant scientific community, (2) that the alleged literature on the theories supports his theories, (3) that there are specific data or published articles regarding the area of future dangerousness of prison inmates, (4) that his theories have been empirically tested, (5) that he has conducted any studies or independent research in the area of future dangerousness, or (6) that anyone else had tested or evaluated the theories upon which his testimony was based.
In Kelly, we held that Rule 702 required the satisfaction of a three-part reliability test before novel scientific evidence would be admissible: (1) the underlying scientific theory must be valid; (2) the technique applying the theory must be valid; and (3) the technique must have been properly applied on the occasion in question. 824 S.W.2d at 573. Factors relating to this determination of reliability include but are not limited to: (1) acceptance by the relevant scientific community, (2) qualifications of the expert, (3) literature concerning the technique, (4) the potential rate of error of the technique, (5) the availability of other experts to test and evaluate the technique, (6) the clarity with which the underlying theory or technique can be explained to the court, and (7) the experience and skill of the person applying the technique. Id.
We subsequently held that this inquiry is substantively identical to the inquiry mandated by the Supreme Court in the federal system in Daubert v. Merrell Dow Pharmaceuticals, Inc., 509 U.S. 579, 113 S. Ct. 2786, 125 L. Ed. 2d 469 (1993) concerning the admissibility of scientific evidence under Rule 702. Jordan v. State, 928 S.W.2d 550, 554 (Tex. Crim.App.1996). In Daubert, the Supreme Court held that Federal Rule 702 required that scientific evidence be "not only relevant, but reliable." 113 S.Ct. at 2795, 125 L.Ed.2d at 481. In determining the reliability of the testimony, the Supreme Court held that a number of factors bear on the inquiry, including: (1) whether the theory or technique can be or has been tested, (2) whether the theory or technique has been subjected to peer review or publication, (3) the known or potential rate of error, and (4) general acceptance within the relevant scientific community. Id. at 2796-97, 125 L.Ed.2d at 483. The Court emphasized that the inquiry is "a flexible one." Id.
Although Kelly involved novel scientific evidence, we later concluded that the standard established in that case applied to all scientific evidence, whether or not it was novel. Hartman v. State, 946 S.W.2d 60, 62-63 (Tex.Crim.App.1997). The question we confront today is whether Kelly is applicable to nonscientific expert testimony (i.e. that involving technical or other specialized knowledge). The answer to that question is a qualified "yes." The general principles announced in Kelly (and Daubert) apply, but the specific factors outlined in those cases may or may not apply depending upon the context. We do not attempt, here, to develop a rigid distinction between "hard" science, "soft" sciences, or nonscientific testimony. *561 The present case illustrates that the distinction between various types of testimony may often be blurred. The observations we make today apply to all types of expert testimony.
Courts must keep in mind the statement in Daubert that the inquiry is "a flexible one." The general approach of the Federal Rules and by inference, the state rules that were patterned upon themwas to "relax[] the traditional barriers to opinion testimony." 113 S.Ct. at 2794-95, 125 L.Ed.2d at 480. The Supreme Court, while setting out four factors relevant to scientific reliability, cautioned that "we do not presume to set out a definitive checklist or test." Id. at 2796, 125 L.Ed.2d at 482. The factors listed were based upon "general observations" about the nature of scientific evidence. Id. And, the standard of evidentiary reliability set forth was derived from Rule 702's requirement that the expert's testimony pertain to "scientific knowledge" (emphasis added). Id. at 2795, 125 L.Ed.2d at 481. While various federal circuits may sometimes purport to disagree with each other, a close examination of the cases shows a general agreement about two important propositions: (1) Daubert `s prescription that trial judges act as "gatekeepers" in determining the reliability of expert evidence applies to all forms of expert testimony, and (2) the four factors listed in Daubert do not necessarily apply outside of the hard science context; instead methods of proving reliability will vary, depending upon the field of expertise. Moore v. Ashland Chemical, Inc., 126 F.3d 679, 685-689 (5th Cir.1997), rehearing en banc granted (general principles of Rule 702 recognized in Daubert apply to other species of expert testimony except where self-evident that the Court's remarks apply only to scientific knowledge; reliability of testimony should be evaluated by reference to the standards applicable to the particular field in question; four Daubert "factors" apply to hard science but not to clinical medicine); United States v. Jones, 107 F.3d 1147, 1156 & 1158 (6th Cir.), cert. denied, ___ U.S. ___, 117 S. Ct. 2527, 138 L. Ed. 2d 1027 (1997)("gatekeeper" and reliability language applicable; but four factors discussed regarding scientific validity should not be extended beyond the scientific realm); Tyus v. Urban Search Management, 102 F.3d 256, 263 (7th Cir. 1996), cert. denied, ___ U.S. ___, 117 S. Ct. 2409, 138 L. Ed. 2d 175 (1997) (Daubert framework applies to social sciences, but "the measure of intellectual rigor will vary by the field of expertise and the way of demonstrating expertise will also vary"). See also, Freeman v. Case Corp., 118 F.3d 1011, 1016 n. 6 (4th Cir.1997), cert. denied, ___ U.S. ___, 118 S. Ct. 739, 139 L. Ed. 2d 676 (1998)("where an expert relies on his experience and training and not a particular methodology to reach his conclusions" Daubert "analysis" is inappropriate); United States v. Bighead, 128 F.3d 1329, 1330 (9th Cir.1997)(Daubert's tests for admissibility "do not require exclusion of expert testimony that involves specialized knowledge rather than scientific theory"); Compton v. Subaru of America, 82 F.3d 1513, 1518 (10th Cir.1996), cert. denied, ___ U.S. ___, 117 S. Ct. 611, 136 L. Ed. 2d 536 (1996)(four factors "applicable only when a proffered expert relies on some principle or methodology" rather than experience or training).
When addressing fields of study aside from the hard sciences, such as the social sciences or fields that are based primarily upon experience and training as opposed to the scientific method, Kelly's requirement of reliability applies but with less rigor than to the hard sciences. To speak of the validity of a "theory" or "technique" in these fields may be roughly accurate but somewhat misleading. The appropriate questions are: (1) whether the field of expertise is a legitimate one, (2) whether the subject matter of the expert's testimony is within the scope of that field, and (3) whether the expert's testimony properly relies upon and/or utilizes the principles involved in the field. These questions are merely an appropriately tailored translation of the Kelly test to areas outside of hard science. And, hard science methods of validation, such as assessing the potential rate of error or subjecting a theory to peer review, may often be inappropriate for testing the reliability of fields of expertise outside the hard sciences.[9]
*562 We turn then, to apply this test to Lanning's testimony. Lanning testified that his analysis was based upon his experience studying cases.[10] He did not contend that he had a particular methodology for determining future dangerousness. Research concerning the behavior of offenders who sexually victimize children appears to be a legitimate field of expertise. Through interviews, case studies, and statistical research, a person may acquire, as a result of such experience, superior knowledge concerning the behavior of such offenders. Moreover, Lanning's testimony shows that future dangerousness is a subject that often surfaces during the course of research in this field. And, Lanning testified that he studied in excess of a thousand cases that concerned the issue of future dangerousness in some fashion. His research involved studying solved cases to attempt to understand the dynamics of what occurred. This research included personal interviews with inmates convicted of child sex offenses, examining the inmates' psychological records, and examining the facts of the offenses involved. Appellant complains about the lack of peer review. But the absence of peer review does not necessarily undercut the reliability of the testimony presented here. To the extent that a factfinder could decide that the absence of peer review cast doubt on the credibility of the testimony, such affects the weight of the evidence rather than its admissibility. We find the reliability of Lanning's testimony to be sufficiently established under Rule 702.
As for appellant's Rule 403 claim, the above discussion shows that Lanning's testimony did not merely duplicate the jury's knowledge because Lanning possessed superior knowledge concerning the behavior of offenders who sexually victimized children. We find that the trial court did not err in determining that the probative value of Lanning's testimony was not substantially outweighed by the danger of unfair prejudice. Point of error one is overruled.
2. Cross-examination
In point of error four, appellant contends that the trial court erred in refusing to grant a mistrial after the prosecutor asked questions based upon an allegedly inadmissible document. In cross-examining Dr. Robert Geffner, one of appellant's expert witnesses, the prosecutor attempted to introduce into evidence a document made by a colleague of Dr. Geffner. The document was an interview with appellant and was one of the materials relied upon by Dr. Geffner in formulating his expert opinion. Appellant objected that the document was hearsay, and the trial court sustained the objection. Later, the prosecutor questioned Dr. Geffner concerning the contents of the document:
PROSECUTOR: Doctor, State's Exhibit No. 99, would you tell the jury generally what State's 99 is?
WITNESS: It's basically him talking about what he remembered from the night of the crime, what he told other people in general.
PROSECUTOR: What did Eric Nenno tell your associate about what he remembered about the night?
Defense counsel objected, and the trial court sustained the objection. No further relief was requested. Later the prosecutor conducted more questioning concerning the colleague's report:
PROSECUTOR: Also on direct examination you said that you considered it extremely important from your standpoint that he began by telling you or began the confession by saying that it was in a dream-like state?
WITNESS: Not to me but to the police officer.
PROSECUTOR: But you attached some significance to those *563 particular words, the way that he used those words, that he was in a dream-like state when this occurred?
WITNESS: I believe I said that people with frontal lobe problems do sometimes use that terminology when they've passed the threshold. I think it was something along those lines.
PROSECUTOR: But you find it significant then that he used that type of wording in making your assessment of the evidence that you're here to testify about today?
WITNESS: That's one piece of it. There is a lot of data. That's one piece of it, yes.
PROSECUTOR: In the interview that was done by your associate, Mr. Nenno basically gives a different view of what happened than he does in the confession, doesn't he?
Defense counsel then objected, but his objection was overruled. The prosecutor continued:
PROSECUTOR: You can answer.
WITNESS: I believe it was the same idea.
PROSECUTOR: Didn't you tell us that as part of your evaluation that he said that he didn't remember anything about this offense after it happened?
WITNESS: In the interview, yes. Pretty much so.
PROSECUTOR: That he didn't even remember where the body was placed?
Defense counsel objected, the trial court sustained the objection, and, upon appellant's request, instructed the jury to disregard the contents of the document. Appellant's mistrial motion was denied.
Appellant contends that the prosecutor's questions were improper and so prejudicial as to require a mistrial. We first note that appellant requested a mistrial only as to the last question detailed above; he has failed to preserve error with respect to the earlier questions. Cockrell v. State, 933 S.W.2d 73, 89 (Tex.Crim.App.1996)(plurality opinion), cert. denied, ___ U.S. ___, 117 S. Ct. 1442, 137 L. Ed. 2d 548 (1997); Id. at 96-97 (Maloney, J. concurring). As for the last question, he obtained an instruction to disregard. Generally, when a witness has not had the opportunity to answer an improper question, an instruction to disregard will cure any harm to the defendant. Burks v. State, 876 S.W.2d 877, 902 (Tex.Crim.App. 1994), cert. denied, 513 U.S. 1114, 115 S. Ct. 909, 130 L. Ed. 2d 791 (1995); Cooks v. State, 844 S.W.2d 697, 735 (Tex.Crim.App.1992), cert. denied, 509 U.S. 927, 113 S. Ct. 3048, 125 L. Ed. 2d 732 (1993); Ransom v. State, 789 S.W.2d 572, 585 (Tex.Crim.App.1989), cert. denied, 497 U.S. 1010, 110 S. Ct. 3255, 111 L. Ed. 2d 765 (1990); Turner v. State, 600 S.W.2d 927, 932 (Tex.Crim.App.1980). The only exception is when the question is so inflammatory that an instruction to disregard could not withdraw the impression from the jurors minds. See above citations. The last question did convey appellant's alleged lack of memory, a fact apparently contained in the inadmissible document. However, essentially the same information was elicited in the immediately preceding question, to which there was no objection. Error is defaulted when the same evidence is presented elsewhere without objection. McFarland v. State, 845 S.W.2d 824, 840 (Tex.Crim.App. 1992), cert. denied, 508 U.S. 963, 113 S. Ct. 2937, 124 L. Ed. 2d 686 (1993); Narvaiz v. State, 840 S.W.2d 415, 430 (Tex.Crim.App. 1992), cert. denied, 507 U.S. 975, 113 S. Ct. 1422, 122 L. Ed. 2d 791 (1993).
However, even if error had been preserved, we find that the prosecutor's question was proper. Appellant's claim is that the evidence was hearsay. Evidence is hearsay only when it is offered "to prove the truth of the matter asserted." Tex.R.Crim. Evid. 801(d). The question about appellant's statement was not designed to show the truth of the statement contained in the document but to impeach Dr. Geffner by attacking *564 the basis for his opinion. The State wanted to undermine Dr. Geffner's opinion by showing that he relied upon specific statements made by appellant to formulate that opinion despite other information (upon which he also claims to have relied) that showed appellant telling a different story.
Moreover, evidence constituting part of the underlying basis for an expert opinion is admissible upon cross-examination under Rule 705, which states that an "expert may... be required to disclose on cross-examination, the underlying facts or data" made the basis of his opinion. Tex.R.Crim. Evid. 705(a); Ramirez v. State, 815 S.W.2d 636 (Tex.Crim.App.1991). In a very similar situation, a court of appeals has held that the State could impeach a defense expert with out-of-court statements contained in another doctor's report where the defense expert had relied upon a summary of the report in formulating his opinions. Moranza v. State, 913 S.W.2d 718, 727-728 (Tex.App.Waco 1995, pet. ref'd). In the present case, Dr. Geffner claimed to have relied upon the complained of interview. The State was entitled to impeach Geffner with the contents of that interview. Point of error four is overruled.
3. Extraneous offense
In point of error six, appellant contends that the trial court erred in admitting a nine-year-old girl's testimony concerning an incident that occurred between her and appellant. The girl testified that she was walking her bicycle in her neighborhood because its chain was broken. Appellant grabbed the bicycle, carried it into the driveway, and fixed the chain. Then he patted the girl on her "butt." The girl testified that appellant's conduct made her feel mad and sad and that she cried. She later told her mother, who called the police. Appellant contends that this conduct did not constitute an offense and was offered only to inflame the minds of the jury. He claims that the evidence is irrelevant, and that it is unfairly prejudicial under Rule 403.
Evidence regarding a defendant's character is generally relevant at the punishment stage of a capital murder trial. Jones v. State, 944 S.W.2d 642, 652 (Tex.Crim.App. 1996), cert. denied, ___ U.S. ___, 118 S. Ct. 100, 139 L. Ed. 2d 54 (1997). Uncharged misconduct, whether criminal or not, is admissible at this stage. Wilkerson v. State, 881 S.W.2d 321, 326 (Tex.Crim.App.), cert. denied, 513 U.S. 1060, 115 S. Ct. 671, 130 L. Ed. 2d 604 (1994). The jury could have found the incident to be misconduct on appellant's part, albeit of a relatively mild sort. The fact that an innocent explanation for such conduct may exist affects the weight of the evidence rather than its admissibility.
As for appellant's Rule 403 objection, the "inflammatory" nature of the evidence is that it tended to show that appellant was a child molester. Showing appellant to be a child molester was a perfectly legitimate purpose, and hence, while the evidence was "prejudicial", it was not unfairly so.[11] Point of error four is overruled.
4. Magazines
In points of error eleven through sixteen, appellant contends that the trial court erred in admitting into evidence sexually explicit magazines found in a locked file cabinet. In the same file cabinet, law enforcement officials also found the victim's black and white polka dot dress and white panties. Appellant contends that the magazines were irrelevant because they were simply items he possessed in exercising his First Amendment rights.[12] He also contends that *565 the magazines were unfairly prejudicial under Rule 403.
Because the sexually explicit magazines were found within the same locked file cabinet as the victim's clothes, the jury could have concluded that the magazines played a role in motivating appellant to commit the sexual assault. And the jury could have believed that appellant's possession of the magazines in close proximity to the victim's effects was a sign that appellant was sexually obsessed and that this sexual obsession was of the sort likely to lead to further violence. As such, the magazines are relevant and their probative value is not substantially outweighed by the danger of unfair prejudice.[13]
5. Argument
In point of error five, appellant contends that the trial court erred in denying his motion for mistrial when the prosecutor made the following argument during the punishment stage of the trial:
He came to the conclusion basically that he had blanked out and was not aware of anything that had happened. If that was the real issue, why didn't we hear that on the guilt-innocence stage? If he didn't know right from wrong, that's a defense.
Appellant objected, the trial court sustained the objection, and the trial court instructed the jury to disregard the prosecutor's comment. Appellant contends that this argument distorted the burden of proof in the State's favor and that the error was not harmless. We have found an instruction to disregard to cure prosecutorial comments more inflammatory than the one that occurred here. Shannon v. State, 942 S.W.2d 591, 597 (Tex.Crim.App.1996)(comment outside the record that the defendant was a sociopath); Hammond v. State, 799 S.W.2d 741, 748-749 (Tex.Crim.App.1990), cert. denied, 501 U.S. 1259, 111 S. Ct. 2912, 115 L. Ed. 2d 1076 (1991)(comment that compared the case on trial with other capital murder cases); Brown v. State, 769 S.W.2d 565, 567 (Tex.Crim.App.1989)(reference to parole); Bower v. State, 769 S.W.2d 887, 906-907 (Tex.Crim.App.1989), cert. denied, 506 U.S. 835, 113 S. Ct. 107, 121 L. Ed. 2d 66 (1992)(comment about lack of remorse that was held to be a comment on failure to testify). The trial court's instruction cured any error. Point of error five is overruled.
The judgment of the trial court is affirmed.
BAIRD, J., joins with note.
OVERSTREET, J., concurs in the result.
PRICE, J., concurs in points of error 17 through 19, and otherwise joins the opinion of the Court.
BAIRD, Judge, joins the judgment of the Court but dissents to the decision to publish. The decision to publish an opinion of the Court should rest on whether the opinion would contribute to the jurisprudence of this State. Because the instant opinion does not make such a contribution, I dissent to the publication thereof. See, Quinn v. State, 958 S.W.2d 395, 403 (Tex.Cr.App.1997); Kirby v. State, 883 S.W.2d 669, 672 (Tex.Cr.App.1994); *566 and, Pawson v. State, 865 S.W.2d 36 (Tex.Cr. App.1993). Overstreet, J., concurs in the result. Price, J., concurs in points of error 17 through 19, and otherwise joins the opinion of the Court.
NOTES
[1] § 19.03(a)(2) provides that a person commits capital murder when he commits murder under § 19.02(b)(1) and "the person intentionally commits the murder in the course of committing or attempting to commit ... aggravated sexual assault" (ellipsis inserted).
[2] Unless otherwise indicated all future references to Articles refer to Code of Criminal Procedure.
[3] The issue asks: "Whether there is a probability that the defendant would commit criminal acts of violence that would constitute a continuing threat to society." Article 37.071 § 2(b)(1).
[4] That issue asks: Whether, taking into consideration all of the evidence, including the circumstances of the offense, the defendant's character and background, and the personal moral culpability of the defendant, there is a sufficient mitigating circumstance or circumstances to warrant that a sentence of life imprisonment rather than a death sentence be imposed. Article 37.071 § 2(e).
[5] The trial court's findings of fact are in narrative form. Except for summarizing the consent to search portions, this "Facts" subsection consists of relevant excerpts of the trial court's findings set out verbatim. Our review shows that the findings are sufficiently supported by the record.
[6] Due to our disposition of this point of error, we need not attempt to determine whether an electronic recording was actually made. Nor do we need to determine whether appellant has inadequately briefed his claim by failing to allege and provide record support for the State's failure to satisfy one of the requirements outlined in § 3(a)(1)-(5).
[7] Rule 702 provides: If scientific, technical, or other specialized knowledge will assist the trier of fact to understand the evidence or to determine a fact in issue, a witness qualified as an expert by knowledge, skill, experience, training or education, may testify thereto in the form of an opinion or otherwise.
[8] Rule 403 provides: 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.
[9] We do not categorically rule out employing such factors in an appropriate case.
[10] Lanning had been studying the sexual victimization of children for fifteen years full-time and eight years part-time prior to that. He had been with the FBI for over twenty-five years, and had been assigned to the Behavioral Science Unit of the FBI Academy in Quantico, Virginia for fifteen years.
[11] Appellant also contends that the child testified to not remembering the incident and relaying only what the district attorneys told her. He bases this contention upon defense questions "You don't remember much about this at all, do you?" and "In fact, you don't know much except what the District Attorneys have told you?" to which the witness answered "no." The latter question is ambiguous: a "no" answer could be interpreted as either agreement or disagreement with the question. And the former question does not necessarily indicate that the girl did not remember the facts to which she testified. Moreover, on redirect, the girl testified that she previously told prosecutors the same story that she testified to at trial. And she testified that the prosecutors did not tell her what to say but simply asked what happened.
[12] Appellant apparently does not make an independent First Amendment argument but simply alleges that such materials are logically irrelevant to his future dangerousness. Assuming arguendo that the viewing of such materials were constitutionally protected, that fact does not necessarily exclude their relevance to show appellant's future dangerousness. And, even if we interpreted appellant as making an independent First Amendment claim, he failed to preserve error on that issue by making no objection on First Amendment grounds at trial. Pondexter v. State, 942 S.W.2d 577, 585 (Tex.Crim.App. 1996), cert. denied, ___ U.S. ___, 118 S. Ct. 85, 139 L. Ed. 2d 42 (1997)
[13] We denied a motion to supplement the record with the magazines. Appellant correctly alleges in his brief that we can on our own motion order the forwarding of such materials. The State contends that the magazines contain numerous photographs of nude females, most of whom are clean shaven in the pubic area and some of whom purport to be young girls. The State further contends that the females are often depicted engaging in sexual acts similar to those appellant described as having fantasized. If the magazines are as the State describes, then their content would make them relevant to show his sexual obsession with children regardless of where the magazines were discovered. However, because a close locational connection between the magazines and the victim's clothes was established, we need not review the magazines' contents to determine their admissibility. We need only assume that the magazines depict nudity or sex in some fashionwhich appellant must concede to make a claim of prejudice in the first place. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1581778/ | 957 F. Supp. 1145 (1997)
Paul John SCHNEIDER, et al., Plaintiffs,
v.
CALIFORNIA DEPARTMENT OF CORRECTIONS, et al., Defendants.
No. C-96-1739 SI.
United States District Court, N.D. California.
March 24, 1997.
*1146 Herman A. D. Franck, V, Stephen T. Gargaro, Franck & Associates, San Francisco, CA, for Plaintiffs.
Daniel E. Lungren, Atty. Gen. of the State of California, Peter J. Siggins, Sr. Asst. Atty. Gen., Bruce M. Slavin, Allen R. Crown, Deputy Attys. Gen., San Francisco, CA, for Defendants California Dept. of Corrections and Director Gomez.
ORDER GRANTING DEFENDANTS' MOTION TO DISMISS
ILLSTON, District Judge.
On March 14, 1997, the Court heard argument on defendants' motion to dismiss. Having considered the arguments of counsel and the papers submitted, the Court hereby grants defendants' motion to dismiss without leave to amend.
BACKGROUND
Plaintiffs are current and former state inmates of Pelican Bay State Prison, California Correctional Institution, and the Central California Women's Facility. The inmates allege that defendants California Department of Corrections ("CDC") and James Gomez, Director of the CDC, have violated the Fifth Amendment Takings Clause by failing to pay interest on funds deposited by prisoners in Inmate Trust Accounts ("ITAs").
For security reasons, prisoners are not permitted to possess money while they are in prison. 15 C.C.R. § 3006(b). For funds to which prisoners wish to have access while incarcerated,[1] inmates can choose to place their money in either an ITA, which does not pay interest to the prisoner, or in a Passbook Savings Account which does pay interest.[2] In order to have a Passbook Savings Account, inmates are required to maintain a balance of $25.00 in an ITA.[3] Only those funds placed in an ITA are available to inmates *1147 for use in the Canteen[4] to purchase items such as soap and toothpaste.
The California Penal Code provides that any interest earned on funds placed in an ITA[5] is allocated to the Inmate Welfare Fund, whose funds are used to improve prison conditions in the State of California. Cal.Penal Code § 5008.
Plaintiffs argue that inmates are unconstitutionally forced to choose between earning interest via the Passbook Savings Account, which funds may not be used at the Canteen, and having access to the Canteen via their ITAs, which do not earn interest.[6] They assert that access to the Canteen is a necessity of prison life. Plaintiffs allege that the CDC's failure to pay interest on funds deposited by prisoners in an ITA constitutes a taking in violation of the Fifth Amendment on the part of the CDC and prison officials. Plaintiffs further allege that defendant James Gomez, the Director of the CDC, is personally liable for implementing the policy on prisoner bank accounts. Plaintiffs seek monetary and injunctive relief against each of these defendants.
Defendants have filed a motion to dismiss with prejudice for failure to state a claim.
LEGAL STANDARD
Under Federal Rule of Civil Procedure 12(b)(6), a district court must dismiss a complaint if it fails to state a claim upon which relief can be granted. The question presented by a motion to dismiss is not whether a plaintiff will prevail in the action, but whether the plaintiff is entitled to offer evidence in support of the claim. Scheuer v. Rhodes, 416 U.S. 232, 236, 94 S. Ct. 1683, 1686, 40 L. Ed. 2d 90 (1974).
In answering this question, the Court must assume that the plaintiff's allegations are true and must draw all reasonable inferences in the plaintiff's favor. Usher v. City of Los Angeles, 828 F.2d 556, 561 (9th Cir.1987). Even if the face of the pleadings suggests that the chance of recovery is remote, the Court must allow the plaintiff to develop the case at this stage of the proceedings. United States v. City of Redwood City, 640 F.2d 963, 966 (9th Cir.1981).
DISCUSSION
The Fifth Amendment provides that "private property [shall not] be taken for public use, without just compensation." U.S. Const. amend. V. The Fifth Amendment Takings Clause has been held to apply to the states through the due process clause of the Fourteenth Amendment. Webb's Fabulous Pharmacies, Inc. v. Beckwith, 449 U.S. 155, 160, 101 S. Ct. 446, 450, 66 L. Ed. 2d 358 (1980). The Fifth and Fourteenth Amendment property and due process guarantees apply only to situations in which an individual is deprived of property in which there exists a constitutionally protected property interest. Board of Regents v. Roth, 408 U.S. 564, 569, 92 S. Ct. 2701, 2705, 33 L. Ed. 2d 548 (1972). Protected property interests are created by "existing rules or understandings that stem from an independent source, such as state law rules or understandings that secure certain benefits and that support claims of entitlement to those benefits." Id. at 577, 92 S.Ct. at 2709.
In order for plaintiffs to establish that they have a protected property interest in the interest income created by funds deposited in an ITA, they must show that they have a legitimate claim of entitlement through either California law or some other independent source to the interest income earned on funds in these accounts. Id.
California law provides no such entitlement to interest earned on funds placed in a prison's ITA. California Penal Code § 5008 provides that the Director of Corrections shall deposit the interest or increment accruing on inmate trust funds in the Inmate Welfare Fund. There is no provision in the *1148 California Penal Code allowing or requiring the Director of Corrections to pay interest earned from funds in an ITA to an inmate. Thus California law specifically does not create a protected property interest that can be vindicated by the Fifth and Fourteenth Amendments.
Plaintiffs cite Tellis v. Godinez, 5 F.3d 1314 (9th Cir.1993), for the proposition that prisoners have a constitutionally protected property right in interest income from an ITA. In Tellis, the Ninth Circuit held that a Nevada statute requiring that interest earned on prisoners' personal funds be credited to prisoners' accounts created a protected property interest in the interest income. Id. at 1317.
The facts of Tellis are wholly distinguishable from the facts of the instant case, because the state law in Nevada is quite different from the law in California. The decision in Tellis was based entirely on the language of Nevada Revised Statute § 209.241, which provides that "[t]he interest and income earned on the money in the fund, after deducting any applicable charges, must be credited to the fund." The Ninth Circuit held that this language required the prison to credit the interest earned on this fund back to the fund and proscribed the prison from spending the interest or withdrawing the interest for other purposes. The Court found that the Nevada statute "create[d] a protected property interest in the interest and income" earned in the account. Id. at 1317.
Unlike the Nevada statute, Cal.Penal Code § 5008 does not mandate that interest earned on prisoner trust accounts be credited back to the individual prisoners account. To the contrary, Cal.Penal Code § 5008 specifically provides that such interest shall be deposited in the Inmate Welfare Fund. The California regulations at issue in this matter are thus very different from the Nevada regulations in Tellis.[7]Tellis does not hold broadly that inmates always have a constitutionally protected right to interest earned in prisoner bank accounts; rather it holds that they have such a right if state law provides it to them. In California, it does not.
Several district courts have also ruled on this issue and have rejected the argument that prisoners have a constitutionally proctected property interest in interest income. See, e.g., Coleman v. McGinnis, 843 F. Supp. 320, 325 (E.D.Mich.1994) (no state statute provided prisoners with a protected property interest in interest earned on accounts; therefore failure to pay interest was not a taking); Gray v. Lee, 486 F. Supp. 41 (D.Md. 1980) (failure to pay interest on inmates' funds held in spending accounts not unconstitutional because inmates had an option of transferring funds to commercial interest-bearing accounts); Smith v. Robinson, 456 F. Supp. 449 (E.D.Pa.1978) (courts have yet to recognize a right to earn interest on funds received while incarcerated).[8]
Plaintiffs also contend that their entitlement to the interest generated by funds in an ITA springs from an independent source. Plaintiffs cite two cases, Webb's Fabulous Pharmacies, Inc. v. Beckwith, 449 U.S. 155, 101 S. Ct. 446, 66 L. Ed. 2d 358 (1980), and United States of America v. $277,000 U.S. Currency, 69 F.3d 1491 (9th Cir.1995), in support of this proposition. However, the Court finds that these cases are distinguishable from the instant case and do not support the plaintiffs' assertion that they have a constitutionally protected property interest in the interest income earned from inmate trust accounts.
In Beckwith, the Supreme Court struck down as unconstitutional a Florida statute *1149 that allowed a Florida county to keep $100,000 in interest earned on an interpleader fund deposited in the county court. In its decision, the Supreme Court emphasized that there was a Florida statute that provided for a separate fee to be paid to the county for holding the funds and thus there was insufficient justification for the county to take the interest on the interpleaded funds. The Court emphasized the narrowness of its holding:
We hold that under the narrow circumstances of this case where there is a separate and distinct state statute authorizing a clerk's fee ... where the deposited fund itself concededly is private; and where the deposit in the court's registry is required by state statute ... the interest earned on the interpleader fund while it was in the registry of the court was a taking violative of the Fifth and Fourteenth Amendments.
Id. at 164, 101 S.Ct. at 452-53. The facts of the instant case distinguish it from the holding in Beckwith. The narrow holding of that case cannot be expanded to create a constitutionally protected property interest in interest income that is not created by state statute.
$277,000 is also distinguishable from the instant case. $277,000 involved funds that were seized by the United States and were found later to be the lawful property of the owner. The Ninth Circuit recognized that the government had immunity from a civil damages suit but held that "it must disgorge benefits that it has actually and calculably received from an asset that it has been holding improperly." Id. at 1498. In this case there has been no seizure of the prisoners assets by the government and their funds have not been held improperly or illegally.
Thus, the Court finds that inmates in California do not have a protected property interest in the interest income earned on Inmate Trust Accounts and that they are not deprived of earning interest on their funds because they can elect to place their money in a Passbook Savings Account. Therefore, the Court concludes that plaintiffs have not stated, and cannot state, a claim for violation of the Fifth Amendment Takings Clause.[9]
CONCLUSION
For the foregoing reasons and for good cause shown, the Court hereby GRANTS defendants' motion to dismiss for failure to state a claim without leave to amend.
IT IS SO ORDERED.
NOTES
[1] Inmates retain the option of placing their funds outside the California Department of Corrections system with family, friends, institutional trustees, etc.
[2] The Passbook Savings Account program was implemented in response to the California Court of Appeal decision in In re Parker, 151 Cal. App. 3d 583, 198 Cal. Rptr. 796 (1984). Because of a growing problem in the trafficking and use of narcotics and other contraband in prison, in 1981 California prison inmates were prohibited by regulation from establishing passbook savings accounts with outside banks, and were restricted to "long term investments" for their funds. The California court found that less restrictive alternatives were available to the prison authorities to afford protection against the narcotics and contraband threat, and this passbook savings program was developed as a result.
[3] At oral argument plaintiffs complained that the CDC failed to inform inmates of their options concerning the Passbook Savings Account and the procedures surrounding the creation of such an account. The Court notes that attached to plaintiffs' complaint is a form entitled "Passbook Savings Account Information" detailing the procedures and requirements for maintaining a Passbook Savings Account. In any event, plaintiffs' allegations concerning the lack of information to inmates are not contained in the complaint and will not be separately addressed by the Court.
[4] The Canteen is the facility at the prison where inmates are able to purchase sundries.
[5] At oral argument defendants represented that no interest is actually earned on the funds in Inmate Trust Accounts. However, whether interest is actually earned on these funds does not affect the constitutional analysis.
[6] Since prisoners may maintain both types of accounts, this argument is factually, as well as legally, flawed.
[7] Tellis said "[W]e must assume that the legislature would have expressly authorized [the prison's] expenditure of money earned on prisoners' personal funds if it intended to do so." Id. at 1317. The California Legislature did just that.
[8] The Tenth Circuit in Petrick v. Fields, 1996 WL 699706 (10th Cir. Dec.6, 1996), confronted the same issue and held that a failure to pay interest was not a taking under the Fifth Amendment because neither Oklahoma law nor any other independent source provided prisoners with a constitutionally protected property interest in the interest income earned on prisoner accounts. Id. at *2. The Tenth Circuit distinguished Tellis on the ground that the Nevada statute explicitly provided for the payment of interest to prisoners. Petrick at *2. However, Petrick is an unpublished decision and as such the Court cannot rely on it as binding authority. See 10th Cir. R. 36-3; 9th Cir. R. 36-3.
[9] Because the Court grants defendants' motion on this ground, it does not reach the issues of exhaustion of administrative remedies, Eleventh Amendment immunity, or qualified immunity. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1881501/ | 60 S.W.3d 880 (2001)
DDD ENERGY, INC., Appellant,
v.
VERITAS DGC LAND, INC., Appellee.
No. 14-99-01176-CV.
Court of Appeals of Texas, Houston (14th Dist.).
October 25, 2001.
*881 Thomas C. Wright, Geoffrey H. Bracken, Cynthia R. Levin Moulton, Jeffrey D. Meyer, Houston, for appellants.
Curtis Collette, R. Russell Hollenbeck, Houston, for appellees.
Panel consists of Justices ANDERSON, WITTIG, and SEYMORE.
*882 CORRECTED OPINION
JOHN S. ANDERSON, Justice.
This is an appeal from a summary judgment in favor of appellee, Veritas DGC Land, Inc. ("Veritas"). Appellant, DDD Energy, Inc.("DDD"), sued Veritas seeking a declaratory judgment that Veritas is obligated to defend and indemnify DDD, pursuant to a contract between them, from third party claims made against DDD. The judgment below granted judgment for Veritas as to all the third party claims against DDD because the indemnity clause relied on by DDD is not enforceable. We affirm in part and reverse in part.
Background
Michael L. Vickers ("Landowner") entered into an oil and gas lease agreement with Playa Exploration, Inc. Playa assigned undivided interests in the oil and gas lease to King Ranch Oil and Gas, Inc., TGX Corporation, and DDD. Thereafter, DDD entered into an agreement for geophysical services with Veritas, who was to conduct field geophysical surveys and related services on Vicker's land. The indemnity provisions in the geophysical services agreement between DDD and Veritas provide in part:
Section V-Operations:
Veritas shall indemnify, defend, ... [DDD] for all claims, damages, causes of actions, and liabilities resulting from Veritas' failure to conduct seismic operations in an orderly and workmanlike manner....
Section X-Liability Indemnity:
Veritas shall protect, indemnify, defend and save [DDD], ... harmless from and against all claims, ... and causes of actions ... asserted by third parties on account of ... damage to property of such third parties, which ... damage is the result of the negligent act or omission, breach of this Basic Agreement or the Supplemental Agreement, or willful misconduct of Veritas.... Likewise, [DDD] shall protect, indemnify, defend and save Veritas, ... harmless from and against all claims, ... causes of action... asserted by third parties on account of ... damage to property of such third parties, which ... damage is the result of the negligent act or omission of willful misconduct of [DDD] ...
This agreement provides that Veritas shall indemnify DDD for the negligent acts of Veritas, and DDD shall indemnify Veritas for the negligent acts of DDD. It does not provide that Veritas shall indemnify DDD for DDD's own negligence.
Veritas subontracted Brush Cutters to conduct brush clearing operations on Landowner's property. After discovering damage to his property, including the destruction of numerous oak and mesquite trees, Landowner filed suit against DDD, in Brooks County for (1) breach of duty to manage and administer the lease, (2) breach of contract, (3) negligence, (4) malicious trespass, (5) negligent misrepresentation, (6) breach of fiduciary duty, (7) gross negligence, and (8) intentional tort. DDD brought suit against Veritas in Harris County seeking a declaratory judgment that Veritas is obligated to defend and indemnify DDD, under the terms of the parties' agreement, against claims based on damage to Landowner caused by Veritas' negligence. Both parties filed motions for summary judgment. DDD sought partial summary judgment declaring Veritas is required to defend and indemnify DDD from the claims asserted in the Brooks County law suit. Veritas' motion for summary judgment asserted three bases: DDD's breach of contract claim does not present a justiciable issue; the indemnity provision relied on by DDD is unenforceable as a matter of law; and *883 Veritas is not liable for damage caused by its subcontractor. The trial court granted Veritas' motion only on the basis the indemnity clause was unenforceable, and denied the other two grounds brought by Veritas. On appeal, DDD contends the trial court incorrectly held the indemnity clause is unenforceable and asserts three separate arguments: the express negligence rule does not govern this case because only Veritas was negligent; the fair notice requirements are not applicable here because Veritas had actual notice of the indemnity provision; and, even if the express negligence rule is applicable, it does not bar DDD's request for indemnification as to the non-negligence claims asserted by Landowner against DDD. No appellate issue is brought by DDD regarding its partial motion for summary judgment.
Standard of Review
When reviewing a summary judgment, we follow these well established rules: (1) the movant has the burden of showing there is no genuine issue of material fact and that it is entitled to judgment as a matter of law; (2) in deciding whether there is a disputed material fact issue precluding summary judgment, evidence favorable to the nonmovant will be taken as true; and (3) every reasonable inference must be indulged in favor of the nonmovant and any doubts resolved in favor of the nonmovant. Am. Tobacco Co., Inc. v. Grinnell, 951 S.W.2d 420, 425 (Tex.1997). This court reviews a summary judgment de novo to determine whether a party's right to prevail is established as a matter of law. Howard v. INA County Mut. Ins. Co., 933 S.W.2d 212, 216 (Tex.App.-Dallas 1996, writ denied). Summary judgment for a defendant is proper only when the defendant negates at least one element of each of the plaintiff's theories of recovery, or pleads and conclusively establishes each element of an affirmative defense. Science Spectrum, Inc. v. Martinez, 941 S.W.2d 910, 911 (Tex.1997).
I.
Express Negligence Doctrine
The only ground upon which the trial court granted summary judgment for Veritas was Veritas' assertion that the indemnity clause asserted by DDD did not meet the express negligence test. Risk shifting clauses must satisfy two fair notice requirements: the express negligence doctrine and the conspicuousness requirement. Littlefield v. Schaefer, 955 S.W.2d 272, 274 (Tex.1997). Under the express negligence doctrine, a party contracting for indemnity from the consequences of its own negligence must express that intent in specific terms within the four corners of the contract. Fisk Elec. Co. v. Constructors & Assoc., Inc., 888 S.W.2d 813, 814 (Tex.1994). The express negligence test was established by the supreme court to cut through the ambiguity of indemnity provisions, thereby reducing the need for satellite litigation regarding interpretation of indemnity clauses. Id. (citing Ethyl Corp. v. Daniel Constr. Co., 725 S.W.2d 705, 708 (Tex.1987)). Parties seeking to indemnify themselves for their own negligence must express that intent in specific terms. Id. Indemnity provisions that do not state the intent of the parties within the four corners of the instrument are unenforceable as a matter of law. Id. The express negligence requirement is not an affirmative defense, but a rule of contract interpretation which is determinable as a matter of law. Id. Either an indemnity provision is clear and enforceable, or it is not. Id. at 815. Such a determination should not depend on the outcome of the underlying suit, but should be established as a matter of law from the pleadings. Id. *884 Thus, application of the express negligence test is proper at the summary judgment stage. MAN GHH Logistics GMBH v. Emscor, Inc., 858 S.W.2d 41, 43 (Tex. App.-Houston [14th Dist.] 1993, no writ).
Veritas, as the summary judgment movant, had the burden of showing there is no genuine issue of material fact and it is entitled to judgment as a matter of law. To that end, Veritas' summary judgment motion argued the indemnity clause in the contract between DDD and Veritas supporting DDD's petition does not meet the express negligence test articulated in Ethyl. More specifically, Veritas contends the indemnity clause does not contain language indemnifying DDD from its own negligence as against a third party claim. We agree.
As noted above, the indemnity clause in question performs two functions: it provides that Veritas shall indemnify DDD for the negligent acts of Veritas, and that DDD shall indemnify Veritas for the negligent acts of DDD. There is no hint in the paragraph that DDD is to be indemnified for DDD's own negligence. The Landowner's suit against DDD in Brooks County, which triggered DDD's suit in Harris County, states several negligence based claims against DDD. By filing a suit against Veritas seeking a declaratory judgment that Veritas was obligated to defend and indemnify DDD against the claims in the Landowner's suit against DDD, DDD was requesting indemnification for its own negligence, thereby directly implicating the express negligence test.
In Fisk, Fisk Electric Company entered into a contract with Constructors and Associates. 888 S.W.2d at 814. The contract contained an indemnity clause that provided: "[t]o the fullest extent permitted by law, [Fisk] shall indemnify, hold harmless, and defend [Constructors] ... from and against all claims, damages, losses, and expenses, including but not limited to attorney's fees" arising out of or resulting from the performance of Fisk's work. Id. An employee of Fisk was injured on the job site and brought a negligence action against Constructors. Id. Constructors brought a third party cause of action against Fisk seeking indemnification to the fullest extent allowable. The court held Fisk had no duty to indemnify Constructors, and therefore had no duty to pay attorney's fees. Id. at 815. There, as here, the indemnification agreement did not express, within the four corners of the contract, the intent that the indemnitee will be indemnified from the consequences of its own negligence. Either the indemnity agreement is clear and enforceable or it is not. DDD is seeking indemnification against the Landowner's claims DDD was negligent, but the indemnity clause upon which it relies does not so provide. Accordingly, it fails the express negligence test, and we need not reach the conspicuousness component of the fair notice requirements. See Dresser Industries, Inc. v. Page Petroleum, Inc., 853 S.W.2d 505, 508 (Tex.1993).
II.
Actual Knowledge
Footnote 2 in Dresser sets out an exception to the fair notice requirements. The text of that footnote is as follows:
The fair notice requirements are not applicable when the indemnitee establishes that the indemnitor possessed actual notice or knowledge of the indemnity agreement.
Id. at 508 n. 2.
DDD contends, in its brief, the summary judgment evidence indisputably establishes DDD and Veritas specifically negotiated several terms of the agreement, including the risk allocation and indemnity provisions. *885 This evidence of actual notice is of no moment here. We have noted the indemnity clause does not shift the responsibility for a party's negligence to another party that was not negligent. Therefore, DDD cannot, under the contract, require Veritas to defend and indemnify DDD against the negligence based claims made against DDD in the Landowner's suit against DDD. A fortiori, the fact that Veritas had actual notice of the indemnity and risk allocation provisions of the agreement cannot create a risk shifting provision where none exists. Accordingly, DDD's summary judgment proof regarding actual notice establishes a fact, but not a fact issue vitiating the summary judgment.
III.
Indemnification for Claims Not Based on Negligence
DDD contends that because the Brooks County lawsuit brought against DDD contains non-negligence claims, the express negligence rule should not apply to those claims. We agree.
In Dresser, the court stated: "[i]t is important to note that our discussion today is limited solely to those types of releases which relieve a party in advance of liability for its own negligence." 853 S.W.2d at 507 (emphasis added). In a footnote to that sentence, the court added the following: "[t]oday's opinion applies the fair notice requirements to indemnity agreements and releases only when such exculpatory agreements are utilized to relieve a party of liability for its own negligence in advance." Id. at 508 n. 2. Some of the claims brought by the Landowner against DDD are not negligence based claims. Applying the limitation on the rule as set out in Dresser, the express negligence component of the fair notice requirements does not apply where an indemnitee is seeking indemnification from claims not based on the negligence of the indemnitee. Accordingly, we sustain DDD's third challenge to the motion for summary judgment.
Conclusion
We affirm the trial court's judgment insofar as it grants summary judgment for Veritas on the ground it is not required to defend and indemnify DDD against third party claims based on DDD's negligence. We reverse the judgment and remand this matter for further proceedings regarding Veritas' obligations under the indemnity provision to defend and indemnify DDD against third party claims not based on DDD's negligence. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1548100/ | 156 F.2d 212 (1946)
FERRARO
v.
ARTHUR M. ROSENBERG CO. INC., OF NEW HAVEN, CONN.
No. 296.
Circuit Court of Appeals, Second Circuit.
June 26, 1946.
Stoddard, Persky & Eagan, of New Haven, Conn., for defendant-appellee.
James F. Rosen, of New Haven, Conn., for plaintiff-appellant.
Before L. HAND, SWAN and CHASE, Circuit Judges.
CHASE, Circuit Judge.
The appellant is a tailor who was employed as a fitter by the appellee, the Arthur M. Rosenberg Company, Inc., of New Haven, Conn., during the period from March 4, 1939 to November 5, 1942, inclusive. His duties required him to travel at times to work in cities outside of Connecticut and his hours of work were irregular. He was paid at first $35 per week. His weekly rate was increased $5 upon three occasions making it $50 at, and for some time before, the date his employment ended. He was paid only his regular weekly wages regardless of overtime.
He sued the appellee in the District Court for the District of Connecticut on February 24, 1943 to recover overtime compensation, liquidated damages and a reasonable attorney's *213 fee under §§ 7(a) and 16(b), of the Fair Labor Standards Act, 29 U.S.C.A. §§ 207(a) and 216(b). In response to a motion by the appellee, his attorneys filed a bill of particulars which included an itemized statement of each day and hour he worked during the 192 weeks he was employed, where his services were performed, the amount of overtime worked each day and the overtime compensation he claimed, computed at $823.09 following Paragraph 12 of Interpretive Bulletin No. 4 issued in November 1938 and revised in December 1939 by the Department of Labor, Wages and Hours Division as a guide for the computation of the regular rate of pay and fluctuating number of hours. The appellee did not answer and on July 18, 1944 the appellant moved for a default and for a hearing on the question of damages. The default was entered. Nothing more was done for nearly eight months when the appellant, who had meanwhile discharged his first attorneys, by another attorney moved, in reliance upon Federal Rules of Civil Procedure, rule 55(c), 28 U.S.C.A. following section 723c, to open the default and for leave to amend his bill of particulars. This was heard on April 6, 1945. It was not held that the motion was barred by the six months limitation of Rule 60(b) and apparently it was not since no judgment had been entered. No excuse for the delay having been shown, however, but merely the appellant's dissatisfaction with his former attorneys as to whom there was no proof whatever of inattention to their duty to their client, or of incompetence, or of fraud, the court found that good cause had not been made to appear and denied the motion because of the long and unexplained delay in making it. He pointed out that the appellant might "apply to the court under Rule 55(b) (2) for a judgment in conformity with his original and still effective, bill of particulars." The appellant then moved "for a hearing in damages in order that the Court may enter judgment in conformance with Rule 55(b) (2) of the Rules of Civil Procedure, for the District Court of the United States."
At this hearing the court permitted the appellant to testify that his contract of employment to the appellee was for a workweek of 48 hours but later on motion struck out this testimony. Following that, the attorney for the appellant was heard at considerable length in his effort to obtain a reversal of that ruling in order to secure an assessment of the overtime compensation upon the basis of a regular 48 hour workweek instead upon irregular hours in accordance with the bill of particulars on file. The judge declined to reconsider and gave his reasons as follows:
"We'll adhere to my decision. It is not necessary for me to rule on your claims of law, because it appears to me that your claims of law are not predicated upon the proof of fact, or claim of fact which are disclosed in the pleading. It appears to me that the evidence received and then stricken is in substantial conflict with the Plaintiff's earlier allegations of fact and claims of fact which gave dimension to this controversy.
"Now, under the Federal Rules it is true that any inadvertence in the proof may be corrected at any time prior to judgment, but as to my earlier ruling, your earlier motions indicate this is not a case of inadvertence on the part of the Plaintiff. The Bill of Particulars which was submitted as a document, full of meticulous details, has all the earmarks of having been very carefully and thoughtfully prepared, and the Plaintiff's present testimony appears to me to be an effort to circumvent and obviate the effect of the earlier pleading.
"One of the chief objectives of the Federal Rules is expeditious litigation. If, after the Plaintiff brings his own case, in response to an adverse motion, and after deliberation makes his representations to the Court on that basis, and therefore decides whether he wants to make the mental change on the basis of his claims under the Federal Rule, he may do so, but he must act promptly, and as my earlier ruling indicates, after this Plaintiff formed a desire to change the basis of his case, he did nothing. If I should allow him now to contradict and obviate his own definition of this case as prepared under the guidance of a respected member of the bar of this *214 Court, I should be making an invitation to procedure that would make litigation practically without end.
"I feel, therefore, that the motion to strike was properly granted, and I will make this further observation: Even if the evidence had been left in, I should have been confronted with a conflict in the Plaintiff's own evidence. His complaint in the Bill of Particulars tells me one thing, and his belated testimony tells me another thing. Faced by that conflict, I should find his written evidence, the Bill of Particulars more persuasive than his oral evidence produced after further controversy had arisen, and I should have found on the basis of the written evidence rather than the oral evidence produced today. I should have reached that decision more easily because of the background of the case that I have from the former hearing. Counsel on both sides disclosed that after a settlement had practically been reached been agreed upon, some further controversy between the parties arose over a detail relating to the settlement. That, to be sure, doesn't appear in the evidence today, but it was conceded by counsel at the prior hearing, so that may be taken into account, although I do not rely on that solely, but that evidence shows that counsel at an eleventh hour controversy, considerable hate and friction was engendered, as a result of which I view with great suspicion oral evidence produced at this late date which is in conflict with the earlier evidence. So all things, considered, am content to adhere to my ruling."
Rule 55(b) (2) provides, inter alia, for the entry of judgment by default by the court and for such hearings as may be necessary to assess the damages. Here there was no need for a hearing to assess provided the bill of particulars was not amended. That showed the exact amount due the appellant so long as he was bound by it. But for the need to fix a reasonable attorney's fee the clerk could have entered the judgment under Rule 55(b) (1). Whether the motion to lift the default and for leave to amend the bill was erroneously denied depends upon whether or not there was an abuse of discretion. Mobile Shipbuilding Co. v. Federal Bridge Etc. Co., 7 Cir., 280 F. 292, certiorari denied 260 U.S. 726, 43 S. Ct. 88, 67 L. Ed. 483; Tallman v. Ladd et al., 5 Cir., 5 F.2d 582. Though such a motion is usually made by the party against whom the default is entered, whoever makes the motion must show an adequate basis for it. Since we cannot say that the judge was clearly wrong in finding that good cause under Rule 55(c) had not been shown, no abuse of discretion was made out. It was the burden of the party who had obtained the default and allowed about eight months to elapse before trying to increase his recovery by means of a new attorney with different legal theories and a somewhat changed version of the facts previously deliberately relied on to place his attempt firmly on good cause. This appeal presents a situation which is, fortunately, not common. The trial judge was aware of the unusual circumstances which called for the sound exercise of his discretion to make it as sure as possible that no injustice was done anyone. We think he succeeded in so doing and in making it clear that he did not believe that the appellant's effort to escape the effect of his bill of particulars was justified by the circumstances and are content to let his judgment in that respect prevail.
At a later hearing to fix a reasonable fee the appellant's attorney again sought to raise the same question, this time by moving orally under Rule 60(a), Federal Rules of Civil Procedure, to correct "a clerical error in part of the record `which arose' from oversight or omission." No clerical error was shown, however, and it changed nothing to call deliberate action accurately reflected in the record a clerical error for the purpose of attempting to invoke Rule 60.
The reasonable attorney's fee with actual and necessary disbursements was fixed and allowed at $751.40. It was based in part upon findings that the services of the original attorneys were reasonably worth $700 and those of the substituted attorney no more than $20. Again we find no abuse of discretion in the overall allowance. That seems fair and reasonable and the trial judge made no allocation of it between the attorneys and no award of it *215 to them as such. It is simply a part of the judgment recovered by this appellant to whom the attorneys must look for their pay. No attorney's fee is allowed on this appeal.
Judgment affirmed. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1895852/ | 631 So. 2d 798 (1994)
Marvin SIMMONS
v.
THOMPSON MACHINERY OF MISSISSIPPI, INC.
No. 91-CA-0251.
Supreme Court of Mississippi.
February 3, 1994.
*799 A.E. (Gene) Harlow, Sr., Harlow & Harlow, Grenada, for appellant.
William R. Sanders, Jr., Charleston, for appellee.
Before PRATHER, P.J., and BANKS and McRAE, JJ.
McRAE, Justice, for the Court:
This appeal arises from a summary judgment dismissal of a cross-complaint filed in a cause originally begun as an action in replevin instituted by Thompson Machinery of Mississippi [hereinafter "Thompson"] against Marvin Simmons [hereinafter "Simmons"] in the Circuit Court of the First Judicial District of Tallahatchie County. Simmons raises three issues on appeal. He claims the trial judge erred in: (1) denying his motion for leave to file an amended response and counterclaim; (2) ruling that his cross-complaint filed in the wake of a replevin action filed by Thompson failed to state a cause of action; and (3) awarding summary judgment to Thompson after finding there existed no genuine issue of material fact to be tried.
As this case is before us within the context of Rule 56(c) of the Mississippi Rules of Civil Procedure, the pleadings are reduced to great importance. Accordingly, we restrict ourselves to the allegations of the cross-complaint, amended counterclaim, affidavits and depositions of the parties. Giving Simmons, as we must, the benefit of any doubt, we reverse and remand for a hearing on the merits of Simmons' amended counterclaim.
STATEMENT OF FACTS
Marvin Simmons is a man with a second grade education who can read a little, write a little and sign his own name. Simmons, however, has worked for others in the timber business for many years and has a great deal of experience and expertise in the timber business. In 1985 Simmons started his own logging operations after being approached and encouraged by a salesman for Taylor Machinery, a predecessor of Thompson. Simmons and Thompson subsequently entered into four lease/rental/purchase agreements for heavy logging equipment. According to Simmons' affidavit, he, however, did not fully understand the nature and terms of the contracts into which he entered.
Thompson's affidavit reflects that payments made pursuant to each of the above agreements were current as of August 31, 1989. Simmons' payments on all four pieces of machinery for the months of September, October, and November 1989, however, were past due. On June 16, 1989, Simmons signed some "papers" which he claims Thompson told him were necessary to reduce his monthly payments. The papers were, in fact, "upon demand" promissory notes totaling $108,247.31. Simmons argues that until he signed the "upon demand" promissory notes he could have surrendered each piece of equipment at the end of the rental agreements. Thompson claims it had Simmons execute the promissory notes in order to have some security in case Simmons did not want to purchase the equipment at the end of the lease period.
Simmons testified at his deposition that he continued to operate all four pieces of equipment until Thompson seized the first two pieces. Thompson Machinery, seeking possession of the other two pieces of heavy equipment in the hands of Simmons, filed its complaint in replevin on February 13, 1990. An "Agreed Order" entered March 21, 1990, required that the two pieces of machinery which were the subject of the replevin action be placed at a neutral site and further ordered the parties to file any additional claims or counterclaims prior to any further hearing.
On May 10, 1990, Simmons filed an original cross-complaint alleging, inter alia, that he was forced to take bankruptcy because of Thompson's claim that Simmons was behind on his payments and Thompson's threats to repossess the equipment. Simmons further claimed he had been harassed for payments which Thompson wrongfully alleged were *800 overdue. Simmons also alleged that Thompson failed to give him the "buy out" value of the property at the time the "buy out" was requested. Simmons stated generally that numerous other activities on the part of Thompson damaged Simmons personally and in his business.
On September 26, 1990, Thompson filed a motion for summary judgment, together with supporting affidavits and a host of business documents. On October 17, 1990, Thompson's motion for summary judgment was noticed for hearing on November 2, 1990. On November 2, 1990, Simmons filed, along with his response to the summary judgment motion, a motion to amend his previous responses and counterclaim. On November 2, 1990, the trial judge limited argument to the issue of summary judgment and declined to consider Simmons' motion for leave to amend etc. until after the court had ruled on Thompson's motion for summary judgment.
On January 30, 1991, the trial judge granted Thompson summary judgment on the replevin issue. This portion of the lower court's ruling has not been assailed by Simmons on appeal. The judge held the original cross-complaint failed to state a cause of action upon which relief could be granted. On February 26, 1991, the lower court, upon the record alone, entered an order denying Simmons' motion for leave to file an amended response and counterclaim, thus this appeal.
1. Denial of Simmons' Motion For Leave to File Amended Response and Counterclaim
On March 21, 1990, by their "Agreed Order", the parties were directed to file any additional claims or counterclaims "prior to any further hearing on this matter by the court"; otherwise, such claims would be considered barred. On September 26, 1990, Thompson filed its motion for summary judgment and a hearing was set for November 2, 1990. On November 2, 1990, Simmons filed a motion to amend his response and counterclaim. Copies of the amended pleadings were delivered to Thompson's attorney on the evening of November 1, 1990. The motion for leave to amend was subsequently denied by the lower court as untimely. Simmons argues that his request for leave to amend should have been granted since justice so required and there had been no suggestion of undue prejudice toward Thompson. Thompson, on the other hand, claims that the motion to amend came much too late.
Motions for leave to amend are left to the trial judge's sound discretion. McDonald v. Holmes, 595 So. 2d 434, 436 (Miss. 1992); Bourn v. Tomlinson Interest, Inc., 456 So. 2d 747, 749 (Miss. 1984). Proposed amendments have been liberally permitted throughout Mississippi legal history and are encouraged under Miss.R.Civ.P. Rule 15; however, "[u]nless we are convinced that the trial judge abused his [judicial] discretion, we are without authority to reverse." Parker v. Mississippi Game and Fish Commission, 555 So. 2d 725, 730 (Miss. 1989).
Miss.R.Civ.P. 15(a) provides, inter alia, that "leave [to amend] shall be freely given when justice so requires." Simmons points to the Comment to Rule 15 which states, in its pertinent parts, that "[i]n practice, an amendment should be denied only if the amendment would cause actual prejudice to the opposite party." (Emphasis added). No prejudice has been demonstrated, or even alleged, in the case at bar.
In Red Enterprises, Inc. v. Peashooter, Inc., 455 So. 2d 793, 795 (Miss. 1984), quoting from Foman v. Davis, 371 U.S. 178, 182, 83 S. Ct. 227, 230, 9 L. Ed. 2d 222, 226 (1962), this Court defined the contours of Rule 15(a) as follows:
Rule 15(a) declares that leave to amend "shall be freely given when justice so requires"; this mandate is to be heeded ... [I]f the underlying facts or circumstances relied upon by the plaintiff may be a proper subject of relief, he ought to be afforded an opportunity to test his claim on the merits. In the absence of any apparent or declared reason such as... undue prejudice to the opposing party by virtue of allowance of the amendment, futility of the amendment, etc. the leave should, as the rules require, be "freely given." [emphasis added].
"[S]ince attorneys sometimes fail to write perfect pleadings, it is necessary that courts *801 permit liberal amendments of the pleadings in order to reach the actual merits of a controversy." William Iselin and Company, Inc. v. Delta Auction and Real Estate Company, 433 So. 2d 911, 913 (Miss. 1983).
The trial judge abused his judicial discretion in the case sub judice by not granting Simmons' motion to amend and refine his pleadings. Notwithstanding the lateness of the hour, the motion for leave to amend was filed within the time frame permitted by the "Agreed Order" entered by the court on March 21, 1990, which stated in plain and ordinary English "[t]hat the parties are hereby Ordered to file any additional claims or counter-claims concerning said equipment, prior to any further hearing on this matter by the Court."
Moreover, the motion to amend did not alter the gist of Simmons' allegations which involved fraud and misrepresentation; rather, it merely set forth the cause of action with more specificity in order to clarify the issues. Finally, neither Thompson nor the trial court identified any undue prejudice toward Thompson in the event the motion to amend was granted. In the final analysis, we hold that under the facts of this case, Simmons should have been granted leave to file his proposed amended response and counterclaim.
2. The Standard for Summary Judgment
Mississippi's summary judgment rule provides, inter alia, that summary judgment shall be entered by a trial judge "if the pleadings, depositions, answers to interrogatories and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law." Miss.R.Civ.P. 56(c). The burden of showing that no triable genuine issue of material fact exists is on the moving party (Thompson), and the non-movant (Simmons) is given the benefit of doubt. Tucker v. Hinds County, 558 So. 2d 869, 872 (Miss. 1990). "All that is required of a non-movant to survive a motion for summary judgment is to establish a genuine issue of material fact by the means available under the rule." Lyle v. Mladinich, 584 So. 2d 397, 398 (Miss. 1991). Furthermore, it is standard practice that "(a)ll motions for summary judgment should be viewed with great skepticism and if the trial court is to err, it is better to err on the side denying the motion." Claiborne County Board of Education v. Martin, 500 So. 2d 981, 981 (Miss. 1986).
The focal point of our standard for summary judgment is on material facts. In Shaw v. Burchfield, 481 So. 2d 247 (Miss. 1985), we said:
The summary judgment movant has a burden of persuasion; a burden to establish that there is no genuine issue of material fact to be tried. Pearl River County Board v. South East Collection, 459 So. 2d 783, 785 (Miss. 1984); Brown v. Credit Center, Inc. 444 So. 2d 358, 362 (Miss. 1983). The party opposing the motion must rebut, if he is to avoid entry of an adverse judgment, by bringing forth probative evidence legally sufficient to make apparent the existence of triable fact issues. Smith v. First Federal Savings and Loan Association of Grenada, 460 So. 2d 786, 792 (Miss. 1984).
Of importance here is the language of the rule authorizing summary judgment "where there is no genuine issue of material fact." The presence of fact issues in the record does not per se entitle a party to avoid summary judgment. The court must be convinced that the factual issue is a material one, one that matters in an outcome determinative sense. As the extensive record in this case has been considered, as well as the persuasive and articulate briefs of counsel, we have kept ever before us that basic tenet of Rule 56 theology that the existence of a hundred contested issues of fact will not thwart summary judgment where there is no genuine dispute regarding the material issues of fact. [emphasis added]
Id. at 252.
This Court employs de novo review of a trial court's award of summary judgment. McMichael v. Nu-Way Steel and Supply, Inc., 563 So. 2d 1371, 1374 (Miss. 1990); Newell v. Hinton, 556 So. 2d 1037, 1041 (Miss. 1990); Short v. Columbus Rubber & Gasket Co., 535 So. 2d 61 (Miss. 1988). All *802 evidentiary matters are examined in the light most favorable to the party against whom the summary judgment motion has been made. Brown v. Credit Center, Inc., 444 So. 2d 358, 362 (Miss. 1983). When there is doubt whether a fact issue exists, the non-moving party is the beneficiary of that doubt. Brown, 444 So.2d at 362. Finally, a trial court's grant of summary judgment is not a proxy for a full-fledged trial of disputed fact issues. "Accordingly, the court cannot try issues of fact on a Rule 56 motion; it may only determine whether there are issues to be tried." Id.
3. Is this a Proper Case For Summary Disposition?
Our conclusion regarding the amended counterclaim, as opposed to the original cross-complaint, dictates the result of the summary judgment issue. Simmons' affidavit, deposition, and documents in evidence demonstrate, within the context of Simmons' amended pleadings, genuine issues of material fact. When viewed in the light most favorable to Simmons, his evidence states a cause of action for fraud, and/or misrepresentation, and/or overreaching. Given our disposition on the amended cross-complaint, it is unnecessary to decide whether the original cross-complaint failed to state a cause of action.
"[T]he clear and convincing standard required of the evidence to sustain a claim of fraud is certainly met in a summary judgment posture when one witness specifically claims a representation was in fact made." McMullan v. Geosouthern Energy Corporation, 556 So. 2d 1033, 1037 (Miss. 1990). Finally, in a motion for summary judgment, a genuine issue of material fact is obviously present where one party testifies to one account of the matter in interest and the other party swears otherwise. Newell v. Hinton, 556 So. 2d 1037, 1041 (Miss. 1990).
As the facts reveal, clearly there exist disputed material facts. "Motions for summary judgment may not be used to determine or decide issues of fact, only to decide whether there are any material fact issues to be tried." American Legion Ladnier Post Number 42 v. City of Ocean Springs, 562 So. 2d 103, 106 (Miss. 1990). This opinion should not be construed as resolving the issues of fraud and misrepresentation in favor of Simmons; rather, we are simply saying that, on the basis of the evidence in the record, Simmons is entitled to an opportunity to prove the merits of his case at a trial by jury. As the benefit of the Fdoubt should go to the party opposing the granting of summary judgment, this case is reversed and remanded for trial on the amended counterclaim.
Based on the facts and posture of this case, the trial court erred in not allowing Simmons' amendments to his pleadings and in granting summary judgment as there were material facts in conflict. For the foregoing reasons, we reverse and remand this case.
REVERSED AND REMANDED.
HAWKINS, C.J., DAN M. LEE and PRATHER, P.JJ., and SULLIVAN, PITTMAN, BANKS, JAMES L. ROBERTS, Jr., and SMITH, JJ., concur. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1959490/ | 144 So. 2d 643 (1962)
Mrs. Alert Louise D'ANTONI
v.
SARA MAYO HOSPITAL and the Aetna Casualty and Surety Company.
No. 638.
Court of Appeal of Louisiana, Fourth Circuit.
July 2, 1962.
Rehearings Denied October 4, 1962.
Certiorari Denied November 27, 1962.
*644 Joseph E. Berrigan, Jr., Francis J. Demarest, Jr., and R. Louis Carruth, New Orleans, for plaintiff-appellee and appellant.
Adams and Reese, St. Clair Adams, Jr., New Orleans, for defendant-appellant.
Henry M. Robinson and Herbert J. Garon, New Orleans, for defendant and third-party plaintiff-appellee.
Before REGAN, SAMUEL and HALL, JJ.
LUTHER E. HALL, Judge pro tem.
This is a suit by Mrs. Alert Louise D'Antoni against Sara Mayo Hospital and The Aetna Casualty and Surety Company, its public liability insurer, to recover damages for personal injuries sustained by plaintiff as a result of falling from her bed in the hospital on August 4, 1958 at approximately 1:00 A.M.
Exceptions of no cause or right of action were filed on behalf of The Aetna Casualty and Surety Company on the theory that the right and cause of action herein are predicated upon alleged malpractice of Sara Mayo Hospital and that the comprehensive general liability insurance policy issued by Aetna to the hospital contained a malpractice exclusion clause. These exceptions were overruled, and Aetna filed a general denial and repeated its defense of no cause of action as to Aetna.
Exceptions of no cause or right of action were filed in behalf of Sara Mayo Hospital under the doctrine of immunity of charitable institutions and were overruled. Sara Mayo Hospital then filed an answer repeating its defense that no cause or right of action existed against the hospital, generally denying negligence on the part of the hospital, and further charging that the sole and proximate cause of the accident was the negligence of the plaintiff and, alternatively, that plaintiff was guilty of contributory negligence. In addition Sara Mayo Hospital filed a third-party action against The Aetna Casualty and Surety Company praying for judgment for whatever amount the hospital might be cast in the suit, and also praying for a further judgment against Aetna for attorney's fees, costs and expenses incurred by the hospital in defending the suit as a result of Aetna's *645 breach of contract by failing to defend on its behalf.
Judgment below was rendered in favor of the plaintiff against the Aetna Casualty and Surety Company in the sum of $25,000.00 plus interest and costs.
Judgment was further rendered in favor of the defendant Sara Mayo Hospital dismissing plaintiff's suit as to it.
Judgment was still further rendered in favor of the third-party plaintiff, Sara Mayo Hospital, against the third-party defendant, The Aetna Casualty and Surety Company, in the sum of $4,500.00 attorney's fees and $110.00 for expenses of the trial together with interest and costs.
The plaintiff appealed from that part of the judgment dismissing her suit against Sara Mayo Hospital, and The Aetna Casualty and Surety Company appealed from the judgment against it in favor of the plaintiff and also from the judgment against it in favor of Sara Mayo Hospital.
The record shows that plaintiff was admitted to Sara Mayo Hospital as a patient on July 25, 1958. At approximately 1:00 A.M. on the morning of August 4, 1958 she fell from the left side of her bed and sustained a fracture dislocation of the left ulna, an impacted fracture of the left radius, and an intertrochanteric fracture of the left femur.
Plaintiff contends that the hospital was negligent in not maintaining the side rail in place on the left side of the bed, and that this failure was the proximate cause of the accident.
When plaintiff was admitted to the hospital a notation was made on her admit card that she was 62 years old, that she had cirrhosis of the liver and that she suffered from tonic-clonic jerkings and epileptic and psychomotor seizures that were sudden and unpredictable in onset. Her attending physician, Dr. Bernard Richmond, testified that he ordered side rails to be placed and maintained on her bed at all times. He also ordered that oxygen be administered initially and then be kept available for immediate use.
Dr. Richmond further testified that plaintiff was semi-lucid; that when he visited her he would have to shake her to arouse her; that she could answer questions put to her but would suddenly lapse into sleep.
Plaintiff was receiving injections of sodium luminal, three grains, four times a day during her early hospitalization; but at the time of the accident she had improved and was receiving only one injection of sodium luminal, two grains, at bed time.
The record shows that in accordance with the doctor's orders side rails were attached and maintained on each side of the patient's bed, but that in order to administer oxygen to the patient the side rail on the left of the bed was lowered and the nurse on duty failed to raise it when the oxygen tent was removed. There is testimony to the effect that oxygen may be administered without lowering the side rail.
On the night of the accident plaintiff's daughter was in the room with her, either sound asleep or dozing in a chair. Plaintiff had received an injection of sodium luminal at 9:30 P.M. and when the nurse on duty visited the room at 12:30 A.M., just one-half hour prior to the accident, the left side rail was down and the patient was asleep. The nurse did not raise the side rail.
It is questionable if anyone saw the patient fall. The daughter's testimony is so filled with contradictions that it is of little value. Plaintiff testified that she did not remember being admitted to Sara Mayo Hospital and remembered nothing of her stay there. However her daughter signed a statement for an insurance investigator to the effect that the plaintiff had advised her the following day after the accident that she was attempting to go to the bathroom because no one had responded to the signal light.
*646 Assuming this to be true, we are of the opinion, as was the trial judge, that had the side rail been in proper position a sick and elderly woman such as the plaintiff would have been restrained by the side rail from attempting to get out of the bed by herself.
Considering the plaintiff's age and her semi-lucid condition and the fact that she was under sedation the entire time she was in the hospital (even though she had improved and the dose had been reduced) we do not believe that her action in attempting to get out of bed (if such be the case) amounted to negligence on her part.
We are of the opinion that the hospital attendants and nurses were negligent in not maintaining the side rails in place at all times in accordance with the doctor's orders, and that the absence of the side rail was the proximate cause of the accident.
Since the doctrine of immunity of charitable institutions obtains in this state and since the record abundantly shows that Sara Mayo Hospital is entitled to the benefit of that doctrine, no judgment can be rendered against it. See Nations v. Ludington, Wells and Van Shaick Lumber Co., 133 La. 657, 63 So. 257, 48 L.R.A.,N.S., 531; Congdon v. Louisiana Sawmill Company, 143 La. 209, 78 So. 470; Jordan v. Touro Infirmary et al., La.App., 123 So. 726; Jurjevich et al. v. Hotel Dieu, La. App., 11 So. 2d 632; Thibodaux v. Sisters of Charity of Incarnate Word, 11 La.App. 423, 123 So. 466.
However, the defense of charitable immunity is personal to the hospital and is not available to the hospital's public liability insurer. See Rome v. London & Lancashire Indemnity Co. of America, La. App., 169 So. 132; Messina v. Societe Francaise de Bienfaissance etc., La.App., 170 So. 801; Lusk v. United States Fidelity & Guaranty Co., La.App., 199 So. 666.
The Aetna Casualty and Surety Company has reurged before us its exception of no right or cause of action which was overruled by the trial court. Aetna argues that the pleadings show that plaintiff's suit was predicated upon acts of malpractice which were excluded under an endorsement on the comprehensive general liability policy issued by it to the hospital. This endorsement is entitled "Exclusion of Malpractice and Professional Services", and reads in part as follows:
"It is agreed that, as respects any classification stated below, the policy does not apply to injury, sickness, disease, death or destruction due to:
"(1) the rendering of or failure to render
"(a) medical, surgical, dental, x-ray or nursing service or treatment, or the furnishing of food or beverages in connection therewith
"(b) any service or treatment conducive to health or of a professional nature or".
Aetna directs our attention especially to Article 12 of plaintiff's petition which in its opinion alleges only acts of malpractice. We find no necessity for quoting Article 12 in full. We find among the acts of negligence charged therein, the following:
"(3) Failure to put the side rail back up along the side of petitioner's bed, from which she fell, after oxygen had been administered to her."
In our opinion the action of the hospital's employees in not maintaining the side rails on plaintiff's bed did not involve professional judgment and was not a "failure to render medical * * * or nursing service or treatment" nor was it "failure to render any service or treatment conducive to health or of a professional nature".
It seems to us that in determining whether or not a particular act or failure to act is of a professional nature we should look not to the title or the character of the party performing the act but to the act itself. The raising of the side rail was purely a *647 mechanical act which any unskilled person could perform. It certainly requires no professional training or knowledge. The side rails were not a part of the patient's treatment per se since she could have recovered without them. They were simply a safeguard to provide her with a safe place to stay and were not a "service or treatment conducive to health" any more than a safe floor to walk on would be. Neither was the maintaining of the rails a nursing service since the placing of the rails could be performed by anyone without the slightest nurses' training. While the initial decision to attach the side rails to the bed may have involved professional judgment, once the attending physician issued the order the professional aspect of it was complete. The placing and maintaining the rails in position was purely mechanical. See Ranelli v. Society of New York Hospital, Sup., 49 N.Y.S. 898; Pivar v. Manhattan General Inc., 279 A.D. 522, 110 N.Y.S.2d 786; New Amsterdam Casualty Co. v. Knowles, 95 So. 2d 413 (Fla.); Norways Sanatorium Inc. v. Hartford Accident & Indemnity Co., 112 Ind.App. 241, 41 N.E.2d 823, 44 N.E.2d 192.
We are of the opinion that Aetna's exception of no cause of action was properly overruled and that Aetna was properly held liable to the plaintiff on the merits.
We have now to consider Aetna's appeal from the judgment against it for attorney's fees and costs incurred by the hospital in defending this suit.
Under the terms of the policy issued by it Aetna was obligated to defend any suits against the hospital on account of injuries embraced within the coverage of the policy. Aetna refused to defend the hospital in this suit on the ground that its policy of insurance excluded coverage for the acts alleged to have caused the injuries. Aetna argues that the allegations of plaintiff's petition govern the duty of an insurer to defend the petition, citing Foreman v. Jordan, La. App., 131 So. 2d 796, and that the acts of negligence alleged in this case clearly fall within the malpractice and professional services exclusion. In Demandre v. Liberty Mutual Insurance Company, 264 F.2d 70 the United States Fifth Circuit Court of Appeal held that whether or not the act was one of professional or non-professional character is a question of fact to be determined after hearing the evidence. The hospital has cited several other cases to the same effect, but we find no necessity for exploring this field since in considering Aetna's exception of no cause of action we reached the conclusion that the petition does allege acts which would oblige the insurer to stand in judgment in the shoes of the hospital.
In our opinion Aetna breached its contract to defend the hospital and is liable to it for attorney's fees and expenses. The district judge allowed $4,500.00 for attorney's fees and $110.00 for expenses. The worth of the services was fully proved and the judgment therefor will not be disturbed.
Finally we come to the question of the amount of the judgment rendered in favor of the plaintiff. The Aetna Casualty and Surety Company urges that the amount is grossly excessive.
Plaintiff's injuries consisted of a fracture dislocation of the left ulna, an impacted fracture of the left radius, and an intertrochanteric fracture of the left femur. After her fall she was treated for these injuries for two weeks in Sara Mayo Hospital then she was transferred to Charity Hospital where she spent an additional eight weeks. Thereafter she was confined to her bed at home for approximately a year and a half, being visited weekly by her private physician, and receiving periodic treatment at Charity Hospital being transported to and from the hospital in an ambulance. Plaintiff could not walk at all for approximately a year. Her left arm is misshapened and has lost all usefulness. Her attending physician testified that this condition is permanent. She still suffers from pain and is still receiving treatment *648 at Charity Hospital. Plaintiff was put in traction at Sara Mayo Hospital, the weights being attached to her leg by adhesive tape which caused the skin on her leg to slough off and she developed sores which became infected. She still bears scars from these sores. When she was removed to Charity Hospital she was again put in traction; the weights being attached by means of metal pins inserted into the bones of the knee. She was in a cast the whole period of her hospitalization.
The District Judge had ample opportunity to observe the plaintiff and to evaluate her injuries. Apparently he was convinced that she was subjected to much pain and suffering and the record in the case sustains him. Plaintiff's medical expenses amounted to $1,304.35. Under the circumstances of this case we do not believe that a judgment in the amount of $25,000.00 is excessive.
For the foregoing reasons the judgment appealed from is affirmed.
Affirmed. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/2430249/ | 824 S.W.2d 568 (1992)
Barry Dean KELLY, Appellant,
v.
The STATE of Texas, Appellee.
No. 969-90.
Court of Criminal Appeals of Texas, En Banc.
February 5, 1992.
*569 Richard Alley, Fort Worth, for appellant.
Tim Curry, Dist. Atty. and C. Chris Marshall, Betty Marshall, Alan Levy and Robert K. Gill, Asst. Dist. Attys., Fort Worth, Robert Huttash, State's Atty., Austin, for State.
Before the court en banc.
OPINION ON APPELLANT'S PETITION FOR DISCRETIONARY REVIEW
CAMPBELL, Judge.
A jury found appellant, Barry Dean Kelly, guilty of murder and assessed his punishment at imprisonment for life. Tex. Penal Code § 19.02(a)(1). The Second Court of Appeals affirmed appellant's conviction. Kelly v. State, 792 S.W.2d 579 (Tex.App. Fort Worth 1990). We granted appellant's petition for discretionary review, pursuant to Texas Rule of Appellate Procedure 200(c)(2), to determine whether the court of appeals erred in holding that the trial court did not abuse its discretion in admitting DNA "fingerprint" evidence[1] at appellant's trial over his objection.[2] We will affirm the judgment of the court of appeals.
Before trial, appellant filed a motion to suppress any expert testimony regarding DNA identification test results on the ground that such tests had "not gained general acceptance [as reliable] in the scientific community in which such testing belongs." At trial, after the State indicated its intention to offer expert testimony regarding a DNA identification test, the trial court conducted a hearing to determine the admissibility of such testimony. The hearing was conducted outside the presence of the jury, pursuant to Texas Rule of Criminal Evidence 104(a) and (c).[3]
I. THE EXPERT TESTIMONY
Six witnesses testified at the suppression hearingfive for the State and one for the defense. According to the testimony presented, the State's witnesses and their backgrounds were as follows: (1) Alan Matthews Giusti, holder of a B.S. degree in molecular biology from Yale University, former laboratory technician at Lifecodes Corporation;[4] (2) Kevin McElfresh, holder of a Ph.D. degree in molecular and population genetics from the University of Georgia, laboratory supervisor at Lifecodes Corporation; (3) Philip Stewart Hartman, genetics professor at Texas Christian University in Fort Worth, never affiliated with Lifecodes; (4) Joseph Frank Sambrook, holder of a Ph.D. degree in microbiology, chairman of the biochemistry department at Southwestern Medical School in Dallas, never affiliated with Lifecodes; and (5) Robert C. Benjamin, holder of a Ph.D. degree in biology from Harvard University, professor of biology at the University of North Texas in Denton, never affiliated with Lifecodes.
In brief, the testimony of the State's expert witnesses at the suppression hearing established the following: (1) it is generally accepted by molecular biologists that each person's DNA is unique and does not *570 change during that person's lifetime (Hartman); (2) the "restriction fragment length polymorphism" (RFLP) technique,[5] generally accepted by molecular biologists as reliable, can be used to compare a known sample of DNA with an unknown sample of DNA to determine whether the two samples share certain molecular characteristics (McElfresh, Hartman, Sambrook, Benjamin); [6] (3) studies of sample populations can be used to determine reliably the frequencies, within the general population, of the molecular characteristics in question (McElfresh, Hartman, Sambrook); (4) sufficient studies of sample populations have already been performed to allow reliable calculations concerning the frequencies, within the general population, of the molecular characteristics in question (McElfresh, Hartman, Sambrook); (5) a false "match" of a known DNA sample with an unknown DNA sample is impossible with the RFLP technique (McElfresh, Hartman, Sambrook, Benjamin); (6) reliable and generally accepted techniques are available to extract DNA from blood and semen stains (Hartman); (7) Lifecodes Corporation utilized both a generally accepted DNA extraction technique and the RFLP technique to compare DNA from appellant's blood with DNA from a semen stain found at the home of Appellant's victim (McElfresh, Giusti, Benjamin); (8) Lifecodes' test showed that appellant's DNA shared certain molecular characteristics with the semen stain DNA (Giusti); (9) the RFLP analysis in this case was performed by Lifecodes in a scientifically acceptable manner (Giusti).
John Thomas Castle, appellant's witness at the suppression hearing, testified that he had a B.S. degree in chemistry from Angelo State University in San Angelo, and that he was the owner-operator of Castle Forensic Laboratories in Dallas. He testified further that, in his opinion, the RFLP technique, at least as applied to forensic samples, was not generally accepted in the scientific community. He also questioned the reliability of Lifecodes' test results because, he claimed, Lifecodes had a policy of re-using certain laboratory materials.
At the conclusion of the testimony at the suppression hearing, appellant argued that DNA identification evidence was inadmissible under Frye v. United States, 293 F. 1013 (D.C.Cir.1923), because such evidence was, according to appellant, "not accepted [as reliable] in the scientific community and [by] the folks who deal with DNA." Appellant also argued that insufficient population studies had been conducted to make a DNA "match" meaningful. The State responded that the holding in Frye was not binding on Texas courts and that the evidence in question had been shown to be reliable and thus admissible under Texas Rule of Criminal Evidence 702.
After the litigants concluded their arguments, the trial court stated:
I'm going to find that the DNA testing, genetic testing evidence is probative of material issues involved in the case. The material evidence is relevant. The evidence is relevant to the matters before the Court.
Its relevancy does notits relevancy outweighs the prejudicial effect of it, and the Court will find that the testimony of the expert witnesses presented by the State established that the DNA testing procedure employed in this case is reliable and that it is generally accepted in the relevant scientific community.
For that reason, I will deny your motion to exclude the evidence of the DNA genetic tests and will permit the State to present such evidence before the jury.
(Emphasis added.)
Hartman, Giusti, Sambrook, and McElfresh testified again before the jury, essentially repeating the testimony they gave at the suppression hearing. In addition, however, Sambrook and McElfresh testified that, according to their calculations, only *571 one person in approximately 13 million possesses DNA with the same molecular characteristics that Lifecodes' test showed were shared by appellant's DNA and the DNA extracted from the semen stain found at the home of appellant's victim. In other words, Lifecodes' test did not positively identify appellant as the source of the semen, but the test did place appellant within the almost infinitesimal class of males who could have been the source.
II. THE ARGUMENTS
Appellant argues now, as he did below, that the Frye "general acceptance" test governs the admissibility of scientific evidence in Texas courts and that the trial court abused its discretion in admitting the DNA evidence because, according to appellant, DNA identification testsand Lifecodes' procedures in particularare not generally accepted as reliable by any scientific community. In support of his argument, Appellant cites various authorities that have questioned the reliability of DNA identification testing. See, e.g., J. Neufield & N. Colman, When Science Takes the Witness Stand, Scientific American 46 (May 1990); Note, The Dark Side of DNA Profiling: Unreliable Scientific Evidence Meets the Criminal Defendant, 42 Stanford L.Rev. 465 (1990).
The State counterargues that the "helpfulness" test of Rule 702 governs the admissibility of all expert testimony, scientific or otherwise, and that the DNA evidence at Appellant's trial was proven to be reliable and helpful and thus admissible under Rule 702.[7]
III. THE HOLDING OF THE COURT OF APPEALS
The Second Court of Appeals agreed with the State and held that the trial court Ford, 301 S.C. 485, 392 S.E.2d 781 (1990); State did not abuse its discretion in admitting the expert testimony. More specifically, the court of appeals "found" that the DNA evidence was reliable, and thus admissible, "since expert testimony established the underlying scientific principle was valid, the technique applying the principle was valid, and the technique was properly applied for tests in this case." Kelly v. State, 792 S.W.2d at 585.
IV. THE PRESENT VIABILITY OF THE FRYE TEST
To determine whether the court of appeals erred in holding that the trial court did not abuse its discretion, we must first determine what test governs the admissibility of novel scientific evidence in Texas criminal trials. We must then determine whether the trial court's decision admitting the DNA evidence was reasonable given the testimony at the suppression hearing and given the governing test of admissibility.
The test which some jurisdictions[8] use with respect to the admission of novel scientific evidence is the test that was enunciated in Frye:
Just when a scientific principle or discovery crosses the line between the experimental and demonstrable stages is difficult to define. Somewhere in this twilight zone the evidential force of the principle must be recognized, and while courts will go a long way in admitting expert testimony deduced from a wellrecognized scientific principle or discovery, the thing from which the deduction is made must be sufficiently established to have gained general acceptance in the particular field in which it belongs. *572 293 F. at 1014. The Frye court thus imposed a "general acceptance" test on the admissibility of scientific evidence. See generally Jones v. State, 716 S.W.2d 142, 145-153 (Tex.App.Austin 1986, pet. refd) (discussing pros and cons of Frye test).
Although this Court has never explicitly adopted the Frye test, on several occasions we have used a general acceptance test when reviewing lower court decisions regarding the admission of scientific evidence. See Zani v. State, 758 S.W.2d 233 (Tex.Cr.App. 1988); Reed v. State, 644 S.W.2d 479 (Tex.Cr.App.1983); Cain v. State, 549 S.W.2d 707 (Tex.Cr.App.1977); Romero v. State, 493 S.W.2d 206 (Tex.Cr. App.1973). In all those cases, however, the trials were held before the promulgation of the Texas Rules of Criminal Evidence.
Since the promulgation of the Rules in 1986, Rule 702 has governed the admission of all expert testimony.[9] That rule provides:
If scientific, technical, or other specialized knowledge will assist the trier of fact to understand the evidence or to determine a fact in issue, a witness qualified as an expert by knowledge, skill, experience, training, or education, may testify thereto in the form of an opinion or otherwise.
We have recognized before that the "threshold determination" for a trial court[10] to make regarding the admission of expert testimony is whether that testimony will help the trier of fact understand the evidence or determine a fact in issue. Duckett v. State, 797 S.W.2d 906, 910 (Tex. Cr.App. 1990); see S. Goode, et al., Guide to the Texas Rules of Evidence § 702.2 (1988). Thus, in a case such as thiswhere the trial court was faced with an offer of expert testimony on a scientific topic unfamiliar to lay jurorsthe trial court's first task is to determine whether the testimony is sufficiently reliable and relevant to help the jury in reaching accurate results. "Unreliable ... scientific evidence simply will not assist the [jury] to understand the evidence or accurately determine a fact in issue; such evidence obfuscates rather than leads to an intelligent evaluation of the facts." K. Kreiling, Scientific Evidence: Toward Providing the Lay Trier With the Comprehensible and Reliable Evidence Necessary to Meet the Goals of the Rules of Evidence, 32 Ariz.L.Rev. 915, 941-942 (1990).
If the trial judge determines that the proffered expert testimony is reliable (and thus probative and relevant), then she must next determine whether, on balance, that testimony might nevertheless be unhelpful to the trier of fact for other reasons.[11] For example, even reliable and relevant expert testimony may be unhelpful if it is merely cumulative, or would confuse or mislead the jury, or would consume an inordinate amount of trial time. In short, if the trial judge determines that the proffered expert testimony is reliable and relevant, she must still decide whether the probative value of the testimony is outweighed by one or more of the factors identified in Rule 403. See 3 J. Weinstein & M. Berger, Weinstein's Evidence para. 702[03] (1991).
Is the Frye general acceptance test still a part of Texas law? We conclude that it is not. First, there is no textual basis in Rule 702 for a special admissibility standard for novel scientific evidence. Second, as should be fairly obvious, scientific evidence may be shown reliable even though not yet generally accepted in the relevant scientific community.[12]
*573 V. PROOF OF RELIABILITY
How does the proponent of novel scientific evidence prove it to be reliable? As a matter of common sense, evidence derived from a scientific theory, to be considered reliable, must satisfy three criteria in any particular case: (a) the underlying scientific theory must be valid; (b) the technique applying the theory must be valid; and (c) the technique must have been properly applied on the occasion in question. See generally Tex.R.Crim.Evid. 705; P. Giannelli & E. Imwinkelried, Scientific Evidence § 1-1 (1986). Under Rule 104(a) and (c) and Rule 702, all three criteria must be proven to the trial court, outside the presence of the jury, before the evidence may be admitted. Factors that could affect a trial court's determination of reliability include, but are not limited to, the following: (1) the extent to which the underlying scientific theory and technique are accepted as valid by the relevant scientific community, if such a community can be ascertained; (2) the qualifications of the experts) testifying; (3) the existence of literature supporting or rejecting the underlying scientific theory and technique; (4) the potential rate of error of the technique; (5) the availability of other experts to test and evaluate the technique; (6) the clarity with which the underlying scientific theory and technique can be explained to the court; and (7) the experience and skill of the person(s) who applied the technique on the occasion in question. See 3 J. Weinstein & M. Berger, Weinstein's Evidence para. 702[03] (1991).
VI. THE PROPONENT'S BURDEN OF PERSUASION
What burden of persuasion does the proponent of novel scientific evidence carry under Rule 702?[13] Unfortunately, our rules of evidence do not prescribe the burden of persuasion or imply what burden might be appropriate. In Zani v. State, 758 S.W.2d at 243, however, in addressing the burden of persuasion required of the proponent of posthypnotic testimony, we held that because of the "uncertainties inherent" in the evidence, "it [was] appropriate to require the proponent of such [evidence] to demonstrate ... by clear and convincing evidence, that such [evidence was] trustworthy." Although Zani was a pre-Rules case, we believe that its reasoning on this issue remains persuasive. Because of the difficulty laypersons have in evaluating the reliability of novel scientific testimony, we conclude it is appropriate for the burden of persuasion to be enhanced, i.e., that the burden be that of clear and convincing evidence rather than simply the preponderance of the evidence. In other words, before novel scientific evidence may be admitted under Rule 702, the proponent must persuade the trial court, by clear and convincing evidence, that the evidence is reliable and therefore relevant. See E. Geary, ed., McCormick on Evidence § 340 (1984).
VII. SUMMARY
To summarize, under Rule 702 the proponent of novel scientific evidence must prove to the trial court, by clear and convincing evidence and outside the presence of the jury, that the proffered evidence is relevant. If the trial court is so persuaded, then the evidence should be admitted for the jury's consideration, unless the trial court determines that the probative value of the evidence is outweighed by some factor identified in Rule 403.
*574 VIII. THE TRIAL COURT'S DECISION
We come finally to the question of whether the trial court abused its discretion in admitting the DNA evidence in the instant case. That is, we must determine whether the trial court's decision was "within the zone of reasonable disagreement" given the evidence presented at the suppression hearing and given the requirements of Rule 702. Montgomery v. State, 810 S.W.2d 372, 391 (Tex.Cr.App. 1990);[14] see also Duckett v. State, 797 S.W.2d at 913.
The trial court was, of course, the sole judge of the weight and credibility of the evidence presented at the suppression hearing. Viewing that evidence in the light most favorable to the trial court's decision, we conclude that it was demonstrated by clear and convincing evidence that the scientific principle underlying the RFLP technique was valid, that the RFLP technique itself was valid, that the technique was properly applied in this case, and that the related population frequency studies were also valid and reliable. Moreover, there is nothing in the record to suggest that the probative value of the DNA evidence was outweighed by one of the Rule 403 factors. We conclude, therefore, that the trial court's decision to admit the DNA evidence was reasonable given the evidence presented at the suppression hearing and given the requirements of Rule 702. The court of appeals did not err in its holding that the trial court did not abuse its discretion in admitting the DNA evidence.
The judgment of the court of appeals is AFFIRMED.
CLINTON, Judge, concurring.
This cause is important, not just because it declares that DNA evidence may be found admissible in Texas, but more so because it announces a new standard for determining admissibility of evidence premised upon novel scientific theories or techniques. In announcing the new standard the majority squarely rejects the test in Frye v. United States, 293 F. 1013 (C.A.D.C.1923), which this Court has seen fit to invoke, albeit sporadically, over the years. Zani v. State, 758 S.W.2d 233, at 241 (Tex.Cr.App. 1988). Certainly the Frye rule is not without problems. See, e.g., Giannelli, P., The Admissibility of Novel Scientific Evidence: Frye v. United States, A Half-Century Later, 80 Colum.L.Rev. 1197, 1204-1231 (1980). Nevertheless, I hesitate so readily to relinquish the advantages of "general acceptance in the relevant scientific community" as a substantive standard by which a court can determine reliability, and hence, relevance of a novel scientific theory or technique.
The beginning, middle and end of the majority's analysis is Tex.R.Cr.Evid., Rule 702. This rule reads:
If scientific, technical, or other specialized knowledge will assist the trier of fact to understand the evidence or to determine a fact in issue, a witness qualified as an expert by knowledge, skill, experience, training, or education, may testify thereto in the form of an opinion or otherwise.
I believe the majority opinion errs to premise its argument exclusively on Rule 702.
Admissibility of novel scientific evidence, as with admissibility of any evidence, is first and foremost a question of relevancy. And relevance of novel scientific evidence is a function of its reliability.[1] But Rule 702 is not meant to insure the relevance of "scientific, technical, or other specialized knowledge." Nor, inasmuch as relevance of scientific, etc., knowledge is a function of reliability of the theory or technique espoused, does Rule 702 require that "scientific, *575 technical or other specialized knowledge" be reliable. Tex.R.Cr.Evid., Rules 401 and 402 are the provisions that require reliability, and hence relevancy, of "specialized knowledge." If such knowledge is not reliable/relevant, it will be inadmissible under Rule 402. That such knowledge must "assist the trier of fact to understand the evidence or to determine a fact in issue," it seems to me, means something else entirely. Under Rule 702, even if reliable/relevant, specialized knowledge must either supply or refute, or at least illuminate, an elemental fact (or some evidentiary fact leading to an elemental fact) in a way not readily apparent to a jury of laymen without that knowledge. Whenever it may contribute to a fuller comprehension by the jury of the evidence or the issues involved, "specialized knowledge" is admissible. By implication, specialized knowledge which does not contribute in any degree to a fuller comprehension is inadmissible, even if reliable/relevant.[2] My point is this: novel scientific evidence must be "reliable," if at all, not because otherwise it will not "assist the trier of fact" as required by Rule 702 (although that will probably be true, incidentally, since irrelevant evidence by definition fails to assist the trier of fact); rather, it must be reliable in order to be deemed relevant, under Rules 401 and 402. See note 1, ante.
In any event, I concur with the majority inasmuch as it concludes that admissibility of evidence of or based upon a novel scientific theory or technique is a function of reliability. It must be shown by the proponent of such evidence that the new theory or technique provides a valid test for the probability of the existence, vel non, of a fact of consequence to the determination of the action. Rule 401, supra. What is not "fairly obvious" to me, however, is that "scientific evidence may be shown to be reliable even though not yet generally accepted in the relevant scientific community." Majority at 573. The majority does not elaborate.
The majority does ask, "How does the proponent of novel scientific evidence prove it to be reliable?" In answering its own question the majority supplies much that is helpful in the way of procedure. I agree that the proponent should be required to show that the theory behind a new scientific procedure is valid; that the technique is a valid application of the theory; and that the proper protocols have been followed in applying the technique in the individual case. I can accept that "all three criteria must be proven to the trial court" as a matter of admissibility of the evidence.[3] Although I do not think it is compelled, I agree it is a sound idea to require that the trial court find these criteria have been established by clear and convincing evidence.
When it comes to announce a substantive test by which trial courts can exercise, and appellate courts can review the discretion to admit or exclude novel scientific evidence, the majority opinion is less than satisfactory. It is true the majority expressly makes the extent of acceptance of a new scientific theory or technique a consideration for the trial judge in determining validity. Unlike the Frye rule, however, the majority's test leaves the ultimate decision of validity to the trial court. The majority rejects the Frye rule because under it some evidence based upon presumably *576 "valid" theory and technique will be inadmissible simply because the "relevant scientific community" has not caught up. This seems to me to beg the question of who most properly decides questions of validity of novel scientific theories. The greatest advantage of the Frye test is that it essentially leaves the question of validity of novel theories and techniques to those whose vocation it is to view the world from the perspective of the scientific method, viz: the scientists. Trial judges are ill equipped to make the determination whether a given theory or technique has been sufficiently "tested in the crucible of controlled experimentation and study" that it can accurately be said to gauge the probability of the existence, vel non, of a fact in issue.[4] The Frye rule does not require him to make this determination. Instead it requires him to decide whether scientists themselves believe the theory or technique has been sufficiently tested.
The majority worries that evidence that may ultimately be accepted as reliable by the general run of scientists will be lost in the meantime under the Frye rule. The contested evidence may make the difference between conviction and acquittal. It seems to me that a conservative approach is justified, however. Convictions now on the basis of evidence that later proves universally rejected by the scientific community will not only result in injustice, but also make the courts look gullible, even foolish.
Presumably the majority would respond that the trial court can measure the sufficiency of a novel theory or technique to produce relevant evidence by the testimony, in the form of opinion or otherwise, of an expert, admissible under Rule 702, as to its reliability. This testimony itself, however, may be subject to objection under Tex.R.Cr.Evid., Rule 705(c), "unless the party offering the testimony first establishes sufficient underlying facts or data." But what, in this context, constitutes sufficient underlying facts or data? Is it sufficient that the expert himself believes the new theory has been sufficiently tested by whatever means that scientific method would prescribe in the circumstances? And what is the basis of his opinion of what scientific method would prescribe as an appropriate regimen of testing? Are the underlying facts and data supporting that opinion sufficient under Rule 705(c)? These questions are esoteric to begin with, involving as they do a discipline beyond the training and common experience of the average judge. They are doubly esoteric because they involve new areas of science beyond the common exposure of scientists themselves. Yet the majority is content to let the trial judge measure reliability, and hence relevance of a novel scientific theory by the untested, and potentially untestable opinion of as few as one "expert."
The majority believes that validity of a novel theory or technique can best be aired in context of the adversarial process. The proponent of evidence presents his expert to champion the cause of admissibility, and then the opponent counters with his own expert to tell the trial court, from the perspective of the scientific method, all the deficiencies in the testing to date that would render the theory or technique questionable. The trial court then makes a reasoned and informed decision. Entertaining the assumption that the trial judge can adequately take the place of the relevant scientific community as the arbiter of acceptability of new theories or techniques, this would seem an appropriate procedure. It certainly has the advantage of not being anti-systemic; that is, ideally, how the adversarial process works. But will the system as it presently exists actually accommodate the level of adversarial testing we almost have to assume is necessary if we are to allow trial court judgments to replace scientific consensus?
In our rules of criminal procedure we have no notice or pre-trial discovery requirements tailored to the use of evidence based upon novel scientific theories or techniques. The first time a defense attorney may see the evidence coming is during voir *577 dire of a State's expert witness pursuant to Rule 705(b). By then it is clearly too late to marshall experts to formulate an opposing opinion (if any) as to the validity of either principle or technique underlying the proffered evidence. Moreover, counsel must obtain "prior court approval" of fees for expert testimony on behalf of an indigent defendant under Article 26.05, V.A.C.C.P. What is a "reasonable expense" for expert testimony is pre-determined on a county by county basis,[5] and may prove woefully inadequate for the kind of time and effort involved in ascertaining reliability of a novel scientific theory or technique. At any rate, without notice of what is coming, counsel for the indigent defendant can hardly obtain "prior court approval" for funds to pay an expert of his own. "Provisions for notice, full discovery, the opportunity to re-examine evidence, and the appointment of defense experts are critical components" of the type of procedure the majority advocates. Giannelli, supra, at 1245. I doubt we are procedurally equipped to accommodate these needs.
In short, the kind of adversarial testing that would be adequate to replace a Frye standard is simply not likely to occur. Trial judges will instead hear testimony from only one side of the issue, frequently from the representative of a commercial lab somewhere that has a vested interest in having its novel theory or technique held admissible in a court of law.[6] These circumstances hardly foster impartial decision making.
Preferable, in my view, would be to impose a substantive requirement on the part of the proponent of scientific evidence that as part of his burden of showing "validity" of both the principle and technique he demonstrate by clear and convincing evidence that both have gained general acceptance in the relevant scientific community. As a practical matter, since the State is more often the proponent of such evidence, such a requirement will place the onus on the party with the greater resources. Because the question of general acceptance embraces the debate, if any, among scientists themselves as to validity of a novel theory or technique, the trial court is assured of hearing both sides of the argument, as well as the scientific consensus, if any, before ruling.
Not just as a practical matter, but as a legal matter as well, it seems to me the proponent of such evidence should have a burden to show general acceptance in the scientific community. The proponent should have to show such general acceptance in order to establish threshold relevance, and hence admissibility under Rule 402. It is true that ordinarily "the law furnishes no test of relevancy." See Montgomery v. State, 810 S.W.2d 372, at 391 (Tex.Cr.App.1991) (Opinion on rehearing on Court's own motion). However, that is because ordinarily a trial court determines relevancy by "common observation and experience, and reason[s] from there in deciding whether the proffered evidence has `any tendency to make the existence of any fact of consequence to the determination of the action more or less probable than it would be without the evidence.'" Id. As I hope I have made clear already, however, whether a new scientific theory or technique has any such tendency is not within the compass of common observation and experience. Only science in general can have the necessary perspective. And the best evidence of that is, of course, evidence of general acceptance, vel non, in the relevant scientific community.
If the Court is reluctant to impose a Frye-type test within the relevancy provisions of Rules 401 and 402, another possibility would be to incorporate it within Rule 705(c).[7] We could rule that as a matter of *578 law the proponent of novel scientific evidence "does not have a sufficient basis for his opinion" if the theory or technique he relies on is not generally accepted in the relevant scientific communitythat absent such general acceptance, he has not established "sufficient underlying facts or data." We would not thereby deviate from interpretation of the Federal Rules, since they contain no analogue to our Rule 705(c).
By focusing exclusively on Rule 702, and by refusing to acknowledge the utility of general acceptance in the relevant scientific community, or some improvement thereon, as a substantive standard for trial courts to use in determining reliability, it seems to me, the majority errs. The trial court did rule in this cause that "the DNA testing procedure employed in this case ... is generally accepted in the relevant scientific community." Because the record supports that conclusion, I concur in the result the majority reaches, but do not join its opinion.
BAIRD and OVERSTREET, JJ., join in this opinion.
NOTES
[1] DNA (deoxyribonucleic acid) is an "organic chemical of complex molecular structure that is found in all living cells and that codes genetic information for the transmission of inherited traits." 4 Encyclopedia Britannica 140 (1990).
[2] In three grounds for review, appellant argues specifically that the "general acceptance" standard enunciated in Frye v. United States, 293 F. 1013 (D.C.Cir.1923), governs the admissibility of scientific evidence in Texas criminal trials and that the trial court erred in admitting DNA identification evidence at his trial because DNA evidence, according to appellant, is not generally accepted by the relevant scientific community.
[3] Rule 104 provides in relevant part:
(a) Preliminary questions concerning the ... admissibility of evidence shall be determined by the court....
(c) Hearings on the admissibility of confessions shall in all cases be conducted out of the hearing of the jury. Hearings on other preliminary matters shall be so conducted when the interests of justice require
[4] Lifecodes Corporation, of Valhalla, New York, was the commercial biotechnology laboratory that conducted the DNA identification test in this case.
[5] Technical details regarding the RFLP technique can be found in L. Kirby, DNA Fingerprinting (1990) and in U.S. Congress, Office of Technology Assessment, Genetic Witness: Forensic Uses of DNA Tests (July 1990).
[6] In other words, the RFLP technique cannot determine whether two samples of DNA are actually identical. Rather, the technique reveals only whether the DNA molecules have certain common characteristics.
[7] The State also points out that DNA identification evidence has been held admissible by virtually every appellate court that has considered the question. See, e.g.. United States v. Jakobetz, 955 F.2d 786 (2d Cir.1992); Caldwell v. State, 393 S.E.2d 436 (Ga.1990); State v. Brown, 470 N.W.2d 30 (Iowa 1991); Smith v. Deppish, 248 Kan. 217, 807 P.2d 144 (1991); State v. Schwartz, 447 N.W.2d 422 (Minn. 1989); State v. v. Wimberly, 467 N.W.2d 499 (S.D.1991); Spencer v. Commonwealth, 238 Va. 275, 384 S.E.2d 775 (1989), cert, denied, 493 U.S. 1036, 110 S. Ct. 759, 107 L. Ed. 2d 775 (1990).
[8] See, e.g., Novak v. United States, 865 F.2d 718 (6th Cir.1989); United States v. Smith, 869 F.2d 348 (7th Cir.1989); State v. Schwartz, 447 N.W.2d 422 (Minn. 1989); State v. Ford, 301 S.C. 485, 392 S.E.2d 781 (1990).
[9] Because of its nature, scientific evidence will almost always be offered through the testimony of experts.
[10] Rule 104(a) requires that the admissibility of expert testimony be determined by the trial court. See S. Goode, et al.. Guide to the Texas Rules of Evidence § 702.2 at 501 (1988).
[11] Thus, Rule 702 incorporates Rule 402 and 403 analyses.
[12] "[Federal] Rule 702's failure to incorporate a general scientific acceptance standard, and the Advisory Committee Note's failure to even mention the Frye case must be considered significant. The silence of the rule and its drafters may arguably be regarded as tantamount to an abandonment of the general acceptance standard." 3 J. Weinstein & M. Berger, Weinstein's Evidence para. 702[03] at 702-36 (1991).
Cases utilizing a Rule 702-type relevancy test for the admissibility of scientific evidence in elude, for example, United States v. Jakobetz, 955 F.2d 786 (2d Cir.1992); United States v. Williams, 583 F.2d 1194 (2d Cir.1978), cert, denied, 439 U.S. 1117, 99 S. Ct. 1025, 59 L. Ed. 2d 77 (1979); DeLuca v. Merrell Dow Pharmaceuticals, 911 F.2d 941 (3d Cir.1990); State v. Brown, 470 N.W.2d 30 (Iowa 1991).
Some jurisdictions hold that the relevancy test incorporates the Frye test. See, e.g., United States v. Two Bulb, 918 F.2d 56 (8th Cir.1990).
[13] In Bourjaily v. United States, 483 U.S. 171, 107 S. Ct. 2775, 97 L. Ed. 2d 144 (1987), the United States Supreme Court concluded that all preliminary fact findings under Federal Rule of Evidence 104(a) are subject to the preponderance of the evidence (i.e., "more probable than not") burden of persuasion. See also Huddleston v. United States, 485 U.S. 681, 108 S. Ct. 1496, 99 L. Ed. 2d 771 (1988). We need not decide today what burden of persuasion is applicable under Texas Rule of Criminal Evidence 702 when the scientific evidence proffered is not truly "novel."
[14] In Montgomery v. State, we explained in some detail the appellate court function under an abuse of discretion standard.
[1] If the proponent of evidence of a novel scientific theory or technique cannot show it establishes or refutes, tends to establish or refute, or at least makes "more or less probable" "the existence of any fact that is of consequence to the determination of the action," then it is not relevant under Rule 401, and is therefore inadmissible under Rule 402. If a novel scientific theory or technique does not prove to be a valid test for the probability of the existence, vel non, of a fact in issueif, in this sense, it is not "reliable"then it will not generate "relevant" evidence.
[2] Whether proffered evidence of specialized knowledge will in fact add to the jury's comprehension is, of course, a matter of the discretion of the trial court, which discretion is abused only where he finds evidence is admissible even though it contributes to the jury's comprehension not at all. Cf. Montgomery v. State, 810 S.W.2d 372, at 387 (Tex.Cr.App.1991) (Opinion on rehearing on Court's own motion) (trial court has discretion in deciding whether evidence has relevance beyond "character conformity," but no discretion to admit evidence which has no relevance beyond "character conformity").
[3] I accept this as a matter of policy-generated interpolation. I do not believe that Tex.R.Cr. Evid., Rule 104(a) substantively dictates what is a "preliminary question concerning the ... admissibility of evidence," but only requires that whatever is determined to be a preliminary question of admissibility be decided in camera. We could just as easily hold that the question whether proper protocol was followed in the particular case is a question of weight rather than admissibility.
[4] Giannelli, supra, at 1249, quoting People v. Collins, 94 Misc. 2d 704, 709-710, 405 N.Y.S.2d 365, 369 (Sup.Ct.1978).
[5] Prior to amendment by Acts 1987, 70th Leg., ch. 979, p. 3323, § 3, eff. Sept. 1, 1987, Article 26.05, Sec. 1(d) set a limit of $500.00 on fees for appointed experts.
[6] Indeed, a perfect example of this latter proposition is to be found in the context of DNA identification evidence. See generally Neufeld & Colman, When Science Takes the Witness Stand, Scientific American, Vol. 262, No. 5, p. 46 (May 1990).
[7] Rule 705(c), reads: "If the court determines that the expert does not have a sufficient basis for his opinion, the opinion is inadmissible unless the party offering the testimony first establishes sufficient underlying facts or data." | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/2443751/ | 571 S.W.2d 953 (1978)
WILLIAM SOMMERVILLE & SON, INC., Appellant,
v.
Leola CARTER et al., Appellees.
No. 1150.
Court of Civil Appeals of Texas, Tyler.
August 31, 1978.
Rehearing Denied October 19, 1978.
*954 Mike Hatchell, Ramey, Flock, Hutchins, Jeffus, McClendon & Crawford, Tyler, for appellant.
Charles M. Wilson, III of Carter, Jones, Magee, Rudberg, Moss & Mayes, Dallas, Wynne & Wynne, Wills Point, John Davenport, Asst. Atty. Gen., Austin, for appellees.
McKAY, Justice.
Appellee Leola Carter, individually and in her representative capacity, brought this suit in the Third Judicial District Court of Henderson County against appellant William Sommerville & Son, Inc., Lloyd Goins, and Doyle Ray Hundley to recover damages for the death of her husband. Appellant, a corporate resident of Dallas County, filed its plea of privilege to be sued in its county of residence. The trial court overruled the *955 plea of privilege and appellant has perfected this appeal.
This case arises out of the death of Findlon Carter on February 11, 1976, while working as an employee for the State Highway Department. While directing traffic on the side of the road, Carter was struck by a pickup truck. Said truck had been struck from the rear by a tractor-trailer rig driven by Doyle Hundley. The tractor trailer rig was owned by Lloyd Goins and at the time was carrying railroad crossties owned by William Sommerville & Son, Inc. Appellee alleged that Carter's death occurred as the result of negligence on the part of Sommerville & Son, Inc., Goins, and Hundley; that Hundley was the agent, servant, or employee of Goins acting in the course and scope of his employment; that Sommerville & Son, Inc., was negligent per se in violating Art. 911b, sec. 16(a), Tex. Rev.Civ.Stat.Ann., and negligent in fact by failing to ascertain that Goins had not been authorized by the Railroad Commission to engage in any hauling activity.
Appellee filed an amended controverting affidavit to the plea of privilege wherein she contended that venue was maintainable in Henderson County, Texas, by virtue of Subdivision 9a, 23, and 29a of Art. 1995, Tex.Rev.Civ.Stat.Ann. Upon hearing of the cause, the trial court overruled the plea of privilege and Sommerville & Son, Inc., perfected this appeal. No findings of fact or conclusions of law were requested by any party and none were filed.
The general rule of venue is that a defendant must be sued in the county of his domicile. In order to defeat the defendant's plea of privilege to be sued in the domiciliary county, the burden is on the plaintiff to plead and prove by a preponderance of the competent evidence that the case comes within one of the statutory exceptions. Compton v. Elliott, 126 Tex. 232, 88 S.W.2d 91 (1935); General Motors Corporation v. Courtesy Pontiac, Inc., 538 S.W.2d 3 (Tex.Civ.App.Tyler 1976, no writ); Admiral Motor Hotel of Texas, Inc. v. Community Inns of America, Inc., 389 S.W.2d 694 (Tex.Civ.App.Tyler 1965, no writ). Unless the plaintiff clearly discharges his burden of proof, the defendant is entitled to have the case transferred to the county of his domicile. Goodrich v. Superior Oil Company, 150 Tex. 159, 237 S.W.2d 969 (1951); Burtis v. Butler Bros., 148 Tex. 543, 226 S.W.2d 825 (1950); Seldon v. Green, 498 S.W.2d 285 (Tex.Civ.App.Tyler 1973, no writ); Admiral Motor Hotel of Texas, Inc. v. Community Inns of America, Inc., supra.
The venue facts which the plaintiff must allege and prove to defeat a plea of privilege are those stated in the particular exception of Article 1995 applicable to the cause of action as alleged. As noted, the burden is on the plaintiff to establish those venue facts by a preponderance of the competent evidence. Wire Rope Corporation of America, Inc. v. Barner, 446 S.W.2d 361 (Tex.Civ.App.Tyler 1969, no writ). A prima facie case, alone, is not sufficient. Compton v. Elliott, supra; Lynch v. Millican, 304 S.W.2d 410 (Tex.Civ.App.Waco 1957, no writ). Venue may not be established by the plaintiff on the basis of mere implication. Burtis v. Butler Bros., supra; Key v. Davis, 554 S.W.2d 60 (Tex.Civ.App. Amarillo 1977, no writ); Reynolds & Huff v. White, 378 S.W.2d 923 (Tex.Civ. App.Tyler 1964, no writ).
Appellee contends that venue is properly placed in Henderson County, Texas, under Sub. 9a, Article 1995, Tex.Rev.Civ.Stat.Ann. The facts required to be proven to sustain venue under 9a are (1) that an act or omission of negligence occurred in the county where the suit was filed; (2) that such act or omission was that of the defendant, in person, or that of his servant, agent, or representative acting within the scope of his employment; and (3) that such negligence was a proximate cause of plaintiff's injuries. Bledsoe v. Yarborough, 422 S.W.2d 222 (Tex.Civ.App.Tyler 1967, no writ); McDonald, Texas Civil Practice, Vol. 1, sec. 4.17.2, pp. 476-480. Appellee alleged *956 that Sommerville & Son, Inc. was negligent per se by aiding or abetting a violation of the Motor Carrier Act, sec. 16(a), Art. 911b, Tex.Rev.Civ.Stat.Ann. (1925), and was negligent in fact by virtue of its failure to know whether Goins was authorized by the Railroad Commission to transport property for hire. Appellee also alleged that Goins and Hundley were agents or employees of appellant and that said agents or employees were negligent on the occasion in question.
Appellee also relies upon Subdivision 23 of Art. 1995 to maintain venue in Henderson County. It is appellee's contention that this cause of action arose, either in whole or in part, in Henderson County. Prior to reaching the question of whether the "cause of action or part thereof" arose, we must first determine whether appellee established by a preponderance of the competent evidence that she did in fact have a cause of action against appellants. Wire Rope Corporation of America, Inc. v. Barner, supra. Unless there is, in fact, a cause of action, there could be no "part thereof" arising anywhere. Admiral Motor Hotel of Texas, Inc. v. Community Inns of America, Inc., supra.
Appellant contends in his third point of error that there is no evidence that Goins or Hundley were agents or employees of appellant. Appellant concedes that the accident happened under circumstances which could raise an inference of negligence on Hundley's part. In reviewing this "no evidence" point, we may look only to the evidence and reasonable inferences therefrom which are favorable to the judgment of the court below. General Motors Corporation v. Courtesy Pontiac, Inc., supra; Ralston Purina Company v. Wiseman, 467 S.W.2d 669 (Tex.Civ.App.El Paso 1971, no writ); Calvert, "No Evidence and Insufficient Evidence Points of Error," 38 Tex.L.Rev. 361, 364 (1960).
An independent contractor has been defined as any person who, in the pursuit of an independent business, undertakes to do a specific piece of work for other persons, using his own means and methods, without submitting himself to their control in respect to all its details. The recognized tests to determine when one is acting in the capacity of independent contractor are (1) the independent nature of his business; (2) his obligation to furnish necessary tools, supplies and materials to perform the job; (3) his right to control the progress of the work except as to final results; (4) the time for which he is employed; (5) the method of payment, whether by the time or by the job. Pitchfork Land and Cattle Company v. King, 162 Tex. 331, 346 S.W.2d 598, 603 (1961); Industrial Indemnity Exchange v. Southard, 138 Tex. 531, 160 S.W.2d 905, 907 (1942).
It has also been said that in practically all cases the independent nature of an agreement of employment may be inferred when the party is engaged in a distinct and generally recognized employment and his stipulated remuneration is to be determined by some quantitative standard. Dave Lehr, Inc. v. Brown, 127 Tex. 236, 91 S.W.2d 693 (1936). Quite often, however, right of control of the details of the work is the determinative test of whether one is an employee or an independent contractor. Anchor Casualty Company v. Hartsfield, 390 S.W.2d 469, 471 (Tex.1965); Newspapers, Inc. v. Love, 380 S.W.2d 582 (Tex.1964).
We fail to find any evidence in the record to support a finding that Goins or Hundley were agents, servants or representatives of Sommerville & Son, Inc. Appellee relies on the testimony of Adrian Brashears, Field Superintendent for appellant, as evidence that Goins was the agent or employee. Brashears testified that he hired Goins and that Goins went to sawmills, without any instructions to do so, to pick up crossties for appellant. Goins testified that for income tax purposes he would call Sommerville & Son, Inc. at the end of the year to determine what he had been paid during the past year. Such testimony is not evidence that Goins was an employee *957 or agent of Sommerville & Son, Inc. Specifically, appellee failed to adduce any evidence that Sommerville & Son, Inc., or its employee Brashears, had the right of control of the details of the work. Assuming Hundley's negligence, appellee failed to meet his burden of proof that Goins or Hundley were servants, agents or representatives thereby maintaining venue in Henderson County under Subdivision 9a, Art. 1995, Tex.Rev.Civ.Stat.
Appellant contends in its point of error two that there is no evidence that appellant procured, aided or abetted a violation of Sec. 16(a) of Art. 911b, Tex.Rev.Civ. Stat.Ann. (1925), Sec. 16(a) provides:
"... Every officer, agent, servant or employee of any corporation and every other person who ... procures, aids or abets in the violation of any provision of this Act ... shall be guilty of a misdemeanor and, upon conviction thereof, shall be punished by a fine of not less than Twenty-five Dollars ($25.00), nor more than Two Hundred Dollars ($200.00), and the violations occurring on each day shall constitute a separate offense." [Emphasis added.]
Appellant argues that one alleged to be an aider and abettor (1) must have knowledge of the illegality alleged plus criminal intent to violate; and (2) must actively or affirmatively encourage the principal actor in the violation, as opposed to merely consenting to it. We agree. It is undisputed that Goins failed to possess authority from the Texas Railroad Commission allowing him to transport crossties for hire over the public highways of Texas which failure was a violation of the Motor Carrier Act, Art. 911b, Tex.Rev.Civ.Stat.Ann.
Appellee cites several cases for the proposition that knowledge and intent and encouragement are not required for appellant to be found guilty of negligence per se. See Mason Feed Store v. Starks, 398 S.W.2d 392 (Tex.Civ.App.Austin 1966, writ dism'd); United States v. Lowther Trucking Co., 229 F. Supp. 812 (N.D.Ala. 1964); United States v. J & J Truck Leasing, Inc., 258 F. Supp. 105 (D. Kansas 1966); United States v. Gunn, 97 F. Supp. 476 (W.D.Ark.1950). The rule announced in Gunn and J & J Truck Leasing that no culpable mental state was required for the violator of the statute involved was not followed by the 9th Circuit in United States v. Hays Roofing and Supply, Inc., 490 F.2d 1190, 1193 (9th Cir. 1974). In Texas any violation of a penal statute requires a culpable mental state. Tex.Penal Code Ann. sec. 6.02. The provision at issue here, sec. 16(a) of Art. 911b, V.T.C.S., is a penal one, and therefore, an intentional, knowing, or reckless mental state is required. With the exception of Mason, we find no decision from a court in this State construing the phrase "procures, aids, or abets" as it appears in sec. 16(a) of Art. 911b. Nevertheless we are constrained not to follow that decision.
In that case, Mason Feed Store executed a grain handler's agreement with the U.S. Department of Agriculture Commodity Credit Corporation (CCC) under which it was to receive grain from the CCC, store it and issue it on purchase orders. Mason Feed Store had two trucks and a Railroad Commission carrier permit to haul grain and made successive oral agreements to haul the grain from Brownwood to the store in Mason, Texas. Pursuant to one of these hauling agreements, Mason Feed Store made an agreement with Homer Briley, Jr. to haul grain, paying him ten cents per hundred pounds. Neither Homer Briley nor his brother W. J. Briley had a Railroad Commission permit authorizing either of them to carry the grain. Pursuant to his brother's agreement with Mason Feed Store to haul grain, and under the latter's agreement with the CCC, W. J. Briley picked up a load of grain and while en route to his destination struck a truck killing the driver of the truck.
The court held that by procuring Homer Briley and through him, W. J. Briley to *958 carry a load of CCC grain from Brownwood to Mason for the Mason Feed Store, neither of whom had a Railroad Commission permit, Mason Feed Store procured, aided and abetted in the violation of Art. 911b, within the meaning of Art. 1690b, V.A.T.S. (now Sec. 16(a), Art. 911b), and therefore was guilty of negligence per se. The court cited Mundy v. Pirie-Slaughter Motor Company, 146 Tex. 314, 206 S.W.2d 587 (1947) as authority for this holding.
Upon consideration of the Supreme Court's decision in Mundy, we do not believe it to be authority for the court's holding in Mason. Although the Supreme Court dealt with a different statute and a different set of facts, we do believe the decision is helpful to our disposition of the case at bar.
In Mundy, a minor employee of the defendant Pirie-Slaughter Motor Co. was driving an automobile owned by the defendant and while negligently operating the vehicle injured the plaintiff. However, there was no evidence that the employee was in the course and scope of his employment. The minor employee did not have a driver's license. In that case, the plaintiff contended that the defendant was negligent in that defendant's agents permitted the minor employee to take and drive the automobile when they knew or in the exercise of reasonable care should have known that said employee (1) was an incompetent and reckless driver and (2) that he did not have a driver's license. The statute under which it was alleged that defendant was negligent was Art. 6687b, Sec. 36, V.A.C.S.
Section 36 made it unlawful for any person knowingly to permit a motor vehicle owned by him or under his control to be driven by any person not licensed or otherwise authorized under the statute to operate a motor vehicle. The court stated: "We do not think ... that the mere proof, in the absence of actual knowledge, that the defendant's agents in the exercise of reasonable care should have known that [the employee] did not have a license would show a violation of the statute." Mundy v. Pirie-Slaughter Motor Co., supra, 206 S.W.2d at p. 590.
Although Mundy was a negligent entrustment case we believe the Supreme Court's statement to be applicable to the facts before us. The only proof before us is that Sommerville & Son, Inc. did not know that Goins did not have Railroad Commission authorization, and did not ask if he did. Therefore, we find there was no evidence that defendant procured, aided or abetted a violation of Sec. 16(a), Art. 911b. Accordingly, appellant's point of error two is sustained.
In its point of error one, appellant contends that appellee failed to prove by a preponderance of the evidence that appellant committed an act of negligence in Henderson County which was the proximate cause of the accident in which Findlon Carter lost his life. We agree.
Appellee alleged that appellant knew, or in the exercise of ordinary care, should have known that Goins was not legally authorized to haul the crossties and that the failure to ascertain Goins' status was negligence proximately causing the death of Findlon Carter. Appellees rely on Mason Feed Stores and Mundy to support their theory of recovery. Under the facts before us, and upon consideration of the authorities cited to us, we find no basis for imposing such a duty upon Sommerville & Son, Inc.
Art. 911b, Tex.Rev.Civ.Stat.Ann., sec. 6(c), provides that no permit shall "be granted if the Commission shall be of the opinion that the proposed operation of any such ... carrier will impair the efficient public service of any authorized common carrier or common carriers then adequately serving the same territory." We do not believe that such language imposes a duty upon one hiring a motor carrier to inquire as to whether such carrier has a permit to operate on the highways of this State. Accordingly, we hold that Sommerville & Son, Inc. owed no duty to appellee to *959 inquire as to whether Goins had a Railroad Commission permit. Appellant's point of error one is sustained.
Thomas v. Reed, 483 S.W.2d 61, 62 (Tex. Civ.App.Dallas 1972, no writ), McIntire v. Sellers, 311 S.W.2d 886 (Tex.Civ.App.Austin 1958, writ ref'd n. r. e.), and Spratling v. Butler, 150 Tex. 369, 240 S.W.2d 1016 (1951), cited and relied upon by appellees, are, like Mundy, cases of negligent entrustment of a motor vehicle to another. We believe they are distinguishable from the instant case.
Assuming that appellant owed a duty to inquire as to whether Goins had a permit and that the failure to inquire was negligence, we would reach the same result based on appellee's failure to prove by a preponderance of the evidence that such failure was a proximate cause of Findlon Carter's death.
In East Texas Theatres, Inc. v. Rutledge, 453 S.W.2d 466 (Tex.1970), the Supreme Court stated, at page 468:
"... Just as we said in Baumler v. Hazelwood [162 Tex. 361, 347 S.W.2d 560] and later in Texas & Pacific Railroad Co. v. McCleery, 418 S.W.2d 494 (Tex.Sup. 1967), it is well settled that proximate cause includes two essential elements: (1) there must be cause in facta cause which produces an event and without which the event would not have occurred; and (2) foreseeability. See also Hopson v. Gulf Oil Corp., 150 Tex. 1, 237 S.W.2d 352 (1951). `An essential element of the plaintiff's cause of action for negligence is that there be some reasonable connection between the act or omission of the defendant and the damage which the plaintiff has suffered.' Prosser, Law of Torts (3rd Ed.) 240-241, `Causation', 41 (1964)."
The court also recognized that cause in fact covers one's omissions as well as his acts.
The record in this case clearly shows a complete lack of proof that Hundley would not have negligently operated Goins' truck "but for" the failure of Sommerville & Son, Inc. to inquire as to Goins' status with the Railroad Commission. A finding of proximate cause cannot be sustained unless there is proof of cause in fact and foreseeability. Enloe v. Barfield, 422 S.W.2d 905 (Tex.1967). Neither cause in fact nor foreseeability has been proven by appellee.
In view of our discussion of appellant's points of error, we hold that appellee failed to prove by a preponderance of the competent evidence the necessary facts under either subdivision 9a or 23 of Art. 1995.
Appellee also contended that venue could be maintained in Henderson County under Subdivision 29a of Art. 1995, which reads as follows:
"29a. Two or more defendants. Whenever there are two or more defendants in any suit brought in any county in this State and such suit is lawfully maintainable therein under the provisions of Article 1995 as to any of such defendants, then such suit may be maintained in such county against any and all necessary parties thereto."
We believe appellee's contention is without merit.
The general rule is that where, under the exceptions contained in Article 1995, a suit is properly maintainable against one defendant in a county other than the county of his residence, and the plaintiff therein joins another as defendant and seeks to sustain venue as to him under Section 29a, such other defendant is a necessary party within the meaning of Section 29a if the complete relief to which plaintiff is entitled under the facts of the case as against the defendant properly suable in that county can be obtained only in a suit to which both defendants are parties. Alexander, C. J., in Union Bus Lines v. Byrd, 142 Tex. 257, 177 S.W.2d 774, 775 (1944), citing *960 Pioneer Building & Loan Ass'n v. Gray, 132 Tex. 509, 125 S.W.2d 284 (1939); and Tarrant v. Walker, 140 Tex. 249, 166 S.W.2d 900 (1942). There was no evidence to establish joint responsibility, and appellee was under the burden of proving that no effectual decree could be rendered between her and Goins and Hundley without joining appellant. Ladner v. Reliance Corp., 156 Tex. 158, 293 S.W.2d 758, 764 (1956); Loop Cold Storage Co. v. South Texas Packers, Inc., 491 S.W.2d 106 (Tex.1973). Appellee failed to carry this burden.
In view of our disposition of appellant's first three points of error, we need not address the fourth point of error attacking the order overruling its plea of privilege because there was factually insufficient evidence to support a finding of negligence per se or negligence in fact.
The order overruling appellant Sommerville & Son, Inc.'s plea of privilege is reversed, and judgment is here rendered sustaining the plea of privilege and ordering the case against it transferred to one of the district courts of Dallas County, Texas. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/2450005/ | 117 F. Supp. 2d 581 (2000)
Jose RIOS-DELGADO, TN: Salomon Roque-Escobar, Movant,
v.
UNITED STATES of America, Respondent.
Nos. EP-98-CA-101-DB, EP-97-CR-020-DB.
United States District Court, W.D. Texas, El Paso Division.
October 11, 2000.
*582 *583 Mary Stillinger, El Paso, TX, for movant.
Janet M. Bonner, Assistant United States Attorney, El Paso, TX, for respondent.
ORDER GRANTING MOVANT'S MOTION TO VACATE, SET ASIDE OR CORRECT SENTENCE PURSUANT TO TITLE 28 U.S.C. § 2255
BRIONES, District Judge.
BEFORE THIS COURT is Movant Jose Rios-Delgado's Motion to Vacate, Set Aside or Correct Sentence pursuant to 28 U.S.C. § 2255 ("Motion to Vacate"), the Government's Response to Motion to Vacate Sentence Under 28 U.S.C. § 2255 and Movant's Reply to the Government's Response.
Facts & Procedural History
On January 10, 1989, Movant pled guilty to the felony conviction of Commercial Burglary in the Superior Court of California and was sentenced to two (2) years imprisonment. After serving his sentence, Movant was deported.
Eight years later, on January 16, 1997, Movant, represented by Claudia Beavers of the Federal Public Defender's Office, pled guilty to a one count Information charging him with Illegal Re-entry of a Removed Alien, a violation of 8 U.S.C. *584 § 1326. On February 3, 1997, the Government separately filed an Amended Notice of Penalty Enhancement, asserting that Movant had previously been convicted of Commercial Burglary, a conviction that it alleges subjects him to an enhanced sentence.
On March 10, 1997, Movant was sentenced after the Government agreed not to oppose the award of a three-level reduction for acceptance of responsibility and to recommend a two-level downward departure in exchange for his agreement to waive deportation proceedings and to enter a plea of guilty. A Pre-Sentence Investigation Report ("PSR") was prepared and advised the Court that Movant's sentence should be adjusted upwards by 16 levels because of United States Sentencing Guidelines ("Guidelines") § 2L1.2(b)(2), which requires such an the enhancement "[i]f the defendant previously was deported after his conviction for an aggravated felony" as provided in 8 U.S.C. § 1101(a)(43). The PSI further advised that, in light of a criminal history category VI, less the adjustment and the downward departure, the guideline range of imprisonment was 63-78 months. Movant filed no objection to the PSR nor voiced concerns over the proposed 16-level enhancement. This Court accepted the PSR and sentenced Movant to a sixty-six-month term of incarceration, finding that Movant was an aggravated felon under the statutory definition in 8 U.S.C. § 1101(a)(43)referenced as Note 7 in the Comment to § 2L1.2(b)(2) of the Guidelines.
Movant did not contest his conviction or sentence by way of a direct appeal to the Court of Appeals for the Fifth Circuit, having waived that right through a plea agreement.
Four months after his sentence, on July 11, 1997, the Fifth Circuit decided United States v. Reyna-Espinosa, 117 F.3d 826 (5th Cir.1997). In Reyna-Espinosa, the Fifth Circuit held that the statutory definition of "aggravated felony" is not intended to be incorporated into § 2L1.2(b)(2) of the Guidelines, which contains a much more limited definition of "aggravated felon" than the statutory definition in 8 U.S.C. § 1101(a)(43). See id. at 830.
Eight months after Reyna-Espinosa, on March 31, 1998, Movant filed his Motion to Vacate. In his Motion to Vacate, Movant posits two overlapping grounds for relief: (1) that he was denied the right to effective assistance of counsel during plea negotiations because counsel advised him to plead without knowing whether his prior felony conviction was a qualifying aggravated felony under the § 2L1.2(b)(2) 16-level enhancement; and (2) that he was denied the right to effective assistance of counsel during sentencing when counsel failed to object to the imposition of the 16-level enhancement based on the classification of his prior felony conviction of Commercial Burglary as an aggravated felony.
On May 12, 1998, the Government filed a Response, through which it alleges that the Motion to Vacate is time-barred and, in the alternative, that Reyna-Espinosa is inapplicable as precedent in this collateral attack. Moreover, the Government argues that, pursuant to Butler v. McKellar, 494 U.S. 407, 110 S. Ct. 1212, 108 L. Ed. 2d 347 (1990), "[a] new decision generally is not applicable in cases on collateral review unless the decision was dictated by precedent existing at the time the petitioner's conviction became final." The Government further argues that Movant does not demonstrate how he was prejudiced by his attorney's alleged omissions because "any objection to the sentence properly would have been rejected by the sentencing court."
On June 1, 1998, this Court entered an Order Appointing Counsel and Granting Evidentiary Hearing. Therein, the Court appointed attorney Mary Stillinger to represent Movant and stated that an evidentiary hearing would be set in the future.
On October 23, 1998, the Court entered an Order Setting Briefing Schedule, requiring that Movant address the Government's *585 Response. In that same order, the Court noted that additional briefing may obviate the need for an evidentiary hearing.
On November 20, 1998, Movant filed a thorough Reply. Therein, Movant avers that his Motion to Vacate is timely despite having filed it one year and twenty days after his sentence became final for two reasons: (1) the one-year statute of limitations did not start to run under 28 U.S.C. § 2255(4) until Movant discovered the factual basis of his claims on July 11, 1997, when Reyna-Espinosa was decided, and (2) for those same reasons, the statute of limitations should be equitably tolled.
Movant further replies that he does demonstrate prejudice because "under the law and guideline in effect at sentencing," he should have only received a four-level enhancement, under § 2L1.2(b)(1) for having been previously deported for a felony conviction, not a 16-level enhancement under § 2L1.2(b)(2) for having been previously deported for an aggravated felony conviction, which would have resulted in a punishment range of 24-30 months instead of the 63-78 month range actually used at sentencing. He cites a case with virtually identical facts that was previously before this Court as an example of how he was prejudiced, given that the same Federal Public Defender's Office that represented him at sentencing represented one Cesar Pacillas-Santa Cruz ("Pacillas"), and at that time knew to object to the 16-level enhancement.[1]
Lastly, Movant addresses the retroactive application of law that the Government contends Teague v. Lane, 489 U.S. 288, 109 S. Ct. 1060, 103 L. Ed. 2d 334 (1989), and its progeny prohibit: "[Movant] would have been afforded the benefit of Reyna-Espinosa before his conviction became final [had counsel objected]." (Emphasis supplied). In the alternative, Movant also argues that Teague allows the application of the Reyna-Espinosa holding because it did not announce a new rule of law nor refer to procedural rules. In light of Movant's Reply, the Court finds that an evidentiary hearing is not necessary.
Discussion
I. Timeliness
Movant signed his Motion to Vacate on March 30, 1998, and filed it on March 31, 1998. Thus, the specific period of limitation provision governing motions to vacate, set aside or correct sentence applies.[2] More specifically, that provision states:
A one-year period of limitation shall apply to a motion under this section. The limitation period shall run from the latest of
(1) the date on which the judgment of conviction becomes final;
(2) the date on which the impediment to making a motion created by governmental action in violation of the *586 Constitution or laws of the United States is removed, if the movant was prevented from making a motion by such governmental action;
(3) the date on which the right asserted was initially recognized by the Supreme Court, if that right has been newly recognized by the Supreme Court and made retroactively applicable to cases on collateral review; or
(4) the date on which the facts supporting the claim or claims presented could have been discovered through the exercise of due diligence.
28 U.S.C.A. § 2255 (West Supp.2000) (emphasis added).
According to Rule 4(b) of the Federal Rules of Appellate Procedure, Movant's conviction became final on March 20, 1997, ten days after the judgment of conviction was entered since he did not appeal. See Griffith v. Kentucky, 479 U.S. 314, 321 n. 6, 107 S. Ct. 708, 93 L. Ed. 2d 649 (1987) ("By `final,' we mean a case in which a judgment of conviction has been rendered, the availability of appeal exhausted, and the time for a petition for certiorari elapsed or a petition for certiorari finally denied."); United States v. Hass, 150 F.3d 443, 450 (5th Cir.1998). Given the date his conviction became final, under § 2255(1) it was incumbent upon Movant to file his Motion to Vacate no later than March 20, 1998, one (1) year after his conviction became final.
On July 11, 1997, Movant could have discovered, through the exercise of due diligence, the facts supporting his claims. Movant effectively makes the case that he could not have discovered the factual predicate of his claims presented sooner than July 11, 1997, despite the exercise of due diligence. He specifically alleges that his counsel was ineffective for not contesting the 16-level enhancement which was based on an incorrect interpretation of § 2L1.2(b)(2) of the Guidelines. The Court finds that this particular claim could not have been discovered until the Fifth Circuit interpreted § 2L1.2(b)(2). The Fifth Circuit interpreted § 2L1.2(b)(2) in Reyna-Espinosa, which was decided on July 11, 1997, four months after Movant's conviction became final. One year from that date is July 11, 1998, and the Motion to Vacate, was filed on March 30, 1998. Consequently, the Court finds that the statutory exception § 2255(4) applies to the instant Motion to Vacate, making it timely. The Court further finds that there is no need to reach the issue of equitable tolling because of the timely filing.
II. Ineffective Assistance of Counsel
In general, claims of ineffective assistance of counsel give rise to constitutional issues cognizable under the statute governing motions to set aside, vacate, or correct sentence. See United States v. Walker, 68 F.3d 931, 934 (5th Cir.1995). The Sixth Amendment to the United States Constitution provides that "[i]n all criminal prosecutions, the accused shall enjoy the right ... to have the Assistance of Counsel for his defense." The Supreme Court has construed this language to include the right to assistance of counsel at trial and on appeal. See Douglas v. California, 372 U.S. 353, 357, 83 S. Ct. 814, 9 L. Ed. 2d 811 (1963). The Supreme Court further has stated that the constitutional right conferred is not simply to the assistance of counsel, but also to the effective assistance of counsel, both at trial and on appeal. See Evitts v. Lucey, 469 U.S. 387, 398, 105 S. Ct. 830, 83 L. Ed. 2d 821 (1985). Thus, whether Movant had effective assistance of counsel at each stage of his prosecution, as guaranteed by the Sixth Amendment, is properly before the Court through the instant Motion.
The constitutional standard for determining whether a criminal defendant has been denied the effective assistance of counsel was announced by the Supreme Court in Strickland. There, the Supreme Court stated: "The benchmark for judging any claim of ineffectiveness must be whether counsel's conduct so undermined *587 the proper functioning of the adversarial process that the trial cannot be relied on as having produced a just result." Id. at 686, 104 S. Ct. 2052; see also Nealy v. Cabana, 764 F.2d 1173, 1177 (5th Cir. 1985). To facilitate the inquiry, the Supreme Court established the following two-prong test:
First, the defendant must show that counsel's performance was deficient. This requires showing that counsel made errors so serious that counsel was not functioning as the "counsel" guaranteed the defendant by the Sixth Amendment. Second, the defendant must show that the deficient performance prejudiced the defense. This requires showing that counsel's errors were so serious as to deprive the defendant of a fair trial, a trial whose result is reliable.
Strickland, 466 U.S. at 687, 104 S. Ct. 2052. In so doing, a convicted defendant must carry the burden of proof and overcome a strong presumption that the conduct of his trial counsel falls within a wide range of reasonable professional assistance. See id. at 687-91, 104 S. Ct. 2052; Belyeu v. Scott, 67 F.3d 535, 538 (5th Cir.1995). The courts are extremely deferential in scrutinizing the performance of counsel and make every effort to eliminate the distorting effects of hindsight. See Lockhart v. Fretwell, 506 U.S. 364, 372, 113 S. Ct. 838, 122 L. Ed. 2d 180 (1993); Burger v. Kemp, 483 U.S. 776, 789, 107 S. Ct. 3114, 97 L. Ed. 2d 638 (1987); Strickland, 466 U.S. at 689, 104 S. Ct. 2052; Green v. Johnson, 116 F.3d 1115, 1122 (5th Cir.1997). It is strongly presumed that counsel has rendered adequate assistance and made all significant decisions in the exercise of reasonable professional judgment. See Strickland, 466 U.S. at 690, 104 S. Ct. 2052; Duff-Smith v. Collins, 973 F.2d 1175, 1182 (5th Cir.1992). An attorney's strategic choices, usually based on information supplied by the defendant and from a thorough investigation of relevant facts and law are virtually unchallengeable. See Boyle v. Johnson, 93 F.3d 180, 187-88 (5th Cir.1996).
Furthermore, in order to establish that he has sustained prejudicethe second Strickland prongthe convicted defendant "must show that there is a reasonable probability that, but for counsel's unprofessional errors, the result of the proceeding would have been different. A reasonable probability is a probability sufficient to undermine confidence in the outcome." Strickland, 466 U.S. at 694, 104 S. Ct. 2052; Cantu v. Collins, 967 F.2d 1006, 1016 (5th Cir.1992). In addition, analysis of the second or "prejudice" prong of the Strickland test must include examination of whether counsel's deficient performance caused the outcome to be unreliable or the proceeding to be fundamentally unfair. See Lackey v. Johnson, 116 F.3d 149, 152 (5th Cir.1997). "Unreliability or unfairness does not result if the ineffectiveness of counsel does not deprive the defendant of any substantive or procedural right to which the law entitles him." Lockhart, 506 U.S. at 372, 113 S. Ct. 838. Finally, prejudice is measured by current law and not by the law as it existed at the time of the alleged error. Westley v. Johnson, 83 F.3d 714, 723 (5th Cir.1996) (citing Lockhart, 506 U.S. at 372-73, 113 S. Ct. 838).
Thus, in order to prevail on a claim of ineffective assistance of counsel, a movant must show that (1) counsel's representation fell below an objective standard of reasonableness, and (2) there is a reasonable probability that, but for counsel's unprofessional errors, the result of the proceeding would have been different. See Kimmelman v. Morrison, 477 U.S. 365, 375, 106 S. Ct. 2574, 91 L. Ed. 2d 305 (1986); Darden v. Wainwright, 477 U.S. 168, 184, 106 S. Ct. 2464, 91 L. Ed. 2d 144 (1986); Williams v. Collins, 16 F.3d 626, 631 (5th Cir.1994); United States v. Bounds, 943 F.2d 541, 544 (5th Cir.1991). A failure to establish either deficient performance or prejudice under that test makes it unnecessary to examine the other prong. See Strickland, 466 U.S. at 700, *588 104 S. Ct. 2052; Green v. Johnson, 116 F.3d at 1122.
A. Reasonableness of Counsel's Performance
Here, Movant alleges that he was denied the right to effective assistance of counsel during plea negotiations because counsel advised him to plead guilty without knowing whether his prior felony conviction was an aggravated felony under the 16-level enhancement provision of § 2L1.2(b)2. Clairvoyance is not a required attribute of effective representation. See Sharp v. Johnson, 107 F.3d 282, 290 n. 28 (5th Cir.1997) (citing Garland v. Maggio, 717 F.2d 199, 207 (5th Cir.1983)). Moreover, the Fifth Circuit has emphatically "made clear that conclusory allegations of ineffective assistance of counsel do not raise a constitutional issue in a federal habeas proceeding." Miller v. Johnson, 200 F.3d 274, 281 (5th Cir.2000) (citing Ross v. Estelle, 694 F.2d 1008, 1012 (5th Cir.1983)). In other words, there must be specific pleading requirements because the Court cannot speculate about a violation of Movant's right to effective counsel. See Kinnamon v. Scott, 40 F.3d 731, 735 (5th Cir.1994) (denying argument of ineffective assistance of counsel that "adds up to a claim that there may be something there").
First, there is absolutely no evidence to suggest that Movant's counsel did not voice concerns about the 16-level enhancement during plea negotiations or that she was unaware of the litigation involving § 2L1.2(b)(2). Second, even assuming arguendo that counsel had no knowledge of challenges to the use of § 2L1.2(b)(2)'s statutory definition of "aggravated felony" pending before the Fifth Circuit, the Court cannot demand that she use a pending case as leverage during plea negotiations. In other words, it is hard to imagine that the Government would have offered a better plea offer because of a pending case. Indeed, it is this Court's experience that the Government only concedes to a more lenient sentence, as compared to what it was prepared to offer, in the face of sound precedent. Therefore, counsel's performance was not constitutionally deficient when she advised Movant to accept the plea offer while there was a case pending before the Fifth Circuit that might impact her client's case.
Rather, Movant was denied the right to effective assistance of counsel at sentencing when counsel failed simply to object to the 16-level enhancement that, at the time, was arguably inapplicable because the omission reflects a failure to reasonably investigate the case, to give the court an opportunity to exercise its discretion and it denied him a right to appeal the 16-level enhancement. Courts have noted how important it is for lawyers to have command of the facts and legal issues as they apply to a client's case.[3] "[A] reasonable attorney has an obligation to research relevant facts and law, or make an informed decision that certain avenues will not prove fruitful." United States v. Williamson, 183 F.3d 458, 462 (5th Cir.1999) (holding that counsel was deficient because he did not "keep abreast of legal developments related to [a] case" which would have revealed a solid and meritorious appellate issue) (citations omitted). "In other *589 words, counsel has a duty to make reasonable investigations or to make a reasonable decision that makes particular investigations unnecessary." Strickland, 466 U.S. at 691, 104 S. Ct. 2052 (finding that counsel had investigated various avenues before sentencing where the record suggested he did not offer the evidence the petitioner desired because it was "of little help" and would have lead to the admissibility of the petitioner's criminal history). At minimum, an attorney should be familiar with the facts and law relevant to his client's case. Childress v. Johnson, 103 F.3d 1221, 1227 (5th Cir.1997) (ruling that counsel was ineffective at his client's plea hearing and acted like a "potted plant" for merely ascertaining if client wished to plead guilty, helping him execute a waiver of jury trial and stood in, on stand-by, just in case the sentencing court had questions).
Generally speaking, a failure to object, standing alone, does not rise to the level of constitutionally deficient performance. In cases where an accused complains that counsel was ineffective because he did not object to something or file a particular pretrial motion, the courts grant significant deference, as such actions fall "squarely within the ambit of trial strategy." Murray v. Maggio 736 F.2d 279, 283 (5th Cir.1984) (per curiam). Courts are not inclined to find ineffective assistance in such cases because they generally find such actions would have been frivolous anyhow and because the objections would have been overruled. See Koch v. Puckett, 907 F.2d 524, 527 (5th Cir.1990); Clark v. Collins, 19 F.3d 959, 966 (5th Cir.1994); United States v. Flores-Ochoa, 139 F.3d 1022, 1024 (5th Cir.1998).
Here, the Court would have overruled the missing objection, as it did in Mr. Pacillas's case earlier. In Flores-Ochoa, the Fifth Circuit declined to find counsel ineffective for not filing a motion for continuance, even though there is no doubt the accused would have benefitted from a continuance, because it was not "reasonably probable" that the court would have granted the continuance. See 139 F.3d at 1024. Moreover, in Murray, the court found that any motion to suppress that would have been filed most likely would have been denied, making the ineffective assistance claim baseless. See 736 F.2d at 282. In the instant case, the record reflects that this Court favored a broad definition of "aggravated felony" and imposition of a 16-level enhancement over the narrow definition in § 2L1.2(b)(2) that called for only a 4-level enhancement. Here, unlike in Flores-Ochoa and Murray, the Court finds that there were several valid reasons for the Court to have considered the objection even if eventually the Court would have overruled such objections.
First, had counsel objected to the 16-level enhancement, the objection would not have been frivolous. In stark contrast to the arguments available to counsel in Koch and Clark, Movant's attorney had valid arguments. In Koch, the Court found that Koch did not offer legitimate reasons that counsel could have argued to suppress the statements he wanted suppressed by way of a motion. See Koch, 907 F.2d at 526-30. In Clark v. Collins, the Court found that counsel did "not fall short of the reasonable professional assistance guaranteed by the [S]ixth [A]mendment" because had counsel objected during voir dire on the basis of Batson it would have been frivolous given that Batson, could not be applied retroactively. 19 F.3d at 965. Here, counsel had several legitimate arguments she could have made to meet the Sixth Amendment objectives of ensuring that the sentencing was adversarial and fair. In fact, she did not have to take heroic steps. Her strategy at trial could have been very simple given the deference lawyers are provided under Strickland. For example, it would have been enough for her to have objected and argued that, while the language in § 2L1.2(b)(2) referred to the broad statutory definition of "aggravated *590 felony" by way of a "see" signal, § 2L1.2(b)(2) defined Movant's commercial burglary conviction as only a non-aggravated felony conviction in the main text. In other words, just by objecting and arguing the plain language of the applicable section in the Guidelines, counsel would have had plenty to say to make her an effective advocate. See Rivers v. Roadway Express, Inc., 511 U.S. 298, 312, 114 S. Ct. 1510, 128 L. Ed. 2d 274 (1994) ("No system of lawwhether it be judge-made or legislatively enactedcan be so perfectly drafted as to leave no room for dispute.").
Her failure to object on the most basic level suggests that she was ineffective for a second reason. That is, counsel did not conduct a basic investigation into the Guidelines, the PSR, relevant legal developments or her employer's experience with this Guidelines section. Had she done so, counsel could have easily argued for a narrow definition and application of "aggravated felony" under § 2L1.2(b)(2). Also, counsel could have informed the Court that Reyna-Espinosa was pending before the Fifth Circuit and that the circuit courts were split on the application of the term "aggravated felony," as defined in § 2L1.2(b)(2). Moreover, had counsel queried her colleagues in the Federal Public Defender's Office, she could have objected and, if overruled, she could have added that her office two months earlier raised concerns about the section's application in the Pacillas case and that this Court preserved a right to appeal in that case. All of this information, individually and collectively, would have provided counsel some shelter from wearing a badge of ineffectiveness. However, the record reflects that not one such argument was made. Given the numerous grounds for objection, the Court must conclude that objection regarding the application of § 2L1.2(b)(2) would not have been frivolous.
Furthermore, the objection would not have been frivolous because the ruling in Reyna-Espinosa can provide Movant relief even though it was decided after Movant's case became final. Unlike in Clark, where the Fifth Circuit ruled that counsel was not ineffective because the law that Petitioner claimed entitled to him to relief was an inapplicable new law rendered four years after counsel's alleged error, the Reyna-Espinosa decision can be applied retroactively as dictated by the Teague inquiry. See Clark, 19 F.3d at 966.
The Teague inquiry is conducted in three steps. See O'Dell v. Netherland, 521 U.S. 151, 155, 117 S. Ct. 1969, 138 L. Ed. 2d 351 (1997). First, the date on which the defendant's conviction became final is determined. See Lambrix v. Singletary, 520 U.S. 518, 527, 117 S. Ct. 1517, 137 L. Ed. 2d 771 (1997). Next, a habeas court must consider if a new rule exists that might be applicable to the movant's claim. See O'Dell, 521 U.S. at 155, 117 S. Ct. 1969. In Teague, the plurality stated that a decision constitutes a "new rule" "if the result was not dictated by precedent existing at the time the defendant's conviction became final." Teague, 489 U.S. at 301, 109 S. Ct. 1060. After Teague, the Supreme Court sought to fine-tune the definition of the "new rule" in Butler v. McKellar, 494 U.S. 407, 110 S. Ct. 1212, 108 L. Ed. 2d 347 (1990). In Butler, the Supreme Court recognized that there are variations as to what constitutes a "new rule." Generally speaking, a new decision that expressly overrules an earlier holding is the most obvious example of a "new rule" because it "`breaks new ground' or `imposes a new obligation.' In the vast majority of cases, however, where the new decision is reached by an extension of the reasoning of previous cases, the inquiry will be more difficult." Butler, 494 U.S. at 412-13, 110 S. Ct. 1212. In the instant case, the Government argues that Movant cannot benefit from Reyna-Espinosa because his conviction was final when it was decided and there was no precedent existing at the time of his sentence which dictated the narrow reading of "aggravated felony" in *591 accordance with the ruling in Reyna-Espinosa. In other words, the Government argues Reyna-Espinosa is a new rule and, consequently, its application to a conviction that is final is precluded on collateral review. Movant counters that Reyna-Espinosa does not announce a new rule of criminal procedure and merely interprets a statute in existence at the time of his sentence or before the conviction became final.
Reyna-Espinosa is not about a rule of criminal procedure; rather, that case interprets the Guidelines. "A judicial construction of a statute is an authoritative statement of what the statute meant before as well as after the decision of the case giving rise to that construction." Rivers, 511 U.S. at 312-13, 114 S. Ct. 1510. When a court "construes a statute, it is explaining its understanding of what the statute has meant continuously since the date when it became law." Id. at 313 n. 12, 114 S. Ct. 1510. By contrast, rules of criminal procedure, which cannot apply on collateral review under Teague are those that concern "a procedure which creates an impermissibly large risk that the innocent will be convicted." See Bousley v. United States, 523 U.S. 614, 620, 118 S. Ct. 1604, 140 L. Ed. 2d 828 (1998). In other words, Movant is not asking that this Court apply a new law that rings of constitutional importance as to his innocence. See Teague, 489 U.S. at 310, 109 S. Ct. 1060. Therefore, Teague does not preclude the application of Reyna-Espinosa to Movant's final conviction.
Lastly, unlike Strickland, where there was evidence that the attorney acted as he did for particular strategic reasons, the Court here cannot find a single reason to justify counsel's silence at Movant's sentencing hearing. On two separate occasions, January 16, 1997, and February 3, 1997, counsel was provided notice of the potential for an enhanced penalty due to Movant's prior felony conviction of Commercial Burglary. Also, at the sentencing hearing, a PSR was offered which proposed that the 16-level enhancement be imposed based on § 2L1.2(b)(2)'s broad definition of "aggravated felony." There is nothing in the record to suggest that counsel was taken by surprise at the sentencing when the PSR recommended enhanced punishment or that the silence was sound trial strategy. In fact, the record suggests that counsel's silence reflects nothing more than a failure to investigate the relevant facts and law that would have given her a strategy at Movant's sentencing hearing. The Court's finding is supported by the letter Movant received from the Federal Public Defender's Office stating that his attorney made a mistake and so the office was forwarding him a draft of a Motion to Vacate so that he could seek a correction of his sentence. In sum, counsel did not have a trial strategy when she stood in silence at Movant's sentencing hearing.
Consequently, counsel was deficient because she had several non-frivolous arguments to make upon a proper objection but failed to bring these arguments to the attention of the sentencing and appellate courts because she did not investigate or familiarize herself with the case before Movant's sentencing.
B. Prejudice
To prove prejudice from this deficient performance, Movant must demonstrate that "there is a reasonable probability that, but for counsel's unprofessional error[], the result of the proceeding would have been different." Jones v. Jones, 163 F.3d 285, 300 (5th Cir.1998) (citing Strickland, 466 U.S. at 694, 104 S. Ct. 2052). A reasonable probability is that which renders the proceeding unfair or unreliable i.e., undermines confidence it its outcome. Green v. Johnson, 160 F.3d 1029, 1043 (5th Cir.1998) (citing Lockhart v. Fretwell, 506 U.S. 364, 369, 113 S. Ct. 838, 122 L. Ed. 2d 180 (1993)). This Court must examine then, whether the holding in Reyna-Espinosa rendered the sentence unfair or unreliable. This requires that the court "determine the probable outcome on appeal had *592 counsel raised the argument." Williamson, 183 F.3d at 463. Given the virtually identical facts in Pacillas, except for the actions of counsel, the probable outcome is that the Fifth Circuit would have vacated Movant's sentence and ordered this Court to re-sentence Movant in light of Reyna-Espinosa if counsel would have objected and if overruled, requested an appealed as to the 16-level enhancement issue. This case is also fairly similar to Williamson, where the court sentenced the defendant as a career offender when the Guidelines "exceeded their stated authority" and he should have been sentenced without the enhancement. See id. The Court finds that Movant was prejudiced because counsel did not preserve Movant's right to a direct appeal by making the non-frivolous objection to the 16-level enhancement that added, at minimum, thirty-six months to his sentence. Hence, the Court is of the opinion that the instant Motion to Vacate satisfies the Strickland two-prong test and should be granted.
Accordingly, IT IS HEREBY ORDERED that Movant Jose Rios-Delgado's Motion to Vacate, Set Aside or Correct Sentence filed pursuant to 28 U.S.C. § 2255 is GRANTED.
IT IS FURTHER ORDERED that Movant's request to VACATE SENTENCE is GRANTED to the extent that the Court will re-sentence him in accordance with Reyna-Espinosa, 117 F.3d 826 (5th Cir.1997).
IT IS FURTHER ORDERED that on or before October 15, 2000, Movant's Attorney, Mary Stillinger, file a motion to set re-sentencing in criminal cause number EP-97-CR-020-DB.
IT IS FINALLY ORDERED that Movant's request to vacate conviction is DENIED.
NOTES
[1] At Pacillas's sentencing hearing, his attorney, a member of the Office of the Federal Public Defender, objected to the proposed 16-level enhancement for an "aggravated felony" classification, urging that a probated sentence for a felony is only a 4-level enhancement. The Court overruled the objection, applying a 16-level enhancement and commenting, "maybe the Fifth Circuit will give him [(Pacillas)] some relief."
Later, on September 9, 1997, the Fifth Circuit provided that relief to Pacillas. The Fifth Circuit held that this Court erred by increasing Pacillas's sentence by 16 levels because Pacillas's prior felony conviction was not an "aggravated felony" under the Guidelines. More specifically, the Fifth Circuit found that this Court "relied on 8 U.S.C. § 1101(a)(43) rather than § 2L1.2(b)(2), comment, (n. 7) for the definition of `aggravated felony.'" The Fifth Circuit vacated Pacillas's sentence and remanded to this Court for re-sentencing in the light of Reyna-Espinosa.
[2] In Spotville v. Cain, the Fifth Circuit held that, "a pro se prisoner's habeas petition is filed, for purposes of determining the applicability of the Anti-terrorism and Effective Death Penalty Act of 1996 [one year statute of limitation provision], when he delivers the papers to prison authorities for mailing." 149 F.3d 374, 378 (5th Cir.1998) (per curiam).
[3] Beyond legal requirements, lawyers practicing criminal law in federal courts have a more basic need to be prepared. For example, in 1988, the American Bar Association ("ABA") published an article underscoring how counsel's role would "change dramatically" under the new Guidelines "because old ploys to avoid imprisonment are no longer available, defense counsel must scrutinize the guidelines for new avenues of relief." Donald A. Purdy, Jr. & Michael Goldsmith, Better Do Your Homework: Plea Bargaining Under the New Federal Sentencing Guidelines, Spring 1988, A.B.A. SEC.CRIM.JUST., 2. The article emphasizes that counsel must devote great attention to researching and considering his client's prior convictions in detail and be prepared to challenge the sentencing implications for the prior convictions. Id. at 3. The authors sum up their article by warning defense attorneys that they should attain a "thorough knowledge of the changed system before traditional litigation skills may be effectively used." Id. at 36. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/2463771/ | 995 S.W.2d 722 (1999)
Ramon REYES, Appellant,
v.
STORAGE & PROCESSORS, INC. and Leonel Guerrero, Appellees.
No. 04-98-00334-CV.
Court of Appeals of Texas, San Antonio.
April 21, 1999.
*723 Jerry A. Pusch, Pusch, Lowery & Gilcrease, Houston, for appellant.
Randall L. Brim, Stewart A. Feldman & Associates, L.L.P., Robert H. Singleton, Jr., Serena A. Strong, Singleton & Cooksey, P.C., Houston, for appellee.
Before PHIL HARDBERGER, Chief Justice, CATHERINE STONE, Justice, SARAH B. DUNCAN, Justice.
*724 OPINION
Opinion by: SARAH B. DUNCAN, Justice.
This appeal questions the enforceability of an agreement by which an employee of a non-subscriber waives his claims arising out of a workplace injury in exchange for certain but far more limited benefits than those provided by workers' compensation insurance. We hold the waiver violates the public policy expressed by the Texas Legislature in the Texas Workers Compensation Act and is therefore void and unenforceable.
FACTUAL AND PROCEDURAL BACKGROUND
Shortly after Ramon Reyes was hired by Storage and Processors, Inc. as a forklift operator, he enrolled in S & P's Occupational Accident Employee Welfare Benefit Plan. Reyes thus signed a document, written in Spanish, stating he had read and understood the rules and stipulations of the S & P Plan and, four days later, he signed the S & P Plan agreement, which states in relevant part:
This company does not have workers' compensation insurance coverage to protect you from damages because of work-related illness or injury. However, we do have an Occupational Accident Employee Welfare Benefit Plan that provides benefits to those employees who are injured on the job.
....
As a result of the Company not having workers' compensation insurance coverage, you may have certain rights under the common laws of Texas for damages arising out of work-related illness or injury. If, however, you choose to participate in the Company's Occupational Accident Employee Welfare Benefit Plan by requesting the benefits provided by the Plan, you hereby agree to accept the Plan benefits as the only benefits you are entitled to receive in the event of a work-related injury and to waive any and all other causes of action, claims, rights, and demands that you could make against the Company, its successors, assigns, employees, officers, directors, shareholders, agents and clients. Participation in the Company's Occupational Accident Employee Welfare Benefit Plan is not compulsory....
....
By my signature below, I acknowledge that this non-subscriber program has been explained to me, and that I was given the opportunity to ask questions, have my questions answered, and to make comments. It was further explained to me that my employment and/or my continued employment was not conditional upon the execution of this Agreement, but that by my execution of this Agreement I am agreeing to comply with the terms of the Plan and this Agreement. I understand that participation in the Plan is not compulsory, and understanding that, I hereby agree to participate in the Plan and to receive the benefits provided to me by the Company through this Occupational Accident Employee Welfare Benefit Plan. I also understand that, by executing this Agreement, I have waived certain claims and rights as stated herein.
Reyes signed an almost identical document again in November 1984.
Eighteen months after he was hired, Reyes was severely injured when his foot was run over and severed by a forklift driven by a coworker, Leonel Guerrero. Reyes' foot was reattached and over the next eighteen months, the S & P Plan paid to him or on his behalf $89,891.69 in medical benefits and $16,842.86 in wage replacement benefits. Before these benefits terminated, Reyes sued S & P and Guerrero for negligence. After the suit was filed, S & P's attorney demanded the suit be dismissed; in response, Reyes requested his benefits under the S & P Plan be discontinued. But he did not return or tender a return of any of the benefits he had already received.
S & P and Guerrero moved for summary judgment, contending Reyes waived his common law causes of action and subsequently *725 ratified that waiver, and he is estopped from contending otherwise by his acceptance of benefits under the S & P Plan. The trial court granted summary judgment against Reyes, and he appealed.
STANDARD OF REVIEW
We review a summary judgment de novo and will therefore uphold a Rule 166a(c) summary judgment only if the summary judgment record establishes there is no genuine issue of material fact "and the movant is entitled to judgment as a matter of law on a ground set forth in the motion." Valores Corporativos, S.A. de C.V. v. McLane Co., 945 S.W.2d 160, 162 (Tex. App.-San Antonio 1997, writ denied); TEX.R. CIV. P. 166a(c). In determining whether a genuine issue of material fact exists, "we view as true all evidence favorable to the non-movant and indulge every reasonable inference, and resolve all doubts, in its favor." Valores, 945 S.W.2d at 162.
ADEQUACY OF REYES' BRIEF
Guerrero argues we must affirm the summary judgment because Reyes has neither brought forward a general Malooly[1] point of error nor specifically challenged estoppel, one of the grounds upon which Guererro and S & P moved for summary judgment. We disagree.
Under the amended Texas Rules of Appellate Procedure, a brief "must state concisely all issues or points presented for review," TEX.R.APP. P. 38.1(e), and "contain a clear and concise argument for the contentions made." TEX.R.APP. P. 38.1(h). "The statement of an issue or point will be treated as covering every subsidiary question that is fairly included." TEX.R.APP. P. 38.1(e).
The requirements of Rules 38.1(e) and 38.1(h) are met in this case. Reyes' brief clearly states the issue presented for review[2] and concisely argues estoppel cannot sustain the trial court's judgment.[3] No more is required.
WAIVER, RATIFICATION, AND ESTOPPEL
Reyes first argues S & P and Guerrero have not conclusively established their affirmative defenses of waiver, ratification, and estoppel because the summary judgment evidence raises a material fact issue regarding whether he understood the waiver he signed sufficiently to be bound by it. While we agree Reyes' affidavit raises this issue of fact, we disagree it is material.
One who signs a contract "must be held to have known what words were used in the contract and to have known their meaning, and he must also be held to have known and fully comprehended the legal effect of the contract." Nguyen Ngoc Giao v. Smith & Lamm, P.C., 714 S.W.2d 144, 146 (Tex.App.-Houston [1st Dist.]1986, no writ). Illiteracy thus does not relieve a contracting party of the consequences of his agreement. Id.; Vera v. North Star Dodge Sales, Inc., 989 S.W.2d 13, 17 (Tex.App.-San Antonio 1998, no pet.); Brown v. Aztec Rig Equip., Inc., 921 S.W.2d 835, 846 (Tex.App.-Houston [14th Dist.] 1996, writ denied). Indeed, "[a]bsent proof of mental incapacity, a person who signs a contract is presumed to have read and understood the contract, unless he was prevented from doing so by trick or artifice." Vera, at 17.
No summary judgment evidence suggests Reyes either lacked the mental capacity to contract or signed the waiver as a result of "trick or artifice." Accordingly, *726 his actual understanding of the effect of what he signed is immaterial. See id. Likewise immaterial is whether Reyes asked that his benefits be discontinued upon learning of the S & P Plan terms. Accordingly, if the agreement is enforceable, Reyes ratified it by accepting and retaining its substantial benefits. See Land Title Co. v. F.M. Stigler, Inc., 609 S.W.2d 754, 756-57 (Tex.1980); Daniel v. Goesl, 161 Tex. 490, 341 S.W.2d 892, 895 (1960). Similar reasoning would foreclose Reyes' estoppel argument. See, e.g., Texas Oil & Gas Corp. v. Vela, 429 S.W.2d 866, 876 (Tex.1968). In short, Reyes is bound by the waiver if it is enforceable.
SECTION 406.035
Reyes first argues the release is void and unenforceable under section 406.035 of the Texas Workers Compensation Act, which provides "an agreement by an employee to waive the employee's right to compensation is void" "[e]xcept as provided by this subtitle." TEX. LAB. CODE ANN. § 406.035 (Vernon 1996). We disagree. Section 406.035 is plainly not intended to apply to agreements by the employees of non-subscribers. E.g., Martinez v. IBP, Inc., 961 S.W.2d 678, 682 (Tex.App.-Amarillo 1998, pet. den.).
EXPRESS NEGLIGENCE TEST
Reyes also argues the waiver is void because it fails the express negligence test. See, e.g., Ethyl Corp. v. Daniel Constr. Co., 725 S.W.2d 705, 708 (Tex.1987). However, Reyes did not raise this issue in his response to the motions for summary judgment and therefore may not raise it on appeal. TEX.R. CIV. P. 166a(c); City of Houston v. Clear Creek Basin Auth., 589 S.W.2d 671, 678-79 (Tex.1979).
PUBLIC POLICY
Finally, Reyes argues the waiver is void because it violates the public policy expressed by the Texas Legislature in the Texas Workers' Compensation Act. With this argument, we agree.
Standard of Review
Whether an agreement violates public policy is a question of law, which we review de novo. See Roberts v. San Jacinto Shipbuilders, 198 S.W.2d 488, 491 (Tex. Civ.App.-Galveston 1946, writ ref'd n.r.e.) (citing Pierce v. Randolph, 12 Tex. 290 (1854)).
Discussion
"To recover damages at common law, an injured worker was required not only to establish that the employer's negligence proximately caused the injury, but also to avoid the defenses of contributory negligence, assumption of the risk, and fellow servant.... [T]his combination of hurdles prevented recovery in a large majority of cases." Texas Workers' Compensation Comm'n v. Garcia, 893 S.W.2d 504, 521 (Tex.1995). Therefore, "to meet the needs of an increasingly industrialized society," the Texas Legislature enacted "[t]he Employers' Liability Act of 1913." Id. at 510. Under this act, employees injured in the course and scope of their employment waived their common law and statutory causes of action in exchange for the ability to receive more limited benefits "without the necessity of proving negligence and without regard to the employer's potential defenses." Id. at 521. Thus, "the Legislature... substituted a different but certain and adequate legal remedy for the one that existed at common law." Lebohm v. City of Galveston, 154 Tex. 192, 275 S.W.2d 951, 954 (1955).
The general scheme of the 1913 act was carried forward in the current version of the Texas Workers' Compensation Act. Garcia, 893 S.W.2d at 521. Accordingly, an employer may elect to become a workers' *727 compensation insurance subscriber or not. TEX. LAB.CODE ANN. § 406.002 (Vernon 1996). If an employer elects subscriber status, its participating employees may waive their common law and statutory causes of action arising out of workplace injuries, id. § 406.034(a), other than those for death proximately caused by an employer's intentional or grossly negligent conduct, id. § 408.001(b), in exchange for "lifetime medical benefits, wage replacement during convalescence, impairment benefits, and long-term wage replacement if they suffer a moderately severe physical impairment" "without regard to the employer's negligence and without reduction for the employee's negligence." Garcia, 893 S.W.2d at 523. "[T]his quid pro quo, which produces a more limited but more certain recovery, renders the Act an adequate substitute for purposes of the open courts guarantee." Id. at 521.
If, on the other hand, an employer chooses to become a non-subscriber, its employees must prove the damages flowing from a workplace injury were proximately caused by the employer's or a co-worker's negligence. TEX. LAB.CODE ANN. § 406.033(d). However, the current version of the Texas Workers' Compensation Act, like its predecessor, discourages an employer from choosing non-subscriber status by "abolishing all the traditional common law defenses." Garcia, 893 S.W.2d at 511; TEX. LAB.CODE ANN. § 406.033(a).
As a general rule, if an employer chooses non-subscriber status, "[v]oluntary work[er]'s compensation is purely a matter of contract and the rights and obligations of the parties are measured by the contract." United States Fidelity & Guar. Co. v. Valdez, 390 S.W.2d 485, 489 (Tex. Civ.App.-Houston 1965, writ ref'd n.r.e.); see also Employers Mut. Cas. Co. v. Poorman, 428 S.W.2d 698, 700 (Tex.Civ.App.-San Antonio 1968, writ ref'd n.r.e.). Accordingly, an agreement by which an employee voluntarily waives her claims arising out of a workplace injury in exchange for a voluntary workers' compensation plan that provides benefits "measured by the terms of the Texas Workmen's Compensation Act" is enforceable and "not contrary to public policy." Tigrett v. Heritage Bldg. Co., 533 S.W.2d 65, 70 (Tex.Civ. App.-Texarkana 1976, writ ref'd n.r.e.); accord Collier v. Allstate Ins. Co., 395 F.2d 719, 720 (5th Cir.1968). Similarly, "[a]n agreement between a non-subscribing employer and its employees whereby the non-subscribing employer contractually obligates itself to provide[] benefits to its employees equal to or greater than those provided under the Texas Workers' Compensation Act is a valid and enforceable contract." Cupit v. Walts, 90 F.3d 107, 109 (5th Cir.1996) (applying Texas law).[4]
But public policy does not permit an employer to reap the principal benefit of providing workers' compensation coveragethe waiver of an injured employee's *728 common law and statutory claimswithout also bestowing on the injured employee the principal benefit for which that waiver is the "quid quo pro" the limited but certain benefits guaranteed by workers' compensation insurance coverage. See Hazelwood v. Mandrell Indus. Co., 596 S.W.2d 204, 206 (Tex.Civ.App.-Houston [1st Dist.] 1980, writ ref'd n.r.e.). If the "balance" between the extent of the waiver and the receipt of benefits "is tipped so that the employee's benefits under the statute are substantially reduced, the clear intent of the legislature is thwarted." Id. Accordingly, an agreement limiting the employer's liability but permitting it to retain its common law defenses is "invalid as against public policy." Id.; cf. National County Mut. Fire Ins. Co. v. Johnson, 879 S.W.2d 1, 5 (Tex.1993) (holding the "family member exclusion" in an automobile liability policy was void because it contravened the liability coverage mandated by the Texas Legislature in the Texas Motor Vehicle Safety-Responsibility Act). "`When the Legislature specifies a particular extent of insurance coverage any attempt to void or narrow such coverage is improper and ineffective.'" National County, 879 S.W.2d at 3 (quoting Unigard Sec. Ins. Co. v. Schaefer, 572 S.W.2d 303, 307 (Tex.1978)).
Therefore, to determine whether public policy is violated by the S & P Plan, we must compare the waiver it requires and the benefits it provides to similar provisions in the Texas Workers' Compensation Act. We perform this review in the following chart:
Benefit Workers' Compensation Act S&P Plan
Waiver all common law and statutory causes of action "any and all other causes of
against the employer and an agent or action, claims, rights, and
employee of the employer except causes of demands that [an employee]
action by survivors of "a deceased employee could make against the
whose death was caused by an intentional act Company, its successors,
or omission of the employer or by the assigns, employees, officers,
employer's gross negligence" directors, shareholders, agents
TEX. LAB.CODE ANN. § 408.001(b). and clients"
Medical lifetimewithout limitation on amount; may not
be settled or compromised 104 weeks
Id. § 408.021.
Wage 70% of the difference between the claimant's
Replacement average weekly wage and the post-injury lesser of $500 or 75% of
During weekly earnings from date of disability until employee's base salary for a
Convalescence date of "maximum medical improvement" for a maximum of 104 weeks
maximum of 2 years
Id. §§ 408.101-.103, 401.011(30).
Impairment 70% of the claimant's average weekly wage for
three weeks for every percentage point of none
impairment
Id. §§ 408.121, .126.
Long-Term 80% of the difference between average weekly
Wage wages earned during the reporting period and none
Replacement 80% of the pre-injury average weekly wage
from date of termination of impairment benefits
for a maximum of 401 weeks for claimants with
impairment ratings of 15% or more if claimant
is earning less than 80% of his or her pre-injury
average weekly wage as a direct result of the
injury
Id. §§ 408.083, .142, .144.
*729
for claimants with certain severe
Lifetime 75% of the pre-injury average weekly wage for injuries, 2.5%-100% (depending
claimants with certain severe injuries upon the severity of the injury)
Id. § 408.161. × lesser of $500,000 or (10 ×
employee base salary)
lesser of $500,000 or (10 ×
Death same rate as lifetime benefits employee base salary) with
Id. § 408.181. guaranteed minimum
Combined $500,000 per worker per
Limit of none accident; $5,000,000 per accident
Liability for all workers
See Texas Workers' Compensation Comm'n v. Garcia, 893 S.W.2d 504, 513-14 (Tex.1995).
As demonstrated by this chart, the S & P Plan, unlike the Workers' Compensation Act, requires a complete waiver, even of death claims arising out of S & P's intentional and grossly negligent conduct, in exchange for benefits that, while certain, are far more limited than those provided by workers' compensation insurance. As a result, the S & P Plan enables S & P to enjoy all of the advantages of subscriber statusindeed, greater advantageswithout providing subscriber-level benefits and, therefore, without requiring S & P to pay all of the associated cost, some part of which is instead shifted to injured employees and their families and, in some cases, the taxpayers who fund state and federal assistance programs. In short, the "balance" between the extent of the waiver required to participate in the S & P Plan and the benefits it provides is so "tipped" in favor of S & P, "the clear intent of the legislature is thwarted." Hazelwood, 596 S.W.2d at 206. We therefore hold the S & P Plan violates public policy and the waiver Reyes signed is therefore void and unenforceable.
We recognize our holding will discourage employers from providing voluntary insurance plans with more limited benefits than those provided by workers' compensation insurance and, from an employee's perspective, more limited but certain benefits may be better than none. But to hold otherwise, we believe, would signal the end of workers' compensation insurance. How many employers would choose subscriber status rather than the S & P Plan, with its complete waiver and significantly lower cost?
CONCLUSION
Because the waiver Reyes signed is void, the trial court erred in granting summary judgment against him on his claims against Storage & Processors, Inc. and Leonel Guerrero. We therefore reverse the trial court's judgment and remand the cause to that court for further proceedings consistent with this opinion.
NOTES
[1] Malooly Bros., Inc. v. Napier, 461 S.W.2d 119 (Tex.1970).
[2] "Should the Occupational Accident Employee Welfare Benefit Plan and its release of claims be fully enforced against Ramon Reyes when Ramon Reyes could not have been held to understand the Plan's terms, could not have been held to understand the English language (the Plan is written in English only) and could not have been held to understand that the Plan inherently violated the Texas Workers' Compensation Act."
[3] "A void contract cannot be rendered enforceable by estoppel."
[4] To the same effect are the cases involving Intex's voluntary benefits plan, through which Intex "offer[s] no-fault insurance coverage to employees in consideration of the waiver of right to sue, in much the same way that employers who subscribe to the TWCA provide no-fault coverage as an exclusive remedy to employees." Bustos v. Intex Aviation Servs., Inc., No. 3:95-CV-1264-R, slip op. at 12 (N.D.Tex. Aug. 29, 1996); see also Brito v. Intex Aviation Servs., Inc., 879 F. Supp. 650 (N.D.Tex.1995); Duran v. Intex Aviation Servs., Inc., No. 3:95-CV-0403-R, slip op. at 4-5 (N.D.Tex. Nov. 9, 1995), aff'd, 98 F.3d 1339 (5th Cir.1996) (table). In Duran, the Fifth Circuit declined to reach the public policy issue because it had not been raised in the trial court. Duran v. Intex Aviation Servs., No. 95-11180, slip op. at 5, 98 F.3d 1339 (5th Cir. Sept.13, 1996). However, the Fifth Circuit and the district court expressly noted Texas courts, including the court in Brito, had upheld similar plans as enforceable. Id. at 5 n. 3; Duran v. Intex Aviation Servs., Inc., No. 3:95-CV-0403-R, slip op. at 4 & n. 6 (citing Collier v. Allstate Ins. Co., 395 F.2d 719, 720 (5th Cir.1968); Tigrett v. Heritage Bldg. Co., 533 S.W.2d 65 (Tex.Civ.App.-Texarkana 1976, writ ref'd n.r.e.); and Brito)). As noted above, the voluntary plans in Tigrett and Collier provided the same benefits provided by workers' compensation insurance. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/2470595/ | 184 F. Supp. 2d 588 (2001)
WELLS FARGO BANK TEXAS, N.A., Bank of America, N.A., Bank One, N.A., the Chase Manhattan Bank, and Comerica Bank-Texas,
v.
Randall S. JAMES, in his official capacity as Texas Banking Commissioner.
No. CIV. A-01-CA-538 JN.
United States District Court, W.D. Texas, Austin Division.
December 3, 2001.
*589 Thomas T. Rogers, Jackson Walker L.L.P., Austin, TX, Keith A. Noreika, E. Edward Bruce, Stuart C. Stock, Covington and Burling, Washington, DC, for plaintiffs.
David Mattax, Assistant Attorney General, Finance Division, Christopher D. Livingston, Office of the Attorney General, Austin, TX, for defendant.
ORDER
NOWLIN, Chief Judge.
Before the Court is Plaintiffs' Motion for Summary Judgment (Doc. No. 29) and Defendant's Response to Plaintiff's Motion for Summary Judgment (Doc. No. 44). Based on these documents, the applicable legal authority and the entire case file, the Court enters the following Order.
FACTUAL BACKGROUND
Plaintiff Banks challenge Texas Business and Commerce Code § 4.112,[1] which came into effect September 1, 2001[2], asserting that the Texas statute is preempted by the National Bank Act, 12 U.S.C. § 21 et seq., and 12 C.F.R. § 7.4002(a). The Texas law would prohibit a bank from charging fees to non-account holders for *590 cashing checks drawn on that bank. The policy consideration behind the statute is to protect employees by ensuring they receive full value when cashing their payroll checks at the bank upon which the checks were drawn. On August 31, 2001, this Court entered a written preliminary injunction in this case (Doc. No. 28) that reflected the ruling made from the bench following oral arguments held the previous day.
ANALYSIS
"Summary judgment is appropriate where the only issue before the court is a pure question of law." Sheline v. Dun & Bradstreet Corp., 948 F.2d 174, 176 (5th Cir.1991). In this case, the only issues to be resolved by this Court are whether § 4.112 is preempted by federal law and whether § 4.112 is severable so that it can be applied only to Texas chartered banks. Both issues are pure questions of law, and therefore the Court finds that summary judgment is proper.
The standard for a preliminary injunction is essentially the same as for a permanent injunction with the exception that the plaintiff must show a likelihood of success on the merits for a preliminary injunction, but actual success on the merits for a permanent injunction. Amoco Production Co. v. Village of Gambell, AK, 480 U.S. 531, 546 n. 12, 107 S. Ct. 1396, 94 L. Ed. 2d 542 (1987). The remaining elements are a substantial threat of irreparable harm if the relief is not granted, that granting injunctive relief will not result in even greater harm to the other party, and that granting relief will be in the public interest. United Offshore Co. v. Southern Deepwater Pipeline, 899 F.2d 405, 407-08 (5th Cir.1990).
The Court finds that the Plaintiffs have succeeded on the merits of their claim. The National Bank Act provides a broad power to national banks[3] "[t]o exercise * * * all such incidental powers as shall be necessary to carry on the business of banking; by discounting and negotiating promissory notes, drafts, bills of exchange, and other evidence of debt ...." 12 U.S.C. § 24(Seventh). A bank's authority to charge fees for these services is found in 12 C.F.R. § 7.4002(a) which expressly provides that a "national bank may charge its customers non-interest charges and fees, including deposit account service charges."
The Office of the Comptroller of the Currency ("OCC") is the agency responsible for interpreting the National Bank Act and administering the national bank charter, including determining the scope of permissible national bank activities. 12 U.S.C. §§ 1-216d. The OCC issued opinion letters to the national banks in this case concluding that the National Bank Act and 12 C.F.R. § 7.4002(a) permit national banks to charge fees to non-account holders for cashing checks drawn on the banks. (Pls.' Ex. I; J; K.). A federal agency like the OCC is afforded deference in the interpretation of the law under which it acts, and even greater deference in its interpretations of its own regulations, see United States v. Mead Corp., 533 U.S. 218, 121 S. Ct. 2164, 2173 n. 13, 150 L. Ed. 2d 292 (2001) (the OCC's ruling and interpretive letters are entitled to full Chevron deference); Christensen v. Harris County, 529 U.S. 576, 588, 120 S. Ct. 1655, 146 L. Ed. 2d 621 (2000) ("an agency's interpretation of its own regulation is entitled to deference"). The Court finds that the OCC's interpretation that federal banking laws permit banks to charge fees *591 to non-account holders for cashing checks, as stated in 12 C.F.R. § 7.4002(a) is not unreasonable and thus cannot be upset by this Court. Therefore, Plaintiffs have succeeded in their claim that the Texas statute is in direct conflict with the National Bank Act and therefore preempted.
The Court finds that Plaintiffs will suffer irreparable harm if injunctive relief is not granted. Further, the Court finds that the Plaintiff Banks' injuries outweigh any injury that the State of Texas, or the public, would face absent injunctive relief. Finally, the Court finds that an injunction will serve the public interest.
Finally, the Court finds that the permanent injunction should apply equally to national banks, out of state banks with branches in Texas, and Texas-chartered banks. The application of the injunction to the first two categories is clear based on federal law, and the parties do not dispute that matter. The application of the injunction to Texas-chartered banks is dependent on this Court holding that the portions of § 4.112 that are not preempted by federal law violate Article 16 of the Texas Constitution. The Texas Constitution states that "[a] state bank created by virtue of the power granted by this section, notwithstanding any other provision of this section, has the same rights and privileges that are or may be granted to national banks of the United States domiciled in this State." TEX. CONST. Art. 16 § 16(c). Applying § 4.112 to Texas-chartered banks, but not to national banks and out of state banks with branches in Texas would result in § 4.112 being a violation of Article 16 § 16(c) of the Texas Constitution.
IT IS THEREFORE ORDERED, ADJUDGED AND DECREED that Plaintiffs' Motion for Summary Judgment (Doc. No. 29) is GRANTED.
IT IS FURTHER ORDERED, ADJUDGED AND DECREED that Defendant Randall S. James, in his official capacity as Texas Banking Commissioner, and his agents, including the Attorney General of Texas, are hereby PERMANENTLY ENJOINED from enforcing, or taking any action to enforce, the provisions of Tex. Bus. & Com.Code Ann. § 4.112, or otherwise requiring Plaintiffs to comply with the provisions of § 4.112.
IT IS FURTHER ORDERED, ADJUDGED AND DECREED that Texas Business and Commerce Code § 4.112 is preempted by the National Bank Act, 12 U.S.C. § 21 et seq., and the Federal Deposit Insurance Act, 12 U.S.C. § 1831a(j); and cannot be severed to apply only to Texas-chartered banks and therefore is DECLARED unenforceable, null and void.
IT IS FURTHER ORDERED, ADJUDGED AND DECREED that this case is CLOSED and any pending motions are hereby DENIED AS MOOT.
NOTES
[1] Section 4.112 of the Texas Business and Commerce Code provides:
PAYMENT OF CHECK AT PAR
(a) Except as otherwise provided by Chapter 3 or this Chapter, a payor bank shall pay a check drawn on it against an account with a sufficient balance at par value without regard to whether the payee holds an account at the bank.
(b) This section does not prohibit a bank from requiring commercially reasonable verification of the payee's identity before settlement of the check.
(c) In addition to any remedy provided by law, the banking commissioner, in coordination with the Finance Commission of Texas, shall ensure that payor banks comply with the requirements of this section.
[2] Although this law was scheduled to come into force on September 1, 2001, no actions have been taken to enforce it due to this Court's preliminary injunction issued on August 30, 2001.
[3] The parties do not dispute that while the National Bank Act on its face only applies to national banks, its provisions are applicable to Texas branches of out-of-state banks and Texas-chartered banks through other various federal and state laws. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1111065/ | 538 So.2d 684 (1989)
Bryan Ardis FRAME, et al., Plaintiff-Appellee,
v.
SHREVEPORT ANTI-TUBERCULOSIS LEAGUE, et al., Defendants-Appellants.
STATE of Louisiana, Through the DEPARTMENT OF HIGHWAYS, Plaintiff-Appellee,
v.
Bryan Ardis FRAME, et al., Defendants-Appellants.
Nos. 20269-CA, 20270-CA.
Court of Appeal of Louisiana, Second Circuit.
January 18, 1989.
Rehearing Denied February 16, 1989.
Writ Denied April 21, 1989.
*685 William M. Cady, Asst. Atty. Gen., Shreveport, for defendants-appellants.
Rountree, Cox & Guin by Gordon E. Rountree, and Evans, Feist & Mills by George H. Mills, Jr., Shreveport, for plaintiffs-appellees.
Edward O. Kernaghan, Cook, Yancey, King & Galloway by Edwin Blewer, Jr., Shreveport, for amicus curiae.
Before HALL, NORRIS and LINDSAY, JJ.
*686 LINDSAY, Judge.
These are consolidated cases concerning ownership of approximately fifty-five acres of land donated in 1918 to the Shreveport Anti-Tuberculosis League for use as a tuberculosis treatment facility. The heirs of the original donor sought to revoke the donation for failure of the ultimate donee of the property, the State of Louisiana, to comply with the condition of the donation. The condition called for the property to be used as a tuberculosis sanitarium or camp or for some other equally charitable purpose.
The trial court held that the heirs were entitled to ownership of approximately one-half of the property plus a sum of money deposited in the registry of the court pursuant to an expropriation of a portion of the property. The court also held that the State was entitled to retain ownership of the remainder of the tract in question. The State appealed and the heirs answered the appeal, each claiming ownership of the entire property. For the following reasons, we affirm in part and reverse in part the trial court judgment.
FACTS
On May 15, 1918, Colonel J.B. Ardis donated approximately fifty-five acres of land to the Shreveport Anti-Tuberculosis League for use as a tuberculosis sanitarium, subject to the following condition:
It is agreed and understood that if said property should cease to be used for a tuberculosis sanatorium or camp or some other equally charitable purpose, the same should then revert back to the donor.
Following the donation, a facility for the treatment of tuberculosis was established on the property. The facility was operated by the Shreveport Anti-Tuberculosis League for many years. On May 20, 1948, the Shreveport Anti-Tuberculosis League donated the property to the Pines Sanitoria, Inc. In that same year, the Pines Sanitoria, Inc. donated the property to the State of Louisiana. The State operated the tuberculosis treatment center on the property continuously until 1972. The facility was known as the Pines Tuberculosis Sanitarium.
Due to innovations in the treatment of tuberculosis, the need for hospitalization and isolation of tuberculosis patients became less frequent. Nationally, the number of patients housed in specialized tuberculosis treatment facilities declined. The same was true of the Pines Tuberculosis Sanitarium. In early January, 1972, Governor Edwards ordered the Pines closed as a treatment facility for tuberculosis patients. The patients who were hospitalized at the Pines were transferred to other facilities or were treated on an outpatient basis.
Shortly after the closure of the tuberculosis sanitarium, the State began renovations on one of the residences on the property for use as a halfway house for recovering alcoholics. The halfway house was opened in September or October, 1973.
On June 7, 1973, the heirs of Colonel Ardis filed suit to revoke the donation. Bryan Ardis Frame, Caro P. Mills, Nancy Mills VanHoose and George H. Mills filed suit against the Shreveport Anti-Tuberculosis League, the Pines Sanitoria, Inc., the Louisiana Tuberculosis and Respiratory Disease Association and the State of Louisiana, claiming that the State had abandoned use of the property for any purpose and therefore ownership of the property should revert to the heirs of the donor.
In the alternative, the heirs claimed that any portion of the property not being used by the State for a charitable purpose, in compliance with the donation, should be returned to them.
In the years following the initial filing of the suit to revoke the donation, there were several substitutions and changes of parties in the lower court. In 1976, Betsey Frame Koenen was added as a plaintiff. In 1981, Pamela J. Frame was substituted as a plaintiff for Bryan Ardis Frame and Bryan Ardis Frame, II. June B. Mills was substituted as a plaintiff for George H. Mills. In 1986, George H. Mills, Jr., Bryan H. Mills, Ardis H. Mills, James H. Mills and Nancy Mills VanHoose were substituted as plaintiffs for Caro P. Mills.
*687 On May 6, 1974, the State of Louisiana, through the Department of Highways, filed an expropriation suit against Bryan Ardis Frame, Virginia Frame, Betsey Frame, George H. Mills, Jr., Caro P. Mills, Nancy Mills VanHoose, the Pines Sanitoria, Inc., Shreveport Anti-Tuberculosis League and the Louisiana Tuberculosis and Respiratory Disease Association. The Highway Department sought to expropriate 5.15 acres in the southern portion of the property in order to relocate U.S. Highway 80 and to build the Pines Road interchange onto I-20. Since title to the property was in litigation in these proceedings, the Highway Department deposited the sum of $54,325.00, the estimated value of the property, into the registry of the court. Pursuant to stipulation and court order, this sum was placed in an interest bearing account.
With the deposit of the funds representing the value of the property, the expropriation order was signed. Therefore, the issue in that case became which of the defendants was entitled to the money. The amount deposited by the State as the fair value of the property was not contested.
On April 14, 1986, the suit to revoke the donation and the expropriation suit were consolidated. Trial on the consolidated cases began December 18, 1986 and concluded January 30, 1987. On May 4, 1987 the case was argued and submitted. On October 23, 1987, the trial court filed written reasons for judgment.
At trial, a survey map of the property was filed into evidence. A copy of the map of the property is attached to this opinion as an appendix. The surveyor divided the property into two tracts, the first containing 24.61 acres and the second containing 18.95 acres. Tract 1 has a nature trail, a baseball field, and an overseer's house. Tract 2 contains the physical plant of the treatment facility. Also shown on the map is the 5.15 acre strip of land expropriated by the Highway Department for the relocation of U.S. Highway 80. With the relocation of Highway 80, a portion of the donated property was cut off and separated from the originally donated tract. This expropriation left a 0.6 acre tract and a 3.1 acre tract of land cut off from Tract 2.
The trial court, in written reasons for judgment, cited the applicable Civil Code Articles dealing with donations[1] and concluded that the clause contained in the act of donation executed by Colonel Ardis, requiring that the property be used for a tuberculosis sanitarium, camp or other equally charitable purpose, created a right to revoke the donation for noncompliance with the condition. The court went on to cite Civil Code Articles dealing with general obligations and the divisibility of obligations. The court then reasoned that the wording of the condition allowed the donee to make alternate uses of the property and gave the donee a choice as to the method of fulfilling the condition of the donation. The court stated that because the donation provided for alternative uses of the property, the obligation created by the condition of the donation was a divisible obligation. The court resorted to Civil Code articles dealing with equity to conclude that because the obligation was divisible, it could be fulfilled on parts of the property and not fulfilled on other parts.
The trial court then found that through the years the defendants had used the property in Tract 2 for tuberculosis treatment and an equally charitable purpose (the treatment of alcoholism). These uses of the property were sufficient to fulfill the condition of the donation and prevent reversion of that tract of land to the plaintiffs.
The court found that after the tuberculosis sanitarium had closed there had not been sufficient use of Tract 1 to fulfill the condition of the obligation. Therefore, the court held that ownership of Tract 1 reverted to the heirs.
The court also found that the State, by expropriating 5.15 acres of the property for a highway, had ceased to use this portion of the land for a charitable purpose. *688 Therefore, the court ruled that the money paid for the property in the expropriation suit belonged to the heirs of the donor.
The court found that the State, by virtue of the expropriation, separated the 0.6 acre tract and the 3.15 acre tract from the main portion of the property and thereby rendered them unusable for the charitable purposes contemplated by the condition of the donation. The court held these two pieces of property also reverted to the ownership of the plaintiffs.
From this judgment, the State appealed, claiming that the trial court erred in finding that the condition was divisible and in failing to recognize that fulfillment of the condition by the use of a portion of the property would constitute fulfillment of the condition as to all the property. The State contends that the trial court should have completely rejected the heirs' claim for revocation of the donation. The heirs answered the appeal, claiming that the trial court erred in failing to declare them to be owners of the entire property.
The issues raised in this appeal are whether the trial court was correct in finding a conditional donation to be a divisible obligation, thereby entitling the heirs to a portion of the property, whether the trial court was correct in finding the heirs were entitled to the money from the expropriation suit and whether the heirs were entitled to ownership of the 0.6 acre tract and the 3.15 acre tract separated from the main property by virtue of the expropriation and relocation of U.S. Highway 80.
CONDITIONAL DONATIONS
The Civil Code articles in effect at the time of the filing of the heirs' suit are controlling in this case.[2] There are three kinds of donations inter vivos, including the onerous donation which is burdened by a charge upon the donee. LSA-C.C. Art. 1523.
The donor may impose upon the donee any charges or conditions he pleases, provided they contain nothing contrary to law or good morals. LSA-C.C. Art. 1527.
Donations inter vivos are liable to be revoked or dissolved for nonperformance of the conditions imposed upon the donee. In the case of revocation or rescission of the donation of an immovable on account of nonexecution of the condition, the immovable shall return to the donor. LSA-C.C. Art. 1559; 1568.
In the present case, the donor, Colonel Ardis, provided as a condition of the donation that the immovable property be used for a tuberculosis sanitarium or camp or for some other equally charitable purpose and upon failure of the condition, the property would revert to the ownership of the donor.
It is undisputed that following the donation, the property was used as a tuberculosis sanitarium until some time in 1972. As found by the trial court, the tuberculosis treatment facility was officially closed by the State on July 1, 1972. However, testimony in the record shows that outpatient treatment of tuberculosis patients continued *689 at the facility for a short time following the official closure date.
The record also shows that prior to the closing of the tuberculosis sanitarium, local groups concerned with the treatment of alcoholism were lobbying to use the disputed property for an alcohol treatment facility. Among these were the Caddo-Bossier Council on Alcoholism. After the closure of the sanitarium, the State arranged with this group to operate the facility as an alcohol treatment center. Pursuant to this arrangement, and following the closure of the tuberculosis sanitarium, the State began renovations on one of the houses on the property for use as a halfway house for recovering alcoholics.
In September or October, 1973, a facility for the treatment of alcohol abuse was opened on the property and various forms of such treatment have been occurring on the property since that time.
The record also shows that the operation of the facility has been a charitable function by the State. A sliding scale is used for those who can pay, contributing a portion of the cost of treatment. Treatment is provided without charge for those who cannot afford treatment.
The heirs of the original donor claim that because of the lapse in use of the property between July, 1972 and September or October of 1973, the condition of the donation was not fulfilled and therefore ownership of the property reverted to them. The trial court found that the State had sufficiently complied with the terms of the condition on a portion of the property sufficient to prevent reversion of ownership of that part of the property to the heirs.
The record shows that even though little active use of the property was made between July 7, 1972 and September or October, 1973, during that time the State was renovating and converting the property to an "equally charitable" use. The question then becomes whether the State complied with the condition of the donation within a reasonable time after closure of the tuberculosis sanitarium.
The jurisprudence dealing with conditional donations has held that where no time is specified for fulfillment of the condition, the condition must be fulfilled within a reasonable time subject to the circumstances surrounding the gift. Braquet v. Administrators of the Tulane Educational Fund, 304 So.2d 720 (La.App. 4th Cir.1974), writ denied 305 So.2d 538 (La.1974); Bowers v. Roman Catholic Church of the Diocese of New Orleans, 264 So.2d 329 (La. App. 4th Cir.1972), writ denied 262 La. 1152, 266 So.2d 441 (1972). As to what constitutes a reasonable time, each case must be decided on its own merits. Bowers v. Roman Catholic Church of the Diocese of New Orleans, supra.
Approximately fifteen months passed between the closure of the tuberculosis sanitarium and the opening of the first halfway house for recovering alcoholics. During that time, renovations were made to a residence on the property to facilitate use as a halfway house. In addition, during that time, the property was administered by Confederate Memorial Medical Center, a State operated hospital providing charitable health care. This institution utilized a portion of the property for storage of records and equipment.
Under the circumstances of this case, the trial court was correct in finding that the condition of the donation was fulfilled by converting use of the property from a tuberculosis sanitarium to a charitable facility for the treatment of alcohol abuse. In addition, the period of approximately fifteen months which passed during the renovation and conversion of the property from one use to another was reasonable.
It would not be reasonable to hold that the State was required to open the alcohol treatment center immediately upon closure of the tuberculosis sanitarium in order to maintain ownership of the property. In addition, the jurisprudence dealing with revocation of donations for nonfulfillment of conditions has traditionally found donations subject to revocation only after long periods of noncompliance with the condition. Voinche v. Town of Marksville, 50 So. 662 (La.1909); Orleans Parish School *690 Board v. Manson, 241 La. 1029, 132 So.2d 885 (1961).
The record also shows that since the opening of the first halfway house for recovering alcoholics in late 1973, further renovations were undertaken on the property. A second halfway house was opened and a large brick building was renovated for inpatient treatment of alcohol abuse. Both facilities were opened in 1976 and have been in continuous operation since that time.
Therefore, under the circumstances of this case, the trial court was correct in finding that the State fulfilled the condition of the donation requiring use of the property for a tuberculosis sanitarium, camp or some other equally charitable purpose. The use of the property was sufficient to prevent revocation of the donation.
DIVISIBILITY OF THE CONDITIONS
The trial court found that even though the State had fulfilled the condition of the donation sufficient to prevent a reversion of a portion of the property, the condition was divisible and had not been fulfilled on other portions of the property. Therefore the court found that the ownership of some portions of the original tract reverted to the heirs of the donor.
The trial court reached this conclusion by reliance upon former LSA-C.C. Arts. 2108 and 2109[3] dealing with the divisibility of obligations. The trial court reasoned that because the condition of the donation allowed alternate uses of the property and permitted the donee to use the property for other than as a tuberculosis sanitarium or camp, or other equally charitable purposes, the donee had the choice of methods of fulfilling the condition and therefore the condition created a divisible obligation. By implication the trial court further reasoned that the property itself could be divided based upon whether its various parts were being used in compliance with the terms of the donation. The court then cited general rules of equity to reason that the State had fulfilled the condition on a portion of the property donated, but had failed to fulfill it on other parts. Therefore, the court found that the ownership of Tract 1, as shown on the survey map drawn by the heirs' surveyor, reverted to the heirs. The trial court also found that ownership of the two parcels of land separated from the main tract by the highway expropriation also reverted to the heirs because the State had made no use of this property since 1972.
For the following reasons, we reverse this portion of the trial court judgment.
The trial court erred in finding the condition to be a divisible obligation which allowed an arbitrary division of the property along a surveyor's line. In the present case, there is only one general condition, that the property be used for the treatment of tuberculosis or some other equally charitable purpose. Performance of that condition requires the heirs of the donor to allow the donee to remain in possession of all the property which was made the subject of the donation.
The condition does not require that every square inch of the property be occupied by buildings or structures used in pursuit of the purposes of the donation. Good faith use of a substantial portion of the property for the purpose intended, as occurred here, is sufficient to fulfill the condition as to all the property and to prevent the revocation of the donation.
We find no other case in which a court has revoked a donation as to a portion of the property for nonfulfillment of a condition, but has upheld the donation as to other portions. In cases dealing with donations containing conditions that the property be used for a particular purpose, fulfillment of the specified condition has been sufficient to prevent revocation of the entire donation. Board of Trustees of Columbia Road Methodist Episcopal Church *691 of Bogalusa v. Richardson, 216 La. 633, 44 So.2d 321 (1949); Bonner v. Board of Trustees, 181 So.2d 255 (La.App. 4th Cir. 1965), writ denied 248 La. 915, 182 So.2d 664 (1966).
We find that the State has fulfilled the condition of the donation. Therefore, ownership of the entire property remains with the State, with the exception of the tract which was expropriated for the relocation of the highway, as discussed hereafter.
EXPROPRIATION AND SEPARATED TRACTS
Consolidated with the suit by the heirs for revocation of the donation is the expropriation suit whereby the State took a 5.15 acre tract from the disputed property for construction of the highway interchange. Because ownership of the property was disputed, the heirs of the donor as well as the State were named as defendants. The State paid $54,325.00 into the registry of the court as compensation for the property taken.
The trial court found that as to the 5.15 acre expropriated tract, the State was, in effect, taking the property from itself and converting it to use for something other than a charitable purpose. Therefore, the heirs were entitled to the funds paid into the registry of the court. The trial court also found that the State, by virtue of the expropriation, severed from the main property a 0.6 acre tract and a 3.15 acre tract that had not been used for charitable purposes for years and therefore ownership of these tracts reverted to the heirs.
The State argues that it is entitled to both the expropriation funds and the severed property by virtue of the doctrine of cy pres. This doctrine, found in LSA-R. S. 9:2331, provides:
In any case in which circumstances have changed since the execution or probate of a will containing a trust or conditional bequest for charitable, educational or eleemosynary purposes, or since the death of the donor who during his lifetime established a trust or made a conditional donation for any of such purposes, and the change in circumstances is such as to render impractical, impossible or illegal a literal compliance with the terms thereof, the district court having jurisdiction of the succession of the testator or of the domicile of the donee (and in the parish of Orleans, the civil district court) may, upon petition of a trustee, or of the person or corporation having custody or possession of the property subject to said trust, conditional bequest or donation or of any heir, legatee or donee who in the absence or invalidity of such trust, conditional bequest or donation would have been entitled to any part of the property contained therein, in accordance with the procedure hereinafter set forth, enter a judgment directing that such charitable trust, devise or conditional bequest or donation shall be administered or expended in such manner (either generally or specifically defined) as, in the judgment of said court, will most effectively accomplish as nearly as practicable under existing conditions the general purpose of the trust, will or donation, without regard to and free from any specific restriction, limitation or direction contained therein.
The State claims that the highway needs of the citizens of Louisiana and the resulting expropriation of the property made it impossible to fully comply with the condition of the donation. This claim of impossibility relates primarily to the property taken for the highway approach to the interchange.
The trial court was correct in finding that the doctrine of cy pres did not apply to the facts of this case. As to the property actually taken for use as a highway interchange, the State, in effect, took this property from itself. Therefore, the impossibility of use of this property for a charitable purpose was caused by the State, even though by another arm of State government. The impossibility of use was not caused by circumstances beyond the control of the State. Under such circumstances, awarding the expropriation money to the heirs of the donor is appropriate. Hero v. City of New Orleans, 135 So.2d 87 (La. App. 4th Cir.1961).
*692 As to the two portions of property separated from the main tract, we find that the State is entitled to continued ownership, but for reasons other than the application of the doctrine of cy pres.
First, the record shows that even though these two parcels are separated from the main tract, use of this land for "an equally charitable purpose" is not precluded. Testimony in the record indicates that the small parcel may be used for a picnic area and the large parcel may be used as an outpatient treatment facility if funding becomes available.
As to these two portions of property, circumstances have not made it illegal, impossible or impracticable to use the property for a charitable purpose. Further, we find that, even though these two parcels of land are separated from the main portion by virtue of the highway expropriation, they are not necessarily independent of the main tract.
Simply because the parcels were physically separated from the main tract by the highway, they should not be treated as separate and distinct from the initial tract of property made the subject of the donation. Our jurisprudence provides that:
A public highway actually wrought and travelled, a railroad, a canal or a creek running through a large tract devoted to one purpose does not necessarily divide it into independent parcels, provided the owner has the legal right to cross the intervening strip of land or water.[4]
Therefore, even though the highway became superimposed upon the originally donated tract, the two smaller portions continue to be a part of the larger tract and are usable for charitable purposes in accordance with the condition of the donation.
In addition, as we stated earlier, we find that fulfillment of the condition on one portion of the property is fulfillment as to the whole, including the two parcels separated by the highway. Therefore, the ownership of these parcels remains with the State in accordance with the terms of the original donation.
MOTION TO EXPUNGE
The heirs of the donor have filed a motion in this court to expunge certain documents from the record on the grounds that these documents were not admitted into evidence in the trial court or filed as an offer of proof. The documents complained of are defendant's exhibits 32-A, 34-C and the first of two exhibits marked defendant's exhibit 53.
Defendant's exhibit 32-A is a memo from the Confederate Memorial Medical Center personnel director based upon a visit to the property on August 28, 1972. The memo lists personnel still employed at the facility and their salaries.
Defendant's exhibit 34-C is a letter dated July 6, 1972, by Charles Roemer, former Commissioner of Administration, to Dr. Edgar Galloway, Director of Confederate Memorial Medical Center, authorizing the use of four employees and $25,000.00 to close the Pines, with the closure to be completed by October 1, 1972.
The first exhibit labeled defendant's exhibit 53 is a local newspaper article of March 15, 1973 dealing with plans to convert the Pines to a "multi-purpose rehabilitative facility."
The heirs are correct in contending that these exhibits were not admitted into evidence nor were they submitted as an offer of proof. As a consequence, they do not properly form a portion of the record on review by this court. The motion for expungement is granted. These exhibits have not been considered by this court in arriving at its decision.
CONCLUSION
For the above stated reasons, as to No. 20,269-CA, the first of these consolidated cases, we affirm that portion of the trial court judgment finding that the State fulfilled the condition of the donation by converting the use of the property from a tuberculosis sanitarium to an alcoholic *693 treatment facility within a reasonable period of time.
However, we find that the trial court erred in holding that the condition of the donation was fulfilled only as to Tract 2, i.e., that portion of the property upon which the main treatment facility is located. Good faith use of a substantial portion of the property for the purpose intended, as occurred here, fulfills the condition as to all the property.
Therefore, that portion of the trial court judgment directing that ownership of Tract 1, the 0.6 acre tract and the 3.5 acre tract be transferred to the heirs is hereby reversed and set aside. The State of Louisiana is hereby recognized as the owner of and entitled to the continued possession of the entire property.
As to No. 20,270-CA, the expropriation suit, the second suit in this consolidated cases, we find that title to the 5.15 acres expropriated for use as a highway is vested in the State Highway Department. However, we find that the State, through its own action in expropriating this property, rendered impossible the use of that property in fulfillment of the condition of the donation. Therefore, we affirm the trial court judgment finding that the heirs of the donor are entitled to the funds deposited in the registry of the court as compensation for the expropriated property. We reject the State's claim that, because another arm of the State, the Highway Department, expropriated this property, that performance of the condition was rendered impossible and therefore the State should be awarded compensation for the property.
Costs are assessed to appellees.
AFFIRMED IN PART AND REVERSED IN PART.
ON APPLICATION FOR REHEARING
Before HALL, NORRIS, LINDSAY, MARVIN and SEXTON, JJ.
Rehearing denied.
*694
NOTES
[1] The articles dealing with donations and obligations in effect prior to the 1985 revision are applicable to this case.
[2] The text of the former Civil Code Articles is as follows:
Art. 1523. There are three kinds of donations inter vivos:
The donation purely gratuitous, or that which is made without condition and merely from liberality;
The onerous donation, or that which is burdened with charges imposed on the donee;
The remunerative donation, or that the object of which is to recompense for services rendered.
Art. 1527. The donor may impose on the donee any charges or conditions he pleases, provided they contain nothing contrary to law or goods morals.
Art. 1559. Donation [Donations] inter vivos are liable to be revoked or dissolved on account of the following causes:
1. The ingratitude of the donee;
2. The nonfulfillment of the eventual conditions, which suspend their consummation;
3. The nonperformance of the conditions imposed on the donee;
4. The legal or conventional return.
Art. 1568. In case of revocation or rescission on account of the nonexecution of the conditions, the property shall return to the donor free from all incumbrances or mortgages created by the donee, and the donor shall have, against any other persons possessing the immovable property given, all the rights that he would have against the donee himself.
[3] Art. 2108. An obligation is divisible or indivisible, according as it has for its object, either a thing which, in its delivery or a fact which, in its execution, is or is not susceptible of division, either material or intellectual.
Art. 2109. The obligation is indivisible, though the thing or the fact which is the object of it, be by its nature divisible, if the light, in which it is considered in the obligation, does not admit of its being partially executed.
[4] 4 Nichols, The Law of Eminent Domain (3rd Edition 1951) § 14.31(1) Pgs. 433-435, quoted in State v. Williams, 131 So.2d 600 (La.App. 3d Cir.1961). | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/4222766/ | COURT OF APPEALS FOR THE
FIRST DISTRICT OF TEXAS AT HOUSTON
ORDER
Appellate case name: Michael Francis Palma v. Harris County Appraisal Review
Board
Appellate case number: 01-17-00705-CV
Trial court case number: 2017-32712
Trial court: 113th District Court of Harris County
Appellant, Michael Francis Palma, has filed a notice of the appeal of the trial
court’s final judgment granting appellee Harris County Appraisal Review Board’s plea to
the jurisdiction and dismissing the case for want of jurisdiction without prejudice. Palma
has filed an “Amended Motion for Temporary Injunction to Harris County Appraisal
Review Board and Harris County Appraisal District for Tax Year 2017 Situs Hearing,”
asserting that a hearing is set for November 28, 2017. The motion is denied.
It is so ORDERED.
Judge’s signature: /s/ Russell Lloyd
Acting individually Acting for the Court
Date: November 16, 2017 | 01-03-2023 | 11-22-2017 |
https://www.courtlistener.com/api/rest/v3/opinions/1427701/ | 792 P.2d 372 (1990)
Kenneth W. MALMQUIST, Appellant,
v.
Nancy MALMQUIST, Respondent.
No. 19173.
Supreme Court of Nevada.
April 24, 1990.
*374 Paul W. Freitag, Sparks, for appellant.
McDonald and Petroni, Reno, for respondent.
OPINION
ROSE, Justice:
Kenneth W. Malmquist appeals a judgment and decree of divorce dividing his and his ex-wife Nancy Malmquist's community property. While the district court made a reasonable division of the parties' residence, we reverse the district court's determination of the separate and community property interests in the residence because the court did not utilize the more appropriate apportionment method set forth in In re Marriage of Moore, 28 Cal.3d 366, 168 Cal. Rptr. 662, 618 P.2d 208 (1980). We adopt a slightly modified version of the Moore apportionment. We cannot establish the parties' final interests in the residence at this time because the residence has been set aside for the benefit of the children and will not actually be divided until some time in the future. Nevertheless, we offer some examples as guidance on how our modified Moore formulae would apply if the residence were to be divided at the present time. Although we do not believe this opinion will require any readjustment of the initial property division, we remand this case to allow the district court to make this determination. We affirm the district court's determination that Kenneth failed to meet his burden of tracing the $37,007 used for home improvements to his separate property. We further take this opportunity to clarify the proper mode of apportionment at divorce of improvements to real property. Finally, we affirm the district court's judgment and decree of divorce in all other respects.
FACTS
Kenneth and Nancy were married on December 12, 1970. Kenneth was a practicing family physician, and Nancy was a dental hygienist. Nancy worked for approximately two years after the marriage. After the couple's first child was born, Nancy did not work during the marriage. The parties had three children during their seventeen-year marriage: Andrew, Nicholas and Casey, aged fifteen, nine and eight respectively at the time of trial. The couple separated in or around March 1986. In June 1986, Nancy filed for divorce.
In June 1967, before he married Nancy, Kenneth had purchased a residence on Wedekind Road with his former spouse, Delores Malmquist. The purchase price was $36,500. Kenneth made a $2,500 down payment and financed the remaining $34,000 by mortgage. By the time he married Nancy, Kenneth already had made mortgage payments which reduced the mortgage *375 principal by an additional $1,037. In total, then, Kenneth had paid $3,537 towards the purchase price by the time he married Nancy. In October 1970, Kenneth and Delores were divorced. Pursuant to a property settlement agreement, Kenneth paid Delores $4,200 for her interest in the home. During their marriage, Nancy and Kenneth made community property payments on the mortgage which further reduced the mortgage principal. Although the exact amount of principal reduction attributable to these community property payments is somewhat unclear, it appears that these payments reduced the principal by approximately $14,463. Accordingly, as the district court found, the outstanding unpaid loan balance remaining at the time of divorce was $18,500.
The district court found the market value of the Wedekind Road residence at the time of divorce to be $215,000. Of that value, the court concluded that 7.5% was Kenneth's premarital separate property, and 74.5% was community property. The court classified the entire remaining 18% interest as Kenneth's post-marital separate property because the court awarded temporary possession of the house to Nancy and the children. Specifically, the court imposed a constructive trust on the Wedekind Road residence for the benefit of the children. The court ordered Kenneth to make all mortgage payments and to pay for maintenance, repairs and utilities on the residence, until the youngest child reaches the age of majority or Nancy consents to a sale of the house. The court further ordered Kenneth to pay the statutory maximum in child support.
During their marriage, the Malmquists also made improvements to the Wedekind Road residence. The improvements cost $62,707 and consisted of a kitchen remodeling and green house addition. Of the improvements, the $25,000 spent on the kitchen is conceded to be community property. The remaining $37,707 spent on the greenhouse came from a joint checking account in Nancy's and Kenneth's names. The district court found that Nancy and Kenneth had commingled both community and Kenneth's separate property funds in the joint account. At trial, Kenneth attempted to persuade the court that the source of the $37,707 was the proceeds from the sale of an "I Street" apartment building owned by Kenneth as his separate property. Soon after Kenneth's counsel began his attempts to trace the source of the money used to pay for the greenhouse improvements, the parties entered into a stipulation in order to speed up the process of documenting the many transactions involving the account. The following exchange occurred in connection with the stipulation:
MS. McDONALD [for Nancy]: Maybe I can stipulate that the I Street was in the name of the partnership. That none of the wives were in that. That when it was sold, the check was payable to Ken and Nancy Malmquist. And that from that account, the greenhouse was built.
Maybe we can stipulate to that and cut through a whole lot.
... .
... .
MR. FREITAG [for Kenneth]: I have no objection, Your Honor. I will accept the stipulation, if I can restate it real quickly, and it will save a lot of time, that I Street property was Sparks Medical and Dental Investments partnership. That the payments that came out were made out to the husband and wife.
MS. McDONALD: They were made payable to Ken and Nancy Malmquist... .
MR. FREITAG: And that they were deposited into this particular account.
MS. McDONALD: Yes.
MR. FREITAG: And from those deposits, the amount of $37,707.00 was spent on the greenhouse.
MS. McDONALD: Yes, I would stipulate.
... .
... .
... .
... .
... .
... .
THE COURT: And that these sums, $37,707 and some $5,000 was paid out of the account, that a check also was deposited *376 from the I Street property or partnership sale ...?
After this exchange, Kenneth's counsel discontinued his efforts to trace the transactions and proceeded to a different area of inquiry. The district court later held that, despite the stipulation, Kenneth had failed to establish that the funds used to purchase the greenhouse were Kenneth's separate property. Thus, the court classified the greenhouse as community property.
At trial, Kenneth also testified regarding an equity credit line debt in the amount of $71,054.23. Kenneth testified that he incurred some of this debt on behalf of the community and some of the debt for his personal expenses after the couple's separation. The court ordered Kenneth to pay this entire debt. Finally, the district court classified Kenneth's entire medical practice as community property and awarded the practice entirely to Kenneth. The court valued the practice at $32,765, of which $25,000 was business good will; the remainder was accounts receivable, equipment and cash.
LEGAL DISCUSSION
On appeal, Kenneth contends that the district court erred by: (1) failing to use the method announced in Moore, supra, in determining the parties' respective interests in the Wedekind road residence; (2) classifying the greenhouse improvement as community property in disregard of the stipulation quoted above; (3) ordering Kenneth to pay the entire equity credit line debt; (4) ordering Kenneth both to pay the maximum level of child support and to continue to pay the mortgage on the residence which was set aside for the childrens' benefit; and (5) failing to utilize the proper method of apportioning the business good will in his medical practice. We address each of Kenneth's contentions in sequence.
I. Apportionment of community and separate property interests in the Wedekind Road residence.
Both parties agree that the community and separate property interests are entitled to reimbursement to the extent that those interests actually contributed toward reduction of the principal on the mortgage for the Wedekind Road residence. Additionally, this court has recognized that the community is entitled to a pro rata ownership share in property which community funds have helped to acquire. Robison v. Robison, 100 Nev. 668, 670, 691 P.2d 451, 454 (1984). The question presented by Kenneth's appeal is precisely how to apportion the community and separate property shares in the appreciation of a separate property residence obtained with a separate property loan prior to marriage. Although we understand and respect the district court's approach to apportionment of these interests, we hereby adopt, with one modification, the mode of apportionment set forth in In re Marriage of Moore, 28 Cal.3d 366, 168 Cal. Rptr. 662, 618 P.2d 208 (1980).
Without a presumptive approach to this apportionment problem, persons similarly situated may receive unequal distributions in different cases. We have full confidence that the district judges of this state can reach equitable distributions in particular cases. No matter how fair the result in individual cases, however, the aggregate result becomes unfair when similarly situated persons receive disparate returns on their home investments. We further note that the presumptive approach for apportionment of home equity adopted here in no way abrogates the rule of just and equitable distribution, which we recently enunciated in McNabney v. McNabney, 105 Nev. ___, 782 P.2d 1291 (1989). The modified Moore formulae simply establish the community interest in a residence. McNabney, in turn, governs how the court may actually divide that community interest between the parties.
Moore generally grants the community a pro rata share in appreciation of a separate property residence according to the ratio that mortgage principal reduction attributable to community property payments bears to the original purchase price. See Moore, 168 Cal. Rptr. at 664-65, 618 P.2d at 210-11. More specifically, the community property appreciation share under Moore is *377 the amount by which community property mortgage payments have reduced the mortgage principal, divided by the original contract purchase price of the residence. This fraction is multiplied by the total appreciation to yield the final community share in appreciation. Assuming the mortgage was originally a separate property loan, the separate property receives credit for the entire outstanding unpaid mortgage balance, plus the amount by which separate property mortgage payments reduced the mortgage principal; this sum is then divided by the original purchase price of the residence and multiplied by the total appreciation to yield the final separate property appreciation share.
The Moore case presents an understandable and workable way to determine the separate and community interests in the appreciation of a residence. In accord with critics of the Moore decision, however, we adopt a different method for assigning credit for the unpaid mortgage balance. See Comment, The Division of the Family Residence Acquired with a Mixture of Separate and Community Funds, 70 Cal. L.Rev. 1263 (1982) (authored by Peter M. Moldave); Wagner, Apportionment of Home Equity in Marital Dissolutions Under California Community Property Law: Is the Current Approach Equitable?, Comm.Prop.L.J. (Winter 1982). We believe that neither the community or separate property should receive credit for the entire outstanding mortgage balance on the sole basis that the loan was originally a separate or community obligation. When, as here, the community has contributed substantially to principal reduction, assigning the separate property credit for the entire outstanding loan balance yields results which are inequitable to the community; (the result may be equally unfair to the separate property in cases involving a mortgage taken out by the community). Credit for the outstanding loan balance should be divided according to the number of monthly payments made by separate or community property. With a new long-term loan, a considerable number of monthly payments can be made without there being a significant reduction in principal.
Moldave has stated an equitable and workable approach for assigning credit for the unpaid mortgage balance, and we hereby adopt this approach. The approach is essentially to assign credit for the unpaid mortgage balance according to a time rule. Moldave explains:
The proposed method is to allocate the appreciation attributable to the loan proceeds to separate or community sources pro rata according to the total number of monthly payments made from separate or community sources... .
The appreciation is shared according to the number of monthly payments, and not the amount of monthly principal payments, both for reasons of simplicity and fairness. Adding the varying principal payments is more complicated, but the more important objection is that it gives a windfall to the party making the later payments, because the principal portion of the monthly payment rises over the term of a fully amortized level payment loan. Counting only the number of payments avoids affecting the shares because of the timing factor.
70 Cal.L.Rev. at 1288-89 (footnotes omitted) (emphasis in original).
Modified slightly to incorporate Moldave's approach, the Moore formulae for determining the community and separate property interests in total home equity, including appreciation, can be stated arithmetically as follows:
1. SP = PD[sp] + [(PD[sp] + OL[sp]) X (A)]; and
________________
(PP)
2. CP = PD[cp] + [(PD[cp] + OL[cp]) X (A)], WHERE:
________________
(PP)
(a) SP = total separate property interest in home equity;
(b) CP = total community property interest in home equity;
(c) PD[sp] = "pay down" attributable to separate property (i.e., the
reduction in mortgage principal due to separate property
payments, plus the separate property downpayment, if any);
*378
(d) PD[cp] = "pay down" attributable to community property (i.e., the
reduction in mortgage principal due to community property
mortgage payments, plus the community property downpayment,
if any);
(e) OL[sp] = portion of outstanding (unpaid) loan to be credited to
separate property;
(f) OL[cp] = portion of outstanding (unpaid) loan to be credited to
community property;
(g) PP = contract purchase price of the residence;
(h) A = appreciation of the residence.
Applying each of these equations yields the correct respective shares in most cases.[1]
In the formulae, "SP" represents the final separate property interest in home equity, and "CP" represents the final community property share. If more than one spouse contributes separate property, then a third formula, identical to formula number one, may be used to calculate the second spouse's separate property interest. "PD[sp]" denotes the separate property "pay down." The separate property pay down equals the actual reduction in mortgage principal attributable to separate property mortgage payments up to the time the house is divided, plus the down payment, if the down payment is made from separate property. "PD[cp]" denotes the community property pay down. If the down payment is made from community property, then the down payment becomes part of the community property pay down, not the separate property pay down. Neither community nor separate property pay down includes payments going towards mortgage interest or taxes, because taxes and interest payments do not directly increase the equity value of the property. Moore, 168 Cal. Rptr. at 664-65, 618 P.2d at 210-11. "PP" denotes the original contract purchase price of the residence or property. "A" generally denotes the appreciation of the house, measured by the difference between the market value at the time of trial and the contract purchase price. Upon sale, however, the net sale proceeds may differ from the estimated market value. Thus, when the residence is actually sold, district courts should use the actual net sale proceeds, instead of the estimated market value, in calculating appreciation. In re Marriage of Horowitz, 159 Cal. App.3d 368, 373, n. 4, 205 Cal. Rptr. 874, 878, n. 4 (1984).
"OL" generally denotes the outstanding unpaid mortgage balance at the time of trial. "OL[sp]" and "OL[cp]" will denote *379 the dollar amounts of the outstanding loan balance to be credited to separate and community property under Moldave's approach. For example, "OL[sp]" equals the percentage of the total number of monthly mortgage payments made with Kenneth's separate property, multiplied by the total outstanding mortgage balance. In order to prevent manipulation of this time rule, only routine monthly mortgage payments are considered. Moldave, supra, at 1288. Large, non-routine lump sum payments which reduce the principal must be credited to "PD[sp]" or "PD[cp]" but not toward "OL[sp]" or "OL[cp]." Moldave suggests that courts should consider only payments made during the period "between the time the loan is taken out and the time the parties separate." Id. (emphasis added). We believe, however, that the courts should consider all routine mortgage payments made after separation, up to the time of the final division at trial. If, as in the present case, the residence is set aside for the benefit of the children, the courts generally should give the spouse making routine separate property mortgage payments credit, under both "PD[sp]" and "OL[sp]," until such time as the residence is actually sold or divided.
Having set forth the applicable principles of law, we turn to the facts of this case. Although the district court did not set forth its methodology, Kenneth appears to have ascertained the method the court employed in determining the parties' respective interests in the residence. The court established $103,407 as the property's total purchase price. It arrived at this figure by adding the initial purchase price ($36,500), the amount Kenneth paid for his former wife's interest ($4,200) and the cost of the improvements to the property ($62,707). The district court then determined Kenneth's separate property contribution by adding Kenneth's down payment ($2,500), the payment for his former wife's interest ($4,200) and the reduction in principal attributable to separate property loan payments before the marriage ($1,037), a total of $7,737. The court divided the total separate property contribution by the purchase price to reach the final separate property share in the property of 7.5%. The court determined the community property contribution by adding the cost of the improvements which the court classified as community property ($62,707) and the amount by which community property payments had reduced the mortgage principal ($14,463), a total of $77,020. The court divided the total community property contribution by the purchase price to reach the final community property share of 74.5%. The court finally divided the unpaid balance on the mortgage ($18,500) by the $103,407 purchase price, yielding a further 18% separate property share in the property; the court classified this 18% share as Kenneth's separate property since Kenneth was to continue to make the mortgage payments following divorce.
The district court's method of apportionment deviated from our modified Moore approach in two principal ways. First, the district court should not have included as part of the purchase price the money paid by Kenneth to purchase his former wife's interest; the purchase price includes only the contract purchase price. Second, the district court should not have included as part of the purchase price the cost of improvements made to the property. The question of improvements should be considered separately from the question of apportionment of appreciation. We will address the question of how to apportion improvements in Part III of this opinion.
What follows is an example of how the district court should have applied the modified Moore formulae if the residence had been divided at the time of trial, rather than set aside for the children. Due to limitations in this record, we consider only the mortgage payments made up to the time of the parties' separation; normally, the district court should consider all routine mortgage payments made up to the time the residence is actually divided.
The outstanding loan balance at the time of trial was $18,500. Kenneth acquired the home on June 26, 1967, making separate property mortgage payments from July 1967 through December 1970, when Kenneth and Nancy married. Kenneth thus made separate property mortgage payments *380 for 41 months. The community made mortgage payments from January 1971 until the separation in March 1986, a total of 183 months. In all, there appear to have been 224 routine monthly mortgage payments between the date of acquisition of the residence and the date of separation. Kenneth made 41, or 18.30%, of the monthly payments. The community made 183, or 81.70%, of the monthly payments. "OL[sp]" therefore equals $3,386 (18.30% of the outstanding balance of $18,500) and "OL[cp]" equals $15,114 (81.70% of $18,500).
The total pay down on purchase price attributable to Kenneth's separate property (PD[sp]) was the sum of his $2,500 down payment and the $1,037 by which Kenneth's payments reduced the principal before he married Nancy. This is a total of $3,537. To obtain Kenneth's percentage share in the appreciation, we add $3,537 (PD[sp]) to $3,386 (OL[sp]) and divide this sum by the original contract purchase price of $36,500. This yields a separate property appreciation share of 18.97%. The total pay down on the purchase price attributable to community property (PD[cp]) equals $14,463, the amount by which community payments actually reduced the mortgage principal. To obtain the community share in appreciation we add $14,463 (PD[cp]) to $15,114 (OL[cp]) and divide by the purchase price. This yields a community appreciation share of 81.03%. Subtracting the purchase price of $36,500 from the market value at time of trial of $215,000 yields a total appreciation of $178,500. Multiplying the respective final appreciation shares by this appreciation yields a community property appreciation share of $144,638.55 (81.03% X $178,500) and a separate property appreciation share of $33,861.45 (18.97% X $178,500).[2]
We have now established the respective shares in appreciation. To establish the final equity interests of the community and of Kenneth's separate property we must add to the respective appreciation shares the respective pay downs attributable to separate and community property. This step represents simple reimbursement for actual contributions made toward the equity. This yields a final community property share in the equity value of the residence of $159,101.55 ($14,463 + $144,638.55) and a final separate property share of $37,398.45 ($3,537 + $33,861.45). Adding these final shares yields a total equity value in the residence of $196,500. This total equity value is less than the total market value by the amount of the outstanding mortgage balance, which was $18,500 at the time of divorce. The assignment of this outstanding mortgage as a debt in reaching an overall division of property is a separate issue from the allocation of home equity just discussed.
After a district court calculates the final community interest according to the modified Moore formulae, the court still faces the separate problem of how to divide the community interest in a single residence. A good summary of the five principal methods of actually dividing the final community interest in a residence may be found in Horowitz, 205 Cal. Rptr. at 878-879.
In the present case we recognize that the residence will actually be divided at a future date because the court awarded Nancy and the children temporary possession of the residence. This presents a special situation different from the more typical example given above. Ideally, in this situation the court can award the spouse who loses possession of the house other community assets to offset that spouse's interest in the house. If this is not possible, however, the parties must address the issue of apportioning their respective interests in the house at the time in the future when the residence is actually divided. If so, the respective interests should be calculated by reapplying the modified Moore formulae based on the appreciation of the *381 house at the time the house is finally divided. Cf. Horowitz, supra (applying percentage interests established for a residence purchased with cash on the basis of appreciation which had occurred after the judgment of divorce during the time the house was set aside for the children). Kenneth should receive credit under the formulae for the mortgage payments the court ordered him to make during the time the residence is set aside for the children. To the extent that Kenneth's routine post-divorce mortgage payments further reduce the principal, Kenneth will receive credit according to the variable "PD[sp]." As stated above, Kenneth also should receive credit for his continuing routine mortgage payments under the variable "OL[sp]."
Finally, in this case the application of the modified Moore formulae may differ from the example just given because this case involves improvements. Part IV of this opinion contains an example applying the modified Moore formulae after taking improvements into account.
II. Classification of the greenhouse improvements as separate or community property.
We have indicated that the district court erred by factoring the cost of the improvements into the calculation of the respective property shares in the Malmquists' principal residence. Before we can address the question of apportionment of the improvements, we must first classify the improvements as separate or community property. Of the total of $62,707 in improvements, the $25,000 spent on the kitchen remodeling is conceded to be community property. The issue presented by Kenneth's appeal is whether the remaining $37,707 paid for the greenhouse improvement is community property or Kenneth's separate property. Kenneth argues that, contrary to the district court's decision, the stipulation quoted above establishes conclusively that the greenhouse was paid for from his separate property.
Kenneth received his share of the proceeds from the sale of the "I Street" partnership by check made payable to both Nancy and him. This check was endorsed by the parties and deposited in their joint checking account. The greenhouse improvements were paid for from this account. The district court found that both community and separate property funds were commingled extensively in the joint account from which the greenhouse payments were made. Once an owner of separate property funds commingles these funds with community funds, the owner assumes the burden of rebutting the presumption that all the funds in the account are community property. Lucini v. Lucini, 97 Nev. 213, 215, 626 P.2d 269, 271 (1981); Marsden, 181 Cal. Rptr. at 918. Generally speaking, there are two ways to rebut the presumption that commingled funds are community property: (1) direct tracing of the source of a particular purchase to the separate property portion of the account, or (2) proof that at the time of the purchase all community income was exhausted by family expenses. Marsden, 181 Cal. Rptr. at 918. Neither party to this appeal argues for application of the exhaustion method. Therefore, Kenneth must shoulder the burden of direct tracing.
Direct tracing requires Kenneth to establish that the timing and amounts of separate property deposits and withdrawals to pay for the improvements clearly indicate that the payments came from separate property funds, as Kenneth claims he intended. Marsden, 181 Cal. Rptr. at 919. The documentary evidence in support of Kenneth's direct tracing consisted of exhibits introduced at trial. These exhibits were not made part of the record on appeal. Accordingly, the only question before this court is whether the stipulation sufficed as a matter of law to satisfy Kenneth's burden of direct tracing. We conclude that the stipulation does not satisfy this burden as a matter of law and therefore affirm the district court's classification of the greenhouse improvement as community property.
The stipulation, while somewhat ambiguous, arguably establishes that Kenneth's separate property was deposited into the joint account and that the greenhouse was *382 paid for using the money so deposited in this joint account. Kenneth argues that this alone satisfies his burden of tracing. Again, however, the bank accounts are not part of the record on appeal. Thus, the record before us does not establish when money was deposited into the joint account or withdrawn for the greenhouse improvement. We do not know the balance in the joint account at the relevant times. Based on all the evidence presented at trial, the district court determined that, despite the stipulation, the money was commingled in a joint account and Kenneth had not sustained his burden of tracing the money for the greenhouse to his separate property deposits into the joint account. Without the bank records, we are unwilling to disturb the district court's determinations on the strength of the stipulation alone. After reviewing the bank accounts and hearing the testimony of the parties, the district court could have concluded that the evidence was sufficiently strong to support a finding of commingling and that the stipulation concerning the funds was not sufficient to refute this. Based on the record before us, we cannot conclude as a matter of law that the district court erred in determining that the greenhouse improvement was made from community funds.
III. Apportionment of community property improvements to a separate property residence.
Having classified the improvements as community property, we must now decide how to apportion them. Apportionment of improvements must be analyzed separately from the apportionment of home equity pursuant to the modified Moore standard. The community property improvements to Kenneth's separate property residence raise a new apportionment issue: should these contributions toward improvements be presumed gifts, be measured by simple reimbursement or be measured by some other method which gives credit for appreciation due to the improvements? We conclude that in most cases simple reimbursement without interest is the appropriate measure for both separate and community property improvements.
Other legal authorities support the establishment of a reimbursement measure for both separate and community property improvements. While they do not agree on the precise measure of reimbursement, several courts have required some compensation to the community for community property improvements to separate property. See Portillo v. Shappie, 97 N.M. 59, 636 P.2d 878 (1981); Elam v. Elam, 97 Wash.2d 811, 650 P.2d 213 (1982); Fisher v. Fisher, 104 Idaho 68, 656 P.2d 129 (1982); Honnas v. Honnas, 133 Ariz. 39, 648 P.2d 1045 (1982). We reject the rule that community property improvements to separate property themselves become separate property. But see In re Marriage of Camire, 105 Cal. App.3d 859, 164 Cal. Rptr. 667 (1980). We further note that California recently enacted a statute establishing the principle of reimbursement of the separate property for separate property contributions to community property. See Cal.Civ. Code § 4800.2 (West Supp. 1989). Although this case does not involve separate property improvements to community property, we note that we see no good reason why the reimbursement measure ought not apply to separate property improvements to community property as well. In most cases we believe reimbursement will be a fair and adequate measure of the separate or community property contribution. Common experience informs us that, in most cases, improvements add little to the market value of a residence above the cost of the improvement. Indeed, the cost of improvements to residential housing often exceeds any increase in the market value of the residence attributable to the improvements. Moreover, in this case, both separate and community property already have shared in any added market value attributable to the improvements, based on application of the apportionment formulae applied above.
While reimbursement is the general rule, we note that in some cases reimbursement may not be the appropriate measure, and the district court may deviate from the reimbursement measure where necessary to effectuate a proper apportionment. *383 For example, where the improvements actually decrease the value of the property, reimbursement may be too generous a measure. Alternatively, reimbursement may be too stingy a measure where the vast bulk of appreciation is due to the improvements. This may be the case, for example, when community funds are used to substantially renovate or rebuild a dilapidated residence, or when community funds pay to construct a house on formerly unimproved separate real property. In such cases, an appreciation share may be the fairest measure of the community or separate property improvement contribution. If a party can prove that the appreciation is almost exclusively due to improvements, and not to market forces, a court may in its discretion apportion this appreciation entirely to the contributing property. Additionally, if the improvement is purchased with credit and both separate and community property contributions are made to the improvement, apportionment of interests in the improvement would be possible based on a separate application of the formulae stated above. This case-by-case approach is consistent with the well-reasoned opinion of the New Mexico Supreme Court in Portillo, supra, and this approach furthers our overriding goal of equitable divisions of marital property. In the present case, however, there is no evidence that the appreciation of the Wedekind residence was due almost exclusively to the improvements, and the improvements were not purchased on credit with both separate and community property contributions. Accordingly, the proper measure of compensation for the improvements in this case is simple reimbursement.
Section 4800.2 of the California Civil Code specifies the scope and precise measure of reimbursement of separate property for separate property contributions to community property. We adopt the rules stated in Section 4800.2 for community property contributions toward improvements of separate property; we believe that the same rules should apply to separate property contributions toward improvement of community property. Specifically, reimbursable improvements do not include maintenance, tax, interest, insurance payments, or inflation adjustments. Reimbursement must not exceed the market value of the entire property at the time of division. Accordingly, in reaching the initial division of property in the present case the district court should have simply credited the community with full reimbursement in the amounts of $25,000 for the kitchen remodeling and $37,707 for the greenhouse. The district court should have done this separately and independently of the calculation of the parties' shares in appreciation.
IV. Calculation of community and separate property interests in a marital residence after taking into account improvements.
In cases not involving improvements, the district court will calculate the final equity shares as stated in Part I of this opinion. Additionally, where the residence is acquired solely by community or separate property, there is no modified Moore apportionment issue and improvements will generally be measured by simple reimbursement. The present case, however, presents a hybrid problem: the residence was acquired by a mixture of community and separate property, and there were community improvements to a separate property residence. In these hybrid cases, the district court may, in its discretion, order the community or separate property reimbursement shares to be paid in at least two ways. First, the district court may award the party who makes the improvements other community assets of a value which offsets that party's reimbursement share. If the district court here ultimately chooses this approach, the parties' interests in the home equity will be calculated by the method set forth in Part I of this opinion.
Second, the court can award the reimbursement share from the proceeds of sale of the residence before applying the modified Moore formulae. We recognize that, in the present case, the residence will not actually be divided until some future date, by which time the residence may have appreciated *384 further and Kenneth will presumably have made several more mortgage payments from his separate property. Nevertheless, by way of example, we apply the second method for paying out reimbursement to the facts of this case as set forth in Part I of this opinion; we stress that this example will differ from the final result in this case, because the residence will not actually be divided until some time in the future.
First, $62,707 would be paid off the top to the community as reimbursement for the money expended for improvements. Next, the modified Moore formulae would be applied to the remaining value of the residence. The remaining market value of the house here, including the mortgage thereon, would be $152,293 ($215,000 minus the $62,707 in improvements). Subtracting the purchase price of $36,500 from $152,293 gives us the remaining appreciation of $115,793. Applying Kenneth's 18.97% appreciation share to the remaining appreciation (18.97% X $115,793) would give Kenneth an interest in the remaining appreciation of $21,965.93. Adding to this Kenneth's separate property contributions of $3,537 fixes Kenneth's final separate property interest in the remaining equity value of the house at $25,502.93. The community interest in the remaining value of the house would be calculated by applying the community property appreciation share of 81.03% to the remaining appreciation (81.03% X $115,793), giving us $93,827.07. To this must be added the community property contributions that reduced the loan in the amount of $14,463, for a final community share in the remaining value of the house of $108,290.07. In summary, the total community interest in the residence, if divided at the time of trial, would be $170,997.07, representing $62,707 in reimbursement for community improvements plus the $108,290.07 community interest in appreciation. The total separate property interest would be $25,502.93.
The total community interest of $170,997.07 stated in our example is not vastly different from the community interest in the home equity reached by the district court (approximately $146,392). Additionally, the residence itself will not actually be divided until some time in the future. For these reasons, we do not anticipate that the district court will need to readjust its initial community property division in any significant manner due to this opinion. We further anticipate that the court will eventually allocate the property shares in the residence according to the second method of paying out the improvements just discussed. Nevertheless, we remand this case to the district court to permit readjustment of the initial division of property if the court deems this necessary in light of this opinion. At the future time when the residence is actually divided, the district court should utilize the modified Moore formulae explained in this opinion.
V. Kenneth's other assignments of error.
Kenneth assigns as error three other acts or omissions by the district court. First, Kenneth urges that the district court erred by ordering Kenneth to pay the entire equity credit line debt, because the debt was community property. This contention is without merit. The district courts of this state are granted broad discretion to determine the equitable distribution of community property and debts; the court need not make an exactly equal division of the community property. Johnson v. Steel Incorporated, 94 Nev. 483, 485, 581 P.2d 860, 862 (1978). Even if the entire debt was community property, the district court's order was not manifestly inequitable, because Kenneth's overall property distribution was substantially greater than Nancy's and Kenneth enjoys a much greater future income potential.
Kenneth next contends that the district court erred by ordering him to pay the statutory maximum of child support and allowing Nancy to retain possession of the residence until the youngest child reaches majority, with Kenneth to make the mortgage payments until the residence is sold. Neither the child support nor the alimony provisions of the Nevada Revised Statutes precludes the district court from making both orders. See NRS 125.150(1)(4); *386 NRS Chapter 125B. Indeed, this court has suggested that an award both of possession of the family residence and of child support is proper. Stojanovich v. Stojanovich, 86 Nev. 789, 793, 476 P.2d 950, 952 (1970). Moreover, the orders in this case are not manifestly inequitable where: Kenneth will receive credit for his future mortgage payments under the modified Moore formulae; Kenneth has a much higher future earning capacity than Nancy; and Kenneth received substantially more community assets in the initial property division. For these reasons, the district court's orders regarding child support and possession of the house in the present case were not an abuse of discretion.
Kenneth's final contention is that the district court erred by failing to apply to his medical practice the methods of apportionment of separate and community property interests in a business set forth in Pereira v. Pereira, 156 Cal. 1, 103 P. 488 (1909) or Van Camp v. Van Camp, 53 Cal. App. 17, 199 P. 885 (1921). This court has required district courts to utilize either the Van Camp or Pereira apportionment methods in classifying separate property businesses. Wells v. Bank of Nevada, 90 Nev. 192, 194, 522 P.2d 1014, 1016 (1974). Even assuming the district court erred by failing to apply one of these two apportionment methods, however, Kenneth has failed to establish that such error was prejudicial. Kenneth has pointed to no evidence to refute the district court's determination that the business and business goodwill were entirely community property; thus, no issue of apportionment of separate and community shares in the medical practice even arises. The only question facing the district court was one of valuation of a community medical practice, including the business good will. The district court's finding that the vast bulk of value of the practice consisted of goodwill appears sound. In valuing the business good will, the district court was free to use any legitimate method of valuation which measures the present value of goodwill by taking into account past earnings. Ford v. Ford, 105 Nev. ___, ___, 782 P.2d 1304, 1309 (1989). Here, the district court's valuation of goodwill was well within the range of valuations offered at trial, and the valuations were properly reached by methods which took into account past earnings. Accordingly, the district court's valuation must stand.
CONCLUSION
We conclude that, in most cases, the modified Moore formulae yield the correct community and separate property shares in the equity value of a marital residence purchased by mortgage. The question of improvements should be considered separate from the modified Moore calculation. In most cases, simple reimbursement is the appropriate measure for compensating the property providing the improvements. Because the district court did not apply these rules of apportionment, we reverse the district court's apportionment of the parties' interests in the marital residence and in the improvements. We affirm the district court's classification of the greenhouse improvements as community property. We affirm the district court's judgment in all other respects.
Accordingly the district court's judgment is affirmed in part and reversed in part in the manner stated in this opinion. The case is hereby remanded for any further necessary proceedings, and with instructions that the district court: (1) assist the parties, if necessary, in the future division of the marital residence according to the principles set forth in this opinion; and (2) decide whether any further action is necessary at this time to effectuate an equitable division in light of this opinion.
YOUNG, C.J., and STEFFEN, SPRINGER and MOWBRAY, JJ., concur.
NOTES
[1] The above stated formulae derive from formulae used as a teaching tool by Carol Bruch, professor of law at Martin Luther King, Jr. Hall School of Law, University of California at Davis. The above stated formulae are potentially applicable to any property which undergoes significant appreciation and is purchased on credit. While this case does not involve separate property payments on a community residence, we believe that the formulae should apply both to community contributions to separate property residences and to separate property contributions to community property residences. See Moore, 168 Cal. Rptr. at 665, 618 P.2d at 211. In California, on the other hand, Section 4800.2 of the Civil Code has been interpreted to preclude the separate property from obtaining an interest in the appreciation of a community property residence, even when separate property makes payments on the mortgage; in such a case, the separate property receives only reimbursement. In re Marriage of Huxley, 159 Cal. App.3d 1253, 1260, 206 Cal. Rptr. 291, 295 (1984). We do not intend our adoption, in Part III of this opinion, of the Section 4800.2 measure of reimbursement for improvements to deprive the separate property of its pro rata ownership share in a community property residence based on mortgage payments made by separate property. Instead, we believe that the formulae stated above provide the preferable measure of compensation of separate property for its contributions toward the acquisition of a community residence.
We do not suggest that these formulae represent the only way to apportion these interests. For example, if the residence is purchased with cash, the parties are entitled to a share in appreciation according to the ratio that each cash contribution bears to the original purchase price. Additionally, when the vast bulk of the appreciation occurs before marriage, it may be appropriate to award the separate property the entire amount of pre-marriage appreciation; then the court can use these formulae to calculate the additional separate and community property shares in appreciation occurring after the marriage. See, e.g., In re Marriage of Marsden, 130 Cal. App.3d 426, 181 Cal. Rptr. 910 (1982). The trial court also may have greater latitude in determining these respective interests where one spouse has contributed "industry" rather than community capital to the property. Id. 181 Cal. Rptr. at 916, n. 2. Nevertheless, we conclude that, in most cases, the formulae stated above are the proper mode of apportionment of these interests.
[2] We stress that these figures are merely examples. The final result reached in this case will differ from this example because the residence will not actually be divided until some time in the future when Nancy consents to a sale or the children reach the age of majority. Additionally, as explained in Part IV of this opinion, the court may alter application of the modified Moore formulae in order to account for the substantial improvements made to the residence. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1427702/ | 441 F.Supp. 1056 (1977)
James R. MEIER, Plaintiff,
v.
TEXAS INTERNATIONAL DRILLING FUNDS, INC., a Delaware Corporation, and Shearson, Hammill & Co., a Delaware Corporation, Defendants.
No. C-76-780 WHO.
United States District Court, N. D. California.
May 2, 1977.
James B. Little, Little, Evans, Zoller, Dok, Daiker & Matteoni, San Jose, Cal., for plaintiff.
Michael L. Kirby, Post, Kirby, Wideman & Noonan, San Diego, Cal., for Texas Intern.
Samuel A. Keesal, Jr., Peter R. Boutin, Samuel A. Keesal, Jr., Law Offices, Long Beach, Cal., for Shearson, Hammill & Co.
FINDINGS OF FACT AND CONCLUSIONS OF LAW
ORRICK, District Judge.
To obtain a so-called "tax shelter," plaintiff, acting through a brokerage firm, defendant *1057 Shearson, Hammill & Co., invested $40,000 to obtain a limited partnership interest in two oil and gas drilling programs formed and operated by defendant Texas International Drilling Funds, Inc. After losing approximately ninety percent of his investment, plaintiff brought this action against defendants, alleging that the defendants falsely represented to him that the limited partnership was a conservative investment and part of a conservative development program, that the risk of loss would be only ten percent of the total amount invested, and that the funds of the partnership would be placed eighty percent in "good, economic development wells" and twenty percent in "higher risk exploratory wells." Plaintiff alleged that these misrepresentations gave rise to common law fraud, and violations of Section 10(b) of the Securities Exchange Act of 1934 (hereinafter cited as the 1934 Act) and Rule 10b-5.
The case was tried to the Court, sitting without a jury, and the Court, having found for defendants, now makes the following findings of fact and conclusions of law pursuant to Rule 52 of the Federal Rules of Civil Procedure.
FINDINGS OF FACT
1. Plaintiff, a gynecologist, graduated from Stanford University in 1959, and from UCLA medical school in 1963; he spent two years in the U.S. Army, finishing in 1966, one year in residency training at UCLA, entered Stanford ob-gyn residency in 1967 and began private practice as a physician in 1970.
2. Plaintiff's income, which was approximately $6,500 in 1968 and approximately $8,400 in 1969, rose to over $100,000 in 1971.
3. Plaintiff first invested in a stock or security in approximately 1967 and, by December 1971, had engaged in approximately 30-40 stock transactions. He also engaged in commodity trading during 1968, when his annual income was approximately $6,500.
4. Defendant Shearson, Hammill & Co., ("Shearson"), is a Delaware corporation engaged in the general securities brokerage business, a registered broker-dealer with the Securities Exchange Commission, a member corporation of the National Association of Securities Dealers, and a member of the New York Stock Exchange and other stock exchanges, and is doing business in California. At all times relevant to this case, Paul McGibbons was the western regional Mutual Fund manager for Shearson and assumed responsibility for the marketing of tax shelters.
5. James Bishop commenced acting as plaintiff's stockbroker at Shearson in 1968, and plaintiff and Bishop have been close personal friends since that time. Bishop was, during 1965 through September 1972, a registered representative and employee of Shearson in its office in Palo Alto, California. Plaintiff visited Shearson's offices three or four times per week to discuss market conditions with Bishop. His medical office at Chope Hospital in San Mateo, California, was within a block of the Shearson brokerage firm where Bishop had his office. During the period 1968-1971, Bishop made various stock recommendations to plaintiff for his review and for possible purchase by plaintiff. Plaintiff also utilized the brokerage firm of Bache & Company in Palo Alto, California, during approximately 1967-1969. Bishop is currently the office manager of the brokerage firm of Hornblower & Weeks Hemphill Noyes in Seattle, where plaintiff now has his account.
6. Defendant Texas International Drilling Funds, Inc. ("Texas International") was, at all material times during 1970-1975, a Delaware corporation with its executive offices in Oklahoma City, Oklahoma, and its operations offices in Shreveport, Louisiana.
7. The Texas International Drilling Fund ("The Fund") is a limited partnership organized under the laws of the state of Oklahoma and was, at all times pertinent hereto, engaged in the business of exploring and drilling for oil and gas. The Fund is a multi-partnership entity which includes Texas International's 1971 year-end drilling partnership and the 1972-2 drilling partnership.
*1058 8. Texas International was the general partner of The Fund and the general partner of the 1971 year-end and 1972-2 drilling partnerships, and the investors purchasing limited partnership interests therein were the limited partners. Texas International acted as fund manager and as partnership operator of the 1971 year-end and 1972-2 drilling partnerships. The Fund's sole purpose was to pay over to the drilling partnerships the moneys subscribed by the venturers.
9. In January 1970, The Fund established a six-year program for raising $25 million in registered public offerings by sponsoring several drilling partnerships to which it made specific allocations of capital. In order to keep The Fund's registration statement with the S.E.C. current, Texas International filed updated registration statements with the S.E.C. and distributed updated printed prospectuses each year.
10. Texas International and Shearson entered into a selling agreement whereby Shearson agreed to act as a nonexclusive broker with respect to the sale of interests to investors in the various drilling partnerships to be formed by The Fund, and Shearson would receive a seven percent sales commission, paid by Texas International, on all such sales.
11. On or about December 17, 1971, plaintiff purchased a limited partnership interest in Texas International's 1971 year-end drilling partnership for a cash price of thirty thousand dollars and, in July 1972, plaintiff purchased a limited partnership interest in a Texas International 1972 drilling partnership for a cash price of ten thousand dollars. The 1971 and 1972 limited partnerships were part of a series of oil and gas drilling limited partnerships being offered and sold by Texas International through various licensed broker-dealers.
12. Plaintiff first had an understanding of the term "tax shelter" sometime during 1969 or 1970, shortly before he went into private practice and was faced with the possibility of his income level rising. He understood that a tax shelter investment would result in some portion of the funds invested being either tax deductible or resulting in a tax savings in the year of investment.
13. The first tax shelter type investment made by plaintiff was the Damson Oil Fund in August 1971, which was a result of information provided to him by Bishop, who received a sales commission on that investment. The tax shelter benefits offered by the Damson Oil Fund in 1971 and the 1971 year-end drilling partnership were essentially the same. Plaintiff had been provided with a written prospectus and knew at the time he invested in the Damson Oil Fund that it was an exploratory oil and gas fund with a tax shelter feature.
14. Plaintiff understood in 1971 that a high risk investment involved a greater probability of losing all or some of the funds he invested than would a low risk investment. Nonetheless, plaintiff considered various potential tax shelter investments in the latter part of 1971 because he found his income was higher for that year than he had anticipated. Plaintiff had discussed tax shelter type investments with Bishop before 1971, and first learned of the Texas International Tax Shelter Program from Bishop during the latter part of 1971.
15. During the latter part of 1971, Bishop provided plaintiff with a single page, undated document entitled "Tax Shelters Open for Remainder 1971," plaintiff's exhibit 2, which identified six potential tax shelter investments being offered or sponsored by Shearson for that year, including The Fund.
16. Plaintiff was a calendar year taxpayer in 1971, and the deadline for making any tax shelter investments for that year was December 31, 1971. The deadline for plaintiff to make an investment in the 1971 year-end drilling partnership was December 20, 1971.
17. An updated written prospectus, dated May 27, 1971, entitled "Supplemental Prospectus" was filed with the S.E.C. and distributed by Texas International during 1971 through the facilities of interstate commerce to Shearson and Bishop in connection *1059 with the sale of interests in the 1971 year-end drilling partnership. Bishop delivered a supplemental prospectus to plaintiff, who read and understood all of the material contained therein, including the "risk" factors involved in oil and gas drilling, and particularly the high risk involved in investments in oil and gas tax shelter programs.
18. The following language appeared in boldface type on the cover of the supplemental prospectus: "THESE SECURITIES ARE SPECULATIVE IN THAT OIL AND GAS EXPLORATION INVOLVES A HIGH DEGREE OF RISK." The supplemental prospectus also stated that "oil and gas drilling is highly speculative, and is marked by unprofitable efforts, not only from dry holes but from wells which, though productive, do not produce oil and gas in sufficient amounts to return a profit on the amounts expended;" the areas in which The Fund anticipated drilling, including Canada, were described; and the fact that The Fund anticipated expending approximately 80% of the funds on semi-proven and 20% on exploratory drilling was set forth, as well as a description of the results of prior drilling fund operations and partnerships. The supplemental prospectus stated that ". . . this prior experience cannot be considered indicative of the results to be expected under operations conducted by future drilling partnerships . . ." and then set out the mechanics by which any possible redemption would be computed, indicating that any computations toward a possible redemption must await completion of drilling. The supplemental prospectus contained a full and complete disclosure of all material facts and information with respect to a potential investment in the 1971 year-end drilling partnership and did not contain any untrue statements of material fact or omit to state any material fact required or necessary to make the statements contained therein not misleading. The supplemental prospectus clearly and adequately set forth the high degree of risk involved in an investment in the 1971 year-end drilling partnership.
19. Plaintiff knew in 1971 that an exploratory oil and gas program involved the drilling of wells in a previously untried area or where there had been no other known oil or gas wells in that area, and that "developmental drilling" was the drilling of wells in an area where there had been a previously successful oil or gas well drilled, and further understood in 1971 that it was possible to drill a well which would be characterized as a "developmental well" and still have a dry hole. Plaintiff also was aware that, even in the case of a producing well, the total amount of production from that well is still subject to estimation and speculation at that point in time.
20. Use of the term "development" or the term "developmental" is an approved designation of the American Petroleum Institute, which institute approves the designations of "developmental" and "exploratory." The term "developmental" is generally accepted to include drilling in proven and semi-proven fields, and use of the phrase "80% development" in the supplemental prospectus is consistent with the reference in the supplemental prospectus to 80% semi-proven. Plaintiff was not misled by the use of the term "developmental" by defendants and their employees.
21. The decision as to the specific amount of funds to be invested in any particular well or drilling prospect in the 1971 year-end and 1972-2 drilling partnerships was within the discretion of the management of Texas International, and more than 80% of the available funds in the 1971-5 and 1972-2 partnerships were in fact expended on "developmental" or "semi-proven" prospects.
22. The only officer, employee, agent or representative of Texas International with whom plaintiff ever spoke or communicated prior to his investment in the 1971 year-end drilling partnership was Wade Davis, a sales representative for Texas International. Plaintiff never had any personal meeting with Davis prior to his investment in the 1971 year-end drilling partnership, and plaintiff's sole contact with Davis prior to December 17, 1971 consisted of a single *1060 telephone call to Davis. During their one telephone conversation prior to plaintiff's investment in The Fund, plaintiff did not tell Davis that he was interested in a conservative tax shelter investment and Davis did not guarantee a specific return on plaintiff's investment. Plaintiff has never met any other officer, employee, agent or representative of Texas International or any of its affiliated companies other than a very brief meeting with Davis during the summer of 1972, which occurred after plaintiff's investment in the 1972-2 partnership.
23. At the time of his investment in the 1971 year-end drilling partnership, plaintiff signed a suitability letter which specifically stated:
"I understand that Texas International Drilling Fund series A is a limited partnership formed for the purpose of exploring for oil and gas, and that the exploration and discovery of oil, gas and other hydrocarbons is a highly speculative and uncertain undertaking whose advantages and benefits are generally limited to a certain class of investors. I further understand that interests in this program may only be sold in California to persons who understand the nature of the program and for whom the investment is suitable."
Plaintiff had the opportunity to review in detail the suitability letter and consult with Bishop concerning the contents of that letter prior to his execution of the letter. Plaintiff read the contents of the suitability letter in its entirety before he signed it on December 17, 1971, and he understood that his execution of the suitability letter on December 17, 1971 was required by the California Corporations Commissioner and that he could not invest in the 1971 year-end drilling partnership unless he signed the suitability letter.
24. Plaintiff never told Bishop, McGibbons or Davis that there was anything contained in the suitability letter which he was unable to understand, nor did he ever raise any questions to Bishop, McGibbons or Davis concerning any of the material or statements contained in the suitability letter before he signed it. The suitability letter which plaintiff signed with respect to The Fund was not the first such suitability letter which plaintiff had executed with respect to his investments.
25. Plaintiff understood that the purpose of the suitability letter was to limit the availability of that investment to sophisticated and high tax bracket investors, and that another purpose of the suitability letter was to limit the investment to persons who could appreciate the risk involved in that type of a tax shelter. Plaintiff further understood when he signed the suitability letter that he was knowingly and intentionally representing to Texas International that he understood the highly speculative and uncertain nature of an investment in the 1971 year-end drilling partnership and was representing other material facts about himself which qualified him to purchase an interest in the 1971 year-end drilling partnership. Texas International relied upon plaintiff's statements and representations regarding his sophistication and his understanding of the highly speculative and uncertain nature of an investment in the 1971 year-end drilling partnership and his own personal qualifications as a knowledgeable, sophisticated and wealthy investor in accepting plaintiff's subscription in the 1971 year-end drilling partnership.
26. At the time of plaintiff's investments in the 1971 year-end and 1972-2 drilling partnerships, he executed separate limited partnership agreements with Texas International.
27. Plaintiff received periodic letters and reports from Texas International regarding the wells in which the 1971 year-end drilling partnership had an interest, and received a letter from Texas International in September 1972 advising him that the well in which the 1971 year-end drilling partnership had the greatest amount of its funds invested had turned out to be a dry hole.
28. Plaintiff considered in December 1971 that he had a relationship of trust and confidence with Bishop, based on his prior experience and dealings with Bishop, and he *1061 was in contact with Bishop on a daily basis during December 1971.
29. Bishop spent less than four hours with or on behalf of plaintiff with respect to the Texas International Tax Shelter Program during 1971, and that investment was the largest tax shelter sale Bishop had during 1971. Plaintiff's tax shelter investments in the 1971 year-end drilling partnership and the Damson Oil Fund constituted more than half of Bishop's total dollar volume of tax shelter sales for 1971. Bishop encouraged plaintiff to invest in the 1971 year-end and 1972-2 drilling partnerships, and was interested in obtaining sales commissions on the sales of that tax shelter to plaintiff.
30. Shearson received seven percent commissions on plaintiff's investments in the Texas International drilling partnerships, half of which were paid directly to Bishop.
31. Plaintiff and Bishop discussed the tax shelter aspects or tax savings aspects of the 1971 year-end drilling partnership prior to plaintiff's investment in that tax shelter, and Bishop never told plaintiff that Shearson would guarantee that his risk of loss would not exceed a certain amount of the total funds invested in the 1971 year-end drilling partnership.
32. During his employment with Shearson, Bishop had no particular area of specialization and had received no special training for tax shelter investments. Bishop had never had any training in the oil and gas field, had never studied any materials on the technical aspects of oil and gas exploration, and never sold an investment in an oil and gas shelter prior to 1971. It was Bishop's custom and practice not to read or review prospectuses on various tax shelter programs being offered by Shearson, and Bishop never read or reviewed the 1971 supplemental prospectus. It was not Bishop's custom and practice to sit down with an investor and go through a suitability letter with him before having the investor sign such a letter. Bishop was instructed during his training program at Shearson that he was to make oral statements and representations regarding a prospective investment only so long as they were consistent with the written prospectus regarding that investment.
33. Plaintiff never asked any questions of Bishop or Davis regarding the supplemental prospectus, or any of the language contained therein, and neither Bishop nor Davis ever told him to disregard or ignore the supplemental prospectus. Neither defendants nor defendants' employees ever told or guaranteed plaintiff prior to his investment in The Fund that all or a specific amount of his investment would be returned to him. Plaintiff understood at the time he made his investment in The Fund that the amount of the return, if any, on that investment would be dependent upon the success of the wells that were drilled for that partnership. Plaintiff understood that any oral statements made to him regarding potential risk of loss with respect to the 1971 year-end drilling partnership prior to his investment in that tax shelter program were only estimates.
34. Bishop considered plaintiff's investment in Damson Oil Fund to be a high risk investment, and the printed prospectus which plaintiff received with respect to Damson Oil Fund did not contain any disclosures on the cover of the prospectus with respect to the investment being highly speculative or high risk. Bishop considered plaintiff's investments in the 1971 year-end and 1972-2 drilling partnerships to be relatively high risk investments.
35. The percentage of write-off or tax shelter of a particular tax shelter program was a material factor for Bishop in 1971 in determining whether or not an investor might be interested in a tax shelter program, and it was Bishop's experience that most tax shelter investments are made toward the end of the calendar year.
36. In all of the discussions between plaintiff and Bishop during 1971, the 1971 year-end drilling partnership was discussed as a tax shelter investment, and both plaintiff and Bishop considered the 1971 year-end drilling partnership to be a tax shelter. Bishop never attempted to sell any interest *1062 in any tax shelter program other than those which were submitted to him by Shearson, and Bishop considered during 1971 that the two real estate tax shelters shown on the Shearson document, plaintiff's exhibit 2, were the least risky of those six tax shelters. Bishop understood during 1971 that there were certain limitations in terms of income tax bracket and net worth for an individual before he could invest in certain tax shelters in California, and Bishop had the opinion during 1971 that by virtue of plaintiff's prior experience and education, plaintiff was capable of analyzing investments for himself. Bishop understood during 1971 that any redemption or buy-back feature in the 1971 year-end drilling partnership was optional, and the amount of any such offer was dependent upon the success of the drilling efforts.
37. Plaintiff never told Bishop during 1971 that he was looking for a tax shelter with a low degree of risk. Bishop never heard anyone guarantee any specific return or rate of return to plaintiff on his investment in the 1971 year-end drilling partnership, either before or after that investment was made, and Bishop considered the 1971 year-end drilling partnership to be a suitable tax shelter investment for plaintiff. Bishop heard no oral statements made by Davis to plaintiff concerning the 1971 year-end drilling partnership before plaintiff invested in that program, and plaintiff never discussed the technology of oil and gas exploration or drilling with anyone in Bishop's presence. Neither defendants nor any of defendants' employees ever represented to plaintiff that the down-side risk or the risk of loss for an investment in the 1971 year-end drilling partnership was ten percent of the total amount involved.
38. Any use of the term "low risk" or of the term "conservative" by defendants or any of defendants' employees with respect to the Texas International drilling partnerships was in the context of comparing these programs to an exploratory oil and gas tax shelter program, and both Bishop and plaintiff were aware that the risk of loss could be greater than was shown by the past record of the Texas International drilling partnerships.
39. Plaintiff never made any statement to Bishop, McGibbons or Davis with respect to the degree of risk he was going to accept in making an investment in the 1971-5 or 1972-2 partnerships.
40. Defendants did not expressly or impliedly authorize any person to make any statement whatsoever not contained in, or inconsistent with, the supplemental prospectus. Defendants acted honestly and in good faith, and with no intention to take advantage of or defraud plaintiff in connection with his investment in the 1971 year-end and 1972-2 drilling partnerships.
41. Plaintiff has also invested in M & O Oil Development, in which plaintiff is one of three partners with respect to the ownership of oil and gas wells in Pennsylvania, and also invested in A & B Oil Development, a program where he was a general partner with respect to some oil and gas properties in West Virginia. Plaintiff's investment in the A & B oil program resulted in his receiving a tax write-off of approximately 90%-100% of his investment of $32,000.
42. Plaintiff has also invested $10,000 in Chaparral Cattle, a cattle tax shelter program, through Bishop, who received a sales commission, and plaintiff executed a suitability letter when he made that investment. Plaintiff received a tax write-off of slightly more than 100% as a result of his investment in the Chaparral Cattle Tax Shelter Program, and thereafter lost his entire investment.
43. Plaintiff's primary purpose for making an investment in the 1971 year-end and 1972-2 drilling partnerships was to obtain tax shelter relief for those taxable years. Plaintiff understood on December 17, 1971 that the amount or percentage of his income tax write-off on his 1971 income tax return relating to an investment in the 1971 year-end drilling partnership would be approximately 100% of the amount invested. As the result of plaintiff's investment of $30,000 in the 1971 year-end drilling partnership, he reported a tax loss or tax deduction *1063 in an amount slightly in excess of $30,000 for the 1971 taxable year, which resulted in a reduction or savings of more than $15,000 on his 1971 federal income taxes.
44. In May of 1973, plaintiff received a buy-back or redemption offer of $1,500 from Texas International for his interest in the 1971 year-end drilling partnership, which represented the reasonable or fair market value of plaintiff's partnership interest on that date, and plaintiff elected not to accept the May 1973 redemption offer.
45. In May of 1976, plaintiff received a buy-back or redemption offer of $1,535 from Texas International for his interest in the 1972-2 drilling partnership, which plaintiff elected not to accept. Plaintiff has received approximately $3,400 in royalties from his interest in the 1972-2 drilling partnership, and had he accepted the redemption offer plaintiff would have recovered fully almost 50% of his investment in that partnership, irrespective of additional tax savings.
CONCLUSIONS OF LAW
1. Federal jurisdiction over the subject matter, and venue, are proper in this action. 15 U.S.C. § 78aa; 28 U.S.C. § 1332(a).
2. A private cause of action for damages will not lie under section 10(b) of the 1934 Act and Rule 10b-5 thereunder in the absence of specific proof of "scienter", i. e., the intent to deceive, manipulate or defraud on the part of defendant. Ernst & Ernst v. Hochfelder, 425 U.S. 185, 96 S.Ct. 1375, 47 L.Ed.2d 668 (1976).
3. Where the evidence establishes that plaintiff has both sufficient experience to conduct his own investment affairs and has access to sufficient information to understand the nature of the investment, he has a duty of reasonable diligence which must be exercised to create a right to recover under the securities laws. Eichen v. E. F. Hutton & Co., 402 F.Supp. 823, 830 (S.D. Cal.1975).
4. Under the Federal Securities Laws, a reasoned and justified statement of opinion, one with a sound factual or historical basis, is not actionable G. & M. Inc. v. Newburn, 488 F.2d 742, 745-746 (9th Cir. 1973); Eichen v. E. F. Hutton & Co., supra, 402 F.Supp. at 829.
5. The supplemental prospectus and the suitability letter required by the California Commissioner of Corporations fully disclosed the risks in the 1971 year-end drilling partnership. Id. at 850.
6. Defendants did not make any misstatement of material fact to plaintiff and did not omit to state any material fact, in light of the circumstances. Id. at 827.
7. Defendants did not intend to deceive, manipulate or defraud plaintiff and did not employ any device, scheme or artifice to defraud plaintiff in connection with the offer and sale of the fund's limited partnership interests to plaintiff.
8. Although in some circumstances reckless behavior might be sufficient for liability under § 10(b) of the 1934 Act and Rule 10b-5, Ernst & Ernst v. Hochfelder, supra, 425 U.S. at 194 n.12, 96 S.Ct. 1375, defendants exhibited no such recklessness in this case.
9. Defendants did not engage in any act, practice or course of business which operated as a fraud or deceit upon plaintiff in connection with the offer and sale of the limited partnership interests.
10. Defendants breached no duty with respect to plaintiff, considering the relationship of the parties, access to necessary information, and related necessary factors as established in White v. Abrams, 495 F.2d 724 (9th Cir. 1974.)
11. Plaintiff is not entitled to judgment against defendants, or any of them, and judgment shall be entered in favor of defendants, and costs shall be paid by plaintiff.
Defendants are ordered to prepare, serve and file on or before May 23, 1977, a judgment in accordance with the foregoing findings of fact and conclusions of law in form approved by the plaintiff. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1987222/ | 660 F.Supp. 892 (1987)
LAWSON PRODUCTS, INC., Plaintiff,
v.
TIFCO INDUSTRIES, INC., and Billy J. Sorrells, Defendants.
No. 8-6-1127-Civ-J-14.
United States District Court, M.D. Florida, Jacksonville Division.
May 22, 1987.
*893 Waddell A. Wallace & Joel B. Toomey, Jacksonville, Fla., Marvin Miller, Chicago, Ill., for plaintiff.
Tyne Boyer, Jacksonville, Fla., Jack Bailey & Michael McGann, Houston, Tex., for defendants.
OPINION AND ORDER
SUSAN H. BLACK, District Judge.
This case came on upon the Defendants' Motion To Dismiss, filed herein on January 16, 1987. Plaintiff's response in opposition was filed January 30, 1987. The Court heard oral argument on March 24, 1987.
Plaintiff Lawson Products, Inc. [hereinafter "Lawson"], a Georgia corporation, alleges in its Complaint that it entered into a Sales Agreement with defendant Billy J. Sorrells [hereinafter "Sorrells"], a Florida resident, for Sorrells to market Lawson's products in northeast Florida. The agreement contained a non-competition clause.[1] Lawson alleges that in 1986, Sorrells terminated his relationship with Lawson and began marketing the products of defendant Tifco Industries, Inc. [hereinafter "Tifco"], a Texas corporation that competes with Lawson in northeast Florida. Lawson alleges this conduct constitutes a breach of contract by Sorrells, interference with advantageous business relationships by both defendants, and a conspiracy by both defendants to breach Sorrells's and others' fiduciary duty to Lawson. The Court's jurisdiction is based on diversity of citizenship.
Defendants seek to dismiss this action on the ground that Section 607.354, Florida Statutes (1985), referred to as Florida's "door closing" statute, bars this lawsuit. The statute provides, in pertinent part:
(1) No foreign corporation transacting business in this state without authority to do so shall be permitted to maintain any action, suit, or proceeding in any court of this state until such corporation shall have obtained authority to transact business in this state.
Section 607.354(1), Florida Statutes (1985).
It is well-settled that a state's door closing statute applies in a federal diversity suit. See Woods v. Interstate Realty Co., 337 U.S. 535, 536-37, 69 S.Ct. 1235, 1236-37, 93 L.Ed. 1524 (1949); McCollum Aviation, Inc. v. CIM Associates, Inc., 438 F.Supp. 245, 249 (S.D.Fla.1977).
Lawson acknowledges that it has not registered to transact business in Florida. It is Lawson's position, however, that its activities in Florida do not constitute "transacting business" within the meaning of the statute. The statute further provides, in pertinent part:
Without excluding other activities which may not constitute transacting business in this state, a foreign corporation shall not be considered to be transacting business in this state, for the purposes of this act, by reason of carrying on in this state any one or more of the following activities:
*894 (a) Maintaining or defending any action or suit or any administrative or arbitration proceeding or effecting the settlement thereof or the settlement of claims or disputes....
(e) Effecting sales through independent contractors.
(f) Soliciting or procuring orders, whether by mail or through employees, agents, or otherwise, when such orders require acceptance without this state before becoming binding contracts
....
(i) Transacting any business in interstate commerce....
Section 607.304(2), Florida Statutes (1985). Lawson maintains that its activities fall within subsections (e), (f), and (i) and it is, therefore, not required to register. Thus, section 607.354 does not bar this action.
The statute's language on its face supports Lawson's position. The Court finds that there is no dispute that the sale of Lawson's products in Florida fall within the exemptions to transacting business listed in the statute. The statute exempts these activities and provides that this list is not exclusive, indicating that there are other activities which also would not constitute transacting business. The statute does not, and could not as a practical matter, list all the activities which do constitute transacting business. The Court must look to case law to determine whether Lawson has engaged in an activity which constitutes transacting business in Florida and, thus, whether Lawson must register before it can maintain this suit.
The Court's analysis begins with KAR Products, Inc. v. Acker, 217 So.2d 595 (Fla. 1st DCA 1969) [hereinafter "KAR"]. KAR involved a foreign corporation which sold products in Florida seeking to enforce a non-competition clause in an employment contract with a Florida resident. The plaintiff was not qualified to do business in Florida. The court stated that the interstate character of plaintiff's business in Florida exempted it from complying with the registration requirement. Id. at 597. The court went on, however, to determine whether the foreign corporation could utilize Florida courts for the cause of action before it without registering. The court articulated a two-part test:
[T]he corporation must first show that the only business it transacts in Florida is exclusively of an interstate character, but also that the cause of action sued upon was acquired under the federal constitution or laws in interstate traffic.
Id. at 597-98. Relying on Eli Lilly and Co. v. Sav-On-Drugs, Inc., 366 U.S. 276, 81 S.Ct. 1316, 6 L.Ed.2d 288 (1961), the KAR court held that plaintiff's cause of action was based on a "private right growing out of a contract of employment" and not derived from any right incident to an interstate transaction. Thus, the court found that the door closing statute barred the action. KAR, 217 So.2d at 598-99.
Plaintiff asserts that the decision in KAR is inconsistent; while the court agreed that the foreign corporation was not required to register to do business in Florida, the court held that the foreign corporation was required to register before it could maintain the suit. In addition, plaintiff asserts that section 607.304, the amendment to the door closing statute enacted subsequent to KAR, overrules KAR. Section 607.304(2)(a) specifically states that maintaining any action does not constitute transacting business. Case law reveals, however, that KAR's test for determining whether the door closing statute applies is still good law. Moreover, case law has clarified the apparent inconsistency in KAR, interpreting KAR to stand for the proposition that the door closing statute cannot bar a suit based on a right incident to the laws of interstate commerce while the statute does prohibit a suit based on a non-interstate cause of action.
In Batavia, Ltd. v. United States, 393 So.2d 1207 (Fla. 1st DCA 1980), a foreign corporation brought a mortgage foreclosure action and claimed to be exempt from the registration requirement pursuant to section 607.304(2)(g) and (h). The court agreed, acknowledging that KAR "stands for the proposition, that if the activity carried on by a foreign corporation is to be categorized as interstate commerce, it is *895 excluded from registration." Id. at 1209. The court distinguished KAR factually, stating: "the activity there involved did not constitute interstate commerce and thus, that foreign corporation's right to institute and maintain the action was not exempt from the registration requirements...." Id.
In Direct Mail Specialist v. Terra Mar Group, 434 So.2d 1027 (Fla. 2d DCA 1983), the court held that a foreign corporation was not required to register before bringing a breach of contract action for failing to pay for services rendered thereunder. The court distinguished KAR, characterizing it as follows:
action on an employment contract brought in a Florida state court by a nonresident corporation engaged exclusively in interstate sales sought redress of a private right against defendant, a Florida resident, growing out of a noncompete provision of the contract in question; held, the trial court did not err in deciding that plaintiff's right to bring the action was barred absent compliance with Florida's statutory registration requirement since its action was grounded upon an intrastate matter.
Id. at 1029.[2]
These cases indicate that KAR is still a viable application of Florida's door closing statute. Furthermore, the enactment of section 607.304 did not overrule KAR. Section 607.304 appears to be a codification of what the court realized in KAR; Florida cannot require foreign corporations to register before bringing an action if the corporation's activities in Florida are purely interstate and the suit is based on those interstate activities. While the language of section 607.304 appears to indicate that there are broad exemptions to the registration requirement, case law indicates that the exemptions are in fact very limited. The Court will apply the two-part test articulated in KAR to determine whether plaintiff must register before bringing this action.
There is no dispute that plaintiff satisfies the first prong of the KAR test. The issue is whether plaintiff's cause of action is derived from the laws in interstate traffic. In the present case, plaintiff's action is based on a non-competition clause in a sales agreement with a Florida resident. This agreement is not an employment contract per se. However, plaintiff's action is based upon a covenant not to compete in the sales agreement which is sufficiently similar to the non-competition clause in the employment contract in KAR to indicate that Florida courts would require plaintiff to register before it can maintain an action in Florida based on this agreement.
Eli Lilly and Co. v. Sav-On-Drugs, Inc., 366 U.S. 276, 282-83, 81 S.Ct. 1316, 1320-21, 6 L.Ed.2d 288 (1961) set forth a test for determining whether the plaintiff's cause of action is derived from the laws in interstate commerce. The Supreme Court held that the state's licensing power was not restricted by the laws in interstate commerce because plaintiff was suing upon a contract "entirely separable from any particular interstate sale...." In the present case, plaintiff is suing upon a sales agreement with defendant Sorrells which does not involve any interstate sales by plaintiff. The present situation was contemplated by Justice Harlan, who stated in his concurring opinion:
Were Lilly, for a distinct consideration, to enter into an arrangement with its New Jersey wholesalers to promote or solicit business within the State for their account, I would suppose it scarcely doubtful that such an endeavor would constitute a local incident subject to the State's licensing power, even though the ultimate purpose and effect of the arrangement itself were also to enhance Lilly's own interstate business.
Id. at 286, 81 S.Ct. at 1322 (Harlan, J., concurring.
The Court finds that plaintiff's action in the present case is not based upon rights *896 derived from the laws of interstate commerce. Plaintiff's instant action does not satisfy the second prong of the test articulated in KAR for determining whether plaintiff can maintain the suit without registering. The Court holds that plaintiff must register pursuant to section 607.354 before it can maintain this action in this Court. The Court will, therefore, grant the motion to dismiss.
Accordingly, it is
ORDERED:
1. That Defendants' Motion To Dismiss, filed herein on January 16, 1987, is hereby granted.
2. That the Clerk of the Court is hereby directed to enter judgment dismissing this case.
NOTES
[1] The non-competition clause provides, in pertinent part:
(a) During the term of his Agency and for a period of Two (2) Years following termination thereof whether by himself or by COMPANY, for whatever reason and whether for cause or without cause, he shall not, directly or indirectly, for or on behalf of himself or any company or firm in which he has an interest or in which any member of his family has an interest, solicit orders from customers or sell products competitive to those sold by COMPANY to any customer that he solicited or sold on behalf of COMPANY during the last 12 months of his relationship with COMPANY.
[2] In addition to these Florida cases, a federal district court sitting in diversity relied upon KAR in McCollum Aviation, Inc. v. CIM Associates, Inc., 438 F.Supp. 245 (S.D.Fla.1977). While the McCollum court did not present the facts of the case before it, the court applied the two-part test articulated in KAR. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1564689/ | 929 S.W.2d 1 (1996)
MOTEL 6 G.P., INC., and Motel 6 Operating L.P., a Delaware Limited Partnership, d/b/a Motel 6, Petitioners,
v.
Maria Ramona LOPEZ, Respondent.
No. 96-0275.
Supreme Court of Texas.
June 28, 1996.
*2 Larry W. Hicks, Monty Kimball, El Paso, for Petitioners.
Jose Montes, Jr., Michael Paul Moffeit, El Paso, for Respondent.
OPINION
PER CURIAM.
In this case, we decide whether the court of appeals erred in holding that a land owner could breach the duty owed to an invitee even though the invitee had not satisfied the threshold burden of showing that the land owner knew or should have known of the dangerous condition that caused her injury. We hold that the court of appeals erred in confusing the duty and breach elements of a premises liability claim. Accordingly, we reverse the judgment of the court of appeals and render judgment that Lopez take nothing from Motel 6.
Maria Ramona Lopez alleged that she suffered injuries when she fell in the shower in her motel room at a Motel 6 in El Paso, Texas. Lopez alleged that she stepped into the shower with her left foot first, felt that the floor of the shower was slippery, took off her bath robe, put her right foot in, and then slipped and fell. Lopez grabbed the faucet in an attempt to break her fall. It is undisputed that the shower stall contained no bars or rods that Lopez could have grabbed. Although Lopez did not allege that the floor of the shower was wet, she asserted that the floor felt "likeafter you have mopped and there is still soap on the floor."
Lopez sued Motel 6 and the two manufacturers of the shower stall for negligence and strict products liability, although her petition did not clearly delineate which claims were asserted against which defendants. Paragraph four of her petition stated that she sought "to recover for personal injuries sustained by her as a result of a dangerous condition on Defendants' property, specifically, an extremely slippery and dangerous shower stall floor." In Paragraph five, she asserted that her injuries were "a direct result of a fall proximately caused by the dangerous condition of Defendants' shower stall floor."
In Paragraph six, she asserted that the stall was defective and unsafe for its intended use at the time it left the manufacturers and at the time it was sold to Motel 6. Specifically, she argued that the stall was defective because the design of the floor made the stall slippery and because the defendants:
failed to provide adequate slip resistant mats and/or slip resistant appliques or other devices. In addition Defendants failed to install adequate hand railings and/or grips in the shower. There was no warning that the shower floor was of a slippery and dangerous nature and would injure the user. Plaintiff therefore invokes the doctrine of strict liability. Plaintiff alleged [sic] that the defect in design was a producing cause of the injuries and damages.
Motel 6 moved for summary judgment on two grounds: that the stall was not unreasonably dangerous and that Motel 6 had no actual or constructive knowledge of a defective condition. Attached to its motion was an affidavit from Betty Strange, the manager of the Motel 6 where Lopez fell. She testified that she had managed that particular motel since 1989 and that all 146 rooms at the motel had the same type of shower stall as the one in which Lopez fell, except for seven that were specially equipped for disabled guests. She said that she had never received a complaint about a shower floor being slippery or about any other dangerous condition in the motel's showers. She explained that the room and shower stall had been inspected immediately before Lopez's arrival. Finally, she stated that she inspected the shower stall immediately after Lopez's fall and found no residue or other defect on the shower floor that could have made the floor slippery before Lopez turned on the water or *3 that could have caused her fall. Motel 6 also attached excerpts from Lopez's deposition in which she testified that she did not know whether Motel 6 or any of its employees had notice of any dangerous condition in its showers. She also described the fall as "an accident" and said that she was not "blaming" the motel for her fall.
Lopez's response to the motion for summary judgment stated that the slippery floor was unreasonably dangerous. She then argued that Motel 6 challenged only one allegation, that it had negligently maintained a stall with a slippery floor, while ignoring a separate cause of action, namely that the motel failed to provide safety mats or bars and failed to warn of the dangers in the shower.
The trial court granted Motel 6's motion for summary judgment without stating the grounds and then severed the claims against Motel 6 from those remaining against the manufacturers.
The court of appeals affirmed in part and reversed in part. 932 S.W.2d 76. It affirmed the trial court's dismissal of the claim that Motel 6 negligently maintained the shower floor because it held as a matter of law that Motel 6 had no actual or constructive knowledge of any defect. But, the court of appeals also held that Lopez had asserted an independent theory of liability against Motel 6, the failure to install safety devices, that Motel 6 did not disprove. The court of appeals remanded this claim for trial. We hold that this was error.
The court of appeals's conclusion that Motel 6 had no actual or constructive knowledge of a dangerous condition in the shower precludes any premises liability claim, whether predicated upon negligent maintenance, a failure to warn, or the absence of safety devices. Even assuming that Lopez's allegation regarding the failure to install safety devices (which appeared in the paragraph asserting a products liability claim against the manufacturers of the stall, not against Motel 6) was intended to illustrate how Motel 6 breached the duty of care owed to its invitees, there can be no liability because Motel 6 has no duty to reduce or eliminate risks of which it is not and should not be aware. Because Lopez pleaded only one premises liability cause of action against Motel 6, the court of appeals cannot separate each of Lopez's suggested safety precautions into a distinct cause of action.
Land owners owe varying duties of care to visitors on their land, depending on the legal status of the visitor. Rosas v. Buddies Food Store, 518 S.W.2d 534, 536 (Tex.1975); Rowland v. City of Corpus Christi, 620 S.W.2d 930, 933 (Tex.Civ.App. Corpus Christi 1981, writ ref'd n.r.e.). The parties do not dispute that as a guest of the motel, Lopez qualifies as an invitee for purposes of a premises liability claim. See Rosas, 518 S.W.2d at 536 (defining an invitee as one who enters the property of another "with the owner's knowledge and for the mutual benefit of both"). A land owner owes invitees a duty to exercise ordinary care to protect them from not only those risks of which the owner is actually aware, but also those risks of which the owner should be aware after reasonable inspection.
To prevail on a premises liability claim against Motel 6, Lopez must prove:
(1) that Motel 6 had actual or constructive knowledge of some condition on the premises;
(2) that the condition posed an unreasonable risk of harm;
(3) that Motel 6 did not exercise reasonable care to reduce or eliminate the risk; and
(4) that Motel 6's failure to use reasonable care proximately caused Lopez's injuries.
See Keetch v. Kroger Co., 845 S.W.2d 262, 264 (Tex.1992); Corbin v. Safeway Stores, Inc., 648 S.W.2d 292, 296 (Tex.1983). Thus, the existence of actual or constructive knowledge of a premises defect is a threshold requirement for such a claim. See Corbin, 648 S.W.2d at 296 ("Corbin's right to recover from Safeway depends on his showing Safeway's knowledge of the foreseeable harm of some course of conduct or method of operation."). An invitee must show that a land owner either knew, or after reasonable inspection should have known, of an unreasonably dangerous condition before arguing that *4 the owner breached a duty by failing to take any one of several precautions. "[A]n occupier's liability to an invitee depends on whether he acted reasonably in light of what he knew or should have known about the risks accompanying a premises condition, not on whether a specific set of facts or a specific breach of duty is established." Id. at 295; see also W. Page Keeton et al., Prosser and Keeton on the Law of Torts § 61, at 426 (5th ed. 1984) ("[T]here is no liability for harm resulting from conditions from which no unreasonable risk was to be anticipated, or from those which the occupier neither knew about nor could have discovered with reasonable care.") (footnotes omitted).
Based upon the summary judgment evidence, the court of appeals concluded that Motel 6 did not know and should not have known of a dangerous condition in the shower. We accept this conclusion as true because Lopez does not contest it on appeal.
The court of appeals held that this determination conclusively disproved an element of Lopez's premises liability claim. The court of appeals failed to realize, however, that this conclusion necessarily absolves Motel 6 of any duty to install safety devices in the shower. Lopez's failure to meet her threshold burden of showing that Motel 6 actually knew, or through the exercise of reasonable care should have known, of an unreasonably dangerous condition in its shower stalls ends the inquiry. There is no need to consider the various ways that Lopez suggests Motel 6 breached its duty because Motel 6 had no actual or constructive knowledge of the risk alleged in this case. Lopez's claim that Motel 6 was negligent for failing to install safety devices is, at best, an allegation of the breach element of her premises claim. Motel 6 cannot breach a duty that it does not owe, and it does not owe a duty to correct a defect of which it is not, and should not be, aware.
We agree with the court of appeals that Lopez stated a cause of action independent of the premises liability claim. The independent cause of action, however, was a strict products liability claim against the manufacturers of the shower stall. While the incidental mention of Motel 6 in the paragraph asserting a products claim makes it possible that Lopez intended to assert that claim against the motel, we find this construction highly unlikely. Lopez never indicated to the trial court that she had brought such a claim against the motel, either before or after the trial court severed her claims against the manufacturers from her claims against Motel 6. Furthermore, she never asserted at any level on appeal that Motel 6's failure to install safety devices triggered liability for a products, rather than a premises, defect.
Given the language in the petition and the course of the litigation, we believe that Lopez's safety device allegation is not a products liability claim against Motel 6, but rather one of several ways in which she believed that Motel 6 breached its duty to protect its guests from a dangerous condition in its shower stalls. As we noted earlier, Motel 6 had no duty to install safety devices in its showers because it had no actual or constructive knowledge that an unreasonably dangerous condition existed. If Lopez had intended to assert a products liability claim against Motel 6, we would be faced with a question that we have not yet decided, but one that another Texas court has considered. See Summers v. Fort Crockett Hotel, Ltd., 902 S.W.2d 20, 27 (Tex.App.Houston [1st Dist.] 1995, writ denied) (holding as a matter of law that a hotel could not be liable for the plaintiff's injuries under a products liability theory because it "did not sell or manufacture the balcony railing" over which the plaintiff had fallen). However, we need not decide this issue because Lopez has not presented it at any stage in the case.
Accordingly, the Court grants Motel 6's application for writ of error, and pursuant to Texas Rule of Appellate Procedure 170, without hearing oral argument, reverses the judgment of the court of appeals, and renders judgment that Lopez take nothing from Motel 6. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1727729/ | 760 So. 2d 1193 (2000)
Calvin J. TALLEY and Mary B. Talley
v.
BLUE CROSS BLUE SHIELD OF LOUISIANA.
No. 99-1974.
Court of Appeal of Louisiana, Third Circuit.
May 3, 2000.
*1194 Paul J. Hebert, Lafayette, Counsel for Defendant-Appellant, Blue Cross Blue Shield of Louisiana.
J. Minos Simon, Bradley D. Watts, Lafayette, Counsel for Plaintiffs-Appellees, Calvin J. Talley and Mary B. Talley.
Before DOUCET, C.J., COOKS and DECUIR, Judges.
DECUIR, Judge.
Calvin and Mary Talley filed suit against Blue Cross/Blue Shield of Louisiana seeking payment of medical benefits, totaling $96,024.02, under a health insurance policy. They also sought penalties and attorney's fees for the arbitrary and capricious failure to pay the claim. Blue Cross denied benefits based on its contention that Mrs. Talley's cancerous tumor found on the spine was in fact metastatic breast disease, a condition specifically excluded by a rider attached to the policy. Both the Talleys and Blue Cross moved for summary judgment on the coverage and penalties issues.
In a thorough and well reasoned decision, the trial court ruled in favor of the plaintiffs and found coverage under the policy. He did not find the actions of Blue Cross to be arbitrary and capricious, however, and declined to award penalties and attorney's fees. Blue Cross has appealed the determination of coverage, and the Talleys answered the appeal, contending the trial court erred in failing to award penalties and attorney's fees. Affirming the trial judge's ruling, we quote in extenso from his reasons for judgment:
This litigation arises out of a contractual dispute between Plaintiffs and their health insurer. It is undisputed that Mrs. Talley was diagnosed with breast cancer in 1988 and underwent surgery to remove her left breast. It is further undisputed that subsequently, Plaintiffs entered into a contract of insurance with the Defendant for comprehensive major medical coverage, which policy became effective on April 14, 1994. The policy contained a rider exclusion which excludes "malignant neoplasms of breast; treatment for and complications therefrom."
Thereafter, on or about March 28, 1996, Mrs. Talley was diagnosed with a spinal tumor for which she sought and received medical treatment. Plaintiffs submitted numerous medical bills for payment and/or reimbursement for this treatment and the Defendant began making payments. After paying certain of the submitted claims, the Defendant ceased making payments on Plaintiffs' claims and, in addition, sought reimbursement of payments previously made to health care providers. In so doing, the Defendant relied on the aforementioned exclusion and contended that the spinal tumor was actually breast cancer that metastasized to the spine.
The only justiciable controversy before the Court is whether the exclusion *1195 relied upon by the Defendant, excluding "malignant neoplasms of breast; treatment for and complications therefrom," is applicable to Mrs. Talley's spinal cancer.
It is well settled that an insurance policy is a contract between the parties and should be construed using the general rules of interpretation of contracts as set forth in the Civil Code. Crabtree v. State Farm Insurance Co., 93-0509 (La.2/28/94), 632 So. 2d 736. Interpretation of a contract is the determination of the common intent of the parties. LSA-C.C. article 2045. If the words of an insurance policy are clear and explicit and lead to no absurd consequences, no further interpretation may be made in search of the party's intent and the agreement must be enforced as written. LSA-C.C. article 2046. The policy should be construed as a whole and one portion thereof should not be construed separately at the expense of disregarding another. LSA-C.C. article 2050. A doubtful provision must be interpreted in light of the nature of the contract, equity, usages, the conduct of the parties before and after the formation of the contract, and of other contracts of a like nature between the same parties. LSA-C.C. article 2053.
Regarding the interpretation of an exclusion in an insurance policy, the Louisiana Supreme Court provided in Garcia v. St. Bernard Parish School Board, 576 So. 2d 975, 976 (La.1991):
Exclusionary provisions in insurance contracts are strictly construed against the insurer, and any ambiguity is construed in favor of the insured. Capital Bank & Trust Co. v. Equitable Life Assurance Society, 542 So. 2d 494 (La.1989); Albritton v. Fireman's Fund Insurance Co., 224 La. 522, 70 So. 2d 111 (1953). Equivocal provisions seeking to narrow the insurer's obligation are strictly construed against the insurer, since these are prepared by the insurer and the insured has no voice in the preparation. 13 J. Appleman, Insurance Law and Practice § 7427 (rev. ed.1976). If the language of the exclusion is subject to two or more reasonable interpretations, the interpretation which favors coverage must be applied. Carney v. America Fire & Indemnity Co., 371 So. 2d 815 (La.1979); W. McKenzie & H. Johnson, 15 Louisiana Civil Law Treatise, Insurance Law and Practice § 4 (1986). The judicial responsibility in the interpretation of an insurance policy is the determination of the common intent of the parties. W. McKenzie & H. Johnson, supra.
Additionally, the burden is on the insurer to prove the applicability of an exclusionary clause in a policy of insurance. Landry v. Louisiana Hospital Service, Inc., 449 So. 2d 584 (La.App. 1 Cir.1984).
With these principles firmly in mind, this Court will now address the insurance contract interpretation question in this case. The language of the insurance policy exclusion at issue purports to exclude "malignant neoplasms of breast; treatment for and complications therefrom." The Defendant contends that the subject exclusionary language is applicable to all Mrs. Talley's claims relating to her spinal cancer.
The testimony of the Defendant's representative establishes that the Defendant itself cannot define the terms of the exclusion relied upon and cannot make clear to an insured what complications are excluded under the policy. The Defendant's representative, a physician, testified that there were potentially hundreds of complications from breast cancer and that he could not name them all and did not believe anyone could. He testified that he could possibly name "maybe 50 percent" of such complications. He testified that the term "complication" is not a standardized medical term.
*1196 The law mandates that an exclusion be definable with a reasonable degree of certainty, and that the terms of the exclusion must be such that it is clear who is insured and what is excluded. Furthermore, it is the duty of the insurer to clearly express its limitations. Any doubts as to coverage must be construed against the drafter of the policy and in favor of coverage.
In this case, by the Defendant's own testimony, the phrase "complications therefrom" cannot be defined with any degree of certainty whatsoever. The Defendant's own expert could only name "maybe 50 percent" of the complications resulting from breast cancer. Accordingly, this Court finds that the subject exclusion does not make clear what is excluded and, for that reason, is ambiguous. Therefore, the exclusion must be construed in favor of coverage.
Further, it is well-settled that technical, medical terms must be interpreted in their plain, ordinary, and popular sense. As such, the policy in question must be interpreted to afford coverage because the plain, ordinary, and popular sense to the term "malignant neoplasms of breast" only encompasses cancer which occurs in the breast, not cancer which is located in the spine. Consequently, the exclusion is ambiguous as its terms, when taken in their plain, ordinary and popular sense, would not alert a policyholder that cancer which originates in the breast and which manifests itself eight years later in the spine would be excluded from coverage.
This Court adopts the reasoning of the Supreme Court in Seguin v. Continental Service Life & Health Ins. Co., 230 La. 533, 89 So. 2d 113 (1956). In that case, the Court articulated that it must be remembered that a contract of insurance is prepared by the insurance company, and that the company contracts, through its agents, with ordinary laymen who do not know the technical meaning of medical words and phrases. No doubt this is one of the reasons why the courts, in construing the meaning of medical words and phrases found in health, accident and sickness policies, have consistently said that such words and phrases should be understood in their plain, ordinary and popular sense rather than in their scientific sense. Id. at 115.
Finally, although the Court finds that exclusion relied upon by the Defendant is ambiguous, the Court is not inclined to grant Plaintiffs' request for penalties and attorney fees. The Court finds that the Defendant had just and reasonable grounds, such as would put a reasonable and prudent businessman on his guard, to deny payment and/or reimbursement of the submitted claims. Dr. James Gengelbach reviewed the relevant policy and medical records of Mrs. Talley and it was his professional medical opinion that Mrs. Talley's condition and treatment fit within the exclusion. The Court concludes that, based upon Dr. Gengelbach's medical opinion, the Defendant had a good-faith basis for denying payment and/or reimbursement on Mrs. Talley's claims; and while, perhaps this was a "close call," the Defendant was not arbitrary and capricious.
Our review of the record supports the trial court's decision. The trial judge correctly focused not on the scientific meaning of the exclusion rider, but rather, on the common and ordinary meaning of the language used in the exclusion. Accordingly, it is not determinative that an analysis of Mrs. Talley's spinal tumor shows that it was very similar to, and probably was a metastasis of, her original breast cancer. What is relevant is simply what the exclusionary language means in its ordinary and popular sense.
On the question of penalties and attorney's fees, we agree with the trial judge's conclusion that Blue Cross was not arbitrary and capricious in denying benefits to Mrs. Talley. Blue Cross initially paid benefits, and continued to do so while *1197 it investigated the claim. Only after the top ranking medical director had researched the claim were benefits terminated and reimbursement sought. Denial of the claim was founded on competent medical evidence, albeit insufficient legal analysis. Consequently, while we have found that the prevailing legal standards mandate coverage, we do not find penalties and attorney's fees to be warranted in this case.
For the above and foregoing reasons, the judgment of the trial court is affirmed. Costs of this appeal are assessed to Blue Cross/Blue Shield of Louisiana.
AFFIRMED. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1806754/ | 132 So. 2d 885 (1961)
241 La. 1029
ORLEANS PARISH SCHOOL BOARD
v.
Mrs. Adrian CAMPBELL, Widow of James J. MANSON et al.
Nos. 45537, 45539.
Supreme Court of Louisiana.
June 29, 1961.
Rehearing Denied October 4, 1961.
*886 Phelps, Dunbar, Marks, Claverie & Sims, Charles M. Lanier, New Orleans, for defendants-appellees-relators for Campbell and others.
Samuel I. Rosenberg, New Orleans, for respondent, Orleans Parish School Board.
McCALEB, Justice.
This suit was brought under the Uniform Declaratory Judgments Act, R.S. 13:-4231-46, to determine whether plaintiff, Orleans Parish School Board, has a merchantable title to two certain lots of land it: acquired from defendants' ancestor for public school purposes. The defendants, who are the surviving widow and heirs of the donor of the lots, James J. Manson, deny the validity of plaintiff's title and reconvene for a judgment declaring the rescission of the donation by reason of plaintiff's failure to fulfill the condition imposed thereon by the donor.
The facts of the case, which were stipulated by the parties, are as follows:
In 1912 the United States, being desirous of enlarging its immigration station situated in the Fifth Municipal District of New Orleans (commonly called Algiers), purchased, through one Lawton, certain lots owned by the City of New Orleans in Square 1 of the Tunisburg Subdivision by conventional conveyance for the sum of $2050 plus the cost of moving school buildings thereon to a new site. The City had maintained the Lawton White School on this property and sought to remove the school to other land within the subdivision provided it could acquire another site with the sum it obtained from the lots sold to the United States. Pursuant to this purpose, the City bought two lots from one *887 Streuby's widow for $500 and four lots from James J. Manson for $1,550, all within Square 5 of the subdivision. Manson, who owned considerable property in the subdivision and was interested in developing it, donated in his conveyance of the four lots to the City, two additional adjacent lots, Nos. 13 and 14, the subject of this litigation. This portion of the notarial act recites [126 So. 2d 88]:
"And the said James J. Manson did further declare that, in consideration of the purchase by the City of New Orleans of the above described property for the price and sum mentioned therein, he does, by these presents, cede, donate, abandon, set over and deliver, without any cost whatsoever to the City of New Orleans, to be used for public school purposes, the following * * * property, to-wit * * *."
Upon its acquisition of the property in 1912, the City established a colored school on the Streuby property and moved the Lawton White school on the six lots acquired from Manson. This school was operated until 1926, when it was closed by the School Board and remained vacant until 1939, at which time the building was rented for $10 per month and the proceeds applied to the general operating expenses of the Board. It was rented for this nominal monthly sum until 1953, when the building was condemned and demolished. Since that time, the lots have remained vacant and the School Board has advertised them for sale.
James J. Manson died in 1952 and the defendants were placed in possession of his succession shortly thereafter. Upon learning, defendants made formal demand upon the City and the School Board (which had acquired title to the property in 1955 from the City in conformity with the provisions of Section 12 of Article 4 of the Constitution, as amended) for a revendication of the two lots because of failure to comply with the condition of the donation that the property be used for public school purposes.
The School Board then filed this suit to have its title declared merchantable and not subject to divestiture. In answer, defendants resisted the demand and reconvened for a declaration upholding their claim for revendication.
After a trial in the district court, defendants' reconventional demand for rescission of the donation was sustained and it was declared that the lots should be returned to them. Plaintiff appealed to the Court of Appeal, Fourth Circuit, where on first hearing the proceeding was dismissed, the Court resolving, ex proprio motu, that the case was not properly one for declaratory relief because the parties were afforded an adequate remedy by ordinary proceedings under our law. On rehearing, the original judgment was reversed on the ground that, since the plaintiff was seeking to judicially determine its right to sell the property and use the proceeds, a proper case for declaratory relief was presented notwithstanding that other remedies were available.[1]
On the merits of the case the Court of Appeal deduced that Manson's donation of *888 the lots to the City was onerous in that the land was subjected to the charge that the donee use it for public school purposes. However, although it resolved that the School Board was without right to sell or rent the lots, the Court was of the opinion that the Board's failure to continue the use of the property as a school did not work a forfeiture of the donation and that it was still vested with authority to physically utilize it as a playground, athletic field, library, or for any other school purpose. It therefore reversed the ruling of the district court and entered a limited judgment declaring merely that the School Board could not sell the lots even though it would use the proceeds of the sale generally for school purposes. See Orleans Parish School Board v. Manson, La.App., 126 So. 2d 82. Upon the finality of this decree both parties applied for certiorari. The applications were granted and the case has been argued and submitted for our decision.
The School Board contends initially that the Court of Appeal erred in holding that Manson's transfer of the two lots was an onerous donation. Its counsel professes that the conveyance was either a sale or a remunerative donation because it is recited in the notarial act that the two lots are donated "* * * in consideration of the purchase by the City of New Orleans of the above described property * * *" i. e., Lots Nos. 7, 8, 9, 10, 11 and 12, for the price of $1550.
There is no merit in this contention. Nothing was given by the City for the lots in question nor was any service performed by it from which it could be deduced that the donation was remunerative. On the contrary, the language of the conveyance is explicit and discloses a donation by Manson of the two lots with a charge upon the donee that they are to be used for public school purposes. Under our law (see Article 1523 of the Civil Code), this is an onerous donation which is subject to revocation or dissolution on account of the non-performance of the conditions imposed by the donor. See Article 1559 of the Civil Code.
Counsel further asserts that, if the donation be regarded as onerous, the School Board may nevertheless sell the property without violating the condition of the donation because the proceeds of the sale will be used for school purposes.
The Court of Appeal properly rejected this contention. The notarial act declares that the lots are to be used for public school purposes. If the lots are sold by the School Board they are no longer available to it for the use specified. The application of the proceeds of a sale to general school purposes would not constitute a compliance with the condition placed on the donee.
Thus, it clearly appears that the School Board has no valid grounds for the declaration it seeks, i. e., that its title to the lots is merchantable and not encumbered by the charge placed thereon by the donor. There remains, then, only for determination the question of defendants' right under their reconventional demand to have the donation rescinded because of the School Board's failure to comply with the condition of the donation.
The Court of Appeal, although it did not mention defendants' reconventional demand in its judgment, effectively denied it when it reversed the judgment of the district court and declared only that the School Board was not legally entitled to sell the lots to third persons. In the body of its opinion the Court said "All we are called upon to decide here is whether the School Board can part with title and *889 use the proceeds generally for the public schools". We think it is evident from this statement that the Court did not feel that defendants' right to have a rescission of the donation was properly before it.
Defendants assert that the Court of Appeal's disposition of their claim was erroneous in view of R.S. 13:4238 which authorizes a court to grant "Further relief based on a declaratory judgment or decree * * * whenever necessary or proper."
This contention is well taken. Defendants' claim for revocation of the donation was properly pleaded in reconvention as it was responsive to issues presented by the petition of the School Board to have its title to the property declared merchantable "and not subject to divestiture by defendants."
Since the School Board has long ago discontinued the use of the property for school purposes, the school building having been condemned and demolished in 1953, it would appear that the district judge was correct in holding that the defendants were entitled to have the donation revoked for noncompliance with the condition imposed by the donor.
However, the School Board contests defendants' claim for a declaration of the right of revendication. It contends that the donation is to be regarded as a dedication by Manson of the property to the public use, having been accepted as such by the Mayor of the City in accordance with the city ordinance attached to the act of transfer and that, therefore, it is not subject to revocation because the act does not contain an express stipulation of the right of reversion.[2]
In support of this proposition, counsel for the Board relies on Jaenke v. Taylor, 160 La. 109, 106 So. 711 and Wilkie v. Walmsley, 173 La. 141, 136 So. 296 and also cite the concurring opinion of Chief Justice O'Niell in Board of Trustees of Ruston Circuit, etc. v. Rudy, 192 La. 200, 187 So. 549.
Jaenke v. Taylor and Wilkie v. Walmsley were suits involving dedications of property for street purposes and the question was whether the land would revert to the original owners upon the discontinuance of the public use. It was held, in line with other authorities pertaining to dedications, that the property does not revert to the original owner in the absence of an express reservation contained in the act of dedication to that effect.
Those two cases were cited by the Court in Board of Trustees of Ruston Circuit, etc. v. Rudy, supra, as authority for its holding therein that a donation of land for religious purposes was not subject to revocation upon the cessation of the designated use, in the absence of an express stipulation by the donor that the property would revert in such event. Chief Justice O'Niell concurred in the result reached in the case on the ground that the donor did not impose any condition on which the title was to remain in the donee. However, he disagreed with the majority pronouncement that an act of donation must contain an express stipulation in order for the donor to sue for its revocation for non-fulfillment of the conditions, stating that the Articles of the Civil Code applicable to donations inter vivos (Articles 1523 and 1559) did not require such a stipulation as a prerequisite for the exercise of the right of rescission *890 and that the cases cited as authority for the majority view (Wilkie and Jaenke) involved dedications of land for public use and not onerous donations.
The controlling authority on this subject is Board of Trustees of Columbia Road Methodist Episcopal Church v. Richardson, 216 La. 633, 44 So. 2d 321, 325. In that matter, which involved the revocation of a donation of land for church purposes by reason of the donee's discontinuance of the use for which the land was donated, we reconsidered our ruling in the Rudy case and refused to follow it, stating:
"This holding is not only at variance with our civil law, as hereinabove demonstrated, but it is also not supported by the authorities relied on by the author of the opinion * * *."
Counsel for the School Board argues that the effect of the Richardson case is to dispense with the requirement of a reverter stipulation only where property is transferred to a person or private corporation and that, where land is donated to a public body for a public purpose, it is a dedication to public use and the rule of the Wilkie and Jaenke cases still obtains.
This position is not tenable. Although similar in their practical operation, dedications for public use and donations to public subdivisions or corporations conditioned upon a particular public use are not governed by the same legal rules. A dedication may be implied as well as express,[3] and the dedicated property becomes vested in the public. Livaudais v. Municipality Number Two, 16 La. 509. Hence, it is considered to be irrevocable in the absence of an express reservation on the part of the former owner of the right of reversion.
The donation inter vivos, on the other hand, transfers the title to the donee, even though the donation is conditioned on a particular public use and it must conform to the provisions of the Civil Code on the subject in order to be effective. When the donor has imposed charges upon the donee there is no necessity for an express stipulation of a reverter clause as the Civil Code (Article 1559) vests in the donor the right to claim a revocation for failure of the donee to comply with the conditions of the gift. This is the rationale of our decision in the Richardson case and Chief Justice O'Niell's concurring opinion in the Rudy case, where he concluded that, under the Articles of the Civil Code, "* * * the resolutory condition is implied if a donation is made subject to a condition imposed upon the donee". [192 La. 200, 187 So. 551.]
The circumstance that the donation is in favor of a political corporation and is conditioned upon a particular public use does not affect the right of rescission given the donor under the Civil Code.
The judgment of the Court of Appeal is annulled and set aside and it is now ordered that the judgment of the district court be reinstated and affirmed.
HAMLIN, Justice (dissenting).
I am compelled to dissent from the majority opinion.
Primarily, it is my view that in this matter there are exceptional circumstances not similar to any involved in the authorities cited in the majority opinion. The instant case involves a sale, coupled with a purported donation.
I am of the opinion that the sale and transfer of Lots Nos. 7, 8, 9, 10, 11 and 12, and the purported donation and transfer of Lots Nos. 13 and 14, on January 9, 1912, are so enmeshed that the entire act is one of sale. If we omit the word "donate" (which I believe is superfluous and was intended *891 as such, as will be hereafter shown), we have:
"And the said James J. Manson did further declare that, in consideration of the purchase by the City of New Orleans of the above described property for the price and sum mentioned therein, he does by these presents cede, * * * [donate], abandon, set over and deliver, without any cost whatever to the City of New Orleans, to be used for public school purposes, the following described property, to-wit:" (Emphasis mine.)
Here follows a description of Lots Nos. 13 and 14.
If I may be pardoned the use of a homely expression, Lots Nos. 13 and 14 were "lagniappe."
I am of the further opinion that the words "to be used for public school purposes" were not intended to be a condition, and were not in fact a condition imposed upon the purchaser by James J. Manson, the vendor, as contemplated by Article 1559 of the Revised Civil Code.
The so-called or purported donation was not made on the condition that the property shall be used for public school purposes. There are no words in the portion of the sale quoted, supra, from which it could be deduced that James J. Manson intended the expression or phrase "to be used for public school purposes" to be a condition imposed on the purported donee.
The history of this case, as evidenced by the following facts, confirms this conclusion:
The school was closed in June, 1926. James J. Manson died in May, 1952about 26 years after the school was closedand made no complaint during his life-time.
Mr. Manson did not act after the school was closed, because he knew that it was his intention in January, 1912, to divest himself entirely of the lots in question; he desired the school so that it would aid him in developing his tract of land. He had been developing his tract from the date of the sale in January, 1912fourteen years before the school was closed in June, 1926and was completely indifferent when the school was closed, being entirely satisfied. After his death, and when the property had gone up in value, this stale claim to the property was made by his widow and heirs, the defendants herein.
I believe that the following holding of this Court, in the case of Lafitte, Dufilho & Co. v. Godchaux, 35 La.Ann. 1161, is applicable to the instant matter:
"The genius of our law does not favor the claims of those who have long slept on their rights, and who, after years of inertia, conveying an assurance of acquiescence in a given state of things, suddenly wake up at the welcome vision of an unexpected advantage and invoke the aid of the courts for relief, under the effect of a newly discovered technical error in some ancient transaction or settlement.[1]
"In the case of Bennett vs. Mechanics' and Traders' Bank, 34 Ann. 150, we had occasion to discuss this principle and to take an extended review of our jurisprudence on this question, and we therein enforced this rule as a bar to recovery on a similarly stale demand. Among the numerous authorities which we had occasion to examine, we find two decisions of our Court which are quite in point in this case. Dupre vs. Splane, 16 La. 51; Starr vs. Zacharie, 18 La. 517.
"We are very clear and positive in our belief, that if the stock in question had not greatly increased in value, since the date of the transactions which plaintiffs now seek to disturb and annul, *892 this suit would never have found its way to the temple of justice, and that a demand, based on the subsequent depreciation of the same, would have been strenuously resisted by plaintiffs.
"The impression made on our minds by the evidence, as well as all the equities in this case, compels us to differ with our learned brother of the District Court."
Being of the opinion that the Orleans Parish School Board has a merchantable title to the two lots involved herein, I respectfully dissent.
NOTES
[1] In view of our decisions in Burton v. Lester, 227 La. 347, 79 So. 2d 333 and Orleans Parish School Board v. City of New Orleans, 238 La. 748, 116 So. 2d 509, it is manifest that the holding of the Court of Appeal on rehearing was incorrect. Since plaintiff had an adequate remedy by employment of the jactitory action (see Board of Trustees of Ruston Circuit, etc. v. Rudy, 192 La. 200, 187 So. 549 and Board of Trustees of Columbia Road Methodist Episcopal Church v. Richardson, 216 La. 633, 44 So. 2d 321), the proceeding for declaratory relief should not have been entertained. Nevertheless, we feel obliged at this time to take jurisdiction of the case because of the enactment of the Louisiana Code of Civil Procedure which went into effect on January 1, 1961 and which, being remedial legislation, is to be applied retrospectively. Article 1871 of that Code enlarges the scope of declaratory judgments and specially provides that "No action or proceeding shall be open to objection on the ground that a declaratory judgment or decree is prayed for; and the existence of another adequate remedy does not preclude a judgment for declaratory relief in cases where it is appropriate." We are told by the editors in their comments on the text that "The specific purpose of the additional language in this Article is to work a legislative overruling of Burton vs. Lester, supra."
[2] Moreover, counsel for the Board contends in his argument and brief that defendants' right to rescind the donation is barred by prescription of either five or ten years (provided by Articles 2221, 3542 and 3544 of the Civil Code) from the date the donee ceased to fulfill its obligation to use the property for school purposes.
This point cannot be considered as prescription has never been specially pleaded by the School Board as a defense. See Articles 3464, 3465 of the Civil Code and Article 927, Louisiana Code of Civil Procedure.
[3] See Arkansas-Louisiana Gas Co. v. Parker Oil Co., 190 La. 957, 183 So. 229 for a discussion of the requirements and effects of dedications to public use.
[1] The foregoing philosophy of this Court has been approved in Sun Oil Co. v. Roger, 1960, 239 La. 379, at page 386, 118 So. 2d 446, at page 449, and Fried v. Bradley, 1950, 219 La. 59, at page 81, 52 So. 2d 247, at page 255. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/2454548/ | 191 F. Supp. 2d 637 (2002)
Dennis Arthur TALBOT, Jr.
v.
U.S. FOODSERVICE, INC., et al.
No. Civ. JFM-01-2643.
United States District Court, D. Maryland.
March 26, 2002.
*638 Hannibal G. Williams Kemerer, II, Hermina Law Group, Laurel, MD, for Plaintiff.
Steven David Frenkil, Justin C. Eller, Miles and Stockbridge PC, Baltimore, MD, James R. Rosenberg, Paul Douglas Starr, Abato Rubenstein and Abato PA, Baltimore, MD, for Defendants.
MEMORANDUM
MOTZ, District Judge.
Plaintiff Dennis Arthur Talbot, Jr., a former employee for Defendant U.S. Foodservice ("Foodservice"), has brought an action for employment discrimination under Title VII of the Civil Rights Act of 1964, 42 U.S.C. § 2000e et seq.; 42 U.S.C. § 1981; and the Americans with Disabilities Act ("ADA," or "the Act"), 42 U.S.C. § 12101 et seq. Defendant has moved to dismiss the ADA claim under Fed.R.Civ.P. 12(b)(6), contending that Plaintiff failed to exhaust administrative remedies before filing suit. For the reasons stated below, the motion will be treated as a motion for summary judgment under Fed.R.Civ.P. 56 and granted.
I.
Talbot was employed by Foodservice as a warehouse worker from June 1989 until October 2000. He admitted to unintentionally *639 falling asleep at work one day during a break, when he was not feeling well. Shortly after that incident, on September 28, 2000, he was suspended for failing to return to work after his break. On October 4, 2000, he was fired, allegedly for charging the company for time not worked.[1]
Talbot claims the real reasons he was suspended and then fired are because he is African American and suffers from an illness called polycystic kidney disease. He contends that white employees committed similar violations but were not fired. He also alleges that his union, Teamsters Local 570, refused to pursue his grievance because of his race and disability. Talbot filed a charge of discrimination with the Equal Employment Opportunity Commission ("EEOC") and the Maryland Human Relations Commission on October 10, 2000.[2]
II.
The Federal Rules of Civil Procedure require that, when a court considers matters outside the pleadings, a motion to dismiss "shall be treated as one for summary judgment and disposed of as provided in Rule 56...." Fed.R.Civ.P. 12(b). In order to decide this motion, which deals exclusively with administrative exhaustion of Plaintiff's s ADA claim, I must consider two items of evidence extrinsic to the pleadings: Plaintiff's EEOC charge, which was submitted by the Defendant, and an EEOC discharge form that Plaintiff completed on April 19, 2001, which was submitted by the Plaintiff as part of his Opposition. (See Def.'s Mem.Attach. 2, Pl.'s Opp'n Attach. 2.) Thus, I will treat this as a motion for summary judgment.[3]
III.
It is well settled that a plaintiff may not assert an ADA discrimination claim in court until he has exhausted the administrative remedies as to that claim. See 42 U.S.C. § 12117(a); see also Ansley v. Varsity Transit, Inc., 1999 WL 672526, at *3 (S.D.N.Y.1999) (explaining that the ADA incorporates by reference the procedures that apply under Title VII, including administrative exhaustion of remedies). In determining what claims have been administratively exhausted, the litigant is not limited to the "precise wording" of his formal EEOC charge of discrimination, but may litigate "all claims of discrimination uncovered in a reasonable EEOC investigation of that charge." Hubbard v. Rubbermaid, Inc., 436 F. Supp. 1184, 1189 (D.Md.1977); see also Chisholm v. United *640 States Postal Serv., 665 F.2d 482, 491 (4th Cir.1981) (explaining that "the scope of the civil action is confined only by the scope of the administrative investigation that can reasonably be expected to follow the charge of discrimination"); King v. Seaboard Coast Line R.R. Co., 538 F.2d 581, 583 (4th Cir.1976) ("The suit filed may encompass only the `discrimination stated in the charge itself or developed in the course of a reasonable investigation of that charge.'") (quoting Equal Employment Opportunity Comm'n v. General Electric, 532 F.2d 359, 365 (4th Cir.1976)).
Plaintiff failed to check the box next to "disability" in the "cause of discrimination" section of his EEOC charge. Instead, he checked only the box next to "race." Further, he did not mention anywhere in the charge, including in the factual narrative, that he was disabled. Rather, his charge alleged only race discrimination and cited a cause of action under Title VII, not the ADA.[4] Where a litigant has neither checked the box for disability discrimination, nor mentioned disability discrimination or the ADA anywhere in his charge of discrimination, the EEOC cannot reasonably have been expected to have investigated disability discrimination. Cf., e.g., Sloop v. Memorial Mission Hosp., Inc., 198 F.3d 147, 149 (4th Cir.1999) (finding no exhaustion of retaliation claim where plaintiff checked only the box for age discrimination and did not mention retaliation except in post-charge letter to EEOC); Lyon v. Bell Atlantic Corp., 2001 WL 826580, at *5 (D.Md.2001) (finding no administrative exhaustion where plaintiff had not checked the box for retaliation and did not mention retaliation in the charge narrative). Thus, Plaintiff has not exhausted administrative remedies as to a claim of disability discrimination.
Other courts have reached the same result in analogous circumstances. Courts have refused to find administrative exhaustion of disability claims where only race discrimination was alleged in an administrative charge, noting that an investigation of race discrimination could not reasonably be expected to encompass a "totally different kind[ ] of allegedly improper conduct. ..." Rodriguez v. Airborne Express, 265 F.3d 890, 897 (9th Cir.2001); see also Ansley, 1999 WL 672526, at *3 (declining to allow an ADA claim to be raised in court that had not first been raised in an administrative charge). In particular, exhaustion of a disability claim is not found when, as here, the claimant did not check the disability box or even mention in the EEOC charge that he was disabled or suffered from health problems. See Penns v. Gannett Rochester Newspapers, 966 F. Supp. 174, 175 (W.D.N.Y.1997); Rodriguez v. Gary Plastic Packaging Corp., 1997 WL 16665, at *4 (S.D.N.Y.1997); Spurlock v. NYNEX, 949 F. Supp. 1022, 1030 (W.D.N.Y.1996).
Plaintiff asserts that a reasonable EEOC investigation would have included his allegation of disability discrimination because he mentioned his disability on an EEOC form entitled "Discharge, Job Elimination, or Layoff" that he completed on April 19, 2001, six months after his *641 charge of discrimination. (Pl.'s Opp'n Attach. 2 at 1-2.) On the form, Talbot was asked to provide the employer's stated reason for firing him, give his own explanation for his performance or conduct, and discuss why he thought the firing was unfair. (See id. at 2.) He stated that he was told he was fired for "[f]raudulent charging of time, i.e., charging the Co. for time not worked." (Id.) He wrote that he told his employer "that I have polycystic kidney disease and that at times my right side has pain unexpectedly. I wasn't feeling well so on my last break I sat down on a pallet and accidentally dosed [sic] off." (Id.) He explained that he thought his firing was discriminatory because "[t]heir [sic] were incidents where white employees committed the same offense and were not discharged." (Id.) Plaintiff checked boxes on the form for "race" and "color"but not "disability"as reasons for his discharge, and provided the names of two white employees who had committed similar infractions but had not been fired and a black employee who, like him, had been fired. (Id. at 4, 8.)
Even assuming such documentation is appropriately relied upon by a court in considering administrative exhaustion,[5] Plaintiff cited his illness on the EEOC discharge form not as a reason he was fired, but as an explanation for why he fell asleep at work. Thus, Plaintiff mentioned his illness only in the context of his own motive (or lack thereof) to violate work rules, not in the context of the discriminatory motive of his employer. Nowhere on the discharge form did he assert that he could not work because of his disability or that he was fired because of his disability.[6] Instead, he explicitly reiterated what he had stated earlier on his EEOC charge: that he believed his firing was due to his race. Therefore, a reasonable EEOC investigation into Plaintiff's allegations would not have included disability discrimination.
Plaintiff argues in the alternative that failure to exhaust administrative remedies should be excused in this case because Defendant "has demonstrated no desire or inclination for conciliation of discrimination claims." (Pl.'s Opp'n at 4.) Plaintiff cites Lilly v. Harris-Teeter Supermarket, 720 F.2d 326 (4th Cir.1983), as authority for a futility exception to the administrative exhaustion requirement. However, Lilly held only that intervenors may be excused from exhausting EEOC remedies as to claims similar to those that the plaintiff had exhausted. Id. at 335. It did not hold that a single plaintiff may be excused from the exhaustion requirement just because he suspected any attempts at conciliation would be fruitless. See, e.g., Murphy v. West, 945 F. Supp. 874, 876 (D.Md.1996) (finding no support for a futility exception to the exhaustion requirement). Therefore, Plaintiff was required to exhaust the administrative remedies as to his ADA claim. Because he did *642 not do so, Defendant's motion will be granted.
ORDER
For the reasons stated in the accompanying Opinion, it is, this ____ day of March 2002
ORDERED that Defendant's motion for summary judgment against Plaintiff as to Plaintiff's claim for relief under the Americans with Disabilities Act is granted.
NOTES
[1] It is not clear from the Amended Complaint whether the suspension and discharge related to the same incident. Foodservice states that Talbot's description of his suspension mischaracterizes the facts or is inaccurate or incomplete. (Answer ¶ 8.) It admits that Talbot's "theft of time from the company" was part of the reason he was fired. (Answer ¶ 9.)
[2] The charge is actually dated and date-stamped October 20, 2000. However, Plaintiff states in his Amended Complaint that it was filed on October 10, 2000. (Am. Compl.¶ 14.) The difference in dates is not material to this motion.
[3] Plaintiff had actual notice that the motion might be converted. Both parties submitted evidence extrinsic to the pleadings. Therefore, "by operation of the Federal Rules of Civil Procedure, [plaintiff] also should have been on notice that the ... motion could be considered by the court to be a summary judgment motion." See Laughlin v. Metro. Washington Airports Auth., 149 F.3d 253, 260-61 (4th Cir.1998). Plaintiff asserts that he will be prejudiced by treating this as a motion for summary judgment, since he has not yet received written discovery nor deposed one of Defendant's officials. However, any discovery taken by Plaintiff could not alter the facts on the present record establishing that Plaintiff failed to exhaust the administrative remedies at the EEOC.
[4] Talbot's EEOC charge consists of the following narrative:
I. I began my employment with the above named company in June 1989 as a warehouse worker. On or about September 28, 2000, I was suspended then discharged on October 6, 2000. Similarly situated Caucasian employees were treated more favorably.
II. No explanation was given for the difference in treatment.
III. I believe that I was discriminated against with respect to suspension and discharge because of my race (African-American) in violation of Title VII of the Civil Rights Act of 1964, as amended.
(Def.'s Mem.Attach. 2.)
[5] In Lane v. Wal-Mart Stores East, Inc., 69 F. Supp. 2d 749 (D.Md.1999), Judge Blake considered a similar EEOC questionnaire (in that case, an ADA Information Form) in "assessing the contours of a reasonable [EEOC] investigation." Id. at 756. She held that the plaintiff could assert a theory of actual disability in her lawsuit based on her statements on the form, even though her charge of discrimination stated only that she had been regarded as disabled. See id. However, Lane involved only different theories of disability discrimination. It does not necessarily stand for the proposition that a plaintiff may rely upon such a form as a basis for proving exhaustion of a wholly different form of discrimination than that alleged in his EEOC charge.
[6] In fact, Plaintiff indicated in his deposition that he was physically able to work and that, while employed by Foodservice, he had not asked for an accommodation or any special treatment. (Talbot Dep. at 15, 21.) | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1132016/ | 448 So. 2d 570 (1984)
CENTURY PROPERTIES, INC., d/b/a Westlake Homes, and Richard A. Simons, Appellants/Cross-Appellees,
v.
Sam MACHTINGER and Patricia Machtinger, Appellees/Cross-Appellants.
No. 83-1130.
District Court of Appeal of Florida, Second District.
April 6, 1984.
*571 Hugh E. Reams of Goldner, Reams, Marger, Davis, Piper & Kiernan, P.A., St. Petersburg, for appellants/cross-appellees.
Dennis M. Janssen of C. Wade Yeakle, III, P.A., St. Petersburg, for appellees/cross-appellants.
CAMPBELL, Judge.
Appellants, Century Properties, Inc. and Richard A. Simons, seek review of a final judgment entered against them in the amount of $10,500 for actual damages, and the award of punitive damages of $3,500 against appellant, Century Properties, Inc., due to a construction contract dispute involving charges for change orders which deviated from the original contract. A cross-appeal was filed in this case. We affirm the award of compensatory damages as well as the point raised on cross-appeal. We reverse the award of punitive damages.
The jury awarded punitive damages to appellees, Sam Machtinger and Patricia Machtinger, based on their claim of fraud in the inducement to contract based on the charges for change orders. Appellants contend that the punitive damages issue was improperly sent to the jury because there was insufficient evidence to support a *572 finding of fraud in the inducement. They also claim that parol evidence was improperly admitted regarding the amount to be billed for change orders.
Appellants and appellees entered into a contract for construction of appellees' residence. Paragraph nine of the contract provided:
Should the Buyer at any time during the course of construction require any alteration of or deviation from the final plans and specifications, he shall have the right and power to make such changes when practicable. Such changes shall be added to or deducted from the amount of the purchase price as stated above. Seller shall have the right any time after issuance of the building permit for construction of the residence to additionally impose a $50 service charge for each meeting necessary to effect changes or addendum to the final plans or specifications. Furthermore, any such change orders made after construction is commenced shall also enlarge the estimated time for completion of construction as may be determined by the Seller.
As is apparent, that paragraph is silent as to any method or manner in which appellants would charge for those change orders. Neither is a method for charging for change orders found elsewhere in the contract.
Paragraph twelve of the contract provides in part:
This contract states the entire agreement between the parties and the Seller is not and shall not be bound by any stipulations, representations, agreements or promises, oral or otherwise, not printed or inserted in this contract.
There were some twenty-one change orders made during the course of the contract. At trial, appellees were allowed to testify that prior to signing the contract, appellants stated that any changes, upgrades or modifications would be done at the cost to appellant Century Properties, Inc. Appellees testified that they chose appellants to build their house because of this promise to make changes at cost.
After the closing, appellees discovered they had been overcharged on some but not all of the change orders and filed suit against appellants, which resulted in this appeal.
We note that appellees signed a contract which made no mention of what they claim was an essential element. Even so, parol evidence is admissible to show fraud or misrepresentation in the inducement to contract. Central Mutual Insurance Co. v. Cropper, 296 So. 2d 69 (Fla. 2d DCA 1974). In Central Insurance, it became clear that material misrepresentations made on an insurance application, or during "negotiations" for a policy, could be presented via parol evidence. However, that type of misrepresentation is of matters that go to the very heart of the basic agreement between the parties.
Here, the alleged misrepresentations concerned billing for change orders. The change orders were deviations from the original contract. We cannot say that misrepresentations as to the method of billing for deviations from the basic contract go to the heart of the agreement between the parties.
Nonetheless, we conclude that parol evidence was admissible to supply a missing element regarding appellants' promises concerning change order billing. Petrus v. Bunnell, 129 So. 2d 702 (Fla. 2d DCA 1961).
Appellants claim, however, that the parol evidence admitted does not constitute actionable fraud so as to support the punitive damages award. Appellants argue that that evidence, construed in the worst light as to them, merely demonstrates breach of contract.
We agree with appellants' contentions that punitive damages cannot be recovered for a mere breach of contract; fraud cannot be predicated solely upon the failure to perform a promise. Associated Heavy Equipment Schools, Inc. v. Masiello, 219 So. 2d 465 (Fla. 3d DCA 1969). However, a promise may be a basis for fraud where there is evidence the promisor *573 had a specific intent not to perform at the time the promise was made. Alexander/Davis Properties, Inc. v. Graham, 397 So. 2d 699 (Fla. 4th DCA 1981).
Here, there was no evidence presented at trial that appellants intended to breach the promise regarding billing at the time the contract was entered. The appellees rely upon the circumstantial evidence of appellants' subsequent overcharges to prove appellants' alleged prior fraudulent intent. Not all of the change orders resulted in overcharges and that, in itself, might indicate a lack of prior fraudulent intent on the part of appellants rather than a preconceived intent to fraudulently induce appellees to enter into the contract. The parol evidence was admissible to supply the missing terms for the purpose of proving compensatory damages. However, the substantive evidence of breach of that promise alone is insufficient for the jury to find a pre-existing intent not to perform and is not adequate to sustain punitive damages based on fraud in the inducement to contract. While not probable, it was at least possible that appellees would have initiated no change orders and, therefore, no charges would have come about, and the fraud, if any, therefore, would never have been operative. The existence of fraud will not be presumed based on doubtful or vague parol evidence. While the proof may be wholly circumstantial, it is always incumbent upon the person asserting fraud to prove it by clear and convincing evidence. Since honesty, not fraud, is presumed where the facts may be fairly and reasonably reconciled with honesty and pure dealing, the existence of fraud will not be presumed. Florida East Coast Railway Company v. Thompson, 93 Fla. 30, 111 So. 525 (Fla. 1927); GARD, Florida Evidence, Second Edition, Rules 3:09, 23:04.
GRIMES, A.C.J., and LEHAN, J., concur. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1132010/ | 448 So. 2d 713 (1984)
STATE of Louisiana
v.
John HOWARD and Carl Hill.
No. 83 KA 0796.
Court of Appeal of Louisiana, First Circuit.
February 28, 1984.
Writ Denied May 4, 1984.
*715 Ossie B. Brown, Dist. Atty., by Richard Chaffin, Asst. Dist. Atty., Baton Rouge, for plaintiff-appellee.
Frank Gremillion, Baton Rouge, for defendants-appellants.
Before LOTTINGER, EDWARDS and ALFORD, JJ.
LOTTINGER, Judge.
Defendants John Howard and Carl Hill were charged by grand jury indictment with three counts of violation of La.R.S. 40:967 A: Count 1, possession with the intent to distribute methaqualone; Count 2, possession with intent to distribute marijuana; Count 3, possession with intent to distribute cocaine. Defendants pled not guilty, were tried jointly by a jury and found guilty as charged on each count.
Defendant Howard was sentenced as follows: on Count 3, to hard labor for a period of ten years without benefit of probation, parole or suspension of sentence, with credit for time served and to pay a fine of $3,000.00 and costs of court or, in default of payment thereof, to be confined in the East Baton Rouge Parish prison for a period of six months; on Count 2, to ten years at hard labor to run concurrently with Counts 1 and 3; and Count 1, to ten years at hard labor to run concurrently with Counts 2 and 3.
Defendant Hill was sentenced as follows: on Count 3, to hard labor for a period of ten years without benefit of probation, parole or suspension of sentence, with credit for time served and to pay a fine of $1,500.00 and costs of court or, in default of payment thereof, to be confined in the East Baton Rouge Parish prison for a period of ninety days; on Count 2 to imprisonment at hard labor for a period of ten years to run concurrently with Counts 1 and 3; and Count 1, to imprisonment at hard labor for ten years to run concurrently with Counts 2 and 3. Defendants now appeal their convictions and sentences, alleging five assignments of error and briefing two.
ASSIGNMENTS OF ERROR
1. The trial court erred when it denied defendants' motion to suppress evidence.
2. The trial court erred when it allowed into evidence the testimony of a witness, Deputy Kuntz, concerning other evidence obtained by the police which was apparently not admissible at trial.
3. The trial court erred when it denied defendants' motion for new trial.
4. The trial court erred when it denied defendants' motion in arrest of judgment.
5. The trial court erred when it imposed an excessive sentence on defendants.
In brief, defendants have argued only Assignments of Error Nos. 1 and 2. Therefore, Assignments of Error Nos. 3, 4, 5 are considered abandoned. Rule 2-12.4, Uniform RulesCourts of Appeal.
FACTS
Defendant John Howard lived with his wife, Linda Howard, and Linda's 15 year old son by a former marriage, Mark Taylor. Defendant Carl Hill, Linda's brother, had just moved from Virginia and was staying *716 with the Howards until he found employment.
For some two months prior to the defendants' arrests, the Howard home had been under partial surveillance by the East Baton Rouge Sheriff's Office. This was a result of information obtained by the sheriff's office that Mark Taylor was dealing drugs at a nearby convenience store and that Linda Howard was deeply involved in narcotics traffic. Ms. Mary Kuntz, a young member of the narcotics division of the sheriff's office, was assigned an undercover role to investigate.
Ms. Kuntz made Mark's acquaintance and on April 9, 1981, visited Mark at the Howards in the early afternoon. Mark and Ms. Kuntz were alone because John Howard was at work and Carl Hill had driven to Florida to pick up Linda. Deputy Kuntz and Mark shared two marijuana cigarettes in Mark's room; they were taken from a plastic bag kept in his dresser drawer which held approximately one ounce of the drug. Mark gave Ms. Kuntz a small sample from the bag and then placed it back in his dresser drawer.
Mark told her however, that his mother, Linda, was due back from Florida with more drugs, including cocaine and quaaludes (Methaqualone).
At about 4:00 p.m. that afternoon, Deputy Kuntz reported the above to her narcotics division captain, who, with Kuntz, swore out an affidavit for the issuance of a search warrant.[1] A search warrant was issued authorizing a search of the Howard residence for "a quantity of controlled dangerous substance to wit: Marijuana."
A raiding party of seven or eight sheriff's deputies, including deputy Kuntz, watched the Howard residence from concealed locations. Around 10:30 p.m. Linda Howard's Oldsmobile drove up to the house. The officers saw some suitcases being unloaded; they waited 20 minutes and then decided to enter (except for Ms. Kuntz who stayed behind in a van). Police knocked and declared their identity. Receiving no reply, the officers then began to kick and beat the door with a maul. Shots were fired from the house. John Howard finally let the deputies inside. They immediately handcuffed him and Mark; Hill and Ms. Howard were subdued a little later. Later testimony revealed that the Howards thought they were being burglarized as they had been before. Ms. Howard was found by the deputies to be on the phone to the police reporting a break-in.
The deputies then proceeded to search the house for drugs. In the master bedroom one suitcase was found on the floor and another in a closet. Both were locked and both were forcibly pried open by the deputies. Approximately one pound of cocaine and 30,000 quaaludes were found inside. A brown paper-wrapped package was found in a closet in the same room; a deputy slit it open and found a bale of marijuana.
Sometime after the bulk of the drugs was found, deputy Kuntz was called in from the surveillance van. She then went to Mark Taylor's room and retrieved the small bag of marijuana which she had seen that afternoon.
Small samples of marijuana were also seized in different areas of the house and in defendant Howard's car.
Linda Howard, John Howard, and Carl Hill were indicted by the grand jury. Linda Howard withdrew her plea of not guilty, *717 and pled guilty prior to trial and testified for the remaining defendants.
ASSIGNMENT OF ERROR NO. 1
Defendants contend that the trial court erred when it denied their motion to suppress evidence seized during the search of the Howard residence. Defendants' attack is on two fronts: first, that the affiants intentionally omitted facts in the affidavit which would have precluded a finding of probable cause, and second, that the deputies exceeded the scope of the search under the warrant.
If an affiant intentionally omits relevant facts when swearing out an affidavit in an attempt to mislead the court, the warrant is quashed. State v. Lehnen, 403 So. 2d 683 (La.1981). Defendants say that the affiants, Deputy Kuntz and her superior Captain Michael Barnett, intentionally omitted the amount of the marijuana which Deputy Kuntz saw in the Howard home (one ounce) and also did not include the time when the officers planned to execute the warrant (whenever Linda Howard returned with the suspected drugs).
Defendants maintain that the affiants left this information out because they felt that the magistrate would not have issued the warrant because of the Supreme Court's opinions in State v. Lewis, 385 So. 2d 226 (La.1980) and State v. Boneventure, 374 So. 2d 1238 (La.1979). In those cases, probable cause was not present because there was no reasonable belief that the marijuana mentioned in the affidavits would still be in the place to be searched. In both cases a "quantity" of marijuana was mentioned in the affidavit. In Boneventure, the entire "quantity" observed was "offered for consumption" and police waited two days to execute the warrant; in Lewis, the "quantity" of marijuana was seen by an informant as much as ten days before the warrant was executed. Here, the entirety of the marijuana seen by Ms. Kuntz was not offered for consumption; the deputies only waited seven to eight hours after the sighting to execute the warrant. Hence, the inclusion on the affidavit of the amount and their intention to delay the search would only have destroyed probable cause had the execution of the warrant been delayed longer; this delay was not long enough to do so, thus the warrant would be validated if we were to add the omitted facts and retest.
There was no evidence that the affiants omitted these facts intentionally to mislead the magistrate. The bare fact of their failure to include, absent other evidence, information which would have not immediately killed probable cause, evinces a neglect rather than an intentional fraud.
Next, defendants claim that the deputies exceeded the scope of the search authorized by the warrant. They claim that the warrant authorized a search only for the one ounce bag of marijuana seen by Deputy Kuntz; that the officers' used this warrant to gain entry into the Howard home to look for other drugs suspected to have been brought there by Linda Howard; that these other drugs were the true object of the search and since they were beyond the scope of the warrant, the search was general and exploratory in nature.
The Fourth Amendment of the United States Constitution, through the Fourteenth Amendment, and Article I, Section 5 of the Louisiana Constitution both require that no search warrant is to be issued without it particularly describing the place to be searched and the persons or things to be seized. The requirements are meant to keep authorized searches as limited as possible, to prevent "general, exploratory rummaging in a person's belongings." Coolidge v. New Hampshire, 403 U.S. 443, 467, 91 S. Ct. 2022, 2038, 29 L. Ed. 564 (1971).
The warrant here authorized the deputies to search the Howard residence for a "quantity of controlled dangerous substance to wit: Marijuana." The marijuana spoken of in the first paragraph of the affidavit was the one ounce bag seen in Mark's bedroom dresser drawers; thus that bag was the authorized object of the search. The second paragraph of the affidavit *718 contains only allegations that the Howard residence had been a scene of distribution of "Quaaludes, Marijuana, and Cocaine."
The deputies, though they waited several hours to execute the warrant, still had probable cause to believe the ounce of marijuana was inside the house when they commenced the search shortly after Linda's arrival. The warrant authorized the police to search "the premises," which has been held to mean a garage, some outbuildings close to the main house, and even a tree nearby a house. State v. Michel, 422 So. 2d 1115 (La.1982); State v. Hymer, 400 So. 2d 637 (La.1981).
The plain view doctrine says that when in the course of a valid search the police came across some other article of incriminating character, they may seize it. Coolidge v. New Hampshire, supra. For the plain view doctrine to apply, however, the initial intrusion must be valid, the discovery must be inadvertent, and the contraband must be immediately recognizable as such. State v. Hernandez, 410 So. 2d 1381 (La.1982). The initial intrusion here was supported by a warrant authorizing deputies to search the entire house, and not just Mark Taylor's bedroom, where the police had last seen the one ounce bag. The deputies were thus within their power in searching the master bedroom where the closed suitcases and the wrapped bale of marijuana were found. Having found these closed containers the deputies' opening of them was valid because they were empowered to search for the object "on the premises where the thing(s) may be found." (emphasis added)
Though it is undisputed that the officers suspected that the suitcases contained other drugs brought in by Linda, the search into the suitcases was still valid. For while the police's finding must also be "inadvertent" to fit under the plain view doctrine, we do not believe that the finding must be wholly unexpected.[2] Rather, the requirement of "inadvertency" means that police must not have probable cause to believe evidence not listed in the warrant will be found. See United States v. Hare, 589 F.2d 1291 (6th Cir.1979) and its discussion of the "inadvertency" requirement. We do not believe the Louisiana Supreme Court cases of State v. Fearn, 345 So. 2d 468 (La.1977) or State v. Williams, 347 So. 2d 231 (La.1977) preclude our interpretation of the inadvertency requirement. The court did not define "inadvertent" but merely held those searches and seizures to have not been so.
The police here strongly suspected that drugs were being brought in, but mere suspicion is not sufficient to establish probable cause and support a warrant. In the course of an intrusion wholly authorized by the legitimate purpose of looking for the one ounce bag of marijuana, the police's suspicion was confirmed by the actual observation of the cocaine, quaaludes and bale of marijuana contained within the suitcases and wrapped package.
The words of the court in United States v. Hare, supra, bear repeating:
"At first, it may seem illogical to hold that police who lawfully enter premises and discover evidence which is not described in their warrant, in the course of a properly limited search, may not seize it if they knew they would find it before entering, but may seize it if they only thought they might find it, or if they discover it unexpectedly. After all, the line between suspicion and probable cause is seldom very clear. It makes sense, however, if the fact is kept in mind that a warrant is normally required before a search can be conducted or a seizure effectuated, and if it is remembered that the only reason plain view seizures are permitted at all is because the intrusion which the Fourth Amendment seeks to guard against has already *719 lawfully occurred, and the police are faced with a situation in which they observe evidence which they could not have obtained permission to seize, and which now is likely to disappear or be destroyed if they stop and leave to obtain a new warrant. This is the "exigency" which underlies the plain view doctrine, and without this exigency the entire rationale falls. We note that the police cannot create their own exigency by simply failing to obtain a warrant until they are faced with the evidence." United States v. Hare, supra, at 1295.
This assignment therefore lacks merit.
ASSIGNMENT OF ERROR NO. 2
Defendants complain that the testimony elicited during the state's case-in-chief by the state from its witness, Deputy Kuntz, was prejudicial to defendants in that the question called for information concerning an extraneous offense and the only purpose in seeking the evidence was to attempt to prove knowledge and intent on the part of defendants. Further, defendants argue that the state's question was irrelevant and obviously called for hearsay and therefore should have been excluded.
The testimony complained of is as follows:
"Q. Did you ever receive any information concerning John Howard or Carl Hill involved in drugs?
A. Before the case, no.
* * * * * *
Q. Did you continue to develop information after the case?
* * * * * *
A. Yes."
La.R.S. 15:434 provides:
"Hearsay evidence is inadmissible, except as otherwise provided in this code."
Evidence is non-hearsay when offered nonassertively, i.e., to prove that the utterance occurred or that a conversation had taken place and not to prove the truth of the facts recited. See, State v. Naas, 409 So. 2d 535 (La.1981) cert. denied, 457 U.S. 1119, 102 S. Ct. 2933, 73 L. Ed. 2d 1332 (1982). At trial, the testimony complained of, although if expanded could have possible led to a statement which would have been hearsay, was limited by the trial judge when he allowed only a "yes" or "no" answer over defendants' objection. We note that, in brief, defendants do not argue that the question "obviously called for hearsay" and "clearly called for information concerning an extraneous offense." Since a "yes" or "no" answer is neither an out-of-court statement offered to prove the truth of the matter contained in it nor does it recite an extraneous offense attributable to defendants, such testimony was not hearsay nor was it other crimes evidence within the meaning of La.R.S. 15:445 and 446 and State v. Prieur, 277 So. 2d 126 (La.1973); State v. Chaney, 423 So. 2d 1092 (La.1982).
Moreover, although defendants had ample opportunity to elicit further information from the witness, Deputy Kuntz, on the point in question, defense counsel chose not to do so. Defendants' complaint that they were prejudiced by testimony that called for hearsay or evidence of an extraneous offense, is merely speculative as evidence of such hearsay and such extraneous offenses was in fact not presented. Moreover, it was within the trial judge's discretion to determine the relevancy of the testimony offered and that determination will not be overturned absent a showing of abuse of that discretion. La. R.S. 15:441; State v. Chaney supra. As the question addressed the material issue of possession of drugs, it was relevant to the crime charged. La.R.S. 15:435.
We cannot say that the trial judge abused his discretion in any way by allowing into evidence the testimony complained of.
Further, at trial, defense counsel objected to the testimony complained of on the grounds that it was hearsay and irrelevant. Only in their appeal brief do defendants raise the additional grounds that the testimony was immaterial and also *720 constituted evidence of extraneous offenses requiring a Prieur notice. Since it is well settled in Louisiana law that a new basis for an objection may not be raised for the first time on appeal, La.Code Crim.P. art. 841; State v. Burdgess, 434 So. 2d 1062 (La.1983), this Court will not address these additional grounds raised by defendants.
We find no merit in this assignment of error.
For the above and foregoing reasons, we affirm the conviction and sentence of defendants.
AFFIRMED.
NOTES
[1] The basis for probable cause in the affidavit reads:
Affiants inform the Court that on this date, April 9, 1981, Deputy Mary Kuntz while working in an undercover capacity was present at the above location and along with one of the occupants, Mark Taylor, simulated smoking a Marijuana cigarette. Deputy Kuntz also observed other Marijuana present at the residence and was able to secure a sample. Said sample was identified by Deputy Kuntz and Captain Barnett as Marijuana.
Affiants further inform the Court that information has been received over the past six months from other reliable and confidential informants, as well as other police officers who had been inside the above residence, that 6408 Teah Drive, is being used as a place from which Quaaludes, Marijuana and Cocaine are distributed.
[2] It has been held by the federal Fifth Circuit Court of Appeals that the "inadvertent discovery" requirement of Coolidge does not apply to contraband; our Supreme Court has not so held. United States v. Thompson, 700 F.2d 944 (5th Cir.1983); State v. Fearn, 345 So. 2d 468 (La.1977). | 01-03-2023 | 10-30-2013 |
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