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OPINION
ALARID, Judge.
Robison Realty Company (appellant) challenges the trial court’s punitive damage and cost awards. The Campbells’ cross-appeal challenges the cost awards, the computation of interest and the denial of a new trial to the Campbells. We affirm.
This case makes its third visit to this Court in six years. Initially, Robison sought a declaratory judgment to determine his liability, if any, for misrepresentations he made in connection with the sale of the Green Valley Mobile Home Park to Beverly Katz. Robison was the real estate broker for the park’s owners, Opal and Sam Q. Campbell (Campbells). Katz counterclaimed against Robison and cross-claimed against the Campbells for fraud, misrepresentation, and breach of fiduciary duty. Katz sought rescission of the contract as well as consequential and punitive damages.
The Campbells cross-claimed against Katz for collection of rent due on a house owned by the Campbells in Los Alamos. The rental arrangement had been part of the trailer park transaction, so the two cases were consolidated.
The trial court found (per Judge Sanchez) that Robison and the Campbells negligently misrepresented certain, material facts on which Katz relied in deciding to purchase the trailer park. Katz was awarded $87,-585 in damages, from which the court allowed the Campbells various set-offs, thereby reducing Katz’ total award to $26,-789 plus costs. Neither consequential nor punitive damages were permitted.
On the first appeal, we reversed the lower court, allowing rescission of the contract. We also allowed special and punitive damages to be charged against Robison. The Court made other determinations on attorneys' fees and privacy not relevant to this appeal. Robison v. Katz, 94 N.M. 314, 610 P.2d 201 (Ct.App.), cert. denied, 94 N.M. 675, 615 P.2d 992 (1980).
On the second appeal, we reduced a damage award against Robison from $81,711.41 to $219.13 and vacated a $10,000 punitive damage award. We remanded for determination of what punitive damages, if any, were to be assessed and for assessment of costs. Robison v. Campbell, 99 N.M. 579, 661 P.2d 479 (Ct.App.), cert. denied, 99 N.M. 578, 661 P.2d 478 (1983).
On remand, Judge Sanchez entered a judgment on the mandate and again awarded Katz $10,000 in punitive damages, explaining his decision in a letter he sent to all counsel. Costs were apportioned as 30% against Robison and 70% against the Campbells.
Robison on this third appeal argues that the trial court erred in assessing $10,000 punitive damages and 30% of costs against him. Katz answers that because Robison did not specifically challenge in his brief-in-chief any finding of fact of the trial court, Robison failed to preserve the punitive damage issue for appeal. Robison replies that the issue was earlier properly submitted to this Court in his brief-in-chief on cross-appeal in the second appeal.
The Campbells answer Robison’s cost argument by countering that the trial court should have applied joint and several liability, rather than imposing upon them 70% of the cost burden.
The Campbells also cross-appealed, arguing that the trial court improperly computed the interest due Katz and that it erred in failing to grant their request for a new trial. Katz answered that these issues were already considered and decided in the second appeal. See Robison v. Campbell. Robison also opposed the Campbells’ claimed error as to the new trial issue, on grounds that the law of the case precludes such action.
Katz in a recent round of appellate maneuvers moved this Court to strike the letter the district judge sent all counsel which explained his disposition of the is sues. The letter, which appellant attached as an exhibit to his brief-in-chief, was not filed and was, apparently, not a part of the record supplied by the district court clerk. We granted the motion on January 13, 1984.
On January 16, 1984, Katz amended her motion to strike, conceding that the letter had in fact been properly included at the end of the trial transcript, but alleging that “appellant’s brief-in-chief argues improperly that matters within the District Judge’s letter to counsel dated August 19, 1983, are ‘findings of fact’ that are not supported by the District Court’s findings of fact and conclusions of law.” Katz subsequently moved for dismissal of appellant’s appeal on grounds that the brief-in-chief “fails to make a single reference to the transcript of record on appeal, or any other findings of fact or conclusions of law which may be of record in this case,” in violation of NMSA 1978, Civ.App. Rule 9(d) (Cum.Supp.1983).
Robison moved to vacate our earlier striking of the district judge’s letter from consideration in this case, and on January 31, 1984 we ordered “that the motions be held in abeyance pending submission of this cause to a panel for decision on the merits.”
Motions Disposition
Katz’ motion to strike the district judge’s letter from the record is denied because the letter was properly included in the trial transcript, which was made part of the record. The letter is useful to our disposition of issues on this appeal because it shows an exercise of discretion by the trial court. Katz’ amended motion to strike and her motion to dismiss are also denied. Katz’ procedural arguments under NMSA 1978, Civ.P. Rule 52(B)(1)(f) (Repl. Pamp.1980) (findings of facts and conclusions of law) and Civ.App. Rule 9(d) (reference in brief to transcript) are frivolous attempts to favor form over substance. The trial judge duly entered his judgment regarding punitive damages and costs, and he explained his decision in a letter which was made part of the transcript record. That judgment was based on the record already made, see 99 N.M. at 591, 661 P.2d 479, and that record included findings as to Robison’s conduct. The letter does no more than show that the trial court exercised discretion in determining the amount of punitive damages. The fact that discretion was exercised is fully supported by the findings concerning Robison’s conduct. Appellant did not specifically refer to the letter with citations to the transcript, but this fact alone does not defeat his right to appeal.
Punitive Damages
The amount of punitive damages is left to the sound discretion of the trier of fact based on the circumstances of each individual case, but should not be so unrelated to the injury and actual damages proven as to plainly manifest passion and prejudice rather than reason and justice. Christman v. Voyer, 92 N.M. 772, 595 P.2d 410 (Ct.App.1979). The courts have refused, however, to specify a ratio between the amount of actual damages and the award of punitive damages, where the validity of the ratio would be determined by a reasonableness standard. “Such a test, by necessity geared to exact figures, does not seem proper to this Court or feasible for actual use.” Faubion v. Tucker, 58 N.M. 303, 308, 270 P.2d 713, 716 (1954).
The question is whether the $10,000 punitive damages is so unrelated to Robison’s reckless misrepresentation and the $219.13 compensatory damages as to plainly manifest passion and prejudice. Galindo v. Western States Collection Co., 82 N.M. 149, 477 P.2d 325 (Ct.App.1970). In answering the question, this Court considers the circumstances of the case, the nature of the wrong committed and such aggravating circumstances as are shown. Sweitzer v. Sanchez, 80 N.M. 408, 456 P.2d 882 (Ct.App.1969). Galindo recognized that punitive damages may be imposed for conduct committed recklessly or with a wanton disregard for the rights of others. Appellant conceded in his brief that he made a reckless misrepresentation. In the first appeal, this Court described Robison’s conduct as follows:
The trial court found that * * * Robison failed to investigate the information supplied to him by Campbell or to check information he had acquired about the park from other sources. He failed to inform Katz that the septic and water systems in the park were old and inadequate; he represented the repair and maintenance expenses, including sewer and septic costs, as $700 per year, when in fact they had cost the Campbells in excess of $7,700 per year; he falsely asserted that the park was in good operating condition; and, knowing Katz’ needs and experience, he misrepresented the park as a good business investment for her.
Robison v. Katz, 94 N.M. at 318, 610 P.2d 201. These findings, considered in the context of Robison’s fiduciary relationship to Katz, were aggravating circumstances properly considered by the trial court. Furthermore, Robison did not appear to attempt amelioration of his misconduct. Marler v. Allen, 93 N.M. 452, 601 P.2d 85 (Ct.App.1979). Robison emphasizes the actual damage award of $219.13, but disregards the fact that the “injury,” separate from the actual damage, may be considered in awarding punitive damages. Marler. That “injury” includes Katz’s financial problems, see 94 N.M. 319, 610 P.2d 201, resulting from purchase of the mobile home park after relying on misrepresentations by Robison. Unlike Marler, the judge in this case, not the jury, determined the size of the punitive damage award and Judge Sanchez carefully outlined his reasoning for the award in a letter to all counsel.
The August 19, 1983 letter explained the judge’s ruling in the following language:
The Court of Appeals [per Judge Wood] modified Robison’s judgment to $219.13. The Court previously found punitive damages. As per the Mandate, the Court is to reset punitive damages. The Court’s Findings and Conclusions, previously filed, is replete with the establishment of a fiduciary relationship between Robison and Katz, the negligent misrepresentation by Robison to Katz within that fiduciary relationship, a financial interest to Robison as a result of the sale, and financial ruin with reference to the park resulting to Katz. Punitive damages in the State of New Mexico are awarded not to benefit primarily a Plaintiff, but to impose a form of punishment upon the offender. In this case, it is not simply Katz who depends upon Robison for truthful representation, but it is the entire public. Cases in New Mexico have defined a real estate broker’s obligations. It is not simply to bring the parties together for purposes of a sale. The broker selling to profit must reasonably ascertain the status of the property. In this case, it would have required very little effort to do that. Such an effort would have eliminated years of litigation and the financial problems suffered by Katz. The Court must look at the total judgment by Katz against Robison, but the Court must also assure that the punitive damages will imprint on Robison and others in his profession the responsibility to exercise reasonable effort to avoid such misrepresentation. The- Court is going to retain the original punitive damages, i.e. $10,000.
The letter showed an exercise of discretion by the trial court which considered the aggravating circumstances of Robison and the injury to Katz which was separate from her actual damage. The $10,000 award is not unrelated to the circumstances of the ease and is not based on passion and prejudice. Rather, the punitive damage award is based on reason and justice.
Costs, Interest and New Trial
Appellant also challenges the 30% cost judgment entered against him. The matter of assessing costs lies within the discretion of the trial court. Unless an abuse of discretion is shown, we will not interfere with the discretion exercised. Hales v. Van Cleave, 78 N.M. 181, 429 P.2d 379 (Ct.App.1967). No abuse appears in this ease. Even if appellant were eon sidered a “prevailing party,” NMSA 1978, Civ.P.R. 54(d) (Repl.Pamp.1980), which is questionable at best, the trial court can “otherwise direct” which party shall be allowed costs and in what proportion. South v. Lucero, 92 N.M. 798, 595 P.2d 768 (Ct.App.), cert. denied, 92 N.M. 675, 593 P.2d 1078 (1979). There need be no direct relation between percentage of fault and costs. Eichel v. Goode, Inc., 680 P.2d 627 (N.M.App.1984). For the same reason, the Campbells’ response that the trial court should have applied joint and several liability in assessing costs is also without merit.
The Campbells’ cross-appeal, which argues that the trial court improperly computed interest due to Katz and erred in failing to grant a new trial, is also merit-less. In Robison v. Campbell we set forth the trial court’s treatment of interest—interest on specified damage items “to date of judgment.” 99 N.M. at 586, 661 P.2d 479. This “to date of judgment” approach was followed in entering the judgment now being appealed. This judgment, however, also provides that the judgment shall bear interest. The Campbells assert that these provisions allow Katz to receive interest on interest, because the judgment includes interest accrued prior to judgment and the entire judgment bears interest. This is not improper. “Interest accrued to date of judgment may be properly included within the judgment amount.” Southern Union Exploration Co. v. Wynn Exploration Co., 95 N.M. 594, 624 P.2d 536 (Ct.App.1981).
At the hearing discussing the details of the judgment now being appealed, the Campbells orally moved for a new trial.
[W]e are moving the Court * * * [for] a new trial, on the grounds that newly discovered evidence—basically what we’re doing here is preserving our record as far as this particular issue is concerned—newly discovered evidence based on evidence we could not have discovered prior to the first trial; it only arose indirectly in the second trial on the Mandate—has shown that there is evidence that Ms. Katz had something to do with . the default * * *.
* * * So then, we preserved it in the second trial and took it up on appeal * *.
Robison v. Campbell, 99 N.M. at 588, 661 P.2d 479 states:
The motion sought to reopen, on the basis of newly discovered evidence, the question of whether there should be a rescission. The motion was properly denied; Campbell did not show an entitlement to relief under either R.Civ.Proc. 59 or 60(b)(2), N.M.S.A. 1978 (1980 Repl. Pamph.).
The trial court denied the oral motion on the basis that it did “not fall within the purview of the Second Mandate.” The Campbells assert this denial was error because their oral motion was a new motion for a new trial, independent of the prior motion discussed in Robison v. Campbell. We disagree. The oral motion, quoted above, shows the asserted newly discovered evidence was the same evidence on which the prior motion was based and which was properly denied because of an insufficient showing on the part of the Campbells. The oral motion was repetitive and was no more than a renewal of the prior motion. Having previously been decided adverse to the Campbells, it did not come within the mandate in Robison v. Campbell.
For the foregoing reasons, Katz’ motions to strike Judge Sanchez’ letter from the record and to dismiss this appeal are denied. We affirm the $10,000 punitive award. Appellants’ other arguments and appellee’s arguments on cross-appeal are unpersuasive.
Having found no error in Judge Sanchez’ judgment, we affirm. Robison shall bear the cost of this appeal.
IT IS SO ORDERED.
WOOD and MINZNER, JJ., concur. | [
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OPINION
SOSA, Senior Justice.
Plaintiff appeals from a failure of the trial court to award prejudgment interest in a suit for breach of contract. Plaintiff Grynberg sued Roberts and several other defendants for breach of an agreement to pay proportionate shares of the cost to drill and operate certain oil wells. The trial court granted judgment to Grynberg on the principal indebtedness, but failed to award the requested “reasonable interest” on the principal awarded. We reverse on that issue.
The sole question on appeal is whether prejudgment legal interest should attend the amount awarded Grynberg.
The trial court found that since 1975 the defendants had not paid their share of the drilling and operational costs under their agreements. In evidence were agreement forms entered into by the parties, titled “Authorization For Expenditures.” In 1974 each defendant had signed such an agreement for each of the six wells involved in this suit. Each authorization agreement listed for each well the estimated dollar amounts for “intangible drilling costs,” “tangible completion costs,” and “intangible completion costs”. Additionally, the agreements recorded each defendant’s specific percentage of working interest and his separate estimated proportionate total cost for that well.
A claim of lien against the working interest in each well was filed against every defendant by Grynberg in 1977. At that time Grynberg filed a document for each defendant listing the date, invoice number and amount of indebtedness owed by each defendant on each invoice. Included was the amount of “interest to date” on each defendant’s total indebtedness. • These documents covered a time period from 1974 to 1977. A portion of the 1974-1975 cost was paid by certain of the defendants and was not included in the 1977 debt summary.
In his complaint in the instant case, Grynberg requested “reasonable interest” on drilling and operation costs he alleged were owed to him by the defendants. Findings by the trial court showed that Grynberg was required to pay twenty percent interest on the amount he borrowed to cover the defendant’s costs. However, the court found it could not allow Grynberg reimbursement for interest on monies borrowed because Grynberg submitted no evidence whatsoever as to the amounts or dates the sums were borrowed, or the actual interest paid in covering these costs. The court ascertained and awarded Grynberg exact sums of monies owed to him by each defendant individually under each agreement, but awarded no interest.
Grynberg claims he is due the prejudgment interest on the amount awarded him, since he has not had use of that money from the time it was initially due and owing to the present. Grynberg did not seek reimbursement for the actual interest paid on money borrowed. Citing to Shaeffer v. Kelton, 95 N.M. 182, 619 P.2d 1226 (1980), he asserts that the trial court erred in not awarding the statutory interest allowed on money due on a contract under NMSA 1978, Section 56-8-3 (Orig.Pamp. and Cum. Supp.1984). Section 56-8-3, governing the interest rate on a contract provides:
The rate of interest, in the absence of a written contract fixing a different rate, shall be not more than fifteen percent annually in the following cases:
A. on money due by contract;
B. on money received to the use of another and retained without the owner’s consent expressed or implied; and
C. on money due upon the settlement of matured accounts from the day the balance is ascertained.
NMSA 1978, § 56-8-3 (Cum.Supp.1984). Previously, this statute provided an interest rate of six percent. NMSA 1978, § 56-8-3 (Orig.Pamp.).
The facts in Shaeffer are similar to those in the instant case. There the defendant buyer breached a construction contract. In Shaeffer, a case in which two members of this panel participated, we stated that because of the debt owed the plaintiff by the defendant, plaintiff was unable to discharge a construction loan and:
[plaintiff] has also been forced to make costly interest payments. * * * In addition, he has lost the use and earning power of $17,000 of his own funds used to finance the project. Simple interest is allowed as a means of estimating these probable gains and as compensation for their prevention.
95 N.M. at 187, 619 P.2d at 1231. The Shaeffer court continued that under NMSA 1978, Section 56-8-3, the contractor was entitled to recover interest as a matter of right on money due by contract, even when there was no interest rate specified in the contract. Id. at 188, 619 P.2d at 1232.
In Shaeffer we quoted with approval O’Meara v. Commercial Insurance Co., 71 N.M. 145, 376 P.2d 486 (1962). O’Meara adopted the common law rule allowing interest on indebtedness where the amount due can be readily ascertained. O’Meara and Shaeffer interpreted NMSA 1978, Section 56-8-3, and its forerunner, NMSA 1953, Section 50-6-3, to allow prejudgment interest in certain instances. O’Meara and Shaeffer adopted the rule stated in Restatement of Contracts Section 337 (1932):
If the parties have not by contract determined otherwise, simple interest at the statutory legal rate is recoverable as damages for breach of contract as follows:
(a) where the defendant commits a breach of a contract to pay a definite sum of money, or to render a performance the value of which in money is stated in the contract or is ascertainable by mathematical calculation from a standard fixed in the contract or from established market prices of the subject matter, interest is allowed on the amount of the debt or money value from the time performance was due, after making all the deductions to which the defendant may be entitled.
This court recognized in Shaeffer that under both the common law and NMSA 1978, Section 56-8-3, where the amount of indebtedness under the contract is ascertainable by the breaching party, the injured party is entitled to interest as a matter of right on those monies at the legal rate.
In adopting Restatement § 337(a), Shaeffer indicated that when the amount owed is “ascertainable by a mathematical calculation from a standard fixed in the contract or from established market prices,” Section 56-8-3 is applicable. 95 N.M. at 187, 619 P.2d at 1231 (quoting from Restatement of Contracts § 337(a) (1932)).
In the instant case Grynberg produced sufficient evidence to sustain his burden of proof, under Shaeffer, that the sums due under the contracts could have been ascertained with reasonable certainty. NMSA 1978, § 56-8-3; Shaeffer; see also Restatement (Second) of Contracts § 354 comment c (1981). Grynberg’s evidence included, first, the “Authorization For Expenditures” signed by the defendants for each well. The agreements stated the exact percentage of the working interest and the percentage of costs each defendant would owe. Secondly, the documents Grynberg filed with the court in 1977 listed dates, invoice numbers, exact amounts due per invoice and the total amount due for each defendant.
Under the rule stated in Shaeffer, the receipt of an invoice showing the amount owed is sufficient notice to a reasonable person of the amount in which he is indebted under his contract. Here, in addition to information provided by the invoices, the defendants could ascertain their portion of the total costs of the operation from their percentage of the “working interest” explicitly stated in the “Authorization For Expenditures” documents, which is a standard fixed in the contract. Therefore, the debt is “ascertainable by mathematical calculation from a standard fixed in the contract ... [and] interest is allowed on the amount of the debt * * *.” Shaeffer, 95 N.M. at 187, 619 P.2d at 1231 (emphasis added); (quoting from Restatement of Contracts § 337(a) (1932)). See also Restatement (Second) of Contracts § 354 comment c (1981).
The defendants argue that Grynberg’s reliance on Shaeffer and subsection (a) of Section 337 is misplaced, and that the case before us falls entirely within judicial discretion under subsection (b). Subsection (b) does not apply to the facts in the instant case. From the transcript it is obvious that Grynberg made a sufficient showing to the trial court through invoices and the “Authorization For Expenditures” to prove that the amounts owing were ascertainable with reasonable certainty. See Restatement (Second) of Contracts § 354 comment c (1981). Therefore, this is a case which comes within the Shaeffer interpretation of subsection (a) of Section 337, and an award of prejudgment interest is proper.
In Hillelson v. Republic Insurance Co., 96 N.M. 36, 627 P.2d 878 (1981), Chief Justice Federici commented on the appropriateness of granting prejudgment interest:
While interest could not be claimed as a matter of right in absence of an express agreement at early common law, according to the modern viewpoint, there are many circumstances where interest can be so claimed. 45 Am.Jur.2d Interest and Usury § 34 (1969).
96 N.M. at 38, 627 P.2d at 880. (Emphasis in original).
The common law rule of prejudgment interest as stated in Restatement of Contracts Section 337 (1932), does not depend on extraneous factors such as whether the injured party borrowed to cover the indebtedness; or whether or not interest was paid on money borrowed to cover the breaching party’s debt. See Shaeffer, 95 N.M. at 187, 619 P.2d 1231 (eventually realizing a profit on the constructed unit is “not relevant” for the purposes of awarding prejudgment interest).
The trial court’s finding that Grynberg did not submit evidence as to dates and amounts borrowed or the interest paid on borrowed sums is not determinative of his right to prejudgment interest under the rule as stated in Restatement of Contracts Section 337 (1932). See Shaeffer.
In Hillelson, we directed the trial court to grant prejudgment interest from the date the defendant denied his liability. Following the Hillelson rule, the interest here accrued from the dates the payments were due. A rate of interest on the judgment at the legal rate, from the date the monies became payable until the date the debts were discharged or the judgment was entered, should have been awarded by the trial court. Shaeffer. Interest following judgment until date of payment is likewise due and payable. NMSA 1978, § 56-8-4(A) (Cum.Supp.1984). The rate of prejudgment interest to be granted is that rate in effect “when this became a pending case.” Hillelson, 96 N.M. at 38, 627 P.2d at 880. The postjudgment rate of interest is set by statute at fifteen percent. NMSA 1978, § 56-8-4(A) (Cum.Supp.1984).
We remand this cause of action to the trial court to award prejudgment interest in accordance with this opinion.
IT IS SO ORDERED
FEDERICI, C.J., and RIORDAN and WALTERS, JJ., concur.
STOWERS, J., dissenting. | [
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OPINION
STOWERS, Justice.
This is a direct appeal from the Public Service Commission’s (Commission) decision that the coal costs incurred by Public Service Company of New Mexico (PNM) during the year 1980 were reasonable. PNM initially came before the Commission seeking an increase in rates based upon 1980 operating expenses. The parties stipulated to all issues except the issue of the justness and reasonableness of certain costs resulting from PNM’s purchase of coal from its affiliate, Western Coal Company (WCC). Following hearings in which the Attorney General (AG) participated, the Commission ruled that these costs would be allowed. The AG appeals. We affirm the Commission.
We discuss the following issues:
(1) Whether the Commission’s findings are adequate under New Mexico law and demonstrate that the Commission properly applied the relevant burden of proof;
(2) Whether certain rebuttal evidence was admitted for a limited purpose and thus was not available for consideration as substantive evidence; and
(3) Whether the Commission’s decision is supported by substantial evidence on the record.
The pertinent facts are as follows. During the late 1950’s and early 1960’s, PNM obtained certain coal leases in the Fruitland area of northwestern New Mexico. Between that period of time and 1980, PNM developed these leases, first through a wholly-owned subsidiary, Public Service Coal Company, and then through WCC, half-owned by PNM and half-owned by Tucson Electric Power Company. Coal for the PNM San Juan Generating Station was supplied by WCC until December 1980. Subsequently, the Fruitland leases were subleased by PNM to Utah International, which in turn subleased them to the San Juan Coal Company. San Juan Coal Company is a subsidiary of Utah International, which in turn is a subsidiary of General Electric.
The issue before the Commission was whether the coal costs incurred by PNM at the San Juan Station in 1980 were reasonable. Although the AG and PNM presented various methodologies to determine the reasonableness of these coal costs, the methods were variations of two fundamental approaches: the rate of return method supported by the AG, and the market comparison method advocated by PNM. A review of the record indicates that the evidence directed to the issue of the reasonableness of these coal costs was conflicting.
The Legislature has delegated to the Commission the power and authority to regulate utilities. NMSA 1978, § 62-6-4 (Cum.Supp.1983). The Commission designated a hearing examiner to preside over this case pursuant to NMSA 1978, Section 62-10-7 (Cum.Supp.1983). The hearing examiner found that PNM’s 1980 coal costs were reasonable. The Commission subsequently issued an order adopting the decision of the hearing officer. The AG then filed this appeal from the Commission’s order, pursuant to NMSA 1978, Section 62-11-1 (Cum.Supp.1983).
The AG argues that the Commission committed error by failing to make any findings as to the arms-length nature of the transaction between PNM and WCC and in so doing failed to apply the proper burden of proof. NMSA 1978, Section 62-10-14 requires only that the Commission find the ultimate fact. This Court previously stated:
The ultimate fact is the logical result of the proofs reached by reasoning from the evident facts. It is a conclusion of fact. (Citations omitted.)
International Minerals & Chemical Corp. v. New Mexico Public Service Commission, 81 N.M. 280, 283, 466 P.2d 557, 560 (1970). Furthermore, the Commission is not required to give reasons for its decision; ultimate findings phrased in the applicable statutory language are sufficient. Id. at 283, 466 P.2d at 560.
NMSA 1978, Section 62-6-4(C) (Cum.Supp.1983) provides in pertinent part:
The sale, furnishing or delivery of coal, uranium or other fuels by any affiliated interest to a utility for the generation of electricity for the public shall be subject to regulation by the commission but only to the extent necessary to enable the commission to determine that the cost to the utility of such coal, uranium or other fuels at the point of sale is reasonable. (Emphasis added.)
In the present case, the ultimate fact required to be found was the reasonableness of the cost of the coal to PNM. The Commission made that finding and no other findings were necessary. There is no merit in the AG’s argument that the Commission erred in not entering a finding on the arms-length nature of the transaction. Such a finding is not required since it is not an ultimate finding. In this case, the arms-length nature of the transaction is not a fact which is “necessary to determine the controverted questions presented by the proceeding.” NMSA 1978, § 62-10-14.
Similarly, the AG’s argument that the Commission failed to apply the proper burden of proof is equally without merit. The normal burden to be met in making a prima facie case regarding costs incurred in transactions with non-affiliates is a demonstration that the costs were, in fact, incurred. However, the normal burden regarding costs incurred in transactions with affiliates is heavier, requiring a showing of the reasonableness of the costs. Boise Water Corp. v. Idaho Public Utilities Commission, 97 Idaho 832, 555 P.2d 163 (1976). A review of the record indicates that the Commission applied the normal burden required in affiliated transactions. The Commission required PNM to file testimony demonstrating the reasonableness of the coal costs involved. This testimony was filed and the Commission then considered all the evidence which went to a comparison of market prices and a comparison of profit levels. After considering this evidence, the Commission determined that the coal costs were reasonable, thus finding that PNM had met its burden of proof.
The AG next contends that certain rebuttal evidence was admitted for a limited purpose and thus was not available for consideration as substantial evidence. The AG argues that the Commission erred in relying on Rebuttal Exhibit E as primary and substantive evidence in this case. We disagree. Evidence can be admitted for a limited purpose and, once so limited, it cannot be relied on for another purpose. In Re Will of Callaway, 84 N.M. 125, 500 P.2d 410 (1972). However, this did not occur in the present case. Exhibit E is a compilation of coal prices on a nationwide basis expressed in cents per million BTU (MMBTU) for mine-mouth coal plant operations. A review of the record shows that PNM did not indicate that it was seeking to introduce Rebuttal Exhibit E for a limited purpose, nor did the AG ask that it be admitted for a limited purpose. Furthermore, this exhibit was admitted without objection.
In order for an objection to be timely, ■ it must be made at the time the party may reasonably become aware of the grounds for objection for the first time. State ex rel. Reynolds v. Rio Rancho Estates, Inc., 95 N.M. 560, 624 P.2d 502 (1981). If a proper objection is not made, the evidence may be considered in the same manner as any other relevant evidence and has sufficient probative value to support a finding. Cf. Fox v. Doak, 78 N.M. 743, 438 P.2d 153 (1968). Failure to object to the admission of evidence operates as a waiver. See McCauley v. Ray, 80 N.M. 171, 453 P.2d 192 (1968). Our review of the record shows that the parties treated Exhibit E as substantive and primary evidence directed to the ultimate fact at issue from the time it was admitted.
The AG argues that the Commission’s decision that PNM’s coal costs for 1980 were reasonable is not based upon substantial evidence. The scope of review of Commission decisions is limited to the question of whether the Commission acted fraudulently, arbitrarily or capriciously, whether the decision is supported by substantial evidence, and, generally, whether the actions of the Commission are within the scope of its authority. Llano, Inc. v. Southern Union Gas Co., 75 N.M. 7, 399 P.2d 646 (1964). Substantial evidence means such relevant evidence as a reasonable mind might accept as adequate to support a conclusion. Viking Petroleum, Inc. v. Oil Conservation Commission, 100 N.M. 451, 672 P.2d 280 (1983). Substantial evidence requires that the appellate court review the whole record to determine whether there is substantial evidence to support the decision made by the Commission. Duke City Lumber Co. v. New Mexico Environmental Improvement Board, 101 N.M. 291, 681 P.2d 717 (1984). Moreover, this Court must view the evidence in the light most favorable to the decision made by the Commission. New Mexico Human Services Department v. Garcia, 94 N.M. 175, 608 P.2d 151 (1980).
The Legislature has vested exclusive rate-making authority in the Commission. See § 62-6-4 (Cum.Supp.1983). Furthermore, in a rate case, the Commission is vested with considerable discretion in determining the justness and reasonableness of utility rates. Hobbs Gas Co. v. New Mexico Public Service Commission, 94 N.M. 731, 616 P.2d 1116 (1980). Although conflicting-testimony was presented to the Commission, evidence of two conflicting opinions in the record does not mean that the decision arrived at is unsupported by substantial evidence. See McDaniel v. New Mexico Board of Medical Examiners, 86 N.M. 447, 525 P.2d 374 (1974).
A review of the record shows that in reaching its decision regarding the reasonableness of PNM’s expenses for coal purchased during 1980 for the San Juan Station, the Commission, in adopting the recommended decision of the hearing examiner, did not tie itself down to any single method to determine reasonableness of the coal costs. The Commission looked at comparative market prices, at returns earned in the coal industry, at the relationship between the contracting parties, and all other relevant evidence which the parties introduced.
The AG contends that the transaction between PNM and WCC was not in actuality an arms-length transaction because of their corporate affiliation. We have already disposed of this issue. We agree with the Commission that based on the testimony and evidence presented that the coal costs incurred in this case were reasonable. The Commission’s decision in this matter is supported by substantial evidence.
Finally, the AG argues that in evaluating the record, the Commission arbitrarily disregarded expert opinion in an area wherein it has no expertise, and instead relied upon unexplained evidence which did not constitute expert testimony. The AG contends that the Commission has no knowledge or technical skill in coal pricing or marketing. The issue here is one of ratemaking. This is an area in which this Court has recognized that the Commission exercises expert judgment. Moreover, this Court has previously stated:
It is said that a finding of reasonableness made after a full hearing by the Commission is the product of ‘expert judgment,’ which carries with it a strong presump tion that it meets the statutory requirements * * * Thus, the Commission is statutorily and constitutionally free to use any ratemaking formula it chooses.
State v. Mountain States Telephone & Telegraph Co., 54 N.M. 315, 336, 224 P.2d 155, 169-170 (1950) (quoting Cities Service Gas Co. v. Federal Power Commission, 155 F.2d 694, 699 (10th Cir.); cert. denied, 329 U.S. 773, 67 S.Ct. 191, 91 L.Ed. 664 (1946)). The Commission is not bound by the opinions of experts so long as the Commission’s ultimate decision is supported by substantial evidence. See Public Service Co. v. New Mexico Public Service Commission, 92 N.M. 721, 594 P.2d 1177 (1979). A review of the record indicates that the Commission properly weighed the evidence on the record and did not arbitrarily disregard the evidence presented.
The decision of the Commission was supported by substantial evidence, was made within the lawful regulatory authority of the Commission, and was not arbitrary of capricious. We therefore affirm the decision of the. Commission.
IT IS SO ORDERED.
FEDERICI, C.J., and SOSA, Senior Justice, concur. | [
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OPINION
WALTERS, Chief Judge.
In a trial to the court, the jury having been waived, defendant was found guilty of three counts of fraud, three counts of securities fraud, three counts of conspiracy to commit fraud, and two counts of solicitation to commit fraud, all contrary to NMSA 1978, § 30-16-6 (Cum.Supp.1982); NMSA 1978, §§ 58-13-39 and -43; NMSA 1978, § 30-28-2 (Cum.Supp.1982); and NMSA 1978, § 30-28-3 (Cum.Supp.1982), respectively. From a judgment and sentence suspending all but six months’ imprisonment and $40,000 in fines on all counts, defendant appeals. This case is the third appeal reaching this court for decision, thus far, in connection with criminal charges that defendants improperly obtained the benefits of low income housing loans under a State program.
FACTS
State v. Griffin, 100 N.M. 75, 665 P.2d 1166 (Ct.App.1983), details the background of the low income housing program established in New Mexico through the Mortgage Finance Authority (MFA) legislation, NMSA 1978, §§ 58-18-1 through 58-18-27 (Repl.Pamp.1982). In addition to the facts outlined there, and pertinent to this appeal, are the additional facts that Mortgage Guaranty Insurance Company (MGIC) had a contract with MFA to insure the various loans purchased by MFA from the private lending institutions which participated in the program. MGIC required from the lender, before issuing insurance, a “loan package” which included the loan application, verification of down payment, verification of the applicant’s employment and income, and appraisal of the property. MGIC relied upon the lender’s approval of the loan application as a guide to its issuance of insurance.
Three properties were involved in the charges on which this defendant was convicted. Defendant’s secretary made application for an MFA loan on the first property (which was owned by defendant), falsely representing her income (verified by defendant), her savings, her down payment on the property, and her intention to occupy the property. The house was deeded back to defendant by his secretary approximately three months after the loan was approved and the sale made. In addition to these proofs, the court found that the secretary’s sole intention was to receive $1,000 from defendant for obtaining the loan and to aid him in refinancing his property; and that defendant’s intention was to have a loan approved that would be insured by MGIC and purchased by MFA, to his benefit, “for the sole purpose of refinancing his ownership interest” in the property.
An application for a loan to purchase the second property was made by an employee of a title company jointly owned by defendant, by the chairman of MFA, and by one other person. That application pertained to another home owned by defendant, but its occupancy and ultimate ownership was to be by one other than the employee-applicant who could not himself qualify for an MFA loan because of his history of erratic income. In the application, the employee falsely represented her income, a down payment on the property, moneys owned by her in her checking account, and her intention to occupy the premises. She was paid $500 from title company funds for making the application; the property was appraised by defendant at a figure that resulted in her receipt of a loan covering 100 percent of the purchase price. MGIC insured the loan and MFA purchased it from the lender, and defendant received the proceeds in payment of the sale of his house.
Defendant’s secretary again was the loan applicant in the third transaction, approximately ten months after she had received her first loan. Defendant was convicted of fraud, security fraud, and conspiracy to commit fraud in connection with the third loan upon evidence that the secretary had made a down payment on a house she wanted to buy with funds advanced by defendant, and had signed a purchase agreement to close approximately 30 days later. In her application for the MFA loan, she overstated her income and falsely represented deposits in her savings account as hers when in fact they were defendant’s funds. Defendant verified her income to the lending institution. Because the loan had not been fully processed by the date of closing, defendant bought the house from the seller under the same terms as had been agreed upon between the seller and his secretary, and he then agreed to sell the house to his secretary at a price $5,500 higher than she had agreed to pay under her original agreement with the first seller. The secretary ultimately obtained the loan and defendant received the proceeds as the new seller of the property.
Appellant raises thirteen issues on appeal. We have grouped them and we discuss (I) Grand jury proceedings and pre-trial rulings; (II) Sufficiency of the evidence; and (III) The sentences imposed.
I.
A. Publicity
On November 22, 1981, while a grand jury was considering the indictment returned against defendant, an extensive newspaper story appeared in the Albuquerque Journal describing allegations of fraudulent dealings and falsification of records in connection with home loans made by a Santa Fe lending institution. Defendant was prominently named in the article. On November 30th defendant moved that the grand jury be discharged from, considering any matter pertaining to him, but an indictment was returned against him on December 4, 1981 before the motion was heard.
However, on December 1st the Assistant Attorney General told the grand jurors:
There were a couple of things that I think we needed to go ahead and address before we get going. I think that Judge Baca may also want to instruct you in this regard. If anybody read any newspaper accounts dealing with any of the individuals who have been discussed during these proceedings, you are to ignore those newspaper articles and any decision which you render in this proceeding should be based solely and I emphasize solely, on the evidence and testimony that is presented to you during this grand jury proceedings.
Defendant then moved to subpoena the grand jurors to determine whether any of them had knowledge of the publicity and to dismiss the indictment if appropriate. Defendant’s motions were denied.
The request for dismissal was based on two grand jury statutes. First, the oath taken by grand jurors speaks of their receipt of “legal evidence” and proscribes indicting “through malice, hatred or ill will.” NMSA 1978, § 31-6-6(A)(l) (Cum. Supp.1982). Second, NMSA 1978, § 31-6-11(A) (Cum.Supp.1982), suggests that the grand jury must rest an indictment only upon the evidence submitted to it. As a prelude to his argument, defendant alleges error in the court’s failure to require the testimony of grand jurors to establish whether they had read the article and were affected by it.
There is merit to defendant’s contentions to the extent that he is entitled to relief if the grand jurors had read the article and it influenced their findings. NMSA 1978, Evid.R. 606(b), allows juror testimony on the subject of extraneous prejudicial information having been injected into the jury’s deliberations. See also D. Louisell & C. Mueller, Federal Evidence, § 292, at 168 (1979). Defendant may not be penalized for not tendering what the jurors’ testimony would have been; grand jurors are bound by an oath of secrecy not to talk to defense counsel. Section 31-6-6(A)(l).
This point of error rests on the presumption of prejudice that arises when certain grand jury statutes are violated. Davis v. Traub, 90 N.M. 498, 565 P.2d 1015 (1977) (unauthorized person before grand jury); Baird v. State, 90 N.M. 667, 568 P.2d 193 (1977) (prosecutor- present during deliberations); State v. Hill, 88 N.M. 216, 539 P.2d 236 (Ct.App.1975) (unauthorized person, who was private prosecutor, present before grand jury).
On the question of potentially prejudicial publicity, there is substantial federal authority establishing that it does not go to the heart of the grand jury system, and it is to be expected in so many cases that it will not vitiate an indictment. 8 J. Moore’s Federal Practice, H 6.04[9] (1982); D. Louisell & C. Mueller, supra; 1 C. Wright, Federal Practice and Procedure, § 102, at 210 (2d ed. 1982). Professor Wright points out that no indictment has ever been dismissed on the claim of bias resulting from massive pre-indictment publicity. Id. United States v. Mandel, 415 F.Supp. 1033, 1061-65 (D.Md.1976), ably analyzes the considerations which preponderate to reject such an attack on the indictment. That analysis was echoed by the trial court below, i.e., that there will almost always be widespread publicity in sensational cases; if dismissal for preindictment publicity were to result, many prominent or notorious persons could avoid the criminal process completely.
The general rule stated in the federal cases is that if lack of bias is a specific requirement of grand jurors, the bare fact of publicity does not show bias. Estes v. United States, 335 F.2d 609 (5th Cir.1964), cert. denied, 379 U.S. 964, 85 S.Ct. 656, 13 L.Ed.2d 559 (1965). Publicity may only result in dismissal if it is generated by the government toward the end of unfairly biasing the grand jurors. United States v. Mandel, supra. There is no allegation and no evidence that the article about which complaint is made in this case was so induced.
The grand jury statutes cited by defendant, as we have said, prescribe legal evidence and proscribe malice. The New Mexico Supreme Court has approved an explanatory instruction for use in grand jury proceedings. NMSA 1978, UJI Crim. 60.00 (Repl.Pamp.1982). The instruction recognizes the possibility that grand jurors will read or hear things about the case; it instructs the jury to decide the case solely on the evidence. The prosecutor cautioned the jury to that effect. We are unable to hold that the trial court erred in not questioning the grand jurors and in not dismissing the indictment. See Buzbee v. Donnelly, 96 N.M. 692, 706, 634 P.2d 1244, 1258 (1981).
B. Prosecutor Misconduct
Defendant asserts error in the trial court’s denial of his motion to dismiss the indictment for prosecutor misconduct before the grand jury. This claim is predicated on a statement of the prosecutor to the grand jurors that he was requesting an indictment on those crimes which he, as their legal advisor, felt had been committed. His comment occurred near the end of the presentment and again after the jury was instructed. The prosecutor, however, corrected himself and said that these were the crimes “that the evidence seems to reflect.” He told the jurors several times that it was their decision to determine whether there was probable cause to indict, and that such a decision was solely within their province.
This case is not similar to State v. Good, 10 Ariz.App. 556, 460 P.2d 662 (1969), relied upon by the defendant. In Good, the prosecutor repeatedly exhorted the grand jury to indict. In our view, this case is more like State v. Ballinger, 99 N.M. 707, 663 P.2d 366 (Ct.App.1983) (opinion on remand filed March 15, 1983), where the grand jury heard a mass of evidence, and the prosecutor’s comment was inadvertent rather than deliberate.
The prosecutor is to instruct the jury on applicable charges. NMSA 1978, UJI Crim. 60.10 (Repl.Pamp.1982). In explaining to the jurors the purpose of the instructions, the prosecutor lapsed into prohibited comment on what charges he felt the jury should return. But because his remarks were corrected and tempered with repeated instructions to “decide the case for yourselves on the evidence,” it was not misconduct of a nature requiring dismissal of the indictment. State v. Ballinger, supra; State v. Martinez, 97 N.M. 585, 642 P.2d 188 (Ct.App.1982); State v. Saiz, 92 N.M. 776, 595 P.2d 414 (Ct.App.1979).
C. Subpoena of Bank Records
The State, and perhaps the grand jury (we did not search the record), issued a subpoena to defendant’s banks for production of defendant’s bank records, and the banks complied. Defendant moved to quash the subpoena(s) and, alternatively, to suppress all materials obtained by such subpoena(s). The motions were denied.
NMSA 1978, § 14-7-1 provides:
14-7-1 Requiring notice of intent to gain access to records of financial institutions.
A. At least seven days prior to a state agency, board or commission requesting or gaining access to or copies of the records of a person, corporation, company or organization, maintained by a bank, savings and loan association, small loan company or other similar financial institution, the agency, board or commission shall notify by certified or registered mail, the person, corporation, company or other organization of its intent to gain access or acquire such records.
B. The requirement of notice set forth in Subsection A of this section shall not apply to the audit of any bank, savings and loan association, small loan company or other similar financial institution by a state agency, when conducted pursuant to the agency’s statutory directive.
C. The provisions of Subsection A of this section shall not apply to requests for records made pursuant to an administrative subpoena. In such instances at least twenty-four hours’ notice shall be given to the person, corporation, company or organization.
Defendant was not given the statutory notice.
The United States Supreme Court, in United States v. Miller, 425 U.S. 435, 96 S.Ct. 1619, 48 L.Ed.2d 71 (1976), held that bank records, including checks, deposit slips, financial statements, and monthly statements, are not within any zone of privacy protected by the Fourth Amendment. They were decided, in Miller, to be items of information voluntarily conveyed by the depositor to the banks, and thus information exposed to all of the banks’ employees in the ordinary course of business without any anticipation of privacy.
The Miller decision has been vehemently criticized by at least one eminent authority. 1 W. LaFave, Search and Seizure, § 2.7(c) (1978). LaFave stamps the result “dead wrong” and the reasoning “woefully inadequate.” Id. at p. 411. Professor LaFave contends that the Supreme Court ignored modern realities of life and based its decision on notions of property long since rejected in Fourth Amendment analyses. He points out, citing respectable precedent, that banks are a necessity in the transactions of daily life and that people do not, by their use, knowingly expose or surrender their personal histories to public scrutiny. Rather, they disclose information in their checks to their banks for the sole purpose of debiting, crediting, or balancing their accounts. Moreover, banks recognize their role as the agent of their depositors and they keep customer transactions private. The bank has virtually no occasion to reconstruct a customer’s life, or any interest in doing so, by its cursory viewing of underlying transactional information in its customers’ accounts. To give the government the right to do that, says LaFave, is “pernicious.” Id. at 417. See cases therein cited.
Some state courts have similarly analyzed searches of personal records and declared that state constitutional law imposes a privacy interest in bank and business records. E.g., Burrows v. Superior Court of San Bernardino County, 13 Cal.3d 238, 118 Cal.Rptr. 166, 529 P.2d 590 (1974) (bank records); People v. Blair, 25 Cal.3d 640, 159 Cal.Rptr. 818, 602 P.2d 738 (1979) (credit card and telephone call records); Charnes v. DiGiacomo, 200 Colo. 94, 612 P.2d 1117 (1980) (bank records). In Commonwealth v. DeJohn, 486 Pa. 32, 403 A.2d 1283 (1979), cert. denied, 444 U.S. 1032, 100 S.Ct. 704, 62 L.Ed.2d 668 (1980), the Pennsylvania Supreme Court called the Miller decision “a dangerous precedent, with great potential for abuse,” and held that the Pennsylvania Constitution protected against such unreasonable searches and seizures absent valid legal process. In DiGiacomo, supra, a subpoena for bank records was upheld, but it is significant that the statute there authorizing administrative subpoenas required the agency to make a showing satisfactory to a district court judge that the court should cause the subpoena to issue. Statutes may enlarge constitutional rights, State v. Wilson, 92 N.M. 54, 582 P.2d 826 (Ct.App.1978), but they may not impinge upon, conflict with, or reduce constitutional protections. See State ex rel. Dow v. Graham, 33 N.M. 504, 270 P. 897 (1928).
It is not necessary for us to decide at this time whether New Mexico would interpret the statute authorizing the administrative subpoena according to Miller, or otherwise under our state constitution as California, Colorado and Pennsylvania courts have done, or whether a grand jury subpoena falls under the requirements of § 14-7-1. Defendant has not cited us to any portion of the record supporting his claim that the grand jury subpoenaed his bank records. There is testimony by defendant at a pretrial hearing that some of defendant’s business documents were referred to in the grand jury transcripts that he had read, and that loan officers of two banks had told him they had responded to a grand jury subpoena. But we are not told where that evidence is in the record before us; we do not know what the evidence consists of that he complains about; we are not advised whether exhibit documents were those so obtained, or in what manner, if any, they prejudiced defendant. Cf. State v. Martin, 90 N.M. 524, 565 P.2d 1041 (Ct.App.1977).
Nor need we consider whether the failure in this case to give defendant notice, as required by the statute, would require suppression of the fruits of the State’s subpoena issued for trial. The trial judge effectively suppressed the records, ruling that any evidence obtained by the subpoena, other than defendant’s financial statement which had previously been introduced by defendant at an earlier hearing, could not be examined by the State until both defendant and the trial court had been alerted and, tacitly, an examination authorized.
Additionally, with 144 packets of compound exhibits offered by the State and only an abstract contention that defendant’s privacy interest was invaded, without specific citation to the tapes, the kinds of records obtained, or the prejudice resulting to defendant, we would engage in impermissible speculation to decide the privacy issue attaching to either the grand jury or trial stage of the proceedings below. See Perez v. Gallegos, 87 N.M. 161, 530 P.2d 1155 (1974). Appellate courts do not render advisory opinions. State v. Herrod, 84 N.M. 418, 504 P.2d 26 (Ct.App.1972).
D. Notice of the Charges
In two separate points defendant urges that the trial court improperly denied his motions for a statement of facts and to compel the State to elect the precise theory of culpability upon which the charges would be tried. The several counts of the indictment alleged crimes committed by various alternative means and against various alternative persons or entities. Defendant complains that the manner of charging in Count I, for example, exposed him to defending against a potential of 12 separate means of committing the crime alleged; in Count II, for example, against 56 possible methods of committing securities fraud.
The exponential variations in the multiple counts resulting from the alternative and cumulative form of charging throughout the indictment indeed exposed defendant to a broad field of allegedly illegal conduct. New Mexico’s appellate courts, however, have held that access by the defendant to the grand jury proceedings, and maintenance by the prosecutor of an “open file” policy for defendant’s examination, obviates the requirement to furnish a statement of facts sufficient to allow defendant to prepare his defense, State v. Hicks, 89 N.M. 568, 555 P.2d 689 (1976), and its progeny; see State v. Sheets, 94 N.M. 356, 610 P.2d 760 (Ct.App.1980). We have no authority to change that rule. Alexander v. Delgado, 84 N.M. 717, 507 P.2d 778 (1973).
Regarding the request for election, State v. Gurule, 90 N.M. 87, 559 P.2d 1214 (Ct.App.1977), and State v. Ortiz, 90 N.M. 319, 563 P.2d 113 (Ct.App.1977), instruct that it is not unfair and there is no deficiency in notice to the defendant when one offense is charged but multiple ways in which the offense could have been committed are alternatively alleged, and the State’s file is open for inspection by defend ant. Cf. State v. Coulter, 84 N.M. 647, 506 P.2d 804 (Ct.App.1973). The implication is inescapable that the State is not required to elect its precise theory of defendant’s unlawful conduct. Sanchez v. State, 97 N.M. 445, 640 P.2d 1325 (1982), is not to the contrary. The Sanchez indictment attempted to charge defendant alternatively, cumulatively, and vaguely, for the purpose of converting separate crimes into a single offense solely to elevate several misdemeanor crimes to the status of a single third degree felony. Those are not the facts of this case; “stacking” is not an issue.
If, as defendant argues, we are unable to review the extent of the State’s “open file” because the record before us does not clearly identify or specify the contents of that file, the onus for the deficiency in the record must be borne by defendant. State v. Duran, 91 N.M. 756, 581 P.2d 19 (1978). We are not told, however, that any evidence produced by the State at trial came as a surprise to defendant or was withheld from defendant’s knowledge prior to trial. The trial court was careful, at the hearing on defendant’s motions, to require a thorough explanation by the State of the charges, the names of witnesses, the names of alleged conspirators, the individuals or entities who relied on representations made, the basis of values alleged, and the State's theory of the security fraud charges. Those requirements should have met the needs stated by defendant’s motions. Consequently, we are not persuaded that defendant did not have sufficient notice and information to adequately prepare his defenses to the charges of the indictment.
E. Severance
Defendant asked the trial court for severances that would permit separate trials on each transaction alleged in the indictment, contending that the evidence produced on each offense charged, multiplied by the number of similar charges relating to five separate mortgage transactions, would create massive prejudice to defendant and severely tax the fact-finder’s impartiality.
Joinder of the offenses in the indictment is authorized by NMSA 1978, R.Crim.P. 10 (Repl.Pamp.1980). Severance of the counts for trial is a matter of discretion for the trial court, State v. McGill, 89 N.M. 631, 556 P.2d 39 (Ct.App.1976); NMSA 1978, R.Crim.P. 34 (Repl.Pamp. 1980); but that discretion must be exercised diligently to assure that prejudice does not prevail because of evidence heard on one count that would be inadmissible on another, or because the number of charged offenses alone would impart an aura of guilt. Cf. State v. Paschall, 74 N.M. 750, 398 P.2d 439 (1965).
The danger, however, of improperly influencing the fact-finder by these circumstances is not present in this case. The denial of a severance occurred after defendant had waived a jury and agreed to trial by the court. The trial court is presumed to have disregarded incompetent evidence, Matter of Doe, 89 N.M. 700, 556 P.2d 1176 (Ct.App.1976); defendant’s acquittal on 10 counts of the indictment dispels any notion that the number of offenses charged disturbed the impartiality of the trial judge. See State v. Sero, 82 N.M. 17, 474 P.2d 503 (Ct.App.1970).
II.
A. Evidence of Fraud
NMSA 1978, UJI Crim. 16.30 (Repl. Pamp.1982), sets forth the essential elements of fraud to be:
1. The defendant, by any words or conduct, [made a promise he had no intention of keeping] [misrepresented a fact] to [name of victim] intending to deceive or cheat [name of victim];
2. Because of the [promise] [misrepresentation] and [name of victim]’s reliance on it, defendant obtained [describe property or state amount of money];
3. This [property] belonged to someone other than the defendant; and
[4. The [property] had a market value of over $_];
5. This happened in New Mexico on or about the _,_ day of -, 19_
Defendant claims that without a victim, there can be no fraud; and because of the way the MFA program operated, none of the alternative “victims” listed in the indictment were damaged. That is, the lenders suffered no damage because MFA bought the loans; MGIC was not damaged because it was paid premiums for insurance issued; MFA was not injured because its money went to the lending institutions, not defendant, and it receives repayment from the borrowers.
In State v. Griffin, supra, we held that “victim” in the context of New Mexico’s restitution statute, NMSA 1978, § 31-17-1 (Repl.Pamp.1981), could be a human being or a legal entity, but restitution could be ordered only when the victim has suffered actual damage as a result of a defendant’s criminal activity. But the requirement of actual damage to the victim is not an element of fraud; indeed, the instruction does not identify whose property defendant must obtain as a result of his fraudulent conduct in order that he be guilty of the crime. Many criminal offenses do not require that another be victimized, e.g., possession of controlled substances, switchblades, explosives; prostitution, and so forth.
The trial court made 78 separate findings of fact, many of those findings having several sub-parts. It appears from the findings regarding fraud that defendant’s convictions on those counts were predicated upon his accessory status, incident to the initiatory misrepresentations by his secretary and other employee in the three transactions first described in this opinion, and defendant’s willing and active participation in the misrepresentations made by those employee-applicants to the lending institutions. If convicted as an accessory, that was not improper. See NMSA 1978, § 30-1-13; State v. Wall, 94 N.M. 169, 608 P.2d 145 (1980).
It is undisputed that defendant’s employees were ineligible for MFA loans under the MFA standards, guidelines and regulations. It is not significant that the MFA regulations were not recorded as required by NMSA 1978, § 14-4-5, so as to give them enforceability. There was ample evidence that defendant was one of the ground-floor participants in the MFA program, was a business partner of the chairman of MFA, was a long-time realtor and broker, knew the general credit requirements lenders demanded of home loan borrowers, and was aware that MFA funds were to be used for low income applicants who were creditworthy. The fact that defendant was the owner of all three homes purchased by ineligible applicants with MFA funds—and that those applicants were defendant’s employees, as well—and that all three sales redounded to defendant’s benefit, is overwhelming evidence that all three transactions resulted from intentional misrepresentations to the lenders, the insurer, and the MFA, to obtain something of value to which neither he nor the applicants were entitled.
The cases cited by defendant for the proposition that because the MFA rules and regulations were invalid, he could not be convicted of fraud by violation of them, are beside the point. This claim, as well as the contention that loan requirements were not uniformly applied, do nothing to excuse defendant’s participation in the deliberate, calculated misrepresentations of his employees by which undeserved loans were obtained for his ultimate benefit. The proofs necessary for conviction did not depend upon whether or not MFA’s rules and regulations were valid; the court’s findings did not even mention them. The misrepresentations constituted the fraudulent acts. See Bryson v. United States, 396 U.S. 64, 90 S.Ct. 355, 24 L.Ed.2d 264 (1969). The evidence sustains the fraud convictions.
B. Evidence of Securities Fraud
Three reasons are advanced by defendant which challenge the securities fraud convictions, the first resting upon insuffici ency of evidence of any fraud. We have disposed of that argument in II A above. The other contentions are (1) that there was no fraud “in connection with an offer, sale or purchase of any security” as prohibited by NMSA 1978, § 58-13-39, and (2) that the crimes prohibited by § 58-13-39 do not apply to the security or the transactions here involved because they are exempted by NMSA 1978, §§ 58-13-29 and -30 (Cum.Supp.1982).
(1) The trial court specifically found that the factual basis for the securities fraud violations were in the transfers from the lenders to MPA of the notes evidencing the loans. Defendant emphasizes that he had no part in those transfers; they occurred because of independent prior agreements between the lenders and MFA that MFA would purchase the securities obtained from the buyers. The critical language is, of course, the meaning of “in connection with,” as used in § 58-13-39.
New Mexico has not interpreted that phrase. However, its federal counterpart, 15 U.S.C. § 78j, and the federal agency’s Rule 10(b)(5), have been construed. T. Parnall and W. Ticer, A Survey of the Securities Act of New Mexico, 2 N.M.L. Rev. 1, 48 (1972), found similarity of wording in the federal and state statutes. The United States Supreme Court has said that “connection” is construed broadly so that if fraud “touches” on the sale of security, the requisite connection exists. Superintendent of Insurance v. Bankers Life and Casualty Co., 404 U.S. 6, 92 S.Ct. 165, 30 L.Ed.2d 128 (1971). Tully v. Mott Supermarkets, Inc., 540 F.2d 187 (3rd Cir.1976), requires that there be a causal connection between the fraud and the sale. In An-no t., 3 ALR Fed. 819 (1970), at 824, it is stated that the “in connection with” requirement is met when there is a purchase or sale in reliance on the fraud. Other federal cases to like effect may be found at notes 481 and 521 of 15 U.S.C.A. § 78j. Federal authority on federal statutes similar to state law is persuasive in New Mexico. State v. Weddle, 77 N.M. 420, 423 P.2d 611 (1967).
As to the sale of each note, the trial court found that MFA bought the note “because of” the misrepresentations made by defendant and his employee. The evidence recited by defendant in his summary of proceedings supports those findings and no claim to the contrary is made.
A case where the alleged fraud was substantially distant from the eventual sale of securities is Sharp v. Coopers & Lybrand, 457 F.Supp. 879 (E.D.Pa.1978), aff'd, 649 F.2d 175 (3rd Cir.1981), cert. denied, 455 U.S. 938, 102 S.Ct. 1427, 71 L.Ed.2d 648 (1982). At issue was an accountant’s opinion letter on tax liability, which letter was later used to induce others to invest in the venture to which the opinion related. The court there said that the “in connection with” requirement was limited to the extent that the defendant must reasonably foresee that his fraud would be used in connection with purchase or sale of a security.
Even under the Sharp test, however, the findings of the trial court satisfy the limitation of foreseeability. Regarding the sale of the notes, the trial court found that the misrepresentations were made with knowledge by defendant that MFA would buy the notes. The evidence sustains those findings. Defendant testified that he was familiar with the MFA program, even to the extent of going to New York to attend one of its bond closings; that as a developer, he obtained commitments from lenders of MFA funds; that he knew all of the personnel at MFA and knew it was necessary for applicants to qualify for MFA loans, and he knew that creditworthiness was a crucial consideration in granting MFA loans. He was also aware that buyers would be required to sign notes as security for their loans.
Defendant’s intentional course of conduct fell within the meaning of “in connection with” the sale of a security, as that meaning has been judicially defined.
(2) Defendant contends that § 58-13-29 exempts from prosecution actions involving securities “issued or guaranteed by ... any state or political subdivision of a state ____” and “any security issued by and representing an interest in, or a debt of or guaranteed by ... any insurance company”; and that § 58-13-30 removes the provisions of §§ 58-13-4 through 58-13-28 of the Securities Act from “any transaction ... secured by a real ... mortgage or deed of trust, or by any agreement for the sale of real estate ... if the entire mortgage ... together with all the bonds or other evidence of indebtedness secured thereby is offered and sold as a unit.”
Section 58-13-29 states that the provisions of §§ 58-13-4, -5, -7 and -8, relating to registration of securities, and registration by notification, coordination or qualification, do not apply to the type of securities identified in the first quotation above taken from § 58-13-29. That section provides only, insofar as the instant case is concerned, that the kinds of securities attaching to the transactions with which defendant was charged were not securities that had to be registered.
Section 58-13-30 then exempts the provisions of §§ 58-13-4 through -28 from the kind of transactions secondly described in the above quotations from the exempting statutes. Sections 58-13-4 through -28 refer to registration requirements and to procedures for registering securities, salesmen, dealers, advisors, etc., and to fees to be assessed for the various registrations.
Section 58-13-39, proscribing fraudulent practices, and § 58-13-43, setting the penalties for fraud, say nothing about their provisions being applicable only to fraudulent dealing in registered securities or against registered dealers or brokers.
Defendant’s argument is that § 58-13-44 refers to “any action, civil or criminal, where a defense is based upon any exemption provided for in the Securities Act.” Thus, he says, the exemption sections apply to any action, including this prosecution. But § 58-13-44 simply requires that one who claims an exemption as a defense must prove the existence of the exemption. If we were to agree that defendant proved the transactions were exempt from the provisions of §§ 58-13-4 through -28, and that the securities were exempt from registration, what defense dependent upon those exemptions is raised?
We are urged to read Bills v. All-Western Bowling Corp., 74 N.M. 430, 394 P.2d 274 (1964), as holding that an action for violation of the Securities Act may not be maintained if an allegedly fraudulent sale pertained to securities that were not required to be registered. That is much too narrow a reading of that case. Bills was a civil suit; plaintiffs sought to recover their purchase price, alleging that the sale had been fraudulently induced and had been made in violation of the Act. The supreme court did no more than agree with the trial court that the securities did not have to be registered under the Act then in effect— they were exempt—but, more particularly, that plaintiffs had failed to prove fraudulent inducement.
The fact that the securities are exempt from registration laws has never, to our knowledge, been a defense to charges of fraud. See I L. Loss, Securities Regulation, ch. 3D at 710 (2d ed. 1961), and its supplement, n. 7 at 2677 (1969); T. Parnell & W. Ticer, supra, at 16. We read § 58-13-43 to include offenses proscribed by § 58-13-39.
The exempt status of the securities and the transactions does not create an exemption from prosecution for securities fraud.
C. Solicitation and Conspiracy
Defendant’s claim that failure to prove the underlying elements of the crimes of fraud and securities fraud vitiates the crimes of solicitation and conspiracy to commit those crimes has been answered adversely to his contention. He urges further, however, that § 30-28-3D precludes findings of guilt on charges of both solicitation and conspiracy. That subsection reads:
D. A person is not liable for criminal solicitation when his solicitation constitutes conduct of a kind that is necessarily incidental to the commission of the offense solicited. When the solicitation constitutes a felony offense other than criminal solicitation, which is related to but separate from the offense solicited, the defendant is guilty of such related felony offense and not of criminal solicitation. Provided, a defendant may be prosecuted for and convicted of both the criminal solicitation as well as any other crime or crimes committed by the defendant or his accomplices or coconspirators, or the crime or crimes committed by the person solicited.
This above portion of the statute appears designed to handle the theory of merger. See State v. Sandoval, 90 N.M. 260, 561 P.2d 1353 (Ct.App.1977).
The first sentence provides for no liability when the solicitation is necessarily incidental to the principal offense solicited. Thus, if the theory of guilt of the principal offense is that of accessory liability for fraud or conspiracy to commit fraud, solicitation would be necessarily incidental to it and there could be no liability for solicitation.
The second sentence provides that a person is “not guilty” of solicitation when the solicitation constitutes a felony offense other than criminal solicitation. Consequently, if the solicitation constitutes conspiracy, defendant would be guilty of the conspiracy and not of the solicitation.
The third sentence provides that a person may be prosecuted for and convicted of all offenses in the situations covered by the first two sentences. What this must mean is that the prosecution need not make a pretrial or preinstruction election; rather, all offenses may be submitted to the jury. The “no liability” or “not guilty” determinations contained in the first two sentences would only be made at the time of entering the judgment and sentence. One could not be separately sentenced for two offenses if his case fit within the first two sentences of § 30-28-3D. See State v. Gallegos, 92 N.M. 370, 588 P.2d 1045 (Ct.App.1978).
There remains the question whether there could be adjudications of guilt when the offenses charged fall within the first two sentences. See Gallegos, supra; see also State v. Keener, 97 N.M. 295, 639 P.2d 582 (Ct.App.1981). The first two sentences of subsection D provide that there cannot be; the third sentence indicates that a defendant can be adjudicated guilty if “convicted” is defined as it was in Keener, supra. But Keener arrived at its holding by an interpretation of the Rules of Evidence. Although such an interpretation is not required here, we do not see any barrier to a formal adjudication of guilt on both counts so long as there is no separate sentence on each count. A possible collateral consequence, see Gallegos, supra, in terms of habitual liability if defendant later commits a crime, is avoided by the express terms of NMSA 1978, § 31-18-17 (Repl. Pamp.1981), since the solicitation convictions here are part of the same transactions related to the, other convictions.
Nonetheless, defendant is entitled to relief under § 30-28-3D, supra. He was adjudicated guilty on two counts of solicitation to commit fraud; at the same time, he was adjudicated guilty on the fraud and conspiracy to commit fraud counts. We conclude, from the court’s findings, that defendant was found guilty of fraud as an accomplice. As a guilty accomplice, the first sentence of § 30-28-3D provides that he is not liable. Because the solicitation also constituted a conspiracy, defendant was guilty of conspiracy and not of solicitation under the second sentence of the same subsection.
III.
A. Sentences of Solicitation and Conspiracy
From what we have said in II D, the solicitation sentences must be vacated. The court ordered concurrent prison sentences on all convictions, but imposed a total of the fines on all convictions of $70,-000 and suspended a portion of that total. Defendant, however, is liable for payment of all of the $70,000 should he breach the conditions of suspension. That condition, as it applies to the total of the fines as sessed, is not consistent with the provisions of § 30-28-3D. Accordingly, the fines attaching to the solicitation convictions must also be vacated.
B. Sentences for Fraud and Securities Fraud
With regard to the convictions of fraud and security fraud, a similar adjustment in the sentences and fines imposed must be made. We held on June 7, 1983, in State v. Maes, 100 N.M. 78, 665 P.2d 1169 (Ct.App.1983), that one convicted of aggravated assault and robbery could be punished for only one crime because the offenses merged.
It was said, in State v. Quintana, 69 N.M. 51, 364 P.2d 120 (1961), an early case discussing merger, that “if the several offenses are the same, as where they arise out of the same transaction, and were committed at the same time, and were part of a continuous criminal act, and inspired by the same criminal intent, which is an essential element of each offense, they are susceptible of only one punishment.” 69 N.M. at 57, 364 P.2d 120. “Same transaction” has since been disapproved as one of the tests of merger, State v. Tanton, 88 N.M. 333, 540 P.2d 813 (1975), but the remaining guidelines of Quintana, supra, have not been discredited, and have been focused to emphasize the “same evidence” test in proving each offense. See State v. Tanton, supra.
It is manifest, from the language of the criminal statute defining securities fraud, § 58-13-39A, that it is necessary to prove conduct that would constitute the crime of fraud before one could be found guilty of securities fraud. Securities fraud is statutorily defined by using the very terms “fraud” and “defraud.” Even if, as we believe, the trial court based defendant’s convictions of fraud on an accessory basis, the underlying “fraud” of the principals was, still, directly or indirectly, “in connection with” an offer, sale, or purchase of those instruments which constituted “securities,” as that word was defined in State v. Sheets, 94 N.M. 356, 610 P.2d 760 (Ct.App. 1980). The notes given by the applicants created the securities which constituted the underlying basis of defendant’s convictions of securities fraud.
Defendant’s “accessory” participation at the applicants’ stage in each transaction was merely the opening gambit in the completed criminal acts of securities fraud. Quintana, supra. The evidence used to prove his guilt of participation in each crime of fraud was part and parcel of the same evidence that was used to prove his guilt in each crime of securities fraud. See State v. Tanton, supra. Stated simply, one cannot be guilty of securities fraud if, in connection with purchase, sale or offer of a security, he has not committed a fraud by any of the methods listed in § 58-13-39. The offense of securities fraud “necessarily involves” the offense of fraud. See State v. Martinez, 77 N.M. 745, 427 P.2d 260 (1967).
Defendant could properly be convicted of both fraud and securities fraud, State v. Maes, supra, but he could be punished for only one offense. Quintana, Maes, supra. As a result, the sentences for fraud, and the fines imposed thereon, must be vacated.
C. Disparity of Sentences Imposed
As a final argument, defendant calls our attention to sentences imposed by other divisions of the Second Judicial District Court on defendants convicted of similar MFA-related offenses, and asks us to set aside the judgment in this case for the trial court’s abuse of discretion and, consequently, denial of defendant’s right to due process.
We allowed defendant to supplement the appellate record by filing the record of dispositions in ten other MFA cases. That record discloses that some defendants were fined and others required to “make restitution” (see State v. Steele, 100 N.M. 492, 672 P.2d 665 (Ct.App.1983), but that sentences of imprisonment for seven defendants were deferred, and wholly suspended for the remaining three. In his brief, defendant says these dispositions (or most of them) were submitted for the trial judge’s consideration prior to sentencing. We do not have a record before us of the sentencing proceedings, but the State does not dispute defendant’s representation in that regard. But see State v. Duran, 91 N.M. 756, 581 P.2d 19 (1978), and State v. Padilla, 95 N.M. 86, 619 P.2d 190 (Ct.App.1980).
Defendant relies on two Illinois cases to urge that we compare the imprisonment sentence he received with the deferred or totally suspended sentences imposed on the other defendants convicted of the same crimes. The authority for such an appellate review in Illinois stems from its S.Ct.Rule 615(b)(4), Ill.Rev.Stat. ch. 110A, ¶ 615(b)(4) (1979). New Mexico does not have a parallel rule; this court has no such authority. We have previously held that if a sentence imposed accords with the law regarding sentencing, it is not an abuse of discretion for the trial court to impose the lawful sentence allowed. See State v. Augustus, 97 N.M. 100, 637 P.2d 50 (Ct.App.1981), and cases therein cited. In the absence of abuse of discretion, the claim of due process violation also must fall. A lawful sentence of imprisonment is not excessive as a matter of law. State v. Mabry, 96 N.M. 317, 630 P.2d 269 (1981). It could hardly be excessive, then, if a portion of the time imposed is suspended, as was done here.
We cannot help observing, however, that the trial court will be required to vacate two convictions and five fines upon remand of this case. It may very well be the trial court’s decision at that time to reconsider the conditions and nature of the sentences imposed, in view of the reduction of the number of convictions upon which fines and terms of sentences may operate, and the dispositions made by other judges in similar cases. That decision, too, is solely in the trial court’s discretion, so long as it complies with the sentencing options authorized by law. See State v. Hernandez, 97 N.M. 28, 636 P.2d 299 (Ct.App.1981).
The matter is remanded to the trial court to vacate the convictions on Counts IV and XIII, and to vacate the fines and terms of incarceration imposed on Counts I, IV, X, XIII, and XVII, and to modify the judgment accordingly.
IT IS SO ORDERED.
LOPEZ and NEAL, JJ., concur. | [
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OPINION
SOSA, Senior Justice.
Plaintiff Valentine appeals from an adverse judgment rendered in district court on a suit to recover unpaid overtime compensation under (1) Section 207 of the Fair Labor Standards Act of 1938 (FLSA), 29 U.S.C. Section 207 (1976); (2) Minimum Wage Act, NMSA 1978, Sections 50-4-19 to 50-4-30 (Cum.Supp.1984); and (3) NMSA 1978, Section 50-5-1, regulating the maximum number of hours for female office employees. The defendant bank alleges that Valentine was employed in a bona fide administrative position within Section 213 of FLSA, and was therefore exempt under the overtime compensation provisions of the FLSA and the New Mexico Minimum Wage Act. See 29 U.S.C. § 213 (1976); NMSA 1978, § 50-4-21(0(2) (Cum.Supp. 1984). We affirm the trial court.
Two issues are presented: first, whether the trial court used an improper standard to conclude Valentine was an administrative employee within the meaning of the FLSA; and secondly, whether the trial court had substantial evidence for its conclusion that Valentine was an administrative employee.
The trial court found that Valentine was hired by the Bank of Albuquerque (Bank) to fill the position of administrative assistant. Valentine’s duties included, inter alia, working with accounts payable, preparing certain reports and the payroll, supervising personnel activities, and performing various clerical functions relating to the duties above. She reported directly to her immediate supervisor, a bank officer holding the executive position of vice president and cashier. She was expected to exercise independent judgment and discretion, and relieve the vice-president and cashier of certain daily responsibilities. Additionally, it was found that only twenty percent of her working hours were devoted to non-administrative duties. She was terminated upon failing to perform the required duties adequately and because of excessive absenteeism.
Administrative Employee
An “administrative employee” is not defined in the FLSA or the New Mexico Minimum Wage Act. However, the FLSA exempts from its overtime provisions, “any employee employed in a bonafide executive, administrative or professional capacity * * as such terms are defined and delimited * * by regulations of the Secretary * * 29 U.S.C. § 213(a)(1) (1976) (emphasis added); see also NMSA 1978, § 50-4-21(C)(2) (Cum.Supp.1984). Administrative regulations are entitled to controlling weight in construing the provisions of the FLSA. Mayhue’s Super Liquor Stores, Inc. v. Hodgson, 464 F.2d 1196 (5th Cir.1972) cert. denied, 409 U.S. 1108, 93 S.Ct. 908, 34 L.Ed.2d 688 (1973). The term “administrative employee” is defined in the Federal Regulations at 29 C.F.R. Section 541.2, and other jurisdictions have used this section to define an “administrative employee” under the FLSA. See Lyles v. K-Mart Corp., 519 F.Supp. 756 (M.D.Fla.1981); Donovan v. Flowers Marine, Inc., 545 F.Supp. 991 (E.D.La.1982). See also 29 C.F.R. § 541.-201(a)(1) (1984).
Valentine, in maintaining she is due overtime compensation under Section 207 of the FLSA, asserts that her position is not “administrative” and therefore, the administrative exemption in Section 213 does not apply. 29 U.S.C. §§ 207, 213 (1983). Valentine argues that whether a position is exempt should depend on the actual duties performed by the employee, and not the job description, the standard she claims the trial court used.
The relevant regulation defining an administrative employee uses as its criteria the duties performed. 29 C.F.R. § 541.2 (1984). The regulation provides, in pertinent part, that an administrative employee is one:
(a) Whose primary duty consists of * * *
(1) The performance of office or nonmanual work directly related to management policies or general business operations of his employer or his employer’s customers,
♦ * * * * *
(b) Who customarily and regularly exercises discretion and independent judgment; and
(c)(1) Who regularly and directly assists a proprietor, or an employee employed in a bona fide executive or administrative capacity * * * or,
(2)Who performs under only general supervision work along specialized or technical lines requiring special training, experience, or knowledge, * * *
(d) Who does not devote more than 20 percent * * * of his hours worked in the workweek to activities which are not directly and closely related to the performance of the work described in paragraphs (a) through (c) of this section * * *.
29 C.F.R. § 541.2 (1984).
Two elements are required to be present before an employee can be classified as “administrative” under 29 C.F.R. Section 541.2: first, that the employee’s job relate directly to administrative functions as described in 29 C.F.R. Section 541.-2(a)(1); and secondly, that the employee regularly performs administrative functions as provided under 29 C.F.R. 541.2(a), (b), (d). See Lyles; Donovan.
The trial court determined that the first element, a job relating directly to administrative functions, was present by finding that Valentine assisted and reported directly to the vice president and cashier, her duties directly related to management policies, and she was expected to relieve the vice president and cashier of certain daily responsibilities. The second requirement, performance of administrative functions, was met by the court’s finding that merely twenty percent of Valentine’s working time was non-administrative, thus, the majority of her time was spent fulfilling the administrative duties. See 29 C.F.R. § 541.2(d) (1984).
The trial court, finding that both requirements of 29 C.F.R. Section 541.2 were met, properly concluded that Valentine was an administrative employee within the meaning of the FSLA, and therefore, not entitled to overtime compensation. See Lyles; Donovan.
Furthermore, 29 C.F.R. Section 541.2 has been amended by adding a new section entitled, EMPLOYEE EMPLOYED IN A BONA FIDE ADMINISTRATIVE CAPACITY. The new section defines an emerging classification by providing:
(a) Three types of employees are described in § 541.2(c) who, if they meet the other tests in § 541.2, qualify for exemption as “administrative” employees.
(1) Executive and administrative assistants. The first type is the assistant to a proprietor or to an executive or administrative employee. In modern industrial practice there has been a steady and increasing use of persons who assist an executive in the performance of his duties without themselves having executive authority. Typical titles of persons in this group are executive assistant to the president, confidential assistant, executive secretary, assistant to the general manager, administrative assistant and, in retail or service establishments, assistant manager and assistant buyer. Generally speaking, such assistants are found in large establishments where the official assisted has duties of such scope and which require so much attention that the work of personal scrutiny, correspondence, and interviews must be delegated.
29 C.F.R. § 541.201(a)(1) (1984) (emphasis added); see also 29 C.F.R. § 541.207(d)(2) (1984).
Valentine falls squarely within the modern industrial practice of using “administrative assistants” to “assist an executive in the performance of his duties without themselves having executive authority.” 29 C.F.R. § 541.201(a)(1) (1984).
Substantial Evidence
An examination of the record, as demonstrated by the facts set forth in this opinion, indicates there is substantial evidence to support the findings of the trial court under the standard determined in Toltec International, Inc. v. Village of Ruidoso, 95 N.M. 82, 619 P.2d 186 (1980).
For the reasons set forth, the trial court is affirmed.
FEDERICI, C.J., and RIORDAN, J„ concur. | [
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] |
OPINION
WALTERS, Justice.
The Superintendent of Insurance suspended Petitioner Madrid’s property bondsman and limited surety agency licenses. Madrid appeals the decision of the district court upholding the superintendent’s decision. We reverse.
On June 3, 1983, the superintendent notified Madrid of his suspension. The notice informed petitioner that the suspension of his property bondsman license could be appealed to the District Court in Santa Fe County. It further advised that, pursuant to NMSA 1978, Section 59-2-9, Madrid could appeal the suspension of both licenses to the State Corporation Commission or to the Santa Fe District Court.
Madrid chose to file an appeal on both license suspensions in the District Court. The Department of Insurance now argues that the district court did not have jurisdiction to hear this case because petitioner failed to exhaust his administrative remedies.
Both of the licenses held by Madrid — a property bondsman license and a limited surety agent license — are bail bondsmen licenses governed by the Bail Bondsmen Licensing Law, NMSA 1978, Sections 59A-51-1 to -19 (Orig.Pamp.1984) (hereafter “BBLL”). NMSA 1978, Section 59-2-9, to which the Superintendent of Insurance referred in his Order of Suspension, is not applicable to the licensing of bail bondsmen.
Although the provisions of the BBLL have changed over a period of time, they have always provided that the correct avenue of appeal from an order of the Superintendent of Insurance is by petition to the State Corporation Commission. Only after a hearing there may a licensee appeal to the district court.
Because the sections of the Insurance Code, NMSA 1978, Chapter 59A (Orig. Pamp.1984) and NMSA 1978, Chapter 61, “Professional and Occupational Licenses,” which contain the review procedure, are less than clear, we trace the relevant statutes.
Section 59A-51-14 E (designated Section 59-32-17 E at the time of the actions on which this case is based) provides that:
The Uniform Licensing Act [61-1-1 to 61-1-31 NMSA 1978] shall apply with regard to the procedure for denial, revocation, suspension or refusal to continue a license pursuant to this article.
The Uniform Licensing Act (hereafter “ULA”) sets out the procedure for review to the district court from a decision of any “board” of the state government. NMSA 1978, § 61-1-17 (Repl.Pamp.1981).
NMSA 1978, Section 61-1-2 A (Cum. Supp.1984), lists most of these boards but does not mention the Superintendent of Insurance, the Insurance Board or the State Corporation Commission. The section does provide, however, that the term “board” shall also apply to:
any other New Mexico state agency to which the Uniform Licensing Act is subsequently applied by law * * *.
The ULA had been applied by law to the licensing of bail bondsmen. NMSA 1978, § 59A-51-14 E (Orig.Pamp.1984). But nowhere in the statutes is it specified which agency concerned with licensing of bail bondsmen is the “board” under the ULA. Other sections of the BBLL, however, make the intended procedure clear.
In June 1983, when the Superintendent of Insurance suspended Madrid’s licenses, the BBLL contained the following provision:
Any applicant for license as bail bondsman or solicitor whose application has been denied or whose license shall have been so suspended or revoked, or renewal thereof denied, shall have the right to appeal to the corporation commission pursuant to Section 59-5-39 NMSA 1978 and in accordance with the provisions of the Uniform Licensing Act [61-1-1 to 61-1-31 NMSA 1978].
NMSA 1978, § 59-32-22 (Supp.1979).
Mr. Madrid contends that the language “and in accordance with the provisions of the Uniform Licensing Act” means that the term “board” in that Act refers to either the Superintendent of Insurance or the Corporation Commission, at the option of the licensee. We cannot accept this argument.
The ULA controls many aspects of licensing procedure beyond the determination of which agency is to serve as the final administrative adjudicator. By referring to the ULA in Section 59-32-22 of the BBLL, the statute merely provided that guidelines set forth in the ULA should be considered when a license suspension is appealed to the Corporation Commission. This interpretation is strengthened by the statute’s final sentence which reads that “[a]ny further appeal shall be taken in district court as provided by law.” § 59-32-22 (emphasis added).
Moreover, Section 59-32-22 specifies that appeal to the Corporation Commission is “pursuant to Section 59-5-39 NMSA 1978 * * That section, at the time this matter arose, provided that an “agent or broker shall have the right to appeal to the corporation commission from the decision of the superintendent * *
Thus, under the statutes in effect at the time the suspension orders were entered here, Madrid’s only recourse was to appeal those orders to the Corporation Commission.
In the most recent revision of the Insurance Code effective January 1, 1985, Section 59-32-22 does not appear. But in the new revision, Section 59A-51-19 makes some other provisions of the Insurance Code applicable to the licensing of bail bondsmen. One such provision in Article 4 is Section 59A-4-20 entitled “Appeal to Court.” Although this section refers to the licensee’s right to appeal to the district court from an order of the superintendent, it specifies that:
[T]he appeal shall be taken within sixty (60) days after receipt by the party appealing, of a copy of the decision on review of the superintendent’s order on hearing by the corporation commission or insurance board.
NMSA 1978, § 59A-4-20 B (Orig.Pamp. 1984).
Thus, while the newer enactment allows a licensee to appeal to the district court after a hearing by either the corporation commission or the insurance board (making both of these agencies “the board” under the ULA), a direct appeal to the court still is not authorized from an order of the superintendent. Clearly, the district court did not have jurisdiction in this case.
We remand the appeal to the Corporation Commission for review of the superintendent’s Order of Suspension, as provided in the Bail Bondsmen Licensing Law. Because of our remand, the other issues raised in this proceeding, which relate to the appeal procedures in and the decision of the district court, need not be addressed.
The case is remanded to the State Corporation Commission for further proceedings in accordance with this Opinion.
IT IS SO ORDERED.
FEDERICI, C.J., and SOSA, Senior Justice, concur. | [
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OPINION
BLACK, Judge.
Defendant appeals from his conviction on one count of criminal sexual contact with a minor. He raises three issues on appeal: 1) whether a videotaped police interview of the alleged victim was properly admitted as a prior consistent statement; 2) whether the district court erred in admitting evidence of uncharged sexual acts between Defendant and others, as well as between Defendant and the alleged victim; and 3) whether it was fundamental error to fail to instruct the jury on the element of unlawfulness. We reverse on issue one, and address issues two and three only as they may arise on retrial.
I. SUMMARY OF FACTS AND TESTIMONY
On May 15, 1992, Susan sent her six-year-old daughter, Tiffany, to Defendant’s trailer to borrow some toenail clippers. When Tiffany was gone fifteen to twenty minutes, Susan began to worry. Upon Tiffany’s return home, Susan questioned her at length. After thirty-five to forty minutes of questioning, Tiffany reported that Defendant had licked her “private.”
At trial, Defendant objected to a neighbor, Sherry, relating comments made to her by her daughter, Amanda, about what Tiffany had told Amanda. Sherry was, however, allowed to testify that Amanda told her “something.” Sherry further testified that she then told Susan “something” was happening between Defendant and Tiffany. Sherry also testified that she did not trust Defendant because, on a previous occasion, after promising that her son would not be allowed to go swimming, Defendant allowed him to swim in his underwear.
Amanda was twelve years old at the time of trial. Amanda testified that she saw Defendant tickle Tiffany all over, including her private parts. She, too, was allowed to testify that Tiffany had told her about “something” occurring between' Tiffany and Defendant. Amanda also testified that she had reported that “something” to her mother. Finding that the probative value of the testimony outweighed its inflammatory effect, the district court allowed Amanda to testify that she told her mother a second time that Tiffany had said “something.” Amanda also testified that her memory was better when she gave her statement to the police than it was “today.” She was then asked whether the police had inquired if she had seen Defendant touching Tiffany’s breasts, and rubbing or touching Tiffany on the vagina. On the witness stand, Amanda was asked, not whether any of this actually had occurred, but rather, whether she remembered being asked about these things by the police. She had some recollection of such questioning.
Susan testified that Tiffany told her Defendant had molested her and her friend, Omi. Susan further testified that Omi told her mother the same story. Defense counsel objected to this testimony as hearsay, and the district court admonished the prosecutor to avoid hearsay. Susan also testified that Tiffany had been sexually molested on several occasions by at least two neighborhood children.
Susan testified that Sherry had reported to her the night before the alleged incident that Amanda had said “something” about Tiffany and Defendant. Susan said she discounted this report as jealousy and allowed Tiffany and her brother to stay overnight at Defendant’s that same night. The State then questioned Susan at length as to whether Tiffany had told her about any specific sexual acts performed by Defendant.
On redirect examination, the prosecutor asked Susan whether Tiffany had told her about other prior sexual contact between Defendant and Tiffany. Susan indicated that Tiffany had said nothing at first, but when asked about specific different types of penetration, Tiffany agreed that some had occurred, but not others. The prosecutor then began trying to refresh Susan’s recollection with a prior statement she had given to the police the day of the incident.
Tiffany also took the witness stand. When the prosecutor asked her if Defendant ever did anything painful to her, she answered affirmatively. When the prosecutor asked what Defendant had done, she did not answer. The prosecutor continued questioning Tiffany. During a portion of that direct examination, the following exchange occurred:
Q: What happened after you were laying down on the bed?
A: He pulled my panties down.
Q: He pulled your panties down? What happened then?
A: He did “nasties” to me.
Q: You said he did “nasties” to you — can you tell us exactly what it was that he did? [silence]
Q: Did he touch you?
A: Yes.
Q: What did he touch you with?
[silence; prosecutor repeated the question]
A: His “private.”
Q: Did he touch you with anything else?
A: No.
Q: What did he do with his “private?”
A: He put it in my “private.”
Q: Put it in your “private?”
A: Yes
Q: How did he put — can you tell us how he did this? Exactly what he did? [silence]
Q: Can you say how long it was? Was it a long time, a short time, what?
A: Short.
Q: You said he was wearing white shorts. And what did he do with the white shorts when he did this? [silence]
Q: tiffany, do you need a drink of water or something? You want to tell us what happened? [silence]
Q: Can you tell us more about what happened? [silence]
Q: Okay, Tiffany, did he touch you with anything else besides his private parts?
A: No.
Q: Was that the whole time?
A: No.
Q: And when you went to get the clippers?
A: Yes.
Q: What else did he touch you with? [silence]
[Prosecutor reminds her that she said she would tell the truth.]
Q: You’d like to do that [tell the truth]?
A: Yes.
After this exchange, defense counsel asked for a bench conference. He objected to the repeated questions because Tiffany was not answering them. The judge informed the prosecutor that he was not going to allow him to ask totally repetitive questions. When the prosecutor requested a recess, the judge asked if he thought it would' do any good, and added that questioning Tiffany was “like pulling teeth.”
Later, the judge held another bench conference regarding Tiffany’s unwillingness or inability to testify. After much cajoling by the prosecutor proved fruitless, the judge agreed to try questioning her himself. The judge then asked Tiffany the following questions:
Q: Did ... [Defendant] hurt you?
A: Yes.
Q: What?
A: Yes.
Q: He did? Did you tell your mother what happened when you went for the clippers?
A: Yes.
When Tiffany returned after a recess, she said that she told both her mother and the officers the truth. She said she had told the officers things that had happened for a “long time,” not just on the morning of May 15, 1992. She said that, in addition to sticking his “private” in her “private,” Defendant licked her “private.” Tiffany said he had also licked her before May 15, 1992, and had touched her “private” with his hands.
The prosecutor then showed Tiffany Defendant’s vibrator, and the following colloquy occurred:
Q: Have you seen [it] before?
A: Yes.
Q: Where did you see it before?
A: At his house.
[discussion to clarify that “his house” refers to Defendant’s house]
Q: What would he do with [it]? [silence]
Q: Let me ask you, did he use [it] on himself?
A: Yes.
Q: And what would he do with it when he used it on himself? [silence]
Q: Would he touch himself with it?
A: No.
Q: What did he do with it? [silence]
Q: Would it make a noise when he had it?
A: No.
Q: Did he ever touch you with it?
A: No.
Q: Did you ever tell anybody that he had touched you with it?
A: No.
Q: Have you ever heard it or seen it turned on?
A: Yes.
Q: When was that? Do you remember?
A: For a long time.
Q: What was being done with it while it was turned on? [silence]
Q: Who had it when it was turned on?
A: Him.
Q: What was he doing with it? [silence]
Q: Do you know what he was doing with it? [silence]
Q: Did you see him with it? [silence]
II. THE VIDEOTAPED STATEMENT WAS NOT ADMISSIBLE UNDER RULE 801(D)(1)(b)
Defendant’s evidentiary challenges center on the admission of Tiffany’s videotaped interview with police the afternoon of the alleged incident. Defendant objected vehemently to the use of the videotape on the ground that it did not fall within the hearsay exception permitted under SCRA 1986, 11-801(D)(1)(b) (Repl.1994). The district court overruled the objection and allowed the videotape to be played during the course of Officer Wilkinson’s testimony. On appeal, Defendant contends that the admission of the videotape as a prior consistent statement was error. We agree.
On the videotape, Tiffany responded to questions much more freely than she did on the witness stand. In response to police questioning, Tiffany stated that, after going to his house to get the clippers, Defendant said he wanted to “lick [her] ‘private.’ ” He told her to come into his bedroom and lie down on the bed. Tiffany said Defendant spread her legs “out how far he wanted [her] legs to go, and it hurt [her].” She stated that Defendant licked her “private” and also licked her “butt.” On the videotape, Tiffany said that Defendant did not put his “private” in her “private” that morning. She stated that Defendant also made her touch his “private” with her hand. In response to later questions, she further informed the police that he touched her “titties” on “Friday, Monday, and Tuesday” and put his “machine” (vibrator) on her “private.”
Relying on State v. Vigil, 103 N.M. 583, 711 P.2d 28 (Ct.App.1985), the State urged admission of the videotape as a prior consistent statement under SCRA ll-801(D)(l)(b), which states that a prior consistent statement offered to rebut a charge of recent fabrication or improper influence is not hearsay. Defendant objected that a prior consistent statement was only admissible to rebut charges of recent fabrication, and contended that this fabrication had occurred as a result of Susan’s initial questioning of Tiffany before the police videotape was made. The State did not dispute this contention.
Defendant also complained that the videotape was not a “consistent” statement. The State responded that the videotaped statement was only inconsistent “in part.” The district court admitted the videotape as a prior consistent statement, but later agreed that the portion of the videotape discussing incidents with other children and uncharged acts should be redacted.
Generally, a videotape made by a witness outside of court, when offered to prove the truth of the matter asserted, constitutes inadmissible hearsay. Sprynczynatyk v. General Motors Corp., 771 F.2d 1112, 1117 (8th Cir.1985), cert. denied, 475 U.S. 1046, 106 S.Ct. 1263, 89 L.Ed.2d 572 (1986). It follows that “[o]ut-of-court testimony, which is usually less reliable than live testimony that is given under oath, in open court, and subject to cross-examination, should not dominate the jury’s deliberations simply because a party was clever enough to record that out-of-court testimony on videotape.” Chambers v. State, 726 P.2d 1269, 1276 (Wyo.1986).
SCRA ll-801(D)(l)(b) is commonly construed to require two conditions before a prior consistent statement may be admitted. State v. Lucero, 109 N.M. 298, 302, 784 P.2d 1041, 1045 (Ct.App.1989). First, the prior statement must be consistent with testimony given by the declarant at trial. Id. Second, the statement must be admitted to rebut an express or implied charge of recent fabrication or improper influence or motive. Id. In addition to the above, some courts have imposed a third requirement that, in order to be admissible, a prior consistent statement must also have been made before the motive to fabricate existed. Id.; see generally Nitz v. State, 720 P.2d 55, 64 (Alaska Ct.App.1986) (describing prior consistent statement rule as “commonly construed” to include this third requirement). In Lucero, this Court rejected a bright line rule allowing admission of prior consistent statements only if they were made before the supposed motive to fabricate arose. We held that the district court should examine the circumstances under which the statement was made to determine the statement’s relevancy and probativeness to rebut a charge of recent fabrication. Lucero, 109 N.M. at 303, 784 P.2d at 1046.
The videotaped interview of Tiffany does not meet the first requirement of SCRA ll-801(D)(l)(b). To the extent she testified as to any substantive events at trial, there are several obvious inconsistencies between Tiffany’s trial testimony and her videotaped police interview. More importantly, Tiffany did not answer, or answered inconclusively, many of the prosecutor’s critical questions at trial. The district judge acknowledged this fact by noting that obtaining answers from Tiffany was “like pulling teeth.” The judge even attempted to question Tiffany himself.
The issue in this case then becomes whether SCRA ll-801(D)(l)(b), which is, of course, patterned after Federal Rule of Evidence 801 (“Rule 801”), can be used, not to admit a prior consistent statement, but to admit the past recollection of a witness who is available and testifies, but with a poor memory. Although the cases and commentators are divided on this issue, compare 1 John W. Strong, McCormick on Evidence § 47, at 177-78 & n. 18 (4th ed. 1992) with 4 Jack B. Weinstein & Margaret A. Berger, Weinstein’s Evidence ¶ 801(d)(l)(B)[01], at 801-192 to 801-195 (1994) (discussing different views), we think the better reasoned position precludes the use of a prior out-of-court statement to fill in the gaps left by the faulty memory of a witness who actually testifies at trial. According to Judge Weinstein and Professor Berger, the Advisory Committee’s notes to Rule 801 support that position. They have written:
The Advisory Committee’s notes do not indicate whether the substantive effect of the rule extends to situations where the prior the [sic] consistent statement is admitted not to rebut an inconsistent statement, but to refute an imputation of inaccurate memory on the part of the witness by showing that he made the same statement when the event was recent. However, normal usage would argue that the words “fabrication,” “influence” and “motive” indicate that the Rule is intended to cover only those situations where the witness deliberately changes his story. Therefore, Rule 801(d)(1)(B) should apply only when there is some suggestion, if only slight, that the witness consciously altered his present testimony after making the inconsistent statement by which he has been impeached.
4 Weinstein & Berger, supra, ¶ 801(d)(B)[01], at 801-192 to 801-195 (footnotes omitted).
Professor Seidelson reaches the same conclusion by comparing the language of Rule 801(d)(1) with the language of Federal Rule of Evidence 804 (“Rule 804”):
It seems plain from the language of the rule itself that Congress intended the non-hearsay characterization to apply only where the declarant testifies meaningfully at trial concerning his prior statement. Therefore, Rule 804 and Rule 801(d)(1) deal with two quite different situations— Rule 804 requires unavailability of the declarant as a condition precedent to utilization of the hearsay exceptions set forth therein, whereas Rule 801(d)(1) contemplates meaningful trial testimony by the declarant as a condition precedent to having the categories of declarations set forth therein characterized as non-hearsay.
The inclusion of the phrase “a lack of memory of the subject matter of [the] statement” as a part of the definition of unavailability in Rule 804, and its exclusion from Rule 801(d)(1), seem to imply that the latter rule was intended to require meaningful testimony from the declarant concerning his prior extrajudicial declaration.
David E. Seidelson, The Confrontation Clause and the Supreme Court: Some Good News and Some Bad News, 17 Hofstra L.Rev. 51, 94 (1988) (alteration in original) (footnotes omitted).
Our task is to determine the purpose and intent of the rule. State v. Lucero, 114 N.M. 460, 462, 840 P.2d 607, 609 (Ct.App.1992). Both the Advisory Committee’s notes and Professor Seidelson’s comparison of the language of Rule 801 with that employed in Rule 804 convince us that Rule 801(d)(1)(B) was not intended to permit an unexamined out-of-court statement as a substitute for trial testimony from a witness who cannot remember critical events.
Even some of those who favor employing Rule 801(d)(1)(B) as a vehicle for admitting out-of-court statements of witnesses who testify poorly at trial would tightly limit the practice. For example, Professor Graham offers a hypothetical example where counsel cross-examines a witness on why he can remember the color of the stoplight but little else about the accident scene. Michael H. Graham, Prior Consistent Statements: Rule 801(d)(1)(B) of the Federal Rules of Evidence, Critique and Proposal, 30 Hastings L.J. 575, 606-07 n. 102 (1979). As he points out, in this type of situation a prior statement that is consistent with the testimony “would not in any significant respect rebut the cross-examiner’s charge of lack of recollection.” Id. at 607 n. 102. Professor Graham therefore concludes that “[o]nly where the cross-examiner engages in a direct attack upon the witness’s ability to recall the particular fact in question, and employs an inconsistent statement or impeaches the witness by negative evidence addressed to that very fact, should a prior consistent statement near the event be admitted to rebut.” Id.
Here the videotape was used to shore up Tiffany’s lack of trial recollection on several key points regarding her encounter with Defendant. Thus, even under Professor Graham’s analysis, it is doubtful that the videotape recounting various alleged encounters between Defendant and Tiffany could have been admitted. Because the videotape fails to meet the first requirement of SCRA 11-801(D)(1)(b), we find it unnecessary to examine the second and third requirements of the rule.
Even though we held the videotape inadmissible in evidence, this Court must ask whether the admission of Tiffany’s videotaped interview was prejudicial to Defendant. We hold that it was. It is far easier to elicit favorable testimony from a child when a detective or other type of skilled questioner leads the child through preconceived scenarios, and without any confrontation or cross-examination, than it is to elicit trial testimony. Burke v. State, 820 P.2d 1344, 1348 (Okla.Crim.App.1991), cert. denied, 504 U.S. 973, 112 S.Ct. 2940, 119 L.Ed.2d 565 (1992); accord, In re Troy P., 114 N.M. 525, 528-29, 842 P.2d 742, 745-46 (Ct.App.1992) (noting that there is a recognized danger of suggestive interviewing procedures in child sexual abuse cases). At trial, there was no medical evidence of sexual contact and virtually no direct testimony, but rather only a profusion of hearsay to support the charges. The admission of an alleged prior consistent statement in such a case constitutes reversible error. See Pennington v. State, 24 Ark.App. 70, 749 S.W.2d 680 (1988) (en banc); Wise v. State, 546 So.2d 1068 (Fla.Dist.Ct.App.), review denied, 554 So.2d 1169 (Fla.1989); State v. Harper, 35 Wash.App. 855, 670 P.2d 296, 298-99 (1983), review denied 100 Wash.2d 1035 (1984). On this record, we cannot say that the admission of the videotape was harmless error.
III. EVIDENCE OF UNCHARGED PRIOR CONDUCT SHOULD NOT HAVE BEEN ADMITTED
We divide this issue into two parts, because the question of whether the district court erred in admitting evidence regarding Defendant’s prior acts with the victim and with others relies on two different lines of ease law. We turn first to a discussion of preservation.
A. Preservation
The prior act at issue on this appeal is Defendant putting a vibrator on the genitals of Tiffany’s friend, Omi. The statement regarding this incident occurs during Tiffany’s videotaped interview. The State argues this error was not preserved. We do not agree.
The State argues that Defendant’s motion for mistrial was improper because it was not timely and because Defendant refused a limiting instruction. See State v. Martinez, 102 N.M. 94, 100, 691 P.2d 887, 893 (Ct.App.) (stating that, where an improper admission of evidence can be cured by a limiting instruction, the proper remedy is to request such an instruction; failure to do so constitutes waiver of error), cert. denied 102 N.M. 88, 691 P.2d 881 (1984); accord State v. Gonzales, 113 N.M. 221, 228, 824 P.2d 1023, 1030 (1992). Defense counsel argues that he concluded the limiting instruction would only make things worse. We think this was a legitimate concern. When, as here, a limiting instruction would not cure the error, a party does not waive error by refusing such an instruction. See Martinez, 102 N.M. at 100, 691 P.2d at 893. Considering that the State was told by the district court to remove the portion of the videotape dealing with uncharged acts with other children, the State should not subsequently benefit from its failure to follow the court’s ruling simply because Defendant tactically tried to provide some damage control. See State v. Rowell, 77 N.M. 124, 128-29, 419 P.2d 966, 969-70 (1966).
B. Acts mth Others
Defense counsel repeatedly expressed concern that the videotape dealt with Defendant’s activities with other children. The district court ruled that the references to sexual acts involving other children should not be shown to the jury. The district court thus required that a five-minute segment of the videotape be redacted before being shown to the jury. This section of the videotape concerned, among other things, alleged sexual activity between Defendant and Omi. However, at the point the State actually started the videotape in front of the jury, Tiffany was saying that Defendant put his “machine” (vibrator) on her “private” and also on Omi’s “private.”
After the videotape was shown to the jury during Officer Wilkinson’s testimony, defense counsel told the judge he would save his motion for mistrial until the conclusion of the officer’s testimony. When Officer Wilkinson had finished testifying, defense counsel moved for a mistrial on the basis that sexual acts with someone other than the alleged victim were now before the jury. The district court denied the motion, finding that the act was not particularly similar to the acts charged, and that it was a “slight matter.”
The State argues that Defendant was not prejudiced by the admission, because the information had been previously admitted through other witnesses. This is not entirely accurate. Due to defense objections, Sherry and Amanda were allowed only to testify that Tiffany had told Amanda unspecified “somethings” about Defendant. Although Tiffany’s mother testified that Tiffany told her Omi was also sexually molested by Defendant, Defendant immediately objected, and the district court admonished the prosecutor to avoid hearsay testimony.
Evidence of alleged sexual acts with someone other than the victim of the crime(s) before the jury is generally not admissible. State v. Lucero, 114 N.M. 489, 492-93, 840 P.2d 1255, 1258-59 (Ct.App.), cert. denied, 114 N.M. 413, 839 P.2d 623 (1992); State v. Mason, 79 N.M. 663, 667, 448 P.2d 175, 179 (Ct.App.), cert. denied, 79 N.M. 688, 448 P.2d 489 (1968). The basic rationale “for excluding character evidence that only shows a propensity, to commit various crimes is that such evidence is not probative of the fact that the defendant acted consistently with his past conduct in committing the acts at issue.” State v. Williams, 117 N.M. 551, 557, 874 P.2d 12, 18 (1994). Therefore, “[tjestimony which amounts to evidence of a defendant’s bad character, or disposition to commit the crime charged, when not offered for a legitimate purpose, is inadmissible and unfairly prejudicial.” State v. Rael, 117 N.M. 539, 540, 873 P.2d 285, 286 (Ct.App.1994).
As the district court implicitly recognized in its ruling, the admission of the uncharged act(s) between Defendant and Omi was error. At the new trial, there should be no admission of uncharged acts between Defendant and other children in contravention of SCRA 1986, 11-404 (Repl.1994).
C. Prior Acts with Victim
Defendant urges this Court to reconsider its holding in State v. Landers, 115 N.M. 514, 853 P.2d 1270 (Ct.App.1992), cert. quashed, 115 N.M. 535, 854 P.2d 362 (1993), regarding the admissibility of prior uncharged sexual acts with the victim. In Landers, we followed long-established New Mexico precedent and held that evidence of a defendant’s previous sexual conduct with the victim of a sex crime is admissible where it demon- states a lewd and lascivious disposition toward that victim. Id. at 519, 853 P.2d at 1275. The rationale. underlying Landers may very well require reconsideration. See Williams, 117 N.M. at 561-62, 874 P.2d at 22-23 (Montgomery, C.J., specially concurring). We need not reach this issue, however, because the specific evidence complained of was inadmissible on hearsay grounds.
The testimony provided by Sherry and Amanda is hearsay and does not fall under any exception to the general exclusion found in SCRA 1986, 11-802 (Repl.1994). The hearsay testimony given by Amanda and Sherry about Tiffany telling them that “something” was occurring between Defendant and Tiffany was prejudicial and had little probative value. Their specific testimony, disallowed by the district court on hearsay grounds, left the jury to imagine what outrageous conduct the “something” that they had testified about could be. It also lacked any indicia of reliability.
The admission of this testimony clearly could have confused the jury. This case was essentially a swearing match between Defendant and Tiffany. The alleged incident that occurred during the nail clipper errand took place on May 15,1992. During their deliberations, a note was sent to the judge asking, “Please define on or about the 15th. Is it subject to only the 15th[?].” The clear inference is that the jury did not know from which act or acts guilt should be determined. The profusion of implied incidents created more chaos than clarity.
The State’s questioning of Amanda evoked the most pernicious type of hearsay. Amanda was only asked if she remembered being asked if she saw Defendant touching Tiffany’s breasts, or rubbing or touching Tiffany on the vagina. The questions thus focused not on Amanda’s first-hand knowledge of events, but upon police suspicions. No direct questions regarding whether the conduct actually occurred were elicited, but the suggestion in the questions is obvious:
Q. [D]o you remember being asked about whether you had seen the Defendant touching what’s called “boobs,” Tiffany’s “boobs?” Do you remember that?
A. I don’t remember being asked that.
Q. Do you remember being asked whether it was a touch, whether it was rubbing, or just a hug?
A. No.
Q. You don’t remember that at all? Do you remember about being asked, “Did he touch her on the vagina?”
A. No.
Q. Do you remember being asked, “Was it rubbing, touching, patting, or what?”
A. A little bit ... not much though.
Q. And your memory was better then than it was today?
A. Yes.
Q. You just don’t remember any of those questions?
A No.
Q. And you don’t remember your answers?
A. No.
Such questioning was improper. See Rowell, 77 N.M. at 127, 419 P.2d at 969. At least some of the jurors would doubtless assume there was some evidence that Defendant had done all those things, or else the police would not have asked the witness about them. See id. “[T]he question is one of prejudice to the defendant arising out of the asking of an improper question for the ostensible purpose of planting ideas or thoughts in the minds of the jury.” Id.; see also State v. Baca, 111 N.M. 270, 278, 804 P.2d 1089, 1097 (Ct.App.1990) (recognizing that a question can provide probative information about which the witness has no knowledge), cert. denied, 111 N.M. 164, 803 P.2d 253 (1991); State v. Day, 91 N.M. 570, 572-73, 577 P.2d 878, 880-81 (Ct.App.) (questioning defendant about a “possible federal crime” was improper), cert. denied, 91 N.M. 491, 576 P.2d 297 (1978).
Furthermore, much of the questioning also crossed the permissible boundaries for prior consistent statements. In order to refresh her recollection, Susan eventually referred to her previous statement to police. After reviewing that statement, Susan recalled asking Tiffany specific questions as to whether or not a certain sexual activity had occurred between Tiffany and Defendant. She asked Tiffany about different types of penetration and stated that Tiffany agreed that they had happened. At another bench conference, the judge agreed to permit this line of questioning because, as the prosecutor argued, during cross-examination of Susan and Tiffany, the inference “has been ... that this witness coached her.” The judge disagreed with defense counsel’s assertions that these questions (“Did these things occur?” and “Did she tell you these things?”) were being offered for the truth of what Tiffany had said.
Once again, this was not a proper use of a prior consistent statement because Susan’s statement to the police was merely a reiteration of Tiffany’s yes-or-no responses to Susan’s earlier leading questions, and Susan repeating Tiffany’s responses to police does not refute the claim that Susan “coaxed” the original charges from Tiffany. Cf. State v. Sanchez, 95 N.M. 27, 28, 618 P.2d 371, 372 (Ct.App.1980) (noting that it is improper to present an entire criminal charge through leading questions that can be answered “yes” or “no”), overruled on other grounds by Buzbee v. Donnelly, 96 N.M. 692, 701, 634 P.2d 1244, 1253 (1981).
Finally, this Court must ask whether the “evidence of guilt was so overwhelming that there is no reasonable probability that the improperly admitted evidence contributed to the conviction.” See State v. Gonzales, 93 N.M. 445, 446, 601 P.2d 78, 79 (Ct.App.1979). In this case, we must hold that it was not.
IV. FAILURE TO INSTRUCT THE JURY ON THE ELEMENT OF UNLAWFULNESS WAS NOT FUNDAMENTAL ERROR
Defendant finally argues that the district court erred in failing to instruct the jury that the “touching” at issue had to be unlawful. Defendant failed to request such an instruction at trial and failed to object to its absence, so the remaining question is whether the failure to include the instruction was fundamental error. See State v. Osborne, 111 N.M. 654, 662, 808 P.2d 624, 632 (1991).
At trial, Defendant denied that the incident in question ever occurred. The jury instruction indicated that one element of the crime of criminal sexual contact of a minor is that “[t]he defendant touched or applied force to the vagina of Tiffany[.]” Although the element of unlawfulness was not included in this instruction, that element is not at issue here. Either Defendant performed the act or he did not, and there is no situation where Defendant placing his tongue on or around Tiffany’s vagina could be considered lawful. See State v. Orosco, 113 N.M. 780, 783-84, 833 P.2d 1146, 1149-50 (1992); State v. Landers, 115 N.M. 514, 516, 853 P.2d 1270, 1272 (Ct.App.1992), cert. quashed, 115 N.M. 535, 854 P.2d 362 (1993). Therefore, we hold that the omission was not fundamental error.
We affirm the district court on this issue.
V. CONCLUSION
Given Tiffany’s lack of memory and somewhat confusing account of the alleged events at trial, we believe that the videotape likely affected the outcome of the trial. The videotape was'not admissible as a prior consistent statement. We also hold that it was error to allow the jury to view the portion of the videotape revealing allegations that Defendant participated in the uncharged criminal sexual contact of Omi and to listen to questioning about prior police interrogation of the witnesses rather than the witnesses’ actual knowledge of events. We reverse Defendant’s conviction and remand for a new trial consistent with this opinion.
IT IS SO ORDERED.
MINZNER, C.J., and BIVINS, J., concur. | [
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OPINION
BIVINS, Judge.
Pete B. Vigil (plaintiff) sought relief against his former employers, Ernesto Arzola, Jr. (Arzola) and Tierra Del Sol Housing Corporation (TDS), asserting three separate causes of action: (1) breach of employment contract; (2) retaliatory discharge; and (3) violation of 42 U.S.C. § 1983 (1981). At the conclusion of all evidence, the trial court dismissed the first two causes of action, leaving only the § 1983 claim. The jury awarded plaintiff $25,000 compensatory damages and $50,-000 punitive damages. After entry of judgment the trial court, sua sponte, held the award of punitive damages against TDS improper. Defendants appeal from the judgment, and plaintiff cross-appeals the dismissal of his breach of contract and retaliatory discharge claims and also the trial court’s deletion of the punitive damage award. We reverse the judgment against defendants and the dismissal of the retaliatory discharge claim, and affirm the dismissal of the breach of contract claim.
A brief summary of the events leading up to plaintiff’s termination will be helpful to an understanding of the issues on appeal.
Incorporated as a not-for-profit corporation under the law of New Mexico, TDS, which enjoys a tax-exempt status, was organized to offer technical assistance to low income persons who qualify for cooperative home building projects. TDS receives its funding primarily, if not entirely, from federal sources. At oral argument TDS was characterized, without substantial contradiction, as “nothing but an arm of FHA.”
A fifteen-member board of directors manages the corporation without pay. Arzola, as the director, has responsibility for the corporation’s day-to-day operation and has the power to hire and fire personnel.
Plaintiff claims his employment with TDS was terminated after he made statements criticizing certain corporate procedures, including expenditures of public funds. Following the criticism, Arzola terminated plaintiff for lack of performance. The personnel committee of TDS reviewed this action and recommended reinstatement. The board stood by the termination. This suit followed.
I. Defendants’ appeal.
Defendants contend plaintiff’s failure to prove color of state law requires reversal. We agree. We apply federal substantive law in determining this issue.
42 U.S.C. § 1983 provides:
Every person who, under color of any statute, ordinance, regulation, custom, or usage, of any State or Territory or the District of Columbia, subjects, or causes to be subjected, any citizen of the United States or other person within the jurisdiction thereof to the deprivation of any rights, privileges, or immunities secured by the Constitution and laws, shall be liable to the party injured in an action at law, suit in equity, or other proper proceeding for redress. For the purposes of this section, any Act of Congress applicable exclusively to the District of Columbia shall be considered to be a statute of the District of Columbia. (Emphasis added).
Defendants argue the emphasized language means that, in order to be liable, they must have acted under color of the law of the State of New Mexico. Plaintiff responds claiming that § 1983, as a remedial statute, should be liberally construed to give effect to its purpose—enforcement of the Fourteenth Amendment. See Monroe v. Pape, 365 U.S. 167, 81 S.Ct. 473, 5 L.Ed.2d 492 (1961). Plaintiff urges this Court to find that federal involvement satisfies the color of state law requirement. This argument has no merit. See Ellis v. Blum, 643 F.2d 68 (2nd Cir.1981); Hubbert v. United States Parole Com’n., 585 F.2d 857 (7th Cir.1978); Williams v. Rogers, 449 F.2d 513 (8th Cir.1971), cert. denied, 405 U.S. 926, 92 S.Ct. 976, 30 L.Ed.2d 799 (1972); Browns v. Mitchell, 409 F.2d 593 (10th Cir.1969).
Even if it could be said that state action was involved, the State in no way compelled the decision to discharge. In Rendell-Baker v. Kohn, 457 U.S. 830, 102 S.Ct. 2764, 73 L.Ed.2d 418 (1982), the Supreme Court affirmed dismissal of § 1983 claims by certain discharged employees of a private school which derives its income primarily from public sources and which is regulated by public authorities. The Court held that the school did not act under color of state law when it discharged the employees. Quoting from its decision in Blum v. Yaretsky, 457 U.S. 991, 102 S.Ct. 2777, 73 L.Ed.2d 534 (1982), the Supreme Court in Kohn said, “ ‘[A] State normally can be held responsible for a private decision only when it has exercised coercive power or has provided such significant encouragement, either overt or covert, that the choice must in law be deemed to be that of the State.’ ” 102 S.Ct. at 2771. The State of New Mexico, like the State of Massachusetts in Kohn, does not purport to regulate or control the personnel termination procedures of a private entity.
Thus, plaintiff’s discharge was not compelled or influenced in any way by any state action. The judgment based on the § 1983 claim must be reversed and the claim dismissed. Having so concluded, this disposes of the remainder of defendants’ points and also disposes of plaintiff’s cross-appeal issue involving punitive damages, since those damages were awarded based on the § 1983 action.
We turn now to the remaining two issues in plaintiff’s cross-appeal involving dismissal of his claim based on breach of contract and retaliatory discharge.
2. Plaintiffs cross-appeal.
(a) Standard of review.
Although the trial court ruled on defendants’ motions for directed verdict at the close of all evidence, it is clear that Counts I and II were dismissed under NMSA 1978, Civ.P.R. 12(b)(6) (Repl.Pamp. 1980), for failure to state claims. Accordingly, for the purposes of review, all well-pleaded allegations of plaintiff’s amended complaint must be taken as true. Buhler v. Marrujo, 86 N.M. 399, 524 P.2d 1015 (Ct.App.1974).
(b) “Terminable-at-will” rule.
In Bottijliso v. Hutchison Fruit Co., 96 N.M. 789, 635 P.2d 992 (Ct.App.1981), we said, “Our courts have long adhered to the rule that an employee is terminable by an employer ‘at will,’ either without cause or for a specific reason, in the absence of a contract of employment for a definite term * * *.” 96 N.M. at 791, 635 P.2d 992. Our appellate courts have also recognized that even where characterized as “permanent,” a contract for employment, not supported by any consideration other than performance of duties and payment of wages, is a contract for an indefinite period. It is terminable at the will of either party so that a discharge without cause does not justify recovery of damages. Gonzales v. United Southwest Nat. Bank, 93 N.M. 522, 602 P.2d 619 (1979); Garza v. United Child Care, Inc., 88 N.M. 30, 536 P.2d 1086 (Ct.App.1975).
While acknowledging these rules, plaintiff says defendants breached his employment contract by failing to comply with the company’s termination requirements as set forth in the personnel manual. In addition, plaintiff argues that the facts and circumstances of his case justify a new cause of action in either tort or contract.
(c) Breach of contract.
Relying on Forrester v. Parker, 93 N.M. 781, 606 P.2d 191 (1980), plaintiff argues that he could not be discharged except in accordance with the Personnel & Procedure Policies of TDS and, accordingly, the dismissal of his breach of contract claim was error. This argument fails. In Forrester the plaintiff had completed his probationary period; here, plaintiff was discharged prior to the expiration of his six-month probation period. Thus, he was not entitled to the procedural steps set out in the personnel manual.
Even if it could be argued that the personnel manual controlled, we do not read that manual as requiring “just cause” before involuntary discharge of an employee, as claimed by plaintiff. Although a question exists as to whether defendants afforded plaintiff administrative due process as required in the personnel manual, we construe this provision, as well as the provision requiring a statement of reasons for dismissal, to apply only to nonprobationary employees. It would make little sense to create a separate category of probationary employees if they were to be afforded the same procedural rights as nonprobationary employees. The trial court did not err in dismissing the breach of contract claim based on the personnel manual.
(d) Retaliatory discharge.
Defendants rely upon the terminable-at-will rule to preclude plaintiffs claim for retaliatory discharge. That rule rests upon the concept of freedom of contract and mutuality of obligation; since an employer cannot force an employee into labor, neither should an employee have the power to force an employer to hire or retain him. This rule of mutuality apparently evolved in the nineteenth century during the industrial revolution when the employer-employee relationship became more impersonal. One court described the at will rule as permitting an employer to discharge, “for good cause, for no cause or even for cause morally wrong, without being thereby guilty of legal wrong.” Payne v. Western & A.R.R., 81 Tenn. (13 Lea) 507 (1884), overruled on other grounds, Hutton v. Watters, 132 Tenn. 527, 179 S.W. 134 (1915). Some authorities have suggested that various social and economic factors such as the concepts of freedom of contract, free enterprise, and laissez-faire provided the foundation for its wide acceptance.
The harsh results of the at will rule have spawned criticism from a growing number of courts and legal writers. See generally Blades, Employment at Will vs. Individual Freedom: On Limiting the Abusive Exercise of Employer Power, 67 Colum.L.Rev. 1404 (1967): Comment, Protecting At Will Employees Against Wrongful Discharge: The Duty to Terminate Only In Good Faith, 93 Harv.L.Rev. 1816 (1980); Comment, Protecting The Private Sector At Will Employee Who “Blows The Whistle”: A Cause Of Action Based Upon Determinants of Public Policy, 1977 Wis.L.Rev. 777; Isbell-Sirotkin, Defending The Abusively Discharged Employee: In Search of A Judicial Solution, 12 N.M.L.Rev. 711 (1982).
The Supreme Court of Illinois in Palmateer v. International Harvester Co., 85 Ill.2d 124, 52 Ill.Dec. 13, 421 N.E.2d 876 (1981), in discussing the at will rule, said:
Recent analysis has pointed out the shortcomings of the mutuality theory. With the rise of large corporations conducting specialized operations and employing relatively immobile workers who often have no other place to market their skills, recognition that the employer and employee do not stand on equal footing is realistic. [Citation omitted.] In addition, unchecked employer power, like unchecked employee power, has been seen to present a distinct threat to the public policy carefully considered and adopted by society as a whole. As a result, it is now recognized that a proper balance must be maintained among the employer’s interest in operating a business effi ciently and profitably, the employee’s interest in earning a livelihood, and society’s interest in seeing its public policies carried out.
52 Ill.Dec. at 15, 421 N.E.2d at 878. In Palmateer an employee alleged his employer discharged him in retaliation for supplying to a local law-enforcement agency information of criminal activity involving a fellow employee and for agreeing to assist in the investigation and trial, if requested. While the court there held no constitutional or statutory provision required the discharged employee to take action to ferret out and prosecute crime, public policy favors his actions.
An employee who becomes aware of organizational wrongdoing is * * * placed in a difficult position. As a member of the general public he or she not only must suffer the consequences of the illegal activity for so long as it continues; but also, given an obligation to come forward and expose such activity, he or she must share in the blame which comes from silence. On the other hand, as an employee, the potential whistleblower must consider the likelihood of job termination as a consequence of public declamations. The employee’s dilemma is one of balancing a public interest against the potential of private loss, with the employee losing either way.
Comments, Protecting the Private Sector at Will Employee Who “Blows the Whistle”: A Cause of Action Based Upon Determinants of Public Policy, 1977 Wis.L.Rev. 777.
The Court of Appeals of Maryland, in Adler v. American Standard Corp., 291 Md. 31, 432 A.2d 464 (1981), recognizes a cause of action for abusive discharge by an employer of an at will employee when the employer’s motivation contravenes some clear mandate of public policy. In reaching that result, the court discussed the need for balancing the interests of the employer, the employee, and society as a whole. The Adler court said:
We recognize that modern economic conditions differ significantly from those that existed when the at will rule was first advanced in the latter part of the nineteenth century. [Citation omitted.] According to 1980 census statistics, a majority of American workers do not have the job security provided by collective bargaining agreements or civil service regulations. [Citation omitted.] When terminated without notice, an employee is suddenly faced with an uncertain job future and the difficult prospect of meeting continuing economic obligations. But this circumstance, of itself, hardly warrants adoption of a rule that would forbid termination of at will employees whenever the termination appeared “wrongful” to a court or a jury. On the other hand, an at will employee’s interest in job security, particularly when continued employment is threatened not by genuine dissatisfaction with job performance but because the employee has refused to act in an unlawful manner or attempted to perform a statutorily prescribed duty, is deserving of recognition. Equally to be considéred is that the employer has an important interest in being able to discharge an at will employee whenever it would be beneficial to his business. Finally, society as a whole has an interest in ensuring that its laws and important public policies are not contravened. Any modification of the at will rule must take into account all of these interests. (Emphasis added).
The appellate courts of this State have not to date recognized a cause of action for retaliatory discharge although a willingness to modify the at will rule appears in several cases. In Garza we said, “Where a contract for permanent employment provides additional consideration, the employee can recover damages for his discharge when made without just cause.” Id. 88 N.M. at 31, 536 P.2d 1086 (citations omitted) (emphasis added). In Gonzales the plaintiff claimed that under his original written employment contract, since expired, his employer promised him lifetime or permanent employment if he “competently” conducted bank business. Although the Supreme Court applied the at will rule, it did so on the basis that no consideration other than performance of duty and payment of wages supported the contract. Forrester discussed under sub-paragraph (c), adopted the concept of an implied contract of employment where the employer’s personnel manual prescribed the procedures for termination. In an even later case this Court in Hernandez v. Home Educ. Livelihood Program, 98 N.M. 125, 645 P.2d 1381 (Ct.App.1982), held that an employee could reasonably expect her employer to conform to the procedures set out in the personnel guide. Thus, both Forrester and Hernandez recognize that a personnel manual or guide may constitute an implied employment contract. See also Jacobs v. Stratton, 94 N.M. 665, 615 P.2d 982 (1980); Jones v. International Union of Operating Engineers, 72 N.M. 322, 383 P.2d 571 (1963).
In Bottijliso we deferred to the legislature the recognition of a cause of action for retaliatory discharge of an employee who files a workman’s compensation claim. Bottijliso did not, however, foreclose consideration of a cause of action in other areas. That case involved the Workmen’s Compensation Act; the case before us does not. The terminable at will rule was judicially created, and the judiciary has the power to modify it. Lopez v. Maez, 98 N.M. 625, 651 P.2d 1269 (1982).
In view of present economic conditions and the need to encourage job security, we believe that a cause of action should exist when the discharge of an employee contravenes some clear mandate of public policy. We do not abrogate the at will rule; we only limit its application to those situations where the employee’s discharge results from the employer’s violation of a clear public policy. We proceed to discuss the nature of the cause of action and methods for discerning “public policy”.
From a review of the cases, as well as law review articles on the subject, it appears that courts have recognized wrongful discharge actions either on the basis of tort, see, e.g., Tameny v. Atlantic Richfield Co., 27 Cal.3d 167, 164 Cal.Rptr. 839, 610 P.2d 1330 (1980); Harless v. First Nat. Bank in Fairmont, 162 W.Va. 116, 246 S.E.2d 270 (1978), or breach of implied contract of good faith and fair dealing, see, e.g., Monge v. Beebe Rubber Company, 114 N.H. 130, 316 A.2d 549 (1974); Zimmer v. Wells Management Corporation, 348 F.Supp. 540 (S.D.N.Y.1972).
A majority of the courts expressly recognizing the cause of action have treated the employee’s claim as one in tort. Most have done so on the basis that the discharge contravenes some clear mandate of public policy. See Adler v. American Standard Corp.; Palmateer v. International Harvester Co.
We note that New Hampshire has qualified the principle announced in Monge v. Beebe Rubber Company. The courts of that state now construe the Monge case to apply only in situations where an employee is discharged because he performed an act that public policy would encourage or refused to do that which public policy would condemn, thereby limiting the Monge holding to the public policy exception. Howard v. Dorr Woolen Co., 120 N.H. 295, 414 A.2d 1273 (1980); Cloutier v. Great Atlantic & Pac. Tea Co., 121 N.H. 915, 436 A.2d 1140 (1981).
Because we focus primarily on the employer’s duty to act in accordance with public policy, a cause of action sounding in tort provides a more appropriate rationale than one in contract. Thus, we recognize the cause of action in tort. See Comment, The Employment At Will Rule, 31 Ala.L. Rev. 421 (1980).
The Palmateer court asked the question: “But what constitutes clearly mandated public policy?” 52 Ill.Dec. at 15, 421 N.E.2d at 878. It answered that question by saying that no precise definition of the term exists. While we do not attempt here to fully define the public policy exception, we do note several specific categories.
The strongest indicators of a state’s public policies appear in legislative declarations. In one category we find legislation which not only defines public poli cy, but also provides a remedy. As we noted in Bottijliso v. Hutchison Fruit Co., the Human Rights Act, NMSA 1978, § 28-1-1 et.seq., dealing with discriminatory practices, falls within this category. Other statutory provisions protect employees but do not provide a specific remedy. For example, NMSA 1978, § 1-20-13 makes it unlawful to discharge an employee because of his or her political beliefs or intention to vote or refrain from voting; NMSA 1978, § 38-5-18 (Cum.Supp.1982) prohibits an employer from depriving an employee of employment, because the employee receives a summons, or serves as a juror; NMSA 1978, § 50-2-4 prohibits coercing an employee to enter into an agreement not to join a labor union as a condition of receiving or continuing employment. As to these, the plaintiff would seek an implied remedy. Still other statutory provisions define a public policy, but the statute fails to express either a right or a remedy. In such cases, the discharged employee would seek not only judicial recognition of the right but also of the remedy. Examples of this type appear in Petermann v. International Brotherhood, Etc., 174 Cal.App.2d 184, 344 P.2d 25 (1959) (refusing to commit perjury) and Tameny v. Atlantic Richfield Co. (refusing to engage in price fixing). There may, in some instances, be no legislative expression of public policy, and here again the judiciary would have to imply a right as well as a remedy. See, e.g., Palmateer; Cloutier. For a discussion of public policy considerations, see 1977 Wis. L.Rev. at 787-799. We do not purport to identify every category of public policy, but instead leave the determination to a case-by-case analysis. We stress, however, that “unless an employee at will identifies a specific expression of public policy, he may be discharged with or without cause.” Pierce v. Ortho Pharmaceutical Corp., 84 N.J. 58, 417 A.2d 505 (1980).
For an employee to recover under this new cause of action, he must demonstrate that he was discharged because he performed an act that public policy has authorized or would encourage, or because he refused to do something required of him by his employer that public policy would condemn. A sufficient nexus must exist between the public policy asserted by the employee and the reasons for his or her discharge. Because the claim in most instances will assert serious misconduct, proof should be made by clear and convincing evidence.
While we have not found any cases discussing damages in depth, legal writers have addressed the subject. See e.g. Harrison, Wrongful Discharge: Toward a More Efficient Remedy, 56 Ind.LJ. 207 (1981); Comment, Protecting At Will Employees Against Wrongful Discharge: The Duty To Terminate Only In Good Faith, 93 Harv.L. Rev. 1816 (1980). At least one court has indicated that where a cause of action in tort is adopted, it follows that rules relating to tort damages would apply. Harless v. First Nat. Bank in Fairmont. In Monge v. Beebe Rubber Company, the New Hampshire Supreme Court, after recognizing an action in contract for bad faith discharge, refused to allow recovery for mental suffering. Cf Agis v. Howard Johnson Company, 371 Mass. 140, 355 N.E.2d 315 (1976) (recovery for emotional harm allowed).
It is more appropriate to fashion the elements of damages to reflect the objective of the cause of action, that is, to encourage job security. Thus, without attempting to identify every conceivable element, we hold that the damages might include lost wages while unemployed, the cost and inconvenience of searching for a new job, moving costs for relocating, and possible punitive damages. Of course, the discharged employee must mitigate his or her damages by securing other employment if not reinstated by defendant. In our view actual pecuniary losses are more compatible with the objectives of the action. What is at stake is job security, not reparation for every conceivable ill. Moreover, recognition of the full range of tort recovery could become self-defeating in terms of attaining and maintaining employment. We limit recovery in order to pre vent any chilling effect on the employer’s freedom in hiring. Thus, emotional distress, traumatic neurosis, mental suffering and similar damages of a non-pecuniary nature will not be allowed.
Without punitive damages there may be little to discourage an employer from discharging an employee if the pecuniary losses are insignificant. Further, the threat of a petty misdemeanor, as under NMSA 1978, § 38-5-19 (Cum.Supp.1982), with respect to jury duty, might in some instances provide insufficient deterrence to retaliatory discharge. The ability to recover punitive damages should offer a sufficient deterrent. See Kelsay v. Motorola, Inc., 74 Ill.2d 172, 23 Ill.Dec. 559, 384 N.E.2d 353 (1978). Ruiz v. Southern Pacific Transp. Co., 97 N.M. 194, 638 P.2d 406 (Ct.App.1981), discusses the criteria for punitive damages.
We turn now to the present case to determine whether plaintiff has stated a cause of action. Pointing out that federal funding provides TDS’s primary, if not sole, source of income, plaintiff alleges generally: payment by Arzola to himself and the bookkeeper of unauthorized salaries; use of federal money to purchase liquor and food; unauthorized signatures on corporate documents; holding land for speculation contrary to non-profit status; failing to advertise certain positions; and bidding irregularities, including favoring Arzola’s father and political allies. Plaintiff claims that his discharge amounted to retaliation for bringing these matters to the attention of the board of directors of TDS.
A general allegation that the discharge contravened public policy is insufficient; to state a cause of action for retaliatory or abusive discharge the employee must identify a specific expression of public policy. Pierce v. Ortho Pharmaceutical Corp.; Cloutier v. Great Atlantic & Pac. Tea Co. While most of plaintiff’s allegations involve mismanagement, the allegations with regard to unauthorized payment of salaries and the purchase of food and liquor from federal funds, if proven, could provide a basis for relief, assuming other elements of the cause of action are established. That misuse of public money contravenes state public policy cannot be doubted. N.M. Const., art. VIII, sec. 4; see also, Asplund v. Hannett, 31 N.M. 641, 249 P. 1074 (1926). New Mexico public policy condemns not only misuse of state money, but misuse of federal money as well. See State v. Gonzales, 22 SBB 581 (Ct.App.1983).
In order to state a cause of action, plaintiff must allege facts which, if proven, would allow relief. See Pattison v. Ford, 82 N.M. 605, 485 P.2d 361 (Ct.App.1971). We are not prepared to say that plaintiff has not done so here; whether he succeeds in his proof will be for the trial court to determine.
In his complaint plaintiff asks for damages for “severe emotional distress.” We have held that this type of non-pecuniary damage will not be allowed. Plaintiff may amend his complaint to claim any other proper damages recoverable under this cause of action. Plaintiff may also amend to otherwise conform to the cause of action as recognized here.
Plaintiff also seeks punitive damages. While we said that punitive damages will be recognized in a proper case, there is no persuasive reason to allow punitive damages in this case where the employer here could not have anticipated beforehand that the claim would even be actionable. See Nees v. Hocks, 272 Or. 210, 536 P.2d 512 (1975); Kelsay v. Motorola, Inc.
Because this new cause of action imposes significant new duties, and because of reliance on the long-standing terminable-at-will rule, we hold that the new law should be given modified prospective application. Lopez v. Maez. Thus, we apply the law announced to the case before us, except as to punitive damages, and to prospective cases filed after the date this decision becomes final.
The judgment in favor of petitioner based on § 1983 is reversed. The trial court’s dismissal of plaintiff’s cause of action based on breach of contract is affirmed. The dismissal of the cause of action based on retaliatory discharge is reversed, and the case is remanded for trial on that claim. Each side shall bear its respective costs on appeal.
IT IS SO ORDERED.
NEAL, J., concurs.
WOOD, J., concurs in part and dissents in part.
. We reviewed this matter on the pleadings as noted in paragraph 2(a) of this opinion. Plaintiff agrees but alternatively invites review based on improper granting of the directed verdict for defendants. We declined the invitation, because plaintiff does not set forth evidence with transcript references. | [
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OPINION
ALARID, Judge.
Matthew Ranville (plaintiff) challenges the district court’s award of worker’s compensation benefits of 15% disability to the body as a whole. He bases his appeal on two issues: (1) Whether he should have been compensated for the loss of a scheduled member under NMSA 1978, Section 52-l-43(A); and (2) whether he should be compensated for the loss of his eye without regard to correction. We hold that plaintiff has suffered an injury to a specific body part which is covered by the scheduled injury section, and that he should receive compensation according to the schedule. Further, we hold that compensation should be based on the damaged eye without considering the correctability of vision through the use of a contact lens. The judgment of the trial court is reversed.
FACTS
Plaintiff received a compensable injury to his eye on November 3, 1979, After trial, the district court determined that the plaintiff was 100% disabled because he suffered from “traumatic neurosis” directly related to his eye injury. The trial court’s judgment was filed on September 10, 1982. Plaintiff received compensation for total disability from the time of the injury until June 2, 1983. On January 19, 1983, J.T.S. Enterprises, Inc., and the Travelers Insurance Company (defendants) filed a motion for termination or reduction of workman’s compensation benefits. On May 11, 1983, plaintiff filed a motion stating that he was no longer disabled by “traumatic neurosis” as of April 1, 1983, and requesting benefits pursuant to Section 52-l-43(A)(41), for loss of his left eye. The trial court, in its judgment filed January 17, 1984, reduced benefits effective June 2, 1983 to an award of 15% disability to the body as a whole rather than for a scheduled injury. The trial court found that plaintiff was legally blind in the left eye without a corrective lens. It concluded that the eye could be corrected to 20/40 and that plaintiff should receive compensation on the basis of corrected vision. Plaintiff appeals from the judgment, and challenges the trial court’s conclusion of law, contending that he should have been compensated for the loss of a scheduled member without regard to correction.
DISCUSSION
Defendants argue that plaintiff is procedurally precluded from asserting his claims on appeal because of (1) judicial estoppel, and (2) res judicata. We disagree with defendants’ arguments. First, as to judicial estoppel, plaintiff did not assume inconsistent positions at the first and second hearings in this case so as to prejudice defendants. This inconsistency and resulting prejudice is .required for the application of judicial estoppel. Citizens Bank v. C & H Construction & Paving Co., 89 N.M. 360, 552 P.2d 796 (Ct.App.1976). Second, as to res judicata, the issue of whether plaintiff had suffered a scheduled injury was specifically reserved at the time of the first hearing in 1982. Therefore, the issue was not fully adjudicated on the merits, and the doctrine of res judicata was inapplicable to preclude the resolution of that issue at the second hearing in 1983. See Miller v. Bourdage, 98 N.M. 801, 653 P.2d 177 (Ct.App.1982).
Plaintiff challenges the ruling of the trial court that he suffered a 15% disability to the body as a whole and asserts that he has an injury to a specific body member. The issue, of course, is whether plaintiff was entitled to workmen’s compensation benefits under NMSA 1978, Section 52-1-42 or Section 52-1-43. By its terms, Section 52-1-42 applies when a workman has suffered a “partial disability ... not specifically provided for in Section 52-1-43 ____” Section 52-1-43 lists specific body members as well as the total period of time for which compensation is to be paid for loss or loss of use of the specific body members listed.
The plaintiff has suffered an injury to his left eye, which is a body part listed under the scheduled injury section of the statute. Section 52-l-43(A)(41). In addition, the trial court found at the first trial in 1982 that the plaintiff was totally disabled as a result of “traumatic neurosis.” He has since recovered from this disability and is now seeking compensation based solely on the injury to his eye.
In order for a court to award a worker benefits under the partial disability benefits section, Section 52-1-42, there must be a separate and distinct impairment to other parts of the body in addition to the disability resulting from injury to a scheduled member. Hise Construction v. Candelaria, 98 N.M. 759, 652 P.2d 1210 (1982); Newhoff v. Good Housekeeping, Inc., 94 N.M. 621, 614 P.2d 33 (Ct.App. 1980). The plaintiff has, because he is legally blind in his injured eye, lost his eye. Since his recovery from the traumatic neurosis, he no longer suffers from an impairment “separate and distinct” from the loss of that eye and, thus, compensation should be under the scheduled injury section. Plaintiff was entitled to compensation under the scheduled injury section.
Defendants maintain, however, that even if scheduled member benefits should be awarded, plaintiff has been paid those benefits because plaintiff was paid benefits for total disability for a full two years after he was discharged by his ophthalmologist in June of 1981, and he was paid 15% disabili ty benefits since June of 1983. Defendants argue that plaintiffs healing period ended in June, 1981, and that under the terms of the statute, he is to be compensated for an additional 120 weeks. Section 52-1-43(A)(41) and (D). According to defendants, more than 120 weeks have elapsed since June, 1981, during which time plaintiff has been paid all, or nearly all, of the benefits provided for under the scheduled injury section. It is not disputed, however, that payments made between June, 1981 and June, 1983 were specifically for the traumatic neurosis which resulted from the eye injury.
Inasmuch as payments from June 1981 to June 1983 were for the traumatic neurosis and not for the eye injury, defendants’ contention necessarily disregards the basis for the payments and considers only the fact that payments were made. The basis for the payments must also be considered. Cf. Montoya v. Sanchez, 79 N.M. 564, 446 P.2d 212 (1968), where plaintiff was entitled to payment for both scheduled injuries. See American Tank & Steel Corp. v. Thompson, 90 N.M. 513, 565 P.2d 1030 (1977), for a possible modification of Montoya on other grounds.
The trial court awarded total disability payments on the basis of the traumatic neurosis. Up until June 1981 plaintiff was undergoing a healing period for the eye injury, and during that healing period he was entitled to compensation for total disability. Section 52-l-43(A) and (D). Although entitled to total disability payments on two separate grounds, this entitlement existed during the same time period, and payments were limited to that for one total disability. Rollins v. Albuquerque Public Schools, 92 N.M. 795, 595 P.2d 765 (Ct.App.1979).
After June 1981, the total disability for the traumatic neurosis continued until June 2, 1983. Because, factually, the payments during this time period were not for the eye loss, defendants’ claim that the payments for traumatic neurosis are also to be considered as payments for the eye loss becomes a question of statutory interpretation. Defendants do not cite any statutory provision in support of their position. Section 52-1-47 states limitations on compensation benefits. Section 52-l-47(A) and (B) limits compensation for a combination of disabilities to 600 weeks and a monetary amount determined by multiplying the maximum weekly benefit by 600. Defendants do not claim that the limitations of Section 52-l-47(A) and (B) apply. Inasmuch as the statute states limitations for combinations of disabilities, if the statutory limitations do not apply, payment for the combination is authorized. We have no authority to make changes in the provisions of statute law. Sanchez v. Bernalillo County, 57 N.M. 217, 257 P.2d 909 (1953).
Once the payment for traumatic neurosis ended, payment should have been ordered for the eye loss for an additional 120 weeks, beginning June 2, 1983. Upon remand, payments made pursuant to the erroneous 15% partial disability award are to be credited against the amount owed by defendants for the eye loss.
We next consider the question of whether that compensation should be based on corrected or uncorrected vision. New Mexico courts have not decided the question of whether compensation under the scheduled injury section should be computed by considering the degree to which the injured body part’s function can be enhanced by the use of corrective or prosthetic devices. Several other jurisdictions, howevér, have decided this issue, and the majority hold that the loss of use should be judged on the basis of uncorrected vision or hearing. Gulf Stevedore Corp. v. Hollis, 427 F.2d 160 (5th Cir.1970); Cannizzaro v. Great American Insurance Co., 223 So.2d 704 (La.App.1969); Hollman v. City of Raleigh Public Utilities Department, 273 N.C. 240, 159 S.E.2d 874 (1968); Contra Wasson v. Northeast Motor Co., 253 A.2d 349 (Me. 1969).
In Sessing v. Yates Drilling Co., 74 N.M. 550, 395 P.2d 824 (1964), our supreme court confronted a situation involving loss of vision where, although the workman’s uncorrected vision was the same after the injury as before, the vision could only be corrected to 20/30 after the injury. Before the injury, it was correctable to 20/20. The court held that a compensable injury had been suffered, represented by the differences in the corrected vision before and after the injury. Although the Sessing court expressly reserved ruling on whether corrected or uncorrected vision should be used to determine the benefits recoverable, in dicta the court suggested that, because the scheduled member section did not expressly state that loss of use was to be determined based upon the use of corrective or prosthetic devices, an uncorrected basis would be more appropriate in determining disability. The court did not want to be understood as inferring in its conclusion that compensation was not payable when there was an eye injury which could be corrected with glasses. 74 N.M. at 553, 395 P.2d 824.
The purpose of Section 52-1-43 is to compensate for specific loss, and there is nothing in the statute to indicate legislative intent to reduce compensation for correction. While it is true that some jurisdictions provide for using corrected vision in determining the extent of an injury to the eye, it is equally true that New Mexico, at the time of Sessing and at present, has not chosen to impose a similar requirement. See Ind.Code Ann. § 22-3-3-10(a)(3), (b)(4) (Burns 1984). The New Mexico Legislature could have provided, as Indiana did, that the determination of blindness is to be made with glasses. It did not. The Legislature has not required that eye loss be determined on the basis of corrected vision and we have no authority to impose such a requirement. Selgado v. New Mexico State Highway Department, 66 N.M. 369, 348 P.2d 487 (1960); Sanchez v. Bernalillo County; Lent v. Employment Security Commission of State of New Mexico, 99 N.M. 407, 658 P.2d 1134 (Ct.App.1982).
We follow the majority rule because of the suggestion of the court in Sessing, and because we lack authority to add correction requirement to the statute.
Because plaintiff suffered an injury which comes within the scheduled injury section, and not within Section 52-1-42, and because the extent of an eye injury is to be decided without regard to correction, the judgment of the trial court is reversed. This cause is remanded to the district court to set aside its original judgment and to enter a new judgment consistent with this opinion. Plaintiff is awarded $2,500 for the services of his attorney in connection with the appeal. NMSA 1978, § 52-l-54(D). This being an appeal by the worker, no costs have been assessed. The appeal having been successful, defendants are to pay the $20 docket fee to the Clerk of the Court of Appeals, and are to pay to the Clerk of the District Court $46.75 for the cost of the record, and any charges of that Clerk for duplication of tapes. Gantt v. L & G Air Conditioning, 101 N.M. 208, 680 P.2d 348 (Ct.App.1983); Ryan v. Bruenger M. Trucking, 100 N.M. 15, 665 P.2d 277 (Ct.App.1983).
IT IS SO ORDERED.
WOOD and HENDLEY, JJ., concur. | [
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OPINION
FEDERICI, Chief Justice.
This case was certified to this Court by the United States District Court for the District of New Mexico. The issue before us is whether the pro se appearance as a party defendant of the Honorable Donaldo A. Martinez, District Judge of the New Mexico Fourth Judicial District, in a lawsuit pending before the United States District Court for the District of New Mexico constitutes the practice of law in violation of NMSA 1978, Code of Judicial Conduct, Canon 5(F) (Repl.Pamp.1983). We hold that it does not.
Canon 5(F) provides that “[a] judge should not practice law.” The Supreme Court of New Mexico has the exclusive right to regulate the practice of law. State Bar v. Guardian Abstract & Title Co., 91 N.M. 434, 575 P.2d 943 (1978); In re Patton, 86 N.M. 52, 519 P.2d 288 (1974). This Court has never fully defined what constitutes the practice of law. Each case is determined in light of its own facts. Sparkman v. State Board of Bar Examiners, 77 N.M. 551, 425 P.2d 313 (1967). The practice of law is usually interpreted to entail the representation of others. See 7 Am.Jur.2d Attorneys at Law, § 101 (1980). The illegal practice of law generally is found when “a layman, as part of his regular course of conduct, resolves legal questions for another ****’’ Guardian Abstract, 91 N.M. at 439, 575 P.2d at 948. In State ex rel. Norvell v. Credit Bureau of Albuquerque, Inc., 85 N.M. 521, 526, 514 P.2d 40, 45 (1973), this Court stated that, inter alia, “representation of parties before judicial or administrative bodies,” or “giving legal advice and counsel” would constitute the practice of law. Representing one’s self in a legal proceeding does not constitute practicing law. See State ex rel. Frohmiller v. Hendrix, 59 Ariz. 184, 124 P.2d 768 (1942). In the case of Connor v. Cal-Az Properties, Inc., 137 Ariz. 53, 668 P.2d 896 (App.1983), the court held that lawyers representing themselves in a property action were not entitled to attorney fees since, by representing themselves, they were not practicing law. The court said, “Even though the buyers in this case were themselves all attorneys, and carried out tasks ordinarily performed by lawyers, their activities did not constitute the practice of law because they represented themselves.” Id. at 56, 668 P.2d at 899.
In addition, self-representation by a judge in a proceeding against him in another court is not incompatible with his judicial responsibilities and duties, nor does it violate public policy. A judge enjoys the Sixth Amendment right to self-representation in the first stages of a criminal action and a qualified right to appear pro se in a civil action. U.S. Const.amend. VI. See 24 A.L. R.4th 430 (1983). This right, coupled with the principle that self-representation does not constitute the practice of law, compels the conclusion that the Honorable Donaldo A. Martinez may appear pro se as a party defendant in a proceeding before the United States District Court without violating NMSA 1978, Code of Judicial Conduct, Canon 5(F) (Repl.Pamp.1983).
IT IS SO ORDERED.
SOSA, Senior Justice, and RIORDAN, STOWERS and WALTERS, JJ., concur. | [
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OPINION
WALTERS, Justice.
Contestee Donald Thompson has sought a writ of superintending control from this Court to prevent a judgment of the trial court, removing his name from the general election ballot as the Democratic candidate for state senator in District 17 and substituting therefor the name of Contestant Shannon Robinson, from being enforced.
Thompson alleges that the action brought below by Robinson was untimely and that the trial court’s determination of Thompson’s non-residency in the precinct and district where he sought election was erroneous. We affirm in part and reverse in part.
Timeliness
Thompson argues that Robinson was required by NMSA 1978, Section 1-8-35 (Repl.Pamp.1984), to challenge Thompson’s nominating petition within ten days after thé last day for filing a declaration of candidacy, and that the district court was required to hear that challenge within ten days of filing the complaint. The complaint in this case was filed on June 21, 1984, 16 days after the primary election in which Thompson received the largest number of votes for the seat he sought as the Democratic nominee. Robinson received the second highest number of votes.
Thompson has overlooked NMSA 1978, Section 1-14-3, which permits an unsuccessful candidate to contest the election of a candidate not later than thirty days from the date the certificate of nomination is issued to the successful candidate. Thompson’s certificate was issued on July 3, 1984. Robinson’s election contest suit was filed well within the statutory time limit.
Residency
NMSA 1978, Section 2-8B-4 (Repl.Pamp. 1983), requires that “[a]ny candidate for the office of state senator shall reside in the district for which he files his declaration of candidacy, at the time of such filing.” According to Section 1-1-7.1 (Repl. Pamp.1984), residence for the purpose of candidacy for an office to which the Election Code (§§ 1-1-1 through 1-8-64) applies is “that place in the precinct where the person is registered and eligible to cast a ballot.” State Senate District 17 is an elective office within the scope of the Election Code. Section 1-1-19(A)(2). N.M. Const, art. VII, Subsection 2(A), provides that “[ejvery citizen of the United States who is a legal resident of the state and is a qualified elector therein, shall be qualified to hold any elective public office * * (Emphasis added.) To be a qualified voter, or elector, in New Mexico, the voter must have resided “in the precinct in which he offers to vote” for thirty days immediately preceding the election. N.M. Const, art. VII, § 1.
These statutory and constitutional residency requirements are clear. The trial court found that although Thompson changed his voter registration to Precinct 323, which is in State Senate District 17, and he then voted in Precinct 323, Thompson was ineligible to so register and vote because he actually resided outside Precinct 323 and outside District 17. The trial court thus correctly concluded that Contestee Thompson was not “eligible to cast a ballot” in District 17 and that he did not reside in District 17 at any time necessary to meet the residency qualifications as outlined above. Therefore, Thompson was not a qualified elector eligible for the District 17 senate candidacy.
The trial court further concluded that Contestee Thompson intentionally concealed his actual residence at the time he filed his candidacy. The factual findings on which the trial court based these conclusions are clear and are supported by substantial evidence which we find unnecessary to further detail here. Duke City Lumber Co. v. New Mexico Environmental Improvement Board, 101 N.M. 291, 681 P.2d 717 (1984).
The question of candidate eligibility is a continuing one. Freund v. Hastie, 13 Wash.App. 731, 537 P.2d 804 (1975). In Freund, the relevant Washington constitution and statutes allowed an election contest challenging candidate eligibility and, as in New Mexico, defined eligibility in terms of citizenship, elector status, and residency. Id. Although our Election Code does not expressly provide for a residency challenge in an election contest, the continuing crucial importance of eligibility and the inextricable link between eligibility and residency is demonstrated by the vacancy provisions of N.M. Const, art. IV, Section 3:
If any senator or representative permanently removes his residence from or maintains no residence in the district from which he was elected, then he shall be deemed to have resigned * * *. (Emphasis added.)
Therefore, we hold that Contestant’s residency challenge is a proper election contest under NMSA 1978, Sections 1-14-1 and 1-14-3 (Repl.Pamp.1984). Cf. Board of County Commissioners v. Chavez, 41 N.M. 300, 67 P.2d 1007 (1937) (judicial right to order cancellation of election certification, although former election code did not specifically authorize such action, inherent in court’s authority to order count of all votes cast). Section 1-14-1 provides for contest of “the election” of a candidate, and the eligibility of the candidate determines, in the first place, the validity of his election. See also Weldon v. Sanders, 99 N.M. 160, 655 P.2d 1004 (1982) (election contest is a much broader remedy than the recount and recheck remedies); Osborn v. O’Barr, 401 So.2d 773 (Ala.1981) (election declared void after action brought by third-place finisher resulted in holding that election winner was ineligible because of lack of residency). Cf. Montoya v. Gurule, 39 N.M. 42, 38 P.2d 1118 (1934) (election contest not available to challenge election of land grant trustees where code applied only to state, district and county offices).
Contestee’s actions in creating a sham residence were nothing less than a deliberate attempt to evade the fundamental eligibility requirements expressly provided by our constitution and statutes. By deceiving voters regarding his actual place of residence, Thompson committed a fraud upon the voting public and upon the entire electoral process.
The members of this Court are sworn to uphold the constitution and laws of New Mexico. In the absence of any claim by Contestee of lack of jurisdiction other than his overruled claim that the contest to his candidacy had to be made under Section 1-8-35, and whether our decision be considered an exercise of our constitutionally authorized superintending control, N.M. Const, art. VI, § 3, or a decision on expedited appeal, Section 1-14-5; NMSA 1978, Civ.App.R. 32 (Repl.Pámp. 1984), we will not avoid our duty to prevent a fraud which goes to the heart of the electoral process. Were we to do so, we would allow the name of an ineligible candidate to remain on the ballot, thereby encouraging such deceitful practices and permitting a mockery to be made of our basic constitutional and statutory election requirements. The very purpose of the Election Code is to secure “purity of elections.” NMSA 1978, Section 1—1—1.1. Whatever label be attached to these proceedings, it will not be permitted to interfere with a meritorious challenge to Thompson’s clear ineligibility to remain on the ballot as the duly certified Democratic nominee in the general election for State Senate District 17. See Orchard v. Board of Commissioners of Sierra County, 42 N.M. 172, 76 P.2d 41 (1938), which discusses the court’s powers to relieve against elections when they are tainted by fraud.
Section 1-8-8, which is within the article of the Election Code pertaining to “Nominations and Primary Elections,” provides that if a vacancy occurs for any cause in the list of nominees, following a primary election for any legislative office within a single county district to be filled in the general election, the central committee of the county political party shall fill the vacancy by appointment. Subsection B further provides that such appointments must be made at least 56 days before the general election unless the vacancy is caused by death, and appointments may then be made up until 5 days before the general election.
The time limitation applicable to this case, 56 days, is impossible of performance. It is otherwise an impractical limitation, as well. Article 14, dealing with election contests, allows 30 days after issuance of the certificate of nomination for filing the contest complaint, and then provides for application of the rules of civil procedure to the action. § 1-14-3. Those steps alone contemplate a total of 60 days after the certificate is issued before the issue is joined. Section 1-14-5 then provides for an appeal to the Supreme Court under the civil appellate rules, once discovery had been completed, any preliminary motions or matters •have been disposed of, and the case has gone to trial and been decided in the district court—another 30 days for docketing the appeal and 60 days to complete briefing, when the rules of civil procedure and appeal have been followed. If the case were tried in district court on the day contestee’s answer was filed—a most unlikely and probably unconstitutional happenstance {see N.M. Const, art. II, § 18)—the contest procedure established by the legislature would consume a minimum of 150 days before it ever became ripe for decision in this Court. The 56-day period within which the judically-declared vacancy had to be filled by the county central committee could rarely, if ever, be met, and an election contest in most instances would be of little purpose were the 56-day limitation to be observed, i.e., the vacancy would remain unfilled.
To partially overcome the inconsistencies of the time allowances on one hand and the constraints for filling vacancies on the other, this Court adopted Rule 32 of the rules of civil appellate procedure, requiring notice of appeal from the district court judgment within 5 days thereafter, and providing for a hearing and decision at the earliest possible date after the appeal is docketed. Even so, the expedited appeal procedure operates to shorten the time consumed only after the case has been decided in district court. The reality of the 56-day limitation, in this ease, is to allow a total of only 70 days from the date of filing the contest complaint in district court to decision by this Court on appeal.
We therefore hold that the 56-day restriction placed upon political central committees by Section 1-8-8 is inconsistent with the panoply of contest rights provided in Article 14 of the Election Code; and because its enforcement would result in unjust, absurd or unreasonable consequences, it cannot stand. See City Commission of Albuquerque v. State, 75 N.M. 438, 405 P.2d 924 (1965).
The judgment of the trial declaring Thompson ineligible for nomination as the Democratic candidate in State Senate District 17 is affirmed. The award of the nomination to Contestant Robinson is reversed. Because of the immediate necessity to print absentee ballots showing the name of the candidate selected by the county central committee to fill the vacancy created by Thompson’s ineligibility, the committee is urged to meet, select, and file the name of its nominee with the proper filing officer forthwith. § 1—8—8(A)(2).
IT IS SO ORDERED.
FEDERICI, C.J., SOSA, Senior Justice, and RIORDAN and STOWERS, JJ., concur. | [
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] |
OPINION
WALTERS, Justice.
Plaintiff Angelo Jimenez, through a declaratory judgment action, sought determination of his entitlement to stack the uninsured/underinsured motorist coverage applying to two cars for which he had purchased insurance under a single policy. Jimenez had paid a separate premium for each car covered. The policy issued by defendant Foundation Reserve Insurance Company contained a limit-of-liability clause that prohibited stacking of uninsured/underinsured benefits. Both parties filed motions for summary judgment on the issues of stacking and on the amount Jimenez should recover if stacking were allowed. The trial court granted summary judgment in favor of Jimenez on both issues and Foundation appeals. We affirm in part and reverse in part.
Jimenez was injured in a two-car accident. At trial the parties stipulated that Jimenez’s damages amounted to $50,000. The negligent driver had liability coverage with Farmers Insurance Company in the amount of $25,000. When Farmers paid the $25,000 to Jimenez, he repaid to Foundation $3,439 that he had previously received from Foundation under a medical payment provision that contained a subrogation and reimbursement clause.
Jimenez’s attempt to recover underinsured motorist coverage from Foundation was unsuccessful. Jimenez contends that he paid two premiums for coverage on two cars; therefore he should be entitled to stack the coverages. Each vehicle was insured under the uninsured motorist provision for $25,000 per person per accident and $50,000 per accident. By stacking, the negligent driver would thus be underinsured in the amount of $25,000, which, according to Jimenez, he should then be able to collect from Foundation. Foundation denied the request for additional benefits under Jimenez’s policy, however, because it relied on the endorsement stating the following limit of liability:
The limit of liability shown in the Declarations for “each person” for Uninsured Motorist Coverage is our maximum limit of liability for all damages for bodily injury sustained by any one person in any one auto accident. Subject to this limit for “each person,” the limit of liability shown in the Declarations for “each accident” for Uninsured Motorist Coverage is our maximum limit of liability for all damages for bodily injury resulting from any one auto accident.
This is the most we will pay regardless of the number of covered persons, claims made, vehicles or premiums shown in the Declarations, or vehicles involved in the auto accident.
Under this limitation, Foundation says that Jimenez would be entitled to a total of $25,000 in recovery for any one accident if the one who injured him were uninsured or underinsured. Because Jimenez received $25,000 from Farmers, Foundation asserts that the tortfeasor was not underinsured, and Farmers, therefore, was not obligated to make any underinsurance payments.
Jimenez additionally argued that he was entitled to have the $3,439 paid by Foundation under its medical payment provision returned to him, in addition to receiving $25,000 from Farmers and the $25,000 he claimed from Foundation. The trial court adopted Jimenez's view and entered a judgment allowing him to recover the total of $53,439.
After entry of the trial court’s judgment, Jimenez filed a bill of costs claiming $3,870 in costs incurred for the suit. The bill included fees for two expert witnesses who attended a hearing that was vacated without any testimony having been taken, because a prior docketed trial went overtime and forced the parties to reschedule their trial for a later date. Foundation objected to those two items of costs because the witnesses had not testified.
The three issues in this case are thus: (1) When an insured pays multiple premiums for coverage on more than one car, is a clear and unambiguous liability limitation clause in the policy enforceable to prohibit stacking of those coverages? (2) Was Foundation entitled to collect reimbursement for its payment of medical benefits to Jimenez, pursuant to a subrogation and reimbursement clause, from the $25,000 paid over to Jimenez from Farmers? and (3) May the prevailing party recover fees for expert witnesses who did not testify because the hearing was rescheduled through no fault of either party? We address each issue in turn.
(1) Limitation of liability clause prohibiting stacking.
The statute mandating that insurance companies provide underinsured and uninsured motorist coverage in all automobile liability policies sold in the state defines an “underinsured motorist” as an operator of a motor vehicle whose limit of liability coverage “under all bodily injury liability insurance applicable at the time of the accident is less than the limits of liability under the insured’s uninsured motorist coverage.” NMSA 1978, § 66-5-301(B) (Repl. Pamp.1984). Foundation argues that the negligent driver was not underinsured because her liability insurance amounted to $25,000, and Jimenez’s uninsured motorist coverage is limited to $25,000 per person under the clear and unambiguous limit-of-liability clause contained in the policy.
Exclusionary provisions in an insurance policy will be enforced if they (1) are clear and unambiguous in meaning, and, (2) if they do not conflict with public policy stated in express statutory language or by indication of legislative intent. March v. Mountain States Mut. Cas. Co., 101 N.M. 689, 691, 687 P.2d 1040, 1042 (1984). The limit of liability provision clearly passes the first test; we consider whether it passes the second.
We have previously discussed the public policy of the underinsured/uninsured motorist statute. The legislature intended that an injured person be compensated to the extent of insurance liability coverage purchased for his or her benefit. Schmick v. State Farm Mut. Auto. Ins. Co., 103 N.M. 216, 219, 704 P.2d 1092, 1095 (1985). The precedent is clear; exclusionary clauses in automobile policies that purport to deny stacking for the purpose of determining the tortfeasor’s underinsured status have been held void as against this State’s policy of compensating innocent victims injured through no fault of their own. Id. Even though Foundation’s liability limitation clause is unambiguous, that is not determinative. In Schmick, the exclusionary clause was both ambiguous and violative of public policy. Insurance policy clauses that prohibit stacking are particularly repugnant to public policy when the injured insured has paid separate premiums for underinsured/uninsured motorist coverage on each vehicle. We held in Lopez v. Foundation Reserve Insurance Co., Inc., 98 N.M. 166, 646 P.2d 1230 (1982), despite the failure of the policy to address the effect on coverage when multiple premiums were paid for several cars under one policy, that if an insurance company charges separate premiums for each vehicle covered under uninsured/underinsured motorist protection, even if the second premium is a reduced premium, fairness requires that the insured be allowed to stack the coverages for which he or she has paid. Id. at 170, 646 P.2d at 1234. Likewise, in Konnick v. Farmers Insurance Co. of Arizona, 103 N.M. 112, 703 P.2d 889 (1985), an insured was entitled to stack the underinsured motorist policies for which separate premiums had been paid. Stacking is an appropriate means to compensate for losses suffered by an insured through no fault of his or her own. Id. at 114, 703 P.2d at 891. By so holding, effect is given to the reasonable expectations of the insured who purchased the multiple coverages. Id. at 116, 703 P.2d at 893.
Foundation argues that Jimenez had no reasonable expectation that he could obtain additional underinsured motorist coverage because the limit-of-liability clause was clear in meaning. Nevertheless, the law in New Mexico also has been clear that when an injured insured is the beneficiary of a policy and either the insured or another has paid premiums for the benefit of the injured insured, then all policy coverages under which he or she is a beneficiary may be stacked. Morro v. Farmers & Foundation, 106 N.M. 669, 671-672, 748 P.2d 512, 514-515 (1988), citing to Sloan v. Dairyland Ins. Co., 86 N.M. 65, 519 P.2d 301 (1974) (an insurance company may not attempt to avoid coverage for which it has received premiums). We also noted in Continental Insurance Co. v. Fahey, 106 N.M. 603, 605, 747 P.2d 249, 251 (1987), that, in general, the only legitimate limitations on the recovery of a party insured under uninsured/underinsured motorist coverage are that: (1) the insured be legally entitled to recover damages, and (2) the negligent driver be uninsured. Because case law in this jurisdiction repeatedly has stated the public policy which allows uninsured/underinsured motorist coverage to be stacked when separate premiums are paid for additional coverage, an insured may reasonably expect to stack coverage. Once again we hold, therefore, that an insurer’s attempt by a limiting clause to preclude stacking of additional coverage separately paid for by the insured violates the clear policy of the uninsured motorist statute, which intends that an injured party be compensated to the extent of coverage obtained by or for the injured party. Jimenez is thus entitled to recover from Foundation “the difference between his uninsured motorist coverage and the tortfeasor’s liability coverage or the difference between his damages and the tortfeasor’s liability coverage, whichever is less.” Schmick, 103 N.M. at 222, 704 P.2d at 1098.
Our holding not only has been presaged by our earlier decisions, it echoes decisions of other courts which similarly have held that when public policy embraces the stacking concept, policy language limiting recovery to one vehicle’s coverage (although premiums have been paid on more than one vehicle) shall be struck as null and void no matter how clear and unambiguous the limiting language. See, e.g., Great Central Ins. Co. v. Edge, 292 Ala. 613, 616, 298 So.2d 607, 610 (1974) (decision in Alabama is not based on whether or not the limiting provision of a policy is in plain, unmistakable language; insurer cannot avoid liability where additional premiums are collected); Alabama Farm Bureau Mut. Cas. Ins. Co. v. Humphrey, 54 Ala.App. 343, 308 So.2d 255 (1975) (uninsured motorist statute construed to assure an injured party recovers from whatever source available, up to the total amount of damages; therefore, provisions limiting such recovery cannot be asserted); Harhen v. State Farm Mut. Auto. Ins. Co., 61 Ill.App.3d 388, 18 Ill.Dec. 542, 377 N.E.2d 1178 (1978) (insured paid premiums for uninsured motorist protection for each of four vehicles with the expectation of receiving greater coverage in case of an accident with an uninsured motorist; an exclusionary provision that requires cross-checking for an explanation of terms in another portion of the policy, which may be difficult to a lay person, is unenforceable as contrary to public policy); Cameron Mut. Ins. Co. v. Madden, 533 S.W.2d 538 (Mo.1976) (stacking permitted when two premiums are paid for uninsured motorist coverage on two vehicles under one policy, clarity of limiting language that prohibits stacking notwithstanding; public policy expressed in the uninsured motorist coverage statute prohibits insurer from collecting multiple premiums, then limiting recovery to only one of the uninsured motorist coverages); Grange Mut. Cas. Co. v. Volkmann, 54 Ohio St.2d 58, 374 N.E.2d 1258 (1978) (stacking permitted under three separate policies, each with uninsured motorist coverage, when three separate premiums paid; exclusionary provision limiting recovery to only the coverage on the vehicle involved in the accident, no matter how clear and definite, violates public policy and therefore is unenforceable).
We agree with the court's statement in Allstate Insurance Co. v. Maglish, 94 Nev. 699, 586 P.2d 313, 315 (1978), relating to two vehicles covered and two premiums paid under one policy, that “it violates public policy to allow the insurer to collect a premium for certain protection and then take it away by a limiting clause.” We are not swayed by any argument that the second premium, whether or not it is a reduced premium, is collected to' indemnify the insurer against an increased risk of loss incurred by insuring additional vehicles. It is the insurer’s responsibility to weigh the probability of risk and exposure and to set its premiums accordingly. Our long-standing recognition of a public policy that allows stacking of coverages paid for by separate premiums is a reality that by now should be no secret to insurance companies.
The trial court correctly determined that Jimenez could stack his policies to establish whether the negligent driver was underinsured. Because Jimenez had $50,000 in underinsured/uninsured motorists coverage and the negligent driver had only $25,-000, the driver was underinsured to the extent of $25,000. Mr. Jimenez was entitled to recover $25,000 from Foundation.
(2) Reimbursement for payment of medical benefits.
Under its “Medical Payments Coverage,” Foundation agreed to pay a maximum of $5,000 in reasonable medical expenses for accidental injuries sustained by a “covered person” (which definition included Jimenez) while occupying the insured vehicle. Part F of the policy included a provision reserving Foundation’s subrogation right to the insured’s right to recover against another, and a further provision that the insured should hold in trust and reimburse Foundation the amount of any payments Foundation had made if the insured recovered damages from another. The parties acted in accordance with those provisions: Foundation paid $3,439 for Jimenez’s medical expenses; Jimenez reimbursed Foundation from the $25,000 received from Farmers. Jimenez sought and was awarded a return from Foundation of the reimbursement he had made to his insurer. Foundation thus was required to contribute $28,439 to Jimenez’s recovery of damages.
We have long recognized an insurer’s subrogation rights, and that they are entitled to protection. See, e.g., March v. Mountain States Mut. Cas. Co., 101 N.M. 689, 687 P.2d 1040 (1984); Safeco Ins. Co. v. United States Fidelity & Guar. Co., 101 N.M. 148, 679 P.2d 816 (1984); Jacobson v. State Farm Mut. Auto. Ins. Co., 83 N.M. 280, 491 P.2d 168 (1971); Motto v. State Farm Mut. Auto. Ins. Co., 81 N.M. 35, 462 P.2d 620 (1969); Campbell v. Benson, 97 N.M. 147, 637 P.2d 578 (Ct.App.1981). We have rejected the claim that public policy weighs against enforcement of those rights in uninsured (or underinsured) motorist situations. March, 101 N.M. at 692, 687 P.2d at 1043.
In the context of medical provisions agreeing to payment for an insured’s injuries cause by another, and the rights of subrogation or reimbursement if the insured may recover from another, it is clear that medical payments coverage is a conditional coverage. If the insured has no entitlement to recovery against another, medical payments to the extent of coverage are an absolute obligation of the insurer. If the injured party may or does recover from another, the insurer’s obligation to pay then entitles it to press its insured’s claim by subrogation, or be reimbursed if its insured directly recovers from another. Clearly, the premium paid for medical coverage provides the insured with the convenience and peace of mind accompanying prompt payment for necessary medical expenses incurred. The requirement for reimbursement of those prompt payments under the terms of the reimbursement provision is not unjust when plaintiff has fully recovered the total of his stipulated damages. In keeping with our consistent disapproval of double recoveries, we adhere to our statement in Hood v. Fulkerson, 102 N.M. 677, 680, 699 P.2d 608, 611 (1985), that double recoveries are not permitted. See also comments in General Motors Acceptance Corp. v. Anaya, 103 N.M. 72, 703 P.2d 169 (1985); Scott v. Woods, 105 N.M. 177, 730 P.2d 480 (Ct.App.1986); Kirby v. New Mexico State Highway Dept., 97 N.M. 692, 643 P.2d 256 (Ct.App.1982).
The trial court erred in awarding the additional $3,439.29 to plaintiff against Foundation.
(3) Award of expert witness fees.
Jimenez’s cost bill included fees for two expert witnesses who attended the scheduled trial on the merits, but who did not testify at that time because the hearing was vacated, through no fault of the parties, and rescheduled for a later date. Foundation objected, but the court awarded the costs. We reverse.
The right of a prevailing party to recover costs incurred in litigation is by virtue of statutory authority, or by rule of the court as authorized by statute. New Mexico Bureau of Revenue v. Western Elec. Co., 89 N.M. 468, 469, 553 P.2d 1275, 1276 (1976). See also NMSA 1978, § 39-3-30. The statute applicable to costs for experts provides that the district judge may order payment of a reasonable fee “for any witness who qualifies as an expert and who testifies in the cause in person or by deposition.” Thus, there are two hurdles the prevailing party must overcome before costs beyond per diem will be allowed for a witness. First, the witness must qualify as an expert and, second, the expert must testify either at trial or by deposition. We note that Foundation does not contest the witnesses’ status as experts. Nevertheless, the witnesses did not testify at any time. Consequently, the statute does not authorize fees, as costs, for their attendance at the courthouse. Plaintiff’s cost bill is reduced by the amount of the costs awarded for expert witness fees.
The judgment of $25,000 against Foundation is affirmed. The portions requiring Foundation to reimburse Jimenez in the amount of $3,439.29 in medical payments, and costs of expert witness fees, are reversed. The case is remanded for the purpose of entering a new judgment accordingly.
IT IS SO ORDERED.
SCARBOROUGH, C.J., SOSA, Senior Justice, and RANSOM, J., concur.
STOWERS, J., dissents. | [
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OPINION
FEDERICI, Chief Justice.
The facts in this case are undisputed, and it is not necessary to set them out separately. The only issue presented on appeal is a question of law: whether 1979 N.M. Laws, Chapter 319 is unconstitutional insofar as it attempts to amend NMSA 1978, Section 3-21-6. It is our opinion that Chapter 319, Section 1, which is the portion of Chapter 319 that'purports to amend NMSA 1979, Section 3-21-6, is unconstitutional because it violates N.M. Const. Article IV, Section 16.
The title to Chapter 319 reads: RELATING TO COMMUNITY DEVELOPMENT; AMENDING SECTION 3-60-25 NMSA 1978 (BEING LAWS 1975, CHAPTER 341, SECTION 25) TO PROVIDE FOR NOTICE TO REAL PROPERTY OWNERS.
Nowhere does the title refer to Section 3-21-6.
N.M. Const. Article IV, Section 16 provides:
The subject of every bill shall be clearly expressed in its title, and no bill embracing more than one subject shall be passed except general appropriation bills and bills for the codification or revision of the laws; but if any subject is embraced in any act which is not expressed in its title, only so much of the act as is not so expressed shall be void.
Article IV, Section 16 of the New Mexico Constitution has been interpreted by the New Mexico courts many times and the guidelines for its application are firmly established. The cardinal test for interpreting Article IV, Section 16, is whether the title of the act in question gives reasonable notice of the subject matter of the body of the act. State v. Ingalls, 18 N.M. 211, 135 P. 1177 (1913). The purpose of Article IV, Section 16 is to prevent “hodgepodge or log-rolling legislation, surprise or fraud on the legislature,” and the enactment of legislation “not fairly apprising the people of the subjects of legislation so that they would have no opportunity to be heard on the subject.” Martinez v. Jaramillo, 86 N.M. 506, 508, 525 P.2d 866, 868 (1974) (citations omitted).
The New Mexico courts have consistently held that when the title of a legislative act specifically pinpoints statutory sections which are to be amended by the act, but the title fails to set out a wholly unrelated statutory section which also is amended by the act, there is a clear violation of Article IV, Section 16. See, e.g., State v’. Candelaria, 28 N.M. 573, 215 P. 816 (1923).
In State ex rel. Salazar v. Humble Oil and Refining Co., 55 N.M. 395, 234 P.2d 339 (1951), this Court determined that the statute challenged in that case was unconstitutional and void in violation of Article IV, Section 16. This Court stated:
The title of the amending act could have been in general terms and yet • would have been sufficient but here there was an attempt to amend specifically by pinpointing in the title of the amending act of 1949 the sections in the 1937 act which were to be changed and amended. The title of the 1949 amending act certainly was misleading, because the act itself went far beyond anything revealed by the title when it amended Sec. 4.
Id. at 419, 234 P.2d at 355 (emphasis added).
In Salazar we quoted extensively from the reasoning set out in the case of Taylor v. Frohmiller, 52 Ariz. 211, 79 P.2d 961 (1938), in which the Supreme Court of Arizona stated:
[Wjhen it appears from the title of the act that certain specific provisions of another act are to be amended, the body of the amending act may contain only matter which is reasonably germane to the subject matter of the sections which are stated by the title to be the subject of amendment, and may not go to the extent of amending sections not named in the title and which refer to matters not naturally connected with the subject matter of the particular sections which are to be amended.
Id. at 217-18, 79 P.2d at 964. See also Bureau of Revenue v. Dale J. Bellamah Corp., 82 N.M. 13, 474 P.2d 499 (1970).
The title of the act in question refers to a specific act, the Community Development Act. The provisions of the Community Development Act, NMSA 1978, Sections 3-60-1 to -37 (Repl.Pamp.1984) (enacted by 1975 N.M. Laws, Chapter 341), are in no way related to NMSA 1978, Section 3-21-6, which Chapter 319, Section 1 purports to amend. Section 3-21-6 is a part of the zoning enabling legislation, which is contained in NMSA 1978, Sections 3-21-1 to -26 (Orig.Pamp. and Cum.Supp.1984) (enacted by 1965 N.M. Laws, Chapter 300).
The challenged title refers only to the amendment of a single specific section of the Community Development Act. It makes no reference to Section 3-21-6, concerning zoning enabling legislation. The title not only fails to provide reasonable notice of the contents of Chapter 319, Section 1, it fails to provide any notice of the contents of Section 1. The title provides no means of ascertaining that the act amends anything but a single section of the Community Development Act, which is amended by Section 2.
The title to Chapter 319 clearly violates Article IV, Section 16 of the New Mexico Constitution which requires that the subject of any act shall be embraced in the title of the act. The subject matter of Chapter 319, Section 1, amending Section 3-21-6, is not referred to in the title to the act; therefore, Section 1 of Chapter 319 is unconstitutional, void and of no effect.
The judgment of the trial court is affirmed.
IT IS SO ORDERED.
SOSA, Senior Justice, and STOWERS and WALTERS, JJ., concur.
RIORDAN, J., dissenting. | [
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OPINION
DONNELLY, .Chief Judge.
Appellants, John Kernan, M.D., William G. McPheron, M.D., and Robert A. Groves, M.D., appeal from the denial of their motion for protective order. NMSA 1978, Civ. P.R. 26(C)(Repl.Pamp.l980).
Appellee, Roberta T. Bartow, filed a petition pursuant to NMSA 1978, Civ.P.Rule 27 (Repl.Pamp.1980), seeking to perpetuate her testimony and alleging that she is terminally ill with cancer. Appellants opposed the motion and moved to have appellee submit to both a mental and physical examination pursuant to NMSA 1978, Civ. P.Rule 35 (Repl.Pamp.1980).
Following a hearing on the motions, the district court entered an order dated August 30, 1983, granting the motion to perpetuate appellee’s testimony by deposition through means of both stenographic and video tape transcription. Appellee’s deposi-
tion was ordered to be taken on September 9, 1983, at the Lea Regional Hospital, where appellee was hospitalized. The court also ordered that appellee submit to a mental and physical examination “for the purpose of adducing evidence relative to her competence as a witness” prior to the taking of her deposition. The deposition commenced at 2:25 p.m. on September 9, 1983.
After conducting the physical and mental examinations, appellants filed a motion for protective order on September 9, 1983, at 11:00 a.m. The motion for protective order sought to have the district court order a stay in the taking of appellee’s deposition until such time as the court first determined the competency of appellee as a witness. Attached to appellants’ motion for protective order was the affidavit of Kenneth Nelson, a psychiatrist. Dr. Nelson stated that he had examined appellee on September 7, 1983, and concluded that she was incompetent to testify by deposition. He further stated that appellee was suffering from a mental condition and delusions which would preclude her from “giving a reasonably accurate account of the events and conversations which would be the subject matter at the deposition.”
A hearing was held on September 15, 1983, on appellants’ motion for protective order. At the hearing, the district court refused to take testimony from the examining doctor as to appellee’s competency, and declined to rule on the issue of her competency. The court entered an order denying appellants’ motion for protective order on October 14, 1983.
Appellants contend that the trial court erred in denying their motion for protective order and in not ruling on appellee’s competency prior to allowing her deposition to be taken for perpetuation of her testimony. See Annot., 148 A.L.R. 1140 (1944); NMSA 1978, Evid.R. 601 (Repl.Pamp.1983); see also In re Renee, 159 Ohio St. 37, 110 N.E.2d 795 (1953). Appellants assert that the issue of whether a trial court must rule on objections to the competency of a deponent prior to permitting a deposition to perpetuate the testimony of a witness is a matter of first impression in this jurisdiction. However, before we may inquire into the question of whether the trial court erred in refusing to determine the issue of appellee’s competency or to grant the protective order sought by appellants, we must first address a threshold question raised by appellee. That question concerns the appealability of the court’s denial of the motion for protective order. We find this issue dispositive of the appeal.
Appealability of Order
Appellants did not appeal from the order allowing the taking of appellee's deposition for the perpetuation of her testimony. „ Instead, appellants pursue an appeal from the order denying their motion for protective order.
As a general rule an order granting or denying a motion for protective order is not a final judgment or decision for purposes of appeal. See NMSA 1978, Civ. App.R. 3(a) (Cum.Supp.1983); NMSA 1978, Crim., Child.Ct., Dom.Rel. & W/C App.R. 203 (Repl.Pamp.1983); see also Securities and Exchange Commission v. Sloan, 535 F.2d 679 (2d Cir.1976), cert. denied, 430 U.S. 966, 97 S.Ct. 1646, 52 L.Ed.2d 357 (1977); North Carolina Association of Black Lawyers v. North Carolina Board of Law Examiners, 538 F.2d 547 (4th Cir. 1976). Appeals from orders which are interlocutory in nature are subject to allowance only upon compliance with NMSA 1978, Section 39-3-4. Miller v. City of Albuquerque, 88 N.M. 324, 540 P.2d 254 (Ct.App.1975). Appeals are permitted from final judgments, interlocutory orders which practically dispose of the merits of actions, and final orders after a judgment which affects substantial rights. NMSA 1978, §§ 39-3-2, 39-3-7.
Orders granting or denying a motion for protective order, like orders requiring or denying discovery, or orders requiring a party to submit to a physical or mental examination, generally do not constitute a final disposition of the proceedings. Therefore, they are not normally appealable, except upon the granting of an interlocutory appeal. Donnelly v. Parker, 486 F.2d 402 (D.C.Cir.1973); 4 J. Moore, W. Taggart & J. Wicker, Moore’s Federal Practice § 26.83[3] (2d ed.1983). See also NMSA 1978, Civ.P.R. 26, 30, 31, 33 and 35 (Repl.Pamp.1980).
The order sought to be appealed herein did not comply with the provisions of Section 39-3-4, and did not contain the requisite finding authorizing an interlocutory appeal.
Appellants did not obtain a hearing on their motion for protective order until more than a month following the taking of appellee’s deposition. A motion for protective order does not have the effect of automatically accomplishing what is sought. A party seeking a protective order pursuant to Rule 26(C) must file such motion prior to the date designated for the taking of the deposition; until an order is issued, there is nothing to delay the taking of the deposition. Wieneke v. Chalmers, 73 N.M. 8, 385 P.2d 65 (1963).
Appellants’ appeal from the order denying the motion for protective order is dismissed.
IT IS SO ORDERED.
HENDLEY and ALARID, JJ., concur. | [
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OPINION
NEAL, Judge.
Defendant appeals his conviction of demanding or receiving a bribe and criminal sexual penetration in the third degree. He raises the following issues on appeal:
1. That his constitutional right to be free from self-incrimination was violated because the prosecutor made impermissible remarks concerning his failure to testify at trial;
2. That the trial court’s refusal to merge Count I, demanding a bribe, and Count II, extortion with criminal sexual penetration, violated his constitutional right prohibiting double jeopardy; and
3. That the trial judge incorrectly excluded evidence of many prior criminal complaints filed by the complainant which would have been used to impeach her testimony.
Defendant stopped the victim for speeding on November 13, 1982. This was not the first time that defendant and the victim had had an interaction. Two or three weeks earlier defendant had stopped the victim for reckless driving. At that time the victim told the defendant that she would do anything to keep from being arrested. According to Sergeant White, who was present at the earlier stop of the victim by the defendant, the defendant said afterward that he would not mind taking the victim out. The victim repeated this statement on the night in question. According to defendant’s statement, the victim was traveling fifty-one miles an hour in a thirty-mile an hour zone.
After the stop, defendant determined that the victim had been drinking. According to the victim, the defendant then said he would not take her to jail if she did him the favor of oral sex. He then followed the victim home. He used her telephone to report that his radio was out of order. The victim testified that the defendant told her to come out to the car, and made her “go down” on him.
Sergeant Sullivan, defendant’s immediate supervisor at that time, testified that later that evening, the defendant came into Sambo’s Restaurant. Sullivan asked the defendant where he had been. Defendant replied that he was out getting oral sex. Shortly after this remark, defendant said that the victim had propositioned him earlier that night at a car stop.
The victim testified that she stayed drunk for most of the weekend following the incident. On Monday she told a coworker what had happened. The co-worker’s husband is a police officer. She said she was afraid of the defendant and hoped her friend could advise her. The victim was then contacted by a captain on the Carlsbad Police Department. She gave him her story.
I. Comments on Defendant’s Silence.
Defendant asserts a comment by the prosecutor during the state’s closing argument constituted a forbidden reference to the accused’s post-arrest silence. He also alleges that certain comments made during the argument were impermissible comments on his silence at trial.
The fifth amendment of the constitution made applicable to the states through the fourteenth amendment, states that an accused is not compelled to testify against himself. The United States Supreme Court held that a prosecutor is not permitted to comment on a defendant’s silence. Griffin v. California, 380 U.S. 609, 85 S.Ct. 1229, 14 L.Ed.2d 106 (1965). Any comment for which the prosecutor is directly responsible constitutes fundamental error and requires reversal. State v. Baca, 89 N.M. 204, 549 P.2d 282 (1976). Failure to object at trial does not preclude review on appeal. State v. Ramirez, 98 N.M. 268, 648 P.2d 307 (1982).
The defendant’s first contention has no merit and may be dismissed on factual grounds. Simply, there was no post-arrest silence. The defendant was informed of his right to remain silent at his arrest. He voluntarily made a statement to the investigating officers. The statement was admitted into evidence without objection. The prosecutor, in his closing argument, attacked various inconsistencies between the defendant’s statement and other testimony heard at the trial. He noted that while the defendant called the dispatcher from the victim’s house at 12:32 a.m., and claimed to have left her home about one and one-half minutes after the call, he did not arrive at his stop until fourteen minutes later, when the victim’s house was only about three minutes away. He said:
Where are the other eight minutes? They are not there because he did not tell the police what happened after he left the house. He did not tell them about getting fellatio from [the victim]. That’s where the other time is. That’s why you know what happened. That’s why we put this statement into evidence.
No objection was made to the comment at trial.
Taken in context it is clear that the prosecutor was remarking on the statement made to the police. At his arrest the defendant waived his right to remain silent and made an exculpatory statement. Therefore, there was no post-arrest silence to which the comment could have made reference.
As stated above, a prosecutor’s comment on the defendant’s exercise of his fifth amendment right to remain silent may constitute error requiring reversal. State v. Ramirez. However, the rule has no application where, as here, the defendant did not remain silent, and after receiving Miranda warnings, gave a statement. State v. Olguin, 88 N.M. 511, 542 P.2d 1201 (Ct.App.1975). The fact that a defendant omits details in his statement is certainly not the kind of silence which is constitutionally protected as the defendant does not remain silent with respect to the subject matter of his statement. Anderson v. Charles, 447 U.S. 404, 100 S.Ct. 2180, 65 L.Ed.2d 222 (1980). Even when a defendant gives a statement but refuses to answer specific questions, the answers provide a context which lends probative value to the silent responses; comment on those silent responses is not prohibited. United States v. Goldman, 563 F.2d 501 (1st Cir. 1977), cert. denied, 434 U.S. 1067, 98 S.Ct. 1245, 55 L.Ed.2d 768 (1978). Therefore, the prosecutor’s comment on the defendant’s statement is not error.
The defendant argues that the following statement in the closing argument was a direct comment on the defendant’s failure to testify at trial.
And that’s what he did in his statement. He just left out what happened after the telephone call and added in a little bit of his own. But you can see by the times and the distances that more happened than the defendant was willing to tell you that; and the reason he wasn’t willing to tell you what happened is he cannot tell you he received a sexual favor without admitting to everything.
The defense moved for a mistrial on the grounds that the statement concerned the defendant’s failure to testify. The state argued that the statement was directed to the defendant’s statement rather than his failure to testify. The court withheld a ruling at the time and never did announce a ruling on the motion.
Again, it is clear from the remark itself and the context in which it was made that the prosecutor was referring to the defendant’s statement. The quoted language begins with a reference to the statement, and the emphasized language again refers to the defendant’s lack of explanation for a period of time during which the incident in question was said to have occurred.
The state may question the plausibility of an exculpatory statement. State v. Olguin. The jury, having listened to many minutes of argument addressed to the statement, would have understood the quoted remark in that context. The comment therefore was not directed at the defendant’s refusal to testify and it was not error to refuse to direct a mistrial.
The next comment by the prosecutor which defendant argues was an improper comment on his exercise of his right not to testify occurred in the state’s rebuttal argument. The defense had argued at length in closing árgument that a policeman’s life is difficult and dangerous. The prosecutor responded by accusing the defense of making an appeal to the sympathy and prejudice of the jury. He said, “they want to pull the shield of all good officers around this defendant.” He then made the remark [complained of]: “You heard no testimony about this defendant’s record as a police officer, whether he faced one killer or no killers, whether he did anything.”
The defense objected. The court ruled that the statement was not a comment on the defendant’s failure to testify. The context of the remark makes clear that the court was correct.
Defendant’s closing argument stressed the dangers faced by police officers in the line of duty. The prosecutor responded that no testimony had been heard regarding the defendant’s police career. Such testimony could have been supplied by means other than the defendant’s own testimony. Therefore, the statement could not reasonably be perceived as a comment on the defendant’s failure to take the stand.
The final statement complained of is: “He never said one word about why the victim didn’t get arrested for that because its just no reason other than the officer received this favor.”
Defendant did not object to the comment but argues that this statement combined with the others constitute fundamental error. The context of the comment again indicates that it refers to the defendant’s exculpatory statement to the police. The prosecutor referred to the statement that the victim was driving well above the speed limit and was “.15”, referring to an estimated level of alcohol in the blood sufficient to arrest, and contrasted that with his failure to arrest her or offer an explanation why he did not arrest her. The quoted statement was not directed at the defendant’s silence at trial. Therefore none of the comments complained of were improper.
II. Merger.
The defendant contends that he suffered double jeopardy because the trial court refused to merge Count I, which charged him with demanding a bribe by a public officer, and Count III, criminal sexual penetration. He also argues that Count I is a lesser included offense within Count III, and therefore the state should only have been allowed to proceed under Count III.
Merger is an aspect of double jeopardy; the concept is applied to prevent a person from being punished twice for the same offense. State v. Sandoval, 90 N.M. 260, 561 P.2d 1353 (Ct.App.), cert. denied, 90 N.M. 637, 567 P.2d 486 (1977). The test • of whether one criminal offense has merged with another is whether one offense necessarily involves the other. Id. at 263, 561 P.2d at 1356. That determination requires an examination of the statutory definitions of the crimes to see whether the elements are the same. Id. The crime of demanding or receiving a bribe by a public officer or public employee “consists of any public officer or public employee soliciting or accepting, directly or indirectly, any thing of value, with intent to have his decision or action on any question, matter, cause, proceeding or appointment influenced thereby, and which by law is pending or might be brought before him in his official capacity.” NMSA 1978, § 30-24h2 (Repl.Pamp.1984). Criminal sexual penetration in the third degree “consists of all criminal sexual penetration perpetrated through the use of force or coercion.” NMSA 1978, § 30-9-ll(C) (Repl.Pamp. 1984).
Demanding a bribe does not require proof that a bribe was actually received, so the state was not required to show that the defendant received fellatio for the crime to be complete. Criminal sexual penetration, in contrast, requires that the act was actually committed. Count I also involves the intent of the defendant that his decision be influenced by the bribe. Count III requires that the victim believed that the defendant would arrest her unless she submitted, thus constituting the requisite “force or coercion.” Therefore, the defendant did not face multiple prosecutions for the same offense and the court did not err in refusing to merge the two counts. The same comparison of the offenses required to determine whether one count is a lesser included offense of another under State v. Medina, 87 N.M. 394, 534 P.2d 486 (Ct.App.1975), yields the same result.
III. Exclusion of Evidence of Prior Complaints.
The defendant presents difficult questions under the Rape Shield Law implicating the opposing principles of the protection of victims of sexual crimes on one hand, and the right of the criminal defendant to cross-examine the witnesses against him on the other. Defendant sought to cross-examine the complainant concerning several other complaints she had made to the police in the three years prior to the incident in question. First he argues that the court erred in limiting his offer of proof concerning the complaints, and he then argues that the court erred in refusing to allow cross-examination at trial about the prior accusations, including prior accusations of rape.
The procedural history of the case is complex. Prior to trial the court held a hearing on the state’s motion in limine. The state sought to prevent the defense from inquiring into the past sexual conduct of the complainant based on the Rape Shield Law, NMSA 1978 Section 30-9-16 (Repl.Pamp.1984), and NMSA 1978 Evid. Rule 413 (Repl.Pamp.1983). The court granted the state’s motion. Then, at trial, the defense sought to cross-examine the victim about the prior complaints, contending the testimony would be admissible under NMSA 1978, Evid.Rule 404(b) and 608 (Repl.Pamp.1983). The defense made an offer of proof; the court refused to allow the defense to cross-examine the complainant outside the presence of the jury, but allowed counsel to read into the record the questions he would have asked the complainant concerning the prior complaints. The defense objected. The defendant argues that the court improperly prohibited him from cross-examining the complainant regarding her prior complaints. For the purpose of analysis we will divide the complaints into two groups, those concerning rape and sexual assault, and those dealing with other allegations. We then discuss the tender issue.
A. Prior Complaints Regarding Sexual Conduct.
At the motion hearing on September 13, 1983, the defense sought to cross-examine the victim with questions concerning three prior assault and rape complaints, arguing that evidence of the complaints showed the victim’s tendency to “cry wolf.” The court ruled that the complaints involved evidence of prior sexual conduct of the complainant and would not be allowed. Then, on his tender he listed questions concerning rape complaints against six named individuals and one unknown individual. He argues that the testimony sought did not involve prior sexual conduct under the Rape Shield Law and was therefore erroneously exclud ed. In the alternative, he contends that if the rapes were prior sexual conduct within the meaning of the statute, they were admissible under the balancing test set out in the Rape Shield Law.
As a preliminary matter note that only three of the prior rape complaints were inquired into at the motion in limine hearing. Failure to seek an in-camera hearing on the issue of the admissibility of evidence of prior sexual conduct bars introduction of the material. State v. Montoya, 91 N.M. 752, 580 P.2d 973 (Ct.App.), cert. denied, 91 N.M. 751, 580 P.2d 972 (1978). Therefore, the issue regarding prior rape complaints beyond the three raised before trial cannot be raised on appeal.
The admissability of evidence of a complainant’s past sexual conduct is governed by Evid.Rule 413(a). That section provides:
(a) Evidence of the victim’s past sexual conduct. In prosecutions under Sections 30-9-11 to 30-9-15 NMSA 1978, evidence of the victim’s past sexual conduct, opinion evidence thereof or of reputation for past sexual conduct, shall not be admitted unless, and only to the extent that the court finds, that evidence of the victim’s past sexual conduct is material and relevant to the case and that its inflammatory or prejudicial nature does not outweigh its probative value.
Section 30-9-16 provides that it is a matter of substantive right that such testimony not be admitted except on the same limited conditions set out in the evidence rule.
The statute is intended to encourage the reporting of rapes by lessening the ordeal a rape victim must endure at trial, and making the prosecution of rape cases more equitable for the victim. It minimizes the intrusive inquiry into the complaining witness’ private life, recognizing that prior sexual conduct is rarely relevant to the guilt or innocence of the accused. State v. Romero, 94 N.M. 22, 606 P.2d 1116 (Ct.App.1980). It also insulates the jury from prejudicial evidence. Id. In doing so it “severely limits the opportunity of a defendant charged with certain sexual offenses to impeach the prosecutrix’ testimony by presenting evidence as to her prior sexual behavior.” Id. at 25, 606 P.2d 1119.
The danger posed by the statute and evidence rule is that its application will prevent the defendant from adequately cross-examining the complainant to attack her credibility, thus violating the defendant’s right to confront the witnesses against him guaranteed by the sixth and fourteenth amendments. Hughes v. Raines, 641 F.2d 790 (9th Cir.1981), citing Davis v. Alaska, 415 U.S. 308, 94 S.Ct. 1105, 39 L.Ed.2d 347.
The contention that prior rape complaints do not involve prior sexual conduct is easily disposed of: the court has determined that the wording of the statute is not limited to sex by consent, rather, its unlimited wording applies to all sexual conduct so that a prior rape is sexual conduct within the meaning of the section. State v. Montoya. Therefore, the prior rape complaints concern past sexual conduct and implicate the statute.
Evidence of prior sexual conduct may be admitted, however, if it is relevant and material, and its prejudicial nature does not outweigh its probative value. Therefore we must first examine the relevancy and materiality of the prior complaints.
In his brief-in-chief, defendant cites dicta in the case of State ex rel. Pope v. Superior Court, 113 Ariz. 22, 545 P.2d 946 (1976) as" authority to the proposition that prior unsubstantiated charges of rape have been found admissible in some jurisdictions as bearing on the credibility of the victim. Other courts have directly considered the question and reached a different result.
In Little v. State, 413 N.E.2d 639, 643 (Ind.App.1980), the court stated, “[w]e believe that evidence of false accusations of similar sexual misconduct is admissible on the issue of the victim’s credibility. The allegations, however, must be demonstrably false.” The court quoted with approval the statement in State v. Nab, 245 Or. 454, 459, 421 P.2d 388, 391 (1966) that, “ ‘[t]he rule is limited to the reception of evidence that the prosecutrix had admitted the falsity of the charges or they had been disproved.’ ” Other courts have applied similar standards.
In State v. Demos, 94 Wash.2d 733, 619 P.2d 968 (1980), the defense sought to introduce two rape complaints which occurred thirteen months prior to the incident in question. The evidence showed the complainant had previously reported two rapes. The first took place in Seattle, and the case was placed on inactive status when she moved to Oregon and the Seattle police could not locate her. In Oregon she reported a rape and took a polygraph test which showed consistent deception. The charges were dropped. The court did not reach the question of whether the Rape Shield Law prohibited evidence of past rape accusations because the offered evidence did not prove falsity and was therefore irrelevant. As it had no tendency to prove anything in dispute and would have been highly prejudicial, it was excluded.
In Hughes, the court was faced with a similar situation. (Citing the wide discretion of the trial judge with respect to limiting the scope of cross-examination.) The court discussed the trial court’s exclusion of prior rape complaints. The court weighed the probative value and found that the only probative value would be if “it could be shown convincingly that the other charge was false.” The court then recited the evidence shown by the defendant's offer of proof that the district attorney did not prosecute the complaint and the accused denied he committed the act. Even if the jury believed the complaint to be false, the probative value was slight, the court reasoned, citing the factual dissimilarity between the two complaints. The same reasoning regarding the similarity of prior complaints to the incident in question was employed by the New Mexico Supreme Court when ruling on the relevance of prior complaints in State v. Fish, 101 N.M. 329, 681 P.2d 1106 (1984).
We agree with the reasoning of the Hughes, Little and Demos cases, and apply the standard that to pass the initial relevancy test of Rule 413 and Section 30-9-16, the prior complaints must be demonstrably false. To allow evidence of unsubstantiated rape complaints would divert the attention of the trial from its primary objective, determination of the guilt or innocence of the accused. Little. Instead, the focus would be on whether the prior charges were “unsubstantiated,” in effect putting the complainant on trial as to the truthfulness of any complaint to the police which did not result in arrest or conviction. Such inquiry violates the intent of the Rape Shield Law.
Here there is no evidence that the complaints were false. In fact one complaint resulted in a prosecution and a guilty plea to a lesser assault charge. The defendant neither sought to depose the complaining witness nor to independently develop evidence of falsity. Defense counsel even admitted he did not know whether the prior complaints were true or false. The complaints, without convincing evidence of falsity, have no relevance. Here the court heard not only the victim’s testimony concerning the incident, but corroborating testimony by the defendant’s fellow police officers who stated that the defendant said he had been propositioned by the victim and had been getting oral sex. The court properly excluded evidence that the victim had made prior rape complaints to the police.
B. Prior complaints unrelated to sexual conduct.
The defense argued that the questioning regarding prior complaints to the police about incidents not involving rape was admissible under NMSA Evid.Rule 608(b) as probative of untruthfulness and lack of veracity, and under NMSA Evid.Rule 404(b) as bearing on motive, habit, or intent of the witness. He argues that “the fact that the complaining witness had made some two dozen false complaints in the' past would have been probative of untruthfulness and lack of veracity,” and could show whether she was a chronic complain er who fabricates and imagines things. At the motion in limine hearing defense counsel admitted he did not know whether the complaints were true or false.
The extent of cross-examination is a matter within the discretion of the trial judge, and its rulings will not be disturbed absent a clear abuse of that discretion. State v. Ewing, 97 N.M. 235, 638 P.2d 1080 (1982). The same is true regarding admission of evidence pursuant to Rule 404(b). State v. Smith, 92 N.M. 533, 591 P.2d 664 (1979); State v. Allen, 91 N.M. 759, 581 P.2d 22 (Ct.App.), cert. denied, 91 N.M. 751, 580 P.2d 972 (1978). Of course, evidence sought to be admitted under that rule is subject to the balancing test of NMSA Evid.Rule 403 (Repl.Pamp.1983), which requires that the probative value of the evidence outweigh its prejudicial effect. State v. Beachum, 96 N.M. 566, 632 P.2d 1204 (Ct.App.1981).
We first examine the probative value of the prior complaints because, until relevancy has been demonstrated, the balancing test does not come into play. State v. Herrera, 92 N.M. 7, 582 P.2d 384 (Ct. App.1978). In other jurisdictions it has been held that the fact a person makes accusations does not establish that they are false, even if they do not result in arrests or convictions. Stewart v. State, 174 Ind. App. 447, 368 N.E.2d 253 (1977); see Durkin v. State, 284 Md. 445, 397 A.2d 600 (1979).
As stated in the previous section, the defendant offered no proof that the accusations were false, and given the other evidence concerning her drug and alcohol use and association with drug dealers, the number of complaints could indicate that her circumstances might likely include contact with criminal behavior. Therefore, the fact that the complainant made the prior complaints has no probative value. The prejudicial effect, however, could be great. With no supporting evidence offered to show that the reports were false, the defense is asking the jury to infer that she lied to the police in the past. The New Mexico Supreme Court stated, “The impeachment of a witness by insinuations ... of prior misconduct provides the trier of fact with no information relevant to the witness’s credibility and carries a great potential for prejudice.” State v. Robinson, 99 N.M. 674, 676, 662 P.2d 1341 (1983).
The analysis under Evid.Rule 608 yields the same result. The rule provides that specific instances' of conduct may be inquired of on cross-examination if, in the discretion of the court, probative of untruthfulness. State v. Madrid, 83 N.M. 603, 495 P.2d 383 (Ct.App.1972). As previously discussed, the probative value of the fact that the victim made prior complaints is non-existent, while we have already held that its prejudicial effect is great. State v. Romero, 94 N.M. at 26, 606 P.2d 1116. There was no abuse of discretion in refusing to allow the defense to cross-examine the complainant regarding prior complaints in order to impeach her credibility.
C. Offer of Proof.
Defendant contends that the court erred in refusing to allow him to question the complaining witness during his offer of proof. The purpose of an offer of proof is to advise the court of the nature of the evidence sought to be admitted. NMSA 1978, Evid.Rule 103(a)(2) (Repl. Pamp.1983); State v. Shaw, 90 N.M. 540, 565 P.2d 1057 (Ct.App.1977). We believe the defendant’s proffer was sufficient to accomplish that result. The court allowed defense counsel to read into the record the questions he wanted to ask the victim. The questions concerned whether she had made the prior complaints listed on a police printout. None of the questions dealt with the truth or falsity of the complaints. No evidence of falsity was presented. As we have already discussed, the mere fact that the complaints were made, assuming the victim admitted she had made the accusations, has no probative value. Given the balancing test of Evid.Rule 403, the court did not impermissibly limit the defendant’s offer of proof, rather, the offer was limited by the defendant, who did not seek to prove that the complaints were false.
The judgment of the trial court is affirmed.
IT IS SO ORDERED.
DONNELLY, C.J., concurs.
HENDLEY, J., concurs in result only. | [
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ORDER
This matter having come before this Court on July 18, 1984, after completion of disciplinary proceedings conducted pursuant to NMSA 1978, Rules Governing Discipline (Repl.Pamp.1983), wherein Attorney Harvey C. Markley (Markley) was found to have filed a client’s claim after the statute of limitations had run, then raised the same case as a frivolous appeal in Crumpton v. Humana, Inc., 99 N.M. 562, 661 P.2d 54 (1983) by this Court, and failed to properly arrange for the sale of two other clients’ real property by not having the deed held in escrow until his clients had been paid in full.
Markley had also prepared the warranty deed conveying this same real property to his clients’ buyers but failed to attach a copy of the real estate contract to the deed when he had it recorded. Subsequently, the buyers obtained a second mortgage on the property, defaulted on their payments to the bank, and then quitclaimed their interest in the property to the bank in lieu of a foreclosure action. Markley’s clients then sued the bank and Markley and were awarded a judgment in the amount of the balance owed to them by the buyers. The bank, the buyers, and 'Markley’s former clients were all awarded judgments against Markley in the amount of their attorney fees and costs incurred.
Such conduct by Markley in failing to file his client’s claim prior to the running of the statute of limitations and his subsequent frivolous appeal to this Court violates NMSA 1978, Code of Prof.Resp.Rules 6-101(A)(3), 7-101(A)(3) and 7-102(a)(2) (Repl. Pamp.1982). In the matter of Markley’s handling of the sale of his former clients’ real property, his conduct violates NMSA 1978, Code of Prof.Resp.Rules 6-101(A)(l) and 7-101(A)(3) (Repl.Pamp.1982).
The Disciplinary Board recommended that we censure Markley for these violations of the code and place him on probation for a period of one year. We adopt these recommendations and warn Attorney Markley that any further violations will be treated much more strongly by this Court.
IT IS HEREBY ORDERED that Markley be and hereby is publicly censured and placed on probation for a period of one year commencing on August 1, 1984, for his violations of NMSA 1978, Code of Prof. Resp.Rules 6-101(A)(l), 6-101(A)(3), 7-101(A)(3), and 7-102(A)(2) (Repl.Pamp. 1982), according to the following conditions:
1. Markley agrees and stipulates that he shall pay all costs assessed against his client, Wanda Crumpton, and give proof of said payment to the Disciplinary Board no later than December 31, 1984.
2. Markley agrees and stipulates that he shall pay his clients, the Martins, in accordance with the judgment entered against him in Cause No. CV-18-298 in the District Court of Lea County and give proof of satisfaction to the Disciplinary Board no later than December 31, 1984.
3. Markley shall be supervised by Jim Saunders, Esq., or should Mr. Saunders become unavailable, by an experienced attorney approved in advance by this Court. Markley shall meet with Mr. Saunders two times per month on a regular basis to review all of the cases and actions taken or to be taken.
4. Markley shall accept new cases only after consultation with Mr. Saunders and then only after he has ascertained that Markley has the expertise necessary to handle said case or cases.
5. Markley shall register for and attend two (2) seminars presented or approved by the Continuing Legal Education section of the Board of Bar Commissioners. One shall be in the area of real estate law and the other in the area of tort litigation and/or negotiation. Proof of attendance shall be provided to the Disciplinary Board no later than February 23, 1985.
This order is to be published in both the New Mexico Reports and the State Bar of New Mexico News and Views. | [
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OPINION
FRANCHINI, Justice.
We consolidated these two cases on appeal because they each raise the question of whether an automobile insurance policy definition that limits uninsured motorist coverage to only those spouses or relatives who live with a named insured at the time of an accident violates public policy. We hold that such a definition does not necessarily violate public policy, but that under the facts of each of these cases before us, coverage must extend to the plaintiffs.
Ramiro Loya appeals from a summary judgment denying Loya class-one coverage under an uninsured motorist policy issued by State Farm Mutual Insurance Company to Ramiro and his wife, Sallie Loya. The narrow and dispositive issue in his appeal is whether, by defining “spouse” in a manner in which the spouse may at a future point during the life of the policy fail to meet a requirement of coverage, an insurance company may require a class-one insured to forfeit coverage. The uncontroverted evidence shows that at the time Sallie purchased the policy, Ramiro met the policy definition of insured spouse, the couple paid a premium for coverage for both spouses, they purchased the policy with community property, and the parties intended to provide class-one coverage for the couple and their son. We hold that because Ramiro qualified for and the couple paid for class-one coverage for both Ramiro and Sallie when they contracted for insurance coverage, State Farm cannot deny coverage to Ramiro during the policy period simply because he moved from the residence where Sallie lived and thereby no longer met the policy definition of “spouse.” We reverse.
In the second case, State Farm appeals from a summary judgment issued in favor of Wayne Smyth and his son, Sean Smyth. The court held that policy language requiring minor children to live with a named-insured parent in order to be protected under the uninsured motorist coverage is void as violative of public policy. The uncontroverted evidence shows that Wayne intended to provide uninsured motorist protection for all of his children including Sean (who lived with Wayne’s former wife), that Sean was dependent upon Wayne for support and that Wayne was a joint legal custodian for Sean. We hold that an insurance company may not exclude from uninsured motorist coverage an unemancipated minor child that the named insured is legally obligated to financially support by inserting a general definition applicable to other relatives in the policy. We affirm the trial court.
Facts and proceedings — the Loyas. The Loyas married in 1986 and experienced marital difficulties, separating three times after December 1989. In March 1991, during a period of reconciliation, they used community funds to purchase two automobile insurance policies from State Farm. The policies were for a car (“the Honda”) and a truck they jointly owned and both drove. The Honda policy listed only Sallie as the named insured but expressly included Ramiro as an insured on the declarations page and on the proof of financial responsibility card issued for that car. The truck policy listed both Sallie and Ramiro as named insureds, in that order. The automobiles were titled in both the Loyas’ names; Sallie drove the Honda most of the time.
The policies defined the “named insured” as the “first person named in the declarations” regardless of whether both spouses were named in the declarations as insureds. The policies provided class-one coverage for “the first person named in the declarations” and “his or her spouse.” In á separate section of the policies (on a different page) the definition of “spouse” was limited to “your husband or wife while living with you.” The policies were renewed for another six months in September 1991 while the couple was still living together.
In October 1991, the Loyas separated for the third time. Ramiro moved out of the marital residence and went to stay with his brother. Ramiro and Sallie each called State Farm and asked to have the other removed as a “named insured” on the policy of the respective automobiles they were driving. State Farm apparently did not refund any premium amounts reflecting a reduction in liability or uninsured motorist coverage on each auto from two covered drivers to one; nor did it issue a new policy on the Honda or notify Ramiro that he was no longer insured under the Honda policy. State Farm did issue a new policy listing only Ramiro as the named insured on the truck.
In December 1991 the couple met to discuss the dissolution of the marriage. Ramiro drove the couple around in the Honda while they were talking. At some point Sallie pulled a gun, they struggled over it, Ramiro threw the gun away, and he got out of the car. Sallie then ran over Ramiro with the car, severely injuring him.
State Farm paid Ramiro the uninsured motorist policy limits on the truck for which he was now designated as the named insured, but denied him the right to stack the Honda policy with the truck policy. Ramiro brought a declaratory judgment action to determine his rights under the Honda policy. After cross-motions for summary judgment were filed, the court held that the Honda policy was clear and unambiguous, that there were no material issues of fact, and that Ramiro should be denied the right to stack because he was not a class-one insured under the definition of “spouse” in the policy at the time of the accident.
Class-one uninsured motorist coverage is determined at the time the policy is purchased. When a married couple contracts for insurance coverage for the family, there is a presumption that the coverage applies with equal effect to both parties unless one of them is expressly excluded from coverage. Each person is considered to be a purchaser of the contract. See, e.g., Schmick v. State Farm Mut. Auto. Ins. Co., 103 N.M. 216, 217-20, 704 P.2d 1092, 1093-96 (1985) (characterizing wife as a purchaser of policies and holding that she was entitled to stack both policies even though she was not the “named insured” on one of the policies). The insurance company may not unilaterally decide who it will designate as the “named insured” in a contract of adhesion and thereby defeat the rights of the contracting member who does not actually sign the contract but who is a clear beneficiary thereof.
Further, the parties designate who is to be covered under the insurance contract, and the number of persons insured by thát contract establishes the amount of the premium, which must be paid in advance. If there is a disagreement between the parties, a court looks at the intent of the parties at the time the contract was executed to determine who the parties intended to insure. See, e.g., Jaramillo v. Providence Wash. Ins. Co., 117 N.M. 337, 341, 871 P.2d 1343, 1347 (1994) (remanding case for trial court to consider whether ambiguity existed in defining who was class-one insured by admitting extrinsic evidence of circumstances under which the parties contracted and purpose of contract); State ex rel. Santa Fe Sand & Gravel Co. v. Pecos Constr. Co., 86 N.M. 58, 61, 519 P.2d 294, 297 (1974) (“The meaning of a contract is to be determined and construed with reference to the intention of the parties at the time the contract was made.”).
It is uncontroverted that at the time the insurance contract was executed, Ramiro was a class-one insured under the policy. State Farm contends that Ramiro lost his rights under the contract of insurance for the Honda solely because he was not living with Sallie at the time of his injury. It convinced the trial court to examine the facts at the time of the injury rather than at the time the contract was executed in order to determine who was an insured. In essence, State Farm is arguing that it should be relieved from the risks it was paid to insure against because of a personal conflict between beneficiaries independent of the initial risks insured against. This theory has been soundly rejected in other jurisdictions when construing insurance contracts.
For example, in United Farm Bureau Mutual Insurance Co. v. Brantley, 176 Ind.App. 178, 375 N.E.2d 235 (1978), a couple, while married, purchased a policy to cover both individuals on a jointly-owned automobile. The husband was listed as the named insured. Id., 375 N.E.2d at 236. The policy, similar to the Loyas’ policy, limited coverage to a spouse who was a resident of the same household as the named insured. Id. While the policy was still in effect, the couple divorced and the wife was subsequently injured in an accident. The insurance company denied coverage, stating that when the divorce occurred, the wife no longer was covered under the definition of “spouse” in the policy. The court disagreed. It held that the insurance company knew that both the individuals were contracting and paying for coverage; that the contract was not materially altered by the divorce because it did not change the risk-related factors on which the premium was based; and that the insurance company was therefore “not prejudiced by accepting the identical risk which was undertaken when the parties originally contracted for coverage.” Id. at 237.
The Brantley opinion cited to United States Fidelity & Guaranty Co. v. Winkler, 351 F.2d 685 (8th Cir.1965), cert. denied, 382 U.S. 1026, 86 S.Ct. 647, 15 L.Ed.2d 540 (1966), in which the Eighth Circuit held that in a family automobile policy, the insurer intends to insure both the husband and wife. That court stated that “[w]hen the risks involved are not altered the insurer should not be permitted to deny liability to one spouse on the basis of a subsequent change in marital status.” Brantley, 375 N.E.2d at 238; see also 6C John A. Appleman, Insurance Law & Practice § 4352, at 20 (Buckley ed. 1979) (stating that a spouse is considered a member of the same household as the named insured despite separation and separate residency). The Winkler court noted that the policy in that case did not make clear whether the insured’s status was to be determined on the basis of facts existing at the time the insurance originated or at the time the accident occurred. Winkler, 351 F.2d at 687. Because the wife met the definition of spouse at the time the contract was executed,
taking away the coverage from her would be in the nature of a forfeiture. It is of course well-established that forfeitures are strictly construed. The policy is far from clear in containing any express statement that the status of the named insured once acquired is lost by a subsequent event such as separation.
Id. Therefore, the court held that reformation of the contract would be justified. Id. at 689.
The Brantley and Winkler cases are founded upon the principle that a husband and wife each have contractual rights in an insurance policy that, once established and paid for, may not be invalidated because of the language the insurance company chooses to use to describe the parties. Because Ramiro was a class-one insured under the policy at the time it was executed, he is entitled to have the insurance contract construed in his favor. See Jaramillo, 117 N.M. at 341-42, 871 P.2d at 1347-48 (stating that the general principle that ambiguities in an insurance policy are construed against the insurer applies to established insureds but not to create coverage for a third party who has not paid for insurance or is not an acknowledged family member).
The application of the policy definition of “spouse” is ambiguous. We agree that the meaning of “while living with” is unambiguous. We find ambiguity in this policy, however, when attempting to determine to whom the policy definitions apply and when to apply them. See, e.g., Schmick, 103 N.M. at 220-21, 704 P.2d at 1096-97 (finding ambiguity because policy provisions when read together were not easily interpreted, the exclu sion logically made no sense and was inconsistent with the purposes of coverage, and the exclusionary clause was difficult to construe because of the necessity of incorporating into the exclusion a complex definition); cf. Lopez v. Foundation Reserve Ins. Co., 98 N.M. 166, 168, 646 P.2d 1230, 1232 (1982) (finding ambiguity because policy failed to address effect of payment of multiple premiums). In response to a request for insurance for each of two married individuals, State Farm sent the Loyas a declarations page describing the coverage purchased. Sallie’s name appeared in a block under “Named Insured” at the top of the page and again in the section of the declarations page setting out the coverages. Ramiro’s name also appeared in this coverage section. The declarations page instructed the Loyas to attach it to the policy booklet and states that the “policy consists of this page, any endorsements, and the policy booklet.” In the policy booklet, the page describing uninsured motorist coverage states that persons covered by the policy are “the first person named in the declarations [and] his or her spouse.” Notwithstanding the fact that the word “spouse” is a common word with a generally understood meaning and that each member of the marital union is contracting for coverage, the policy contains a unique definition of “spouse.” This definition is located on a separate page that defines other words that are peculiar to the policy. “Spouse” is limited to mean “your husband or wife while living with you.” ‘You” is then defined on the next page as “the named insured or named insureds shown on the declarations page” (emphasis added). “Named insured” is not defined, but “insured” is defined as “the person, persons or organization defined as insureds in the specific coverage.” Several questions arise out of these unusual definitions and their placement in the policy. First, would a reasonable person contracting for insurance coverage look past the declarations page and the specific coverage page for a definition of a common word if the person had requested insurance and both pages clearly designate the person as a class-one insured? If the person did see the definitions, would the person believe himself or herself to be “you” and not “spouse” if the person is expressly named as an insured on the declarations page? If one thinks the term “spouse” may apply, would a reasonable person think his or her coverage could be canceled if for any reason he or she was not living with his or her spouse, i.e., that coverage would stop and start depending upon physical residency? What if the person’s spouse moved out of the marital residence? Would the contract of insurance be voided because of a unilateral act over which the person had no control? There is no separate or express exclusion notifying the parties that coverage will be forfeited for the person who is not currently living with the individual who was designated as the named insured. Is the definition of “spouse” intended to simply designate the class-one insureds at the time the insurance contract is executed or should it be applied like an exclusion at the time a class-one policy-holder is injured to defeat coverage? These questions demonstrate that the policy is ambiguous.
Ambiguity in coverage is resolved in favor of the reasonable expectations of the insured. We are compelled to resolve this ambiguity in favor of coverage. The Court in Sanchez v. Herrera, 109 N.M. 155, 159, 783 P.2d 465, 469 (1989), noted, “The typical insured does not bargain for individual terms within policy clauses; the insured makes only broad choices regarding general concepts of coverage, risk, and cost.” The Court therefore held that “[t]he reasonable expectations of the insured ... provide the criteria for examining an insurance contract on the basis both of the actual words used and of unresolved issues that the insurance company has an obligation to address.” Id. As a class-one insured who jointly purchased the policy, Ramiro had a reasonable expectation of coverage during the whole policy period notwithstanding marital conflicts or circumstances that could cause him to not physically live with Sallie. See Federal Ins. Co. v. Century Fed. Sav. & Loan Ass’n, 113 N.M. 162, 169, 824 P.2d 302, 309 (1992) (stating that when policy language is ambiguous, the reasonable - expectations of the insured must be considered and the analysis “should focus primarily on protecting the one for whose benefits premiums have been paid ... and construing the policies liberally in favor of the insured and strictly against the insurers” (quoting CC Hous. Corp. v. Ryder Truck Rental, 106 N.M. 577, 580, 746 P.2d 1109, 1112 (1987)). The policy did not contain any warnings that separation could result in forfeiture of coverage, and it is not reasonable to suppose that an insurance contract could be canceled on the basis of a non-risk-related factor that arose after insurance was secured. A policyholder has a right to expect stability and security of coverage. See Chavez v. State Farm Mut. Auto. Ins. Co., 87 N.M. 327, 330, 533 P.2d 100, 103 (1975) (holding that the insurer may not create gaps in uninsured motorist coverage by creating exclusions dependent upon location or vehicles).
Exclusions that purport to limit uninsured motorist coverage of class-one insureds are void. Even if the definition of “spouse” could be considered an express exclusion that limits Ramiro’s coverage, we would not give effect to it. It has long been established that in uninsured motorist coverage policies even unambiguous exclusions that limit class-one coverage will not be enforced. Id. (holding that exclusion denying coverage if insured was riding in an uninsured vehicle was not valid because “it is not the intent of the [uninsured motorist] statute to limit coverage for an insured to a particular location or a particular vehicle”). In Foundation Reserve Ins. Co. v. Marin, 109 N.M. 533, 535, 787 P.2d 452, 454 (1990), this Court overruled Willey v. Farmers Ins. Group, 86 N.M. 325, 523 P.2d 1351 (1974). In Willey, the insured was a passenger in her own car when she was killed in an accident caused by the negligence of the uninsured driver who was driving her car. Willey held that an unambiguous policy definition of “uninsured motor vehicle” that excluded a vehicle owned by the named insured vitiated the insured’s class-one coverage. Id. at 326, 523 P.2d at 1352. In Marin, we revisited Willey and held that, as Chavez noted, there are only two legitimate limitations on uninsured motorist recovery: that the insured be legally entitled to recover damages and that the negligent driver be uninsured. 109 N.M. at 535, 787 P.2d at 454. Any other exclusionary clause limiting recovery will not be enforced. See, e.g., Stinbrink v. Farmer’s Ins. Co., 111 N.M. 179, 180, 803 P.2d 664, 665 (1990) (holding that unambiguous uninsured motorist exclusion denying recovery for punitive damages was unenforceable); Jimenez v. Foundation Reserve Ins. Co., 107 N.M. 322, 324-25, 757 P.2d 792, 794-95 (1988) (stating that “[t]he legislature intended that an injured person be compensated to the extent of insurance ... purchased for his or her benefit.” Notwithstanding the unambiguous language of an exclusion precluding recovery under more than one policy, the Court held that when “an injured insured is the beneficiary of a policy and either the insured or another has paid premiums for the benefit of the injured insured, then all policy coverages under which he or she is a beneficiary may be stacked.”); Schmick, 103 N.M. at 221, 704 P.2d at 1097 (striking exclusionary clause that precluded recovery if insured was injured in a vehicle not described in the policy but owned by the insured); Sloan v. Dairyland Ins. Co., 86 N.M. 65, 67, 519 P.2d 301, 303 (1974) (striking an exclusion that limited or eliminated uninsured motorist coverage if uninsured motorist coverage was available under another applicable policy).
This Court has consistently refused to enforce exclusions that attempt to limit uninsured motorist coverage to particular circumstances. Being separated from one’s spouse at the time of an accident is no different analytically than being in an uninsured vehicle at the time of an accident. In neither circumstance may the insurance company deny coverage to its insured after accepting premiums for uninsured motorist coverage. “If the [uninsured motorist] statute is to be meaningful and controlling in response to the nature and extent of the coverage ... all inconsistent clauses ... must be judicially rejected.” Sloan, 86 N.M. at 67, 519 P.2d at 303.
We do not today decide the question of whether an insurance company, by expressly precluding coverage to those spouses who do not live with the named insured, may validly deny insurance coverage from, the outset. The resolution of that question depends upon the contract language, who was contracting for insurance, and who were the intended beneficiaries of that contract. That question is not raised by the facts in the dispute involving Ramiro Loya.
The Smyth case, however, directly raises the issue of whether an insurer may validly limit coverage for dependent minor children by simply including a limitation in its definition of “relatives.”
Facts and proceedings — the Smyths. Wayne Smyth contracted with State Farm for liability and uninsured motorist coverage for more than twenty years. Sean Smyth, Wayne’s natural son, lived with Wayne and his natural mother Jane from the time he was bom in 1974 until his parents’ divorce in 1981. During this time, Sean admittedly was covered under the provisions of his father’s uninsured motorist policy. After the divorce, Wayne and Jane agreed to joint legal and physical custody of Sean. Wayne provided monetary support, and Sean lived with his father every other weekend and during holidays for several years. State Farm agrees that Sean was also covered under his father’s policy during this time period. Wayne remarried and had two more children. Wayne testified that his intent throughout the years was to provide continuous uninsured motorist protection for all of his children, including Sean. When Sean was fifteen, he and his father had a disagreement and Sean did not live in Wayne’s house for about a year. Wayne, however, continued to support his son. During this period of estrangement, Sean was seriously injured in an automobile accident. Because Sean’s medical expenses exceeded the policy amounts of other policies available for Sean’s needs, a demand was made upon Wayne’s uninsured motorist policy. State Farm refused to pay on the basis that at the time of the accident Sean no longer met the definition of an insured under Wayne’s uninsured motorist policy.
The Smyth policy. Wayne’s uninsured motorist policy states that State Farm “will pay damages for bodily injury ... an insured is legally entitled to collect from the owner or driver of an uninsured motor vehicle.” Another section of the uninsured motorist policy states
Insured — means the person or persons covered by uninsured motor vehicle coverage.
This is:
1. the first person named in the declarations;
2. his or her spouse;
3. their relatives; and
4. any other person while occupying [the named insured’s car or a car driven by the named insured or his/her spouse].
To complicate matters, an “Amendatory Endorsement” was apparently sent to Wayne that states:
Section III — Uninsured and Unknown Motorists — Coverage U. The definition of ‘Insured’ under ‘Who is an Insured’ is changed to read: Insured — means the person or persons covered by uninsured and unknown motorists coverage.
The endorsement does not include parts 1-4 describing the individuals quoted above. To further complicate matters, another change notice was sent to Wayne stating that, regarding the uninsured motorist coverage,
Effective immediately, there now may be coverage for the first named insured and resident relatives when injured in a vehicle owned by or available for the regular use of you, your spouse or your relatives.
Finally, as in the Loya policy, in a section of the main policy, certain words are defined. In that section, “Relative” is defined as
a person related to you or your spouse by blood, marriage or adoption who lives with you. It includes your unmarried and unemancipated child away at school.
As a named insured, Wayne is entitled to recover amounts expended on behalf of his dependent child for damages suffered in an accident with an uninsured motorist. State Farm complains that the trial court did not set forth what public policy is violated by an insurance policy that limits a named insured’s right to recover damages on behalf of an injured child by providing coverage when the child lives with the named insured and taking it away when the child does not. We stated almost twenty years ago, however, that “the Legislature did not intend to allow the creation of a gap in coverage which is contrary to the purpose of the statute.” Chavez, 87 N.M. at 330, 533 P.2d at 103. We emphasized that the purpose of the unin sured motorist statute is to protect an insured from losses that are uncompensated because of a tortfeasor’s lack of liability coverage. Id. at 329, 533 P.2d at 102. Wayne is legally obligated and liable for his son’s medical bills whether Sean lives with his mother or with him or at a boarding school. If Wayne cannot recover those losses because of an exclusion, that exclusion violates the public policy clearly expressed in Chavez.
The policy is not clear regarding who is an insured. As mentioned in the above discussion regarding the definition of “spouse” in the Loyas’ State Farm policy, a policy may give rise to an ambiguity because it requires the party seeking insurance to untangle a web of provisions and related definitions in order to determine who the policy actually covers. See, e.g., Schmick, 103 N.M. at 220-21, 704 P.2d at 1096-97. Considering the context in which the parties contracted may also reveal an ambiguity even though apparently unambiguous language was used. See Jaramillo, 117 N.M. at 341, 871 P.2d at 1347. It would not be too difficult to simply state the names of all of the class-one individuals the contracting parties intend to protect on the declarations page and to expressly exclude any family member drivers that the insurance company is not willing to cover for liability insurance. See Federal Ins. Co., 113 N.M. at 168, 824 P.2d at 308 (noting that “insurers have had over one hundred years to hone their policies into forms that would not ferry the unwary reader on a trip into Wonderland”); Pribble v. Aetna Life Ins. Co., 84 N.M. 211, 213, 501 P.2d 255, 257 (1972) (finding it “curious” that simpler language clearly excluding a condition was not used); Read v. Western Farm Bureau Mut. Ins. Co., 90 N.M. 369, 373, 563 P.2d 1162, 1166 (Ct.App.1977) (“Decade after decade, with regularity, the insured and the insurer fight for a bone, which includes the meaning of a word, a phrase or a provision of the insurance policy.”).
As noted above, there is no ambiguity in the meaning of “lives with”; the ambiguity arises in determining whether that limitation applies, and if so, how it is applied. Does it mean that only children who live with the named insured at all times are insured? Does it mean that coverage fluctuates depending on where the child is currently living, i.e. that coverage exists when a child is living with his dad for a week?
Consideration of the context in which this contract was made also reveals an ambiguity in the terms of this policy. See Mark V, Inc. v. Mellekas, 114 N.M. 778, 781, 845 P.2d 1232, 1235 (1993) (holding that ambiguity may be discerned by fully examining the circumstances surrounding the making of an agreement and examining the contract terms in light of those circumstances). Here, a father contracted for uninsured motorist coverage for himself, his wife, and his children. The policy premium did not fluctuate depending on the number of children covered under the uninsured motorist policy. There was no express warning that, if a child lived with Wayne only temporarily, the policy only covered the period of time during which the child lived with him. The policy purported to provide coverage to “relatives” in one section, “resident relatives” in an amended endorsement, and “a person ... covered by uninsured ... motorist coverage” in a different amended endorsement. The word “relative” has a common and generally understood meaning, but Wayne was expected to look for a definition of that word on a different page to find out that it meant something more limited than his own child. Further, the policy expressly provided coverage for unemancipated and unmarried children living away from home who were in school, which could imply that the limited definition of “relative” did not apply to unmarried, unemancipated minor children. Certainly, it would make no sense to a reasonable father seeking family coverage that a policy provides coverage for his child who lives at a private boarding school in another state or who is away at college but does not provide the same coverage for his child not old enough for college who lives with his mother. The ambiguity must be construed in favor of coverage. As in Chavez, 87 N.M. at 329, 533 P.2d at 102, we hold that Sean was within the class of “innocent victims [to be protected] against uninsured tortfeasors.” Sean is entitled to coverage as a class-one insured under the policy.
Conclusion. State Farm argues that in the Loya policy, “while living with” means that the individual must be actually and currently living in fact with the named insured on a daily basis at the time of the accident, and that Ramiro’s testimony that he had taken meals and slept with his wife during their separation period had no effect on that terminology. It argues that in the Smyth policy, however, the phrase “who lives with” means only that the individual must provide some “indication that he resides with his father at all.” Because State Farm has used language that may be ambiguously applied, it is able to argue both ways. It is exactly this kind of uncertainty of coverage that our rules requiring strict construction against the insurer and in favor of coverage are intended to guard against. In Pribble, we refused to charge the insured with the duty of reading and understanding a policy and then bar recovery by upholding a literal application of its terms and provisions. Instead, this Court held that the insured is bound to make such an examination of documents as would be reasonable under the circumstances and is held to that which he or she would be thereby alerted. 84 N.M. at 216, 501 P.2d at 260. Further, if a layman “would not understand its full impact were he to attempt to plow through it, the document will yield the maximum protection consistent with [its] language and the reasonable expectations of [the insured].” Id.
Given the fact that most individuals are not legally responsible financially for relatives other than their children or spouses and therefore do not normally intend to provide uninsured motorist coverage for those relatives, it is not necessarily against public policy for an insurance policy to preclude coverage to those other kinds of relatives not living with a named insured. However, for the reasons explained in this opinion, State Farm cannot preclude coverage to the named insureds, their spouses, and their children under the facts of these cases. Accordingly, we reverse the trial court in the Loya case and remand for entry of judgment in favor of Ramiro Loya, and affirm the trial court in the Smyth case.
IT IS SO ORDERED.
BACA, C.J., and FROST, J., concur.
. Class-one coverage is discussed in Konnick v. Farmers Insurance Co., 103 N.M. 112, 115, 703 P.2d 889, 892 (1985). The purchaser of uninsured motorist coverage for more than one car and the purchaser’s spouse and relatives covered under the policy are entitled to stack, or combine, the policy limits for each car if injured by an uninsured or underinsured motorist. Jimenez v. Foundation Reserve Ins. Co., 107 N.M. 322, 324, 757 P.2d 792, 794 (1988). "First class insureds tire covered by policies no matter where they are or in what circumstances they be; coverage is not limited to a particular vehicle.” Gamboa v. Allstate Ins. Co., 104 N.M. 756, 758, 726 P.2d 1386, 1388 (1986). | [
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OPINION
DONNELLY, Judge.
Plaintiffs, Robert H. Bolton and Meribelle L. Bolton (the Boltons), appeal from a judgment denying in part their suit to invalidate the June 1990 $1.8 million dollar bond issue approved by Valencia County (the County). Defendant, GE Capital Finance, Inc. (GE), and third-party Defendants, Compton, Hickey «fe Ives, P.A. (the Compton Firm), James C. Compton, individually, Esquibel, Sanchez «fe Griego, P.C. (the Esquibel Firm), and Thomas C. Esquibel, individually, have filed separate cross-appeals.
The Boltons raise numerous issues on appeal which we combine and discuss as follows: (1) whether the district court violated due process by limiting their requests for discovery, granting summary judgment without full discovery, bifurcating trial of the issues, denying their motion to file an amended complaint, and refusing to consider documentary evidence in response to a motion for summary judgment; and (2) whether the district court erred in refusing to invalidate the entire bond issue.
GE’s cross-appeal asserts that the district court erred in (1) invalidating a portion of the bond issue for refinancing road building equipment; and (2) not holding that GE was entitled to payment of the bonds it purchased.
Third-party Defendants and Cross-Appellants, the Compton Firm, the Esquibel Firm, and Compton and Esquibel, individually, contend in their cross-appeal that the district court erred in (1) invalidating a portion of the bond issue for refinancing road building equipment; (2) refusing to find that the Boltons’ challenge to the validity of the refinancing aspect of the bond issue was time barred; (3) refusing to find that under NMSA 1978, Section 55-8-202 (Repl.Pamp.1987), GE was a good-faith purchaser for value without notice of any bond defect in the event that refinancing of road construction equipment was unauthorized under the 1990 bond issue; and (4) refusing to find that no amount was refinanced.
We affirm in part and reverse in part.
FACTS
In May 1990 the County, through its board of county commissioners, adopted an ordinance to authorize the issuance of a $1.8 million dollar revenue bond issue. In order to facilitate the issuance of the bond issue, the County hired Compton as its bond counsel. The County also relied upon Esquibel, the county attorney, for advice concerning the issuance and sale of the bonds. On the advice of Compton, the County executed a Trust Indenture and Security Agreement (Trust Indenture) between the County and Ranchers State Bank, as Trustee. The Trust Indenture specified that the bonds issued thereunder were payable only from properly pledged revenues. No voter approval was sought for the issuance of the bonds. The Trust Indenture specifically pledged as sources for the repayment of such bonds monies from thirteen specific sources, together with:
(B)All other income, proceeds and revenues received by the County, except: (1) the proceeds of ad valorem taxes; (2) State of New Mexico appropriations; and (3) the proceeds of any County contracts or grants, whether from or with public, private or governmental sources, which are restricted as to use.
The Trust Indenture further provided:
If the pledge of any one or more sources of income or revenue to the payment of the Bonds shall ever be held by final decision of a court of competent jurisdiction to be invalid or to make the Bonds invalid because of constitutional restrictions on County indebtedness, the income or revenue derived from such source or sources shall not be subject to the pledge herein contained.
As outlined in the ordinance authorizing the bond issue, the bonds were issued for the purposes of:
[ACQUIRING] AND FINANCING ... EQUIPMENT, VEHICLES AND OTHER PERSONAL PROPERTY FOR LAYING OFF, OPENING, CONSTRUCTING, RECONSTRUCTING, RESURFACING, MAINTAINING, REPAIRING, AND OTHERWISE IMPROVING ALLEYS, STREETS, PUBLIC ROADS AND BRIDGES WITHIN [THE] COUNTY....
The bond ordinance did not specifically list any other purposes but did refer to the Trust Indenture which defined “Purposes” to include:
(A) Constructing, purchasing, furnishing, equipping, rehabilitating, making additions and improvements to public buildings;
(B) Laying off, opening, constructing, reconstructing, resurfacing, maintaining, repairing or otherwise improving existing building [sic], alleys, streets and public roads and bridges within the County;
(C) Acquiring, financing and refinancing equipment, vehicles and other personal property for such purposes; and
(D) All purposes incidental to and necessary and appropriate for the foregoing.
Compton, the County’s bond counsel, issued an opinion letter to Alden Capital Markets, Inc. (Alden) stating that the bonds were valid obligations of the County. Esquibel also gave a similar opinion letter.
The County issued the bonds on June 14, 1990. Following the issuance of the bonds by the County, they were purchased by Alden, who acted as the bond underwriter. Thereafter, Alden resold the bonds to GE. Alden and its president, Leo V. Valdez, prepared the offering circular in connection with Alden’s offer to sell the bonds to GE. After the County issued the bonds and had spent a portion of the bond proceeds, its bond counsel, Compton, advised it to pass a supplemental bond ordinance. The supplemental ordinance had the effect of broadening the purposes of the bond issue, thereby authorizing the County:
[TO PROVIDE] FOR THE CONSTRUCTING, PURCHASING, FURNISHING, EQUIPPING, REHABILITATING AND MAKING ADDITIONS AND IMPROVEMENTS TO PUBLIC BUILDINGS AND FOR THE LAYOFF, OPENING, CONSTRUCTING, RECONSTRUCTING, RESURFACING, MAINTAINING, REPAIRING AND OTHERWISE IMPROVING EXISTING PUBLIC BUILDINGS, ALLEYS, STREETS, PUBLIC ROADS AND BRIDGES WITHIN VALENCIA COUNTY....
On June 29, 1991, approximately twelve months following the issuance of the bonds, the Boltons filed suit against the County and GE for declaratory judgment, injunction, and equitable relief. They sought a ruling that the bond issue required advance voter approval, that the bonds were issued in violation of state constitutional and statutory provisions, and that the bond issue was void and unenforceable. The Boltons also requested that the court enjoin the County from repaying the bond issue. GE cross-claimed against the County and filed third-party complaints against Aden, Valdez, the Compton Firm, the Esquibel Firm, and Compton and Esquibel, individually, asking reimbursement for any portion of the bond indebtedness which the district court determined to be unenforceable. The County’s answer to the cross-claim of GE denied the invalidity of the bond issue and asserted a counterclaim for a declaratory judgment confirming the validity of the bond issue. Thereafter, the County filed a third-party complaint for indemnification against the Compton Firm, and Compton, individually, and a third-party complaint against Aden and Valdez, individually. The Esquibel Firm, Esquibel, individually, and Aden also cross-claimed against the Compton Firm, and Compton, individually.
In November 1991 the Attorney General moved to intervene in the action. The district court granted the motion. The County filed a motion to dismiss the Boltons’ complaint. GE filed a motion for summary judgment. GE also filed a second motion for summary judgment seeking to have the district court determine that it was a subsequent purchaser of the bonds, without notice of any defect as to the validity of the bonds. GE, the Compton Firm, Compton, individually, the Esquibel Firm, and Esquibel, individually, filed motions for summary judgment seeking to have the district court determine that the amount of the bond issue found to be not statutorily authorized, i.e., that portion devoted to refinancing, totaled $412,182. The district court granted summary judgment upholding the bond issue, but invalidated a portion of the bond issue in the amount of $412,182.
In its letter to counsel following the hearing on the motions for summary judgment, the district court stated, in part:
[T]he indenture seeks to pledge not only some 13 sources of county revenue including ... the Small Counties Assistance Fund, business licenses revenues and the county equalization distribution, but also “all other income, proceeds and revenues received by the County____” with three exceptions. In fact, it would appear that the only resource not pledged is ad valorem taxes____ [I]n my view, the indenture creates a “debt” within the meaning of the [state] Constitution which requires voter approval.
The district court also stated that although it found the Trust Indenture improperly pledged certain county revenues to the repayment of the bonds, the Trust Indenture was severable so that the unauthorized revenues could be severed from the bond issue, thereby validating the remainder of the bond issue. The district court found that there should be severed from the pledged revenue those revenues not specifically set forth in NMSA 1978, Section 3-31-1 (Repl. Pamp.1991), or made applicable to counties under NMSA 1978, Section 4r-62-l (Repl. Pamp.1984), so all that remains are “sales [tax revenue] (gross receipts) tax revenue and gasoline tax revenue.” Additionally, the district court stated:
I find the requirement ... of the indenture and quoted below to be constitutionally proscribed and severable:
“... [T]he County covenants and agrees that as long as the Bonds are Outstanding, it will cooperate with the Trustee as a revenue undertaking to cause the Pledged Revenues on an annual basis to be continuously and sufficiently available in amounts at least equal to one hundred twenty percent (120%) of the annual debt service on the Bonds.”
The district court further held that “the purposes which are not identical to those set forth in Section 3-31-1(0 and (E) will also be severed. I find these to be ‘furnishing and equipping’ public buildings ... [and] ‘[acquiring, financing, and refinancing equipment, vehicles and other personal property for such purposes’____ Thus, that purpose, too, will be severed.”
Although the district court found that certain of the revenue sources pledged by the Trust Indenture violated Article IX, Section 10 of the New Mexico Constitution prohibiting a pledge of general revenues without voter approval, the court concluded this defect could be cured because the Trust Indenture contained several severability clauses. Relying in part upon these severability provisions, the district court ordered that all of the pledged revenues be severed, with the exception of the revenues derived from the County’s portion of the gross receipts and gasoline tax revenues. The court also found that one of the purposes of the bond issue, i.e., the “refinancing of equipment, vehicles and personal property,” was invalid.
The district court held that the portion of the bonds issued to refinance equipment, vehicles, and other personal property was $412,182, that that portion of the bond issue was void ah initio, and that the County had no authority to pay back this portion of the principal or the interest thereon. The amount of $412,182 was listed in the County’s bond offering circular for refinancing road equipment. This amount was expended by the County from the bond proceeds to purchase road and construction equipment that it was buying under five lease-purchase agreements. Based on the above rulings, the district court granted Defendants’ motions for summary judgment. The court treated the County’s motion to dismiss as a motion for summary judgment and granted the motion in part.
I. CLAIM OF DENIAL OF DUE PROCESS
The Boltons argue that they were denied procedural due process by the district court’s rulings limiting their right of discovery, granting summary judgment without full discovery, bifurcating the issues raised by the contingent derivative claims, precluding them from participating in the second phase of the trial, denying their right to file an amended complaint, and refusing to consider documentary evidence submitted by them in response to the motions for summary judgment. However, a review of the substantive allegations made below as well as a review of the procedural facts shows that the Boltons’ procedural claims are without merit.
As stated earlier, the Boltons’ complaint sought to invalidate the bond issue and enjoin payment of the bonds. The County and GE took the positions that the constitutional validity of the bond issue was an issue of law apparent from the transcript of the bond proceeding, that the statutory validity of the bond issue was time barred as a matter of law, and that the Boltons’ claims concerning their need for discovery in order to determine where the proceeds of the bonds went was irrelevant to a proceeding to determine the validity of the bonds themselves. The district court agreed with the positions of the County and GE and bifurcated trial of the Boltons’ challenges concerning the validity of the bond issue from the claims against the attorneys. The district court reasoned that if the bond issue was valid, the claims against the attorneys would be moot; if the bond issue was invalid in whole or in part, the claims against the attorneys and the issue of whether GE was a good-faith purchaser would then have to be decided.
The Boltons’ complaint was filed on June 29, 1991. On June 3,1992, the Boltons filed an affidavit under SCRA 1986, 1-056(F) (Repl.1992), claiming they needed additional time for discovery prior to the summary judgment hearing. The summary judgment hearing was on the constitutional and statutory validity of the bond issue. The Boltons’ request was denied by the district court, and the Boltons attack the propriety of this ruling. We agree with the district court that the Boltons’ requested discovery was irrelevant to the purpose of the summary judgment hearing. Although they contend that discovery might have revealed a myriad of improprieties in the application of the proceeds of the bonds, a bond issue will not be invalidated because of misuse of bond proceeds, as long as the bonds were issued for a valid purpose. Johns-Manville Corp. v. Village of Dekalb, 439 F.2d 656, 660 n. 5 (8th Cir.1971).
Moreover, the Boltons’ request for additional discovery was filed after the district court’s order dated January 30, 1992, which specified that the deadline for completion of discovery was April 3, 1992. The order also specified that any conflicts regarding discovery were to have been brought to the district court’s attention by April 3, 1992. The Boltons claim that they could not engage in discovery before the deadline because new parties (Esquibel, his firm, and Alden) had just been brought into the lawsuit and thus it would have been a waste of time to engage in discovery without all parties present. However, the Boltons did not alert the district court to this problem, if it indeed was a problem, by April 3. Consequently, we find no error in the district court’s denial of this request, since the Boltons waited until well beyond the April 3 deadline to seek additional discovery.
After the district court entered its order granting in part the motions of GE and the Compton and Esquibel Firms for summary judgment, each of the Defendants, except the County, moved for a protective order. On January 6,1993, the district court entered an order limiting discovery to matters involving whether GE had notice of any defect in the issuance of the 1990 county revenue bonds, any issues relevant to the enforceability of the portion of the bond issue that was invalidated, the Boltons’ claim of conspiracy, fraud, or concealment, and to matters relating to the discovery of admissible evidence bearing on the foregoing issues. Considering the fact that the district court had granted motions for summary judgment on the issue of the validity of the bonds, thereby considerably narrowing the issues remaining in the case, under the record before us we see no abuse of discretion in the district court’s placement of reasonable limitations on the Boltons’ motions for discovery. See DeTevis v. Aragon, 104 N.M. 793, 797-98, 727 P.2d 558, 562-63 (Ct.App.1986) (trial court’s order is subject to reversal only upon showing of abuse of discretion). Moreover, inasmuch as most of the information the Boltons sought to discover was directed to the misapplication of the bond proceeds, an issue irrelevant to their lawsuit, the Boltons were not prejudiced by the limitations imposed.
The Boltons also argue that the district court erred in ordering separate trials on their complaint and the third-party or cross-claims. We find this argument unpersuasive. The district court, for purposes of convenience, avoiding prejudice, or for the purpose of expediting the trial of the issues or in the interests of judicial economy, may direct that specific issues be tried separately. SCRA 1986, 1-042(B) (Repl.1992); see also Mendenhall v. Vandeventer, 61 N.M. 277, 279, 299 P.2d 457, 458 (1956) (bifurcation of issues is appropriate if resolution of particular issue may expedite or end the litigation). The decision as to whether to bifurcate the trial of certain claims is entrusted to the sound discretion of the court. McCrary v. Bill McCarty Constr. Co., 92 N.M. 552, 554, 591 P.2d 683, 685 (Ct.App.1979). Considering the number and complexity of the issues raised by the parties, the district court did not abuse its discretion in ordering a separate trial on certain of the issues. In particular, we find no abuse of discretion for the district court to try the validity of the bond issue before any determination of the complex issues concerning the allegations of attorney malpractice, to determine the validity of the bonds before any hearing on the issue of whether the bond purchaser had notice of any defects.
On March 5, 1993, almost two years after the County answered their initial complaint, the Boltons also sought to file an amended complaint. The district court denied the motion. The district court had previously entered a scheduling order, and the case had been scheduled for trial. Moreover, the Boltons’ attempted amendment came after the district court had granted several motions for summary judgment. The proposed amended complaint was filed by Plaintiffs as citizens and taxpayers and sought declaratory and injunctive relief, as well as damages for alleged tort and criminal violations of Alden, Compton, and Esquibel purportedly committed against the County. In view of the matters sought to be raised in the amended complaint, the timing of the filing of such motion, and the fact that the district court had previously entered an order setting deadlines for discovery, bifurcating the trial of issues, granting partial summary judgment, and fixing a trial date, we find no error in the district court’s denial of the motion. See Newman v. Basin Motor Co., 98 N.M. 39, 43, 644 P.2d 553, 557 (Ct.App.1982) (denial of motion to amend will be reversed only upon showing of an abuse of discretion); see also Slide-A-Ride of Las Cruces, Inc. v. Citizens Bank of Las Cruces, 105 N.M. 433, 436-37, 733 P.2d 1316, 1319-20 (1987) (upholding denial of motion to amend where additional claims were sought to be raised on eve of close of discovery, some twenty months after complaint filed).
The Boltons also argue that the district court erroneously refused to consider documentary evidence which they submitted in response to the motions to dismiss and motion for summary judgment. This is a facet of the Boltons’ other argument that summary judgment was improperly granted because there were genuine issues of material fact supported by their tendered documentary evidence. The district court’s order expressly stated that the “factual material submitted by Plaintiffs ... on August 5, 1992 will not be considered by the Court inasmuch as it was submitted outside the time limits provided by the rules.” Thus, we find no error in the district court’s refusal to consider this additional material. The court did consider the voluminous briefs and materials submitted by the Boltons in their initial response to the motions, together with two additional briefs filed by them. As noted by GE, the material which the district court refused to consider was not filed until the last day for filing briefs and at a time when Defendants had no further opportunity to respond to the materials filed. Moreover, the Boltons have failed to specifically show how this additional material differed from the matters previously submitted by them and which were considered by the court. Under these circumstances the Boltons have failed to show any abuse of the district court’s discretion or how they were prejudiced by the ruling of the court. Cf. Behrmann v. Phototron Corp., 110 N.M. 323, 327, 795 P.2d 1015, 1019 (1990) (reviewing court will reverse trial court’s ruling admitting or excluding evidence only when it is clear that trial court has abused its discretion).
II. VALIDITY OF BOND ISSUE
The Boltons make a multifaceted attack on the validity of the bonds. Included in their attack are constitutional challenges and statutory challenges. The district court ruled that the statute of limitations operated to bar all but the constitutional challenges. The district court upheld the validity of the bonds except for a portion thereof, in the amount of $412,182, which was found to be for a statutorily impermissible purpose. Although statutory challenges were held barred by the statute of limitations, the district court, in upholding most of the bonds under the special fund doctrine, ruled that the existence of a statutorily authorized special fund was necessary to the special fund doctrine. In considering this ruling, we will review the case as postured by the district court. We first state the parties’ contentions and then discuss the constitutional challenges, the purposes of the bonds, and the applicability of the statute of limitations.
The Boltons’ appeal and the cross-appeals of each of the Cross-Appellants focus on the issue of whether the district court properly upheld the validity of the bond issue except for that portion of the bond proceeds ($412,-182) utilized for refinancing the purchase of road equipment, vehicles, and other personal property. The Boltons argue the district court erred in refusing to declare that the entire bond issue contravened the provisions of Article IX, Section 10 of the New Mexico Constitution. Specifically, the Boltons argue that the entire bond issue is invalid because the bonds were issued without first obtaining voter approval, that the bonds were issued for unauthorized purposes, and that the bond issue purported to authorize the County to pledge the payments of general tax revenues for repayment of the bonds rather than restricting payment of the bonds from special funds. The Boltons contend that the district court erred in refusing to invalidate the entire bond issue because repayment of the bonds was not limited to revenues derived from a special fund or funds, but instead pledged county revenues from diverse county funding sources, including county gross receipts taxes, county and local road funds, gasoline and special fuels taxes, motor vehicle excise taxes, small county assistance fund, county equalization distribution, building permits, licenses and fees, business licenses, school bus route reimbursements, and the motor vehicle road tax. In addition to Article IX, Section 10, the Boltons contend that various other provisions of the constitution were violated, and that such violations served to invalidate the entire bond issue.
The County disagrees with the Boltons that the entire bond issue was invalid, but concurs with the district court’s finding that a portion of the revenue bonds was issued for an unauthorized purpose. The County also agrees with the district court’s order which granted GE’s motion for summary judgment determining that $412,182 was the amount of the invalid portion of the bonds. Responding to the Boltons’ appeal, GE asserts that the district court erred in concluding that the amount of bonds issued for the purpose of “refinancing equipment, vehicles and other personal property” was outside the purview of Section 3-31-1 and, hence, was an unauthorized purpose. GE concedes, however, that if a portion of the bond issue was invalid, there was no genuine issue of material fact as to the amount of bonds issued for the purpose of refinancing equipment. Similarly, the Compton and Esquibel Firms, and Compton and Esquibel, individually, argue in their cross-appeal that the district court properly rejected the Boltons’ constitutional challenges because the indebtedness came within the special fund exception to Article IX, Section 10 of the New Mexico Constitution.
(A) Constitutional Challenges of the Boltons
Neither the County nor Cross-Appellants challenge the district court’s invalidation and severance of the several general funding sources from the revenue bond issue. However, Cross-Appellants argue that the district court erred in finding that the “special fund doctrine” requires that a statutorily available “special fund” may only be expend- ■ ed for “statutorily approved purposes.” We address these contentions only to the extent necessary to our disposition.
We first consider the contentions of the parties as to whether the County’s 1990 bond issue constituted an indebtedness within the contemplation of Article IX, Section 10 of the state constitution so as to require voter approval. Article IX, Section 10, as it existed at the time of the issuance of the bonds, provided in applicable part:
No county shall borrow money except for the following purposes:
A erecting, remodeling, and making additions to necessary public buildings;
B. constructing or repairing public roads and bridges;
C. constructing or acquiring a system for supplying water, including the acquisition of water and water rights, necessary real estate or rights-of-way and easements;
D. constructing or acquiring a sewer system, including the necessary real estate or rights-of-way and easements;
E. constructing an airport or sanitary landfill, including the necessary real estate; or
F. the purchase of books and other library resources for libraries in the county.
In such cases, indebtedness shall be incurred only after the proposition to create such debt has been submitted to the registered voters of the county and approved by a majority of those voting thereon.
In addressing this issue, we find the following instructive:
Although the cases are not entirely in accord and dissenting opinions have been frequent, it has generally been held that an obligation payable from a special fund created by the imposition of fees, penalties, or excise taxes, and for the payment of which the general credit of the state is not pledged and resort may not be had to property taxation, is not a debt within the meaning of constitutional debt limitations.
72 Am.Jur.2d States, Territories, and Dependencies § 82 (1974). See generally Annotation, Obligation Payable From Special Fund Created by Imposition of Fees, Penalties, or Excise Taxes as a “Debt” Within Constitutional Debt Limitation, 100 A.L.R. 900 (1936).
The Boltons claim New Mexico disfavors public debt without voter approval and that the special fund doctrine should therefore be narrowly applied. We think this argument misperceives the rationale of our Supreme Court in State ex rel. Capitol Addition Building Commission v. Connelly, 39 N.M. 312, 318, 46 P.2d 1097, 1100-01 (1935). In Connelly our Supreme Court construed the word “debt” as used in Article IX, Section 12 of the state constitution as “comprehending a debt pledging for its repayment the general faith and credit of the state or municipality, ... and contemplating the levy of a general property tax as the source of funds with which to retire [such indebtedness].” Id. (emphasis added). Similarly, as observed in Seward v. Bowers, 37 N.M. 385, 386, 24 P.2d 253, 253 (1933):
The idea of a “debt” in the constitutional sense is that an obligation has arisen out of contract, express or implied, which entitles the creditor unconditionally to receive from the debtor a sum of money, which the debtor is under a legal, equitable, or moral duty to pay without regard to any future contingency.
In State Office Building Commission v. Trujillo, 46 N.M. 29, 46, 120 P.2d 434, 444 (1941), our Supreme Court noted that in order for “an obligation to come under the special fund doctrine, the creation of the obligation and the law authorizing it must specify and set out the sources for payment thereof and thereby disclose that no part of the payment is to be obtained from general taxation.” Accordingly, we hold that the limitation contained in Article IX, Section 10 of the New Mexico Constitution, prohibiting a county from incurring an indebtedness without first submitting the question of the indebtedness to a vote of the electorate, does not apply where the obligation is payable solely from a special fund or funds and the county has not pledged its general full faith and credit. See McKinley v. Alamogordo Mun. Sch. Dist. Auth., 81 N.M. 196, 201, 465 P.2d 79, 84 (1969); Connelly, 39 N.M. at 318, 46 P.2d at 1100; Seward, 37 N.M. at 385-86, 24 P.2d at 253; see also Village of Deming v. Hosdreg Co., 62 N.M. 18, 26, 303 P.2d 920, 925 (1956) (revenue bonds which do not engage the general taxing power of the state or a political subdivision do not require approval by popular referendum).
Included in the several constitutional challenges raised by the Boltons is their claim that the district court erred in not declaring the bond issue, invalid because the bond issue violated Article IX, Section 10 of the New Mexico Constitution and because issuing bonds for the purpose of making building repairs is not authorized by the constitution and such purpose was not included in the County’s initial bond ordinance. The Boltons contend that attempts to amend Article IX, Section 10 in 1992 and 1994 to authorize incurring indebtedness for making repairs to county buildings was twice rejected by the electorate; thus, the bond issue embraced an unlawful purpose. We think this argument must fail because it misinterprets the underlying purpose of Article IX, Section 10. This provision prohibits a county from incurring indebtedness, except for the purposes enumerated therein. The restrictions on the borrowing of money or incurring “indebtedness” contained in Article IX, Section 10 are debt limitations where the county unconditionally pledges to repay the obligation. The constitutional restrictions enumerated in Article IX, Section 10, do not apply where the obligation is payable out of a special fund. Seward, 37 N.M. at 385-86, 24 P.2d at 253; see also Allstate Leasing Corp. v. Board of County Comm’rs, Rio Arriba County, N.M., 450 F.2d 26, 29-30 (10th Cir.1971). Nor do we believe the County’s use of revenue bond monies derived from a special fund for the purpose of repairing public buildings to be improper, where, as here, such purpose was expressly stated in the supplemental bond ordinance.
The Boltons additionally argue that because the district court found that payment of the bond issue was not restricted to payment from special funds, the entire bond issue was invalid and the district court erred in finding that the portion of the offending provisions could be severed, thereby render ing the remainder of the bond issue valid. They contend that the bond issue transaction was functionally equivalent to a pledge of full faith and credit, and that the bond obligation illegally impacted the County’s general revenue funds and “powers of taxation” because of the number and types of revenues pledged.
The district court struck down the pledges of revenue sources which it found to implicate the full faith and credit of the county. The district court, relying upon severability clauses contained in the Trust Indenture, ordered that certain revenue sources be severed from the remainder of the bond provisions. See City of Santa Fe v. First Nat’l Bank, 41 N.M. 130, 139, 65 P.2d 857, 862-63 (1937) (recognizing severability of portion of bond issue where other provisions of agreement are valid and enforceable). We think Judge Smith properly determined that by limiting the repayment of the bonds to receipts from gross receipts and gasoline tax revenues, the bonds were repayable solely out of special funds and thus they did not pledge the frill faith and credit of the county. See id. Under such posture, the district court correctly declined to invalidate the entire bond issue.
The Boltons also contend that the district court erred in allowing the gross receipts and the gasoline tax pledge to stand. They argue that under McKinley, the County cannot constitutionally encumber revenues that it receives from the state from gross receipts taxes or gasoline taxes, without first obtaining voter approval. While some courts in other jurisdictions have applied the rule urged by the Boltons, e.g. Dykes v. Northern Va. Transp. Dist. Comm’n, 242 Va. 357, 411 S.E.2d 1, 4-5 (1991), certs,. denied, 504 U.S. 941, 942, 112 S.Ct. 2275, 2277, 119 L.Ed.2d 201, 203 (1992), decisions of our Supreme Court rest on a different rationale. Connelly held that a constitutional debt limitation applies to obligations that are met through property taxes only, not excise taxes. 39 N.M. at 327-28, 46 P.2d at 1106. Moreover, our legislature has narrowed the application of Connelly by its adoption of Section 3-31-1 which limits the use of excise taxes only to those purposes authorized by statute.
Furthermore, we think the present case is distinguishable from McKinley. Here, unlike the situation in McKinley, the district court’s order directing the severance of all funding sources for payment of the bonds, except for gross receipts and gasoline tax revenue, resulted in a limitation that the bonds be paid only from the two special funds recognized by the court and eliminated any provision arguably authorizing payment from general fund sources. By statute, the legislature has expressly authorized the use of such funds for the issuance of revenue bonds. See §§ 3-31-1; 4-62-1; cf. San Juan Water Comm’n v. Taxpayers & Water Users, 116 N.M. 106, 111, 860 P.2d 748, 753 (1993) (upholding right of county to fund acquisition of water rights with a special fund obtained from ad valorem taxes); Stone v. City of Hobbs, 54 N.M. 237, 240-41, 220 P.2d 704, 706-07 (1950) (the city’s application of proceeds from gasoline and motor fuel tax to special street improvement fund held not to constitute “debt” in constitutional sense); see also Switzer v. City of Phoenix, 86 Ariz. 121, 341 P.2d 427, 428-29 (1959). Additionally, the Trust Indenture expressly provided that “[t]he Bonds and all payments by the County hereunder are not general obligations of the County, and shall never constitute its indebtedness, but are the limited, special obligations of the County payable solely from revenues, proceeds and receipts derived from the Pledged Revenues as provided herein.” Thus, we conclude that the district court correctly determined that revenues derived from the County’s share of the gross receipts and gasoline taxes came within the special fund doctrine.
The Boltons further assert that the 1982 amendment to Article IX, Section 10 of the state constitution, which deleted the requirement that qualified voters in a bond election must be property owners, indicated an intent that all registered voters in the county be permitted to vote on all bond issues, including revenue bond issues. The Boltons claim this intent is further supported by the legislature’s use of the word “borrow” in Article IX, Section 10, which they claim encompasses borrowing through revenue bonds. We find this argument unpersuasive. Our examination of the amendment indicates an intent on the part of the legislature and electorate to bring this section of our state constitution into conformity with the provisions of the holding of the United States Supreme Court in City of Phoenix v. Kolodziejski, 399 U.S. 204, 90 S.Ct. 1990, 26 L.Ed.2d 523 (1970), so that all properly qualified voters within a county are permitted to vote upon questions involving the issuance of general obligation bonds. See Hair v. Motto, 82 N.M. 226, 227, 478 P.2d 554, 555 (1970); Board of Educ. v. Maloney, 82 N.M. 167, 169, 477 P.2d 605, 607 (1970). We discern nothing in the language of the amendment which implies an intent to require voter approval of revenue bond issues prior to their issuance.
The Boltons next contend that Section 4-62-1 and NMSA 1978, Section 4-62-2 (Repl.Pamp.1984) authorizing the issuance of county revenue bonds, in effect at the time of the bond issue, violated Article IV, Section 18 of the New Mexico Constitution because they extended the provisions concerning municipal revenue bond statutes by reference to title only. Former Section 4-62-2 provided that bonds authorized to be issued under Section 4-62-1 “shall be issued in accordance with the terms of Sections 3-31-1 through 3-31-12 NMSA 1978, as the same may from time to time be amended, except that no county shall issue revenue bonds pledging revenues the county does not collect or receive.” Section 4-62-1 contained the substantive authority for certain named types of revenue bonds. We do not interpret the challenged language as violating our state constitution. Scrutiny of the language in question indicates a legislative intent to specify that the procedure for the issuance of county revenue bonds should be consistent with the procedural requirements prescribed by NMSA 1978, Sections 3-31-1 to -12 (Repl.Pamp.1991), for the issuance of municipal revenue bonds. See Daniels v. Watson, 75 N.M. 661, 669, 410 P.2d 193, 198 (1966) (provisions of Article IV, Section 18 of the New Mexico Constitution condemns adoption of substantive law by reference; the rule is different, however, where reference is to procedural matters); see also Ballew v. Denson, 63 N.M. 370, 372, 320 P.2d 382, 383 (1958) (no constitutional impediment to adoption of procedural law by reference); Tondre v. Garcia, 45 N.M. 433, 439-41, 116 P.2d 584, 587-88 (1941) (statute extending the procedures for collecting an assessment does not violate the constitutional proscription against the extension of substantive law by reference to title only).
Finally, the Boltons contend that the district court has validated an illegal public debt in violation of Article TV, Section 25 of the state constitution. We disagree. We find nothing in the record to indicate that the district court construed the various statutes and ordinances in a manner violative of Article IV, Section 25.
(B) Challenges to Bond Purposes
Both the Boltons and the County agree that the district court correctly decided that the bonds were partially void. GE, the Compton and Esquibel Firms, and Compton and Esquibel, individually (Cross-Appellants), however, contend that the district court erred in holding that the County was without statutory authority to utilize revenues derived from gasoline and gross receipts taxes for the purpose of “[acquiring, financing and refinancing [of] equipment, vehicles and other personal property.”
In challenging the district court’s ruling invalidating a portion of the bond issue, Cross-Appellants argue that Section 3-31-1(C)(5) authorized the issuance of gross receipts tax revenue bonds for “reconstructing, resurfacing, maintaining, repairing or otherwise improving existing alleys, streets, roads or bridges,” and that gasoline tax revenue bonds were authorized under Section 3-31-1(E) for “laying off, opening, constructing, reconstructing, resurfacing, maintaining ... alleys, streets, public roads and bridges or any combination [thereof].” Cross-Appellants also point out that the Trust Indenture specifically provided that the bonds were issued for the purpose of “[a]cquiring, financing and refinancing [of] equipment, vehicles and other personal property.”
The district court, although holding that the County was authorized to purchase and finance equipment for any of the purposes delineated in Section 3-31-l(E), held that the use of bond proceeds for “refinancing” equipment was not authorized by statute and was, therefore, unconstitutional. The district court found that although Section 3-31-l(C) necessarily implied the authority to issue gross receipts tax revenue bonds to acquire equipment, vehicles, and other personal property to construct, maintain, and repair roads, the legislature did not authorize counties to refinance existing lease-purchase contracts incurred in acquiring such equipment. In reaching this conclusion the district court looked in part to the provisions of Section 3-31-8(A). The district court also concluded that the expenditure of bond proceeds for the refinancing of equipment was not expressly authorized under Section 3-31-1 and that the County had not sought to implement the provisions of Section 3-31-8(A), which permitted the issuance of “refunding revenue bonds for the purpose of refinancing, paying and discharging all or any part of such outstanding bonds____” (Emphasis added.) We do not read the provisions of Section 3-31-8(A) to preclude a county from utilizing a portion of revenue bond proceeds to refinance road building equipment, which the County had previously contracted to acquire under lease-purchase agreements.
The authorization contained in Section 3-31-8 permitting the County to refinance pri- or indebtedness refers to the refinancing or' refunding of one or more outstanding bond issues. Nothing in such statute restricts the authority of a county from utilizing the proceeds of a revenue bond issue to refinance the acquisition of road building equipment or vehicles in order to carry out and effectuate the purposes of the 1990 revenue bond issue. Since Section 3-31-8 was intended to govern the procedure for refunding prior bond issues, it imposes no restriction upon the use of proceeds from an original bond issue.
The term “financing” embraces the raising of money for the acquisition of property or to pay off existing indebtedness. “Refinance” means “[t]o finance again or anew; to pay off existing debts with funds secured from new debt.” Black’s Law Dictionary 1281 (6th ed. 1990). We think the County’s act of refinancing the purchase of road building equipment, vehicles, and personal property properly falls within the ambit of its express power to issue revenue bonds to maintain and repair roads. Cross-Appellants argue that a county cannot maintain and repair roads without possessing the corresponding authority to purchase and acquire equipment to carry out this function and that such power implicitly arises from the County’s power to maintain and build roads. We agree. The provisions of Section 3-31-8 relate to the issuance of revenue refunding bonds; hence, we discern no legislative intent in the enactment of this statute to indicate that such statute was meant to preclude a municipality or county from issuing revenue bonds and utilize the proceeds to pay off or refinance prior equipment purchase agreements involving equipment utilized for the purposes set out in Section 3 — 31—1(E). Neither do we find any constitutional or statutory impediment to use of county revenue bonds funded by gasoline tax or gross receipts tax revenues for refinancing the purchase of road building equipment or vehicles which have previously been leased where there were no outstanding revenue bonds issued by the County that were being ■ discharged with the proceeds.
The authority to issue revenue bonds for the purpose of constructing, repairing, and maintaining county roads and streets necessarily embodies the power to purchase equipment to carry out such work. Cf. Board of County Comm’rs v. McCulloh, 52 N.M. 210, 217-18, 195 P.2d 1005, 1009-10 (1948) (grant of express power to erect public building implies power to purchase necessary land on which to erect it). A county, being a political subdivision of the state, possesses such powers as are expressly granted to it by the legislature, together with those necessarily implied to implement its express powers. El Dorado at Santa Fe, Inc. v. Board of County Comm’rs, 89 N.M. 313, 317, 551 P.2d 1360, 1364 (1976); Colfax County v. Angel Fire Corp., 115 N.M. 146, 149, 848 P.2d 532, 535 (Ct.App.1993).
Indisputably, the County possesses the authority to construct or repair county roads within its boundaries. ' See NMSA 1978, §§ 4-37-1; 4-38-24 (Repl.Pamp.1992). Thus, we think it is clear that the power to refinance equipment used for this purpose is necessarily embraced within this general power, except where the County seeks to refinance outstanding revenue bonds. Here, the County did not issue refunding bonds, but undertook to apply a portion of the monies derived from revenue bonds for the purpose, among other things, of constructing, maintaining, and improving public roads, and acquiring and financing “equipment, vehicles and other personal property for such purposes.” We find no constitutional or statutory restriction upon the County’s use of revenue bond proceeds to refinance the acquisition of its road building equipment. Thus, we conclude that the district court erred in invalidating that portion of the bond issue and the proceeds relating to refinancing.
(C) Statutory Challenges to the Bond Issue
In addition to the constitutional challenges discussed above, the Boltons have also challenged the validity of the bond issue on a number of statutory grounds. Specifically, they argue that the bond issue was void because, inter alia, Section 3-31-1 fails to authorize the issuance of revenue bonds or the use of bond proceeds for refinancing the lease-purchase debts previously incurred; the public notice adopted by the County relating to the bond issue did not disclose all of the intended uses of the bond proceeds; the bond ordinance adopted by the County did not disclose certain terms of the bonds, such as the revenues sought to be pledged as security for repayment, the interest rates, and cost of issuance; the notice of the bond ordinance required to be published was defective and was not timely or properly filed; the cost of the bond transaction was not disclosed; there were inconsistencies between the County ordinance authorizing the issuance of the bonds and the Trust Indenture; and that some of the purposes for which the bonds were issued were unlawful.
The district court, at the urging of the County and Cross-Appellants, denied each of the Boltons’ statutory challenges to the validity of the bond issue and held that they were barred by the statute of limitations contained in NMSA 1978, Section 6-14-7 (Repl. Pamp.1993). The latter statute provides:
After- the passage of thirty days from the publication required by [NMSA 1978, Section 6-14-6] of the Public Securities Limitation of Action Act, any action attacking the validity of any proceedings had or taken by ... any public body preliminary to and in the authorization and issuance of the public securities described in the notice is perpetually barred.
In seeking to deflect the effect of this statute, the Boltons argue that the statute applies only to “procedural defects” and not “lack of power.” The language of the statute makes no such distinction. However, it does refer to attacks on the “validity” of any proceeding. The Boltons’ attack on the legality of the County’s bond issue ordinance is an attack on the validity of the proceedings in which the ordinance was enacted. As such, it is subject to the statute of limitations, except as to the constitutional issues previously discussed. See Taos County Bd. of Educ. v. Sedillo, 44 N.M. 300, 305, 101 P.2d 1027, 1030-31 (1940) (where there is general power to borrow money and issue bonds therefor, statute of limitations protects proceedings against attack except for constitutional grounds).
The Boltons also argue that the time limitations imposed under Section 6-14-7 were tolled by reason of the County’s misrepresentations and nondisclosures in the notice of publication and in the bond ordinance itself. They argue that the notice of publication required by NMSA 1978, Section 6-14-6 (Repl.Pamp.1993), giving notice of the adoption of such resolution was not fulfilled because County Ordinance 1990-3 failed to disclose or specify that the bond issue included in its purposes the erection of a county office building or the refinancing of personal property. They also argue that the County’s adoption of a second county ordinance, No. 1990-4, to add building improvements and refinancing and the County’s failure to publish such ordinance effectually tolled the running of the statute of limitations, that the omissions on the part of the County constituted fraud, and that the district court erred in refusing to find that the County was es- topped from asserting the time requirements of Section 6-14-7. We find these arguments unpersuasive.
The County published a timely notice of the first bond ordinance. The district court properly found that the Boltons’ statutory challenges to the bond issue were barred by their failure to timely assert the claimed irregularities within the thirty-day time limit imposed by Section 6-14-7. We do not believe the delay in publication of the second notice tolled the statute of limitations or amounted to a statutory defect. Cf. Sedillo, 44 N.M. at 303, 101 P.2d at 1029 (failure to publish in Spanish resolution calling for bond election held an irregularity cured by the appellants’ failure to timely challenge within statute of limitations). The statutory claims raised by the Boltons were filed on June 29, 1991, more than a year after the County issued the bonds on June 14, 1990. The district court found that the purposes which the Boltons challenged in their petition were set out in the Trust Indenture and offering circular that were public records as of June 14, 1990. When a litigant is relying on fraudulent concealment or estoppel to toll the running of a statute of limitations, the statute is tolled until the right of action is discovered or, by the exercise of ordinary diligence, could have been discovered. Hardin v. Farris, 87 N.M. 143, 146, 530 P.2d 407, 410 (Ct.App.1974). The ordinance in the case at bar alerted the Boltons that bonds were to be issued and that they would be issued for the purposes set forth in the Trust Indenture. Implicit in the district court’s ruling was a determination that the Boltons could have, with the exercise of ordinary diligence, discovered all of their claims at the time the Trust Indenture and offering circular became public records. Since the time for asserting their claims expired almost a year before the petition was filed, the district court properly granted summary judgment as to these claims.
The Boltons also argue that the provisions of Section 6-14-7 purporting to impose a thirty-day statute of limitations upon actions challenging the validity of a bond issue is unconstitutional because the time period provided is so unreasonably short that it violates constitutional due process guarantees. The thirty-day statute of limitations imposed by Section 6-14-7 is activated by the publication of notice as provided in Section 6-14-6. Our review of this statute fails to reveal any infringement of the Boltons’ due process rights. The purpose of the statute of limitations specified in Section 6-14-7 is to put in repose any nonconstitutional question of law or fact that may subsequently be raised affecting the validity of the bonds. In view of the need for issuance of bond issues by numerous public entities, we do not believe the thirty-day statute of limitations imposed under the Public Securities Limitation of Action Act unreasonably restricts legitimate challenges to the validity of such bond issues. In Oliver v. Board of Trustees, 35 N.M. 477, 480, 1 P.2d 116, 118 (1931), our Supreme Court upheld a district court’s ruling rejecting a challenge on similar grounds to a thirty-day statute of limitations for protesting municipal improvements. The Court in Oliver held in part:
Short periods of limitations on the right to attack proceedings such as these are present almost invariably in legislation of this kind. 5 McQuillin, Municipal Corp. (2d Ed.) pp. 826 and 854. The reason therefor is well stated ... in the case of Edmonds v. Town of Haskell, 121 Okl. 18, 247 P. 15, 19, where it said:
“This statute has a twofold purpose, and a twofold effect, viz: That of stabilizing and maintaining the credit of a town in the commercial world, and thereby benefitting property owners by maintaining a sound credit for their town, and on the other hand it carries assurance to contractors and investors in town securities that the legal obligations of the town must be met.”
Oliver, 35 N.M. at 480, 1 P.2d at 118. Similarly, the County’s delay in filing the notice of County Ordinance No. 1990-4 did not have the effect of tolling the time limitations of Section 6-14-7 because the County had already published and filed the notice of its prior Ordinance No. 1990-3, thereby placing all interested parties on notice of the proposed bond issue. Nor do we believe Plaintiffs’ response to Cross-Appellants’ motion for summary judgment contained matters which gave rise to material disputed issues of fact as to matters which would estop the County from raising the defense of statute of limitations or indicate a basis for fraud. Cf. Romero v. U.S. Life Ins. Co., 104 N.M. 241, 242-43, 719 P.2d 819, 820-21 (Ct.App.1986) (affirming trial court’s determination that the plaintiffs complaint failed to properly allege sufficient matters indicating that statute of limitations had been tolled).
Because we determine that the district court erred in holding that the County improperly sought to utilize a portion of the bond proceeds to refinance road building equipment, it is unnecessary to address the remaining arguments of Cross-Appellants. We have examined each of the remaining issues raised by the Boltons and the County and find them without merit.
CONCLUSION
We reverse that portion of the district court’s judgment that invalidated the use of the bond proceeds for the purpose of refinancing the purchase of equipment, vehicles, and other personal property for constructing or maintaining public roads. In all other respects, the judgments of the district court are affirmed. The parties shall bear their own costs on appeal.
IT IS SO ORDERED.
PICKARD and FLORES, JJ., concur. | [
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OPINION
FROST, Justice.
Petitioner-Appellant Rex, Inc., (Rex) appeals from an order by Resp ondent-App ellee Manufactured Housing Committee (MHC) requiring that it repay, in full, a down payment made by Dimples Atkins (Atkins) on a mobile home. Rex argues that the MHC was collaterally estopped from ordering repayment because Atkins and Rex had already settled their claims by arbitration. Rex also contends that the MHC improperly allowed Rex only one peremptory challenge at the disciplinary hearing. We reverse in part and remand.
I. FACTS
On August 20, 1991, Atkins entered into a contract to purchase a customized mobile home from Rex, a dealer of manufactured homes who is licensed by the State Manufactured Housing Division (MHD). The contract was expressly contingent upon the “acceptance by a finance agency” of a retail installment contract or security agreement. Atkins intended to purchase the mobile home for her disabled son, and she included payments she received for the care of her son as available income on the financing application.
Over the next three months, Atkins made down payments on the mobile home totalling $15,250. On September 20,1991, Green Tree Acceptance, Inc., (Green Tree) a financing company, conditionally approved Atkins’ financing of the mobile home. Green Tree conditioned final approval on, among other things, the actual delivery of the mobile home to Atkins and upon receipt of a check for titling fees. The next month, Rex ordered and received the custom mobile home from the factory and indicated to Atkins that it was prepared to deliver the home. However, due to inclement weather and muddy conditions at the intended site of the mobile home, Atkins requested that delivery be postponed.
On December 31, 1991, before the home had been delivered, Atkins’ son died. As a result of the death, Atkins’ income dropped significantly. Green Tree notified Atkins in January that she no longer qualified for financing, stating that her change in income “made the application a dead deal.” Atkins, in turn, wrote to Rex on January 15, 1992, asking that it refund her $15,250 down payment in full. She also forwarded a copy of the demand letter to the MHD, which initiated an investigation,into the matter. In March 1992 Rex notified the MHD that it would not return any of the deposit and intended to enforce the contract for the full purchase price of $54,735. Atkins then filed a civil lawsuit against Rex seeking a refund of her down payment.
On May 4, 1992, the MHC issued a notice of contemplated action (NCA) against Rex for failure to refund Atkins’ full deposit in violation of MHD Regulations 207(B) and 207(C). These Regulations provide:
B. In the event financing is denied or terms of approval are unacceptable to buyer and seller[,] deposits will be refunded in full. For other circumstances for which the buyer fails to complete his obligation for the purchase, deposits will be refunded as follows:
1. Deposits on units in stock will be refunded in full less a maximum of $150.00 to help defray dealer expenses in processing the sale.
2. Deposits on special ordered units will be refunded in full less a maximum of 10 percent of the selling price to help defray dealer expenses.
C. The timetable for refund of deposit is:
1. Cash deposits should be refunded within one business day, but in no case, later than 5 business days after request for refund.
2. Check deposits should be refunded within one business day after clearing the maker’s bank, but in no case, later than 5 business days.
Deposits, N.M. Manufactured Hous.Div.Reg. 207(B)-(C), 2 N.M. Reg. No. 7, 8 (Apr. 15 1991). The NCA advised Rex that the MHC had sufficient evidence, if not rebutted or explained, to suspend or revoke Rex’s dealer’s license and . attach Rex’s consumer protection bond. The NCA also provided for an administrative hearing upon timely request.
Four days after the MHC issued the NCA, Rex and Atkins settled their lawsuit. The settlement agreement provided that Rex refund all but 10% of the purchase price and pay Atkins’ costs and attorney’s fees. Both parties agreed to arbitrate the disposition of the remaining 10%. The MHC and MHD were not parties to the arbitration. The arbitrator concluded that Green Tree had not denied financing to Atkins and that, under MHD Regulation 207(B), Rex was permitted to retain a portion of Atkins’ deposit up to 10% of the purchase price in order to defray its expenses in the aborted sale. The arbitrator determined that Rex’s expenses totalled $3,724.24 and awarded the balance of the remaining deposit money to Atkins.
After reviewing the arbitrator’s decision, the MHC decided to pursue its administrative action against Rex, and a hearing was set for November 19, 1992. At the hearing, Rex attempted to peremptorily disqualify two of the MHC members under the Uniform Licensing Act, NMSA 1978, § 61 — 1— 7(C) (Repl.Pamp.1989). The MHC ruled that Rex was entitled to only one peremptory disqualification at the hearing. On November 30, 1992, the MHC issued its ruling that Rex had violated both 207(B) and 207(C). It ordered Rex to return the remaining portion of the down payment, $3,724.24, to Atkins and attached Rex’s consumer protection bond for that amount. It also suspended Rex’s dealer’s license for thirty days but provided that the suspension would be stayed if Rex returned the payment. Finally, the MHC placed Rex’s license on probation for a period of six months. The district court upheld the order of the MHC on administrative appeal.
Rex now asks this Court to review the MHC’s order on two grounds. First, it claims that the MHC was collaterally es-topped by the arbitration decision between Rex and Atkins. Second, Rex argues that the MHC violated Section 61-1-7(0 by allowing Rex only one peremptory challenge of the committee members at the hearing.
In examining any administrative order, this Court conducts the same review as the district court and, at the same time, determines whether the district court erred in the first appeal. Padilla v. Real Estate Comm’n, 106 N.M. 96, 97, 739 P.2d 965, 966 (1987); see NMSA 1978, § 61-1-23 (Repl. Pamp.1993) (Appeal to Supreme Court). Our examination is limited to assessing whether the agency acted arbitrarily or capriciously, whether the decision was supported by substantial evidence, and whether the agency acted within the scope of its authority. Conwell v. City of Albuquerque, 97 N.M. 136, 138, 637 P.2d 567, 569 (1981). “Although the reviewing court generally may not substitute its judgment for that of the administrative decisionmaker, it may correct the decisionmaker’s misapplication of the law.” Id. (citation omitted).
II. COLLATERAL ESTOPPEL
The issues in this case present several novel questions involving the application of collateral estoppel. We previously noted in Shovelin v. Central New Mexico Electric Cooperative, Inc., 115 N.M. 293, 297, 850 P.2d 996, 1000 (1993), that the doctrine of collateral estoppel promotes judicial economy by preventing the relitigation of ultimate facts or issues actually litigated and necessarily decided in a previous suit. In order for the court to apply collateral estoppel, or “issue preclusion,” the moving party must show that:
(1) the party to be estopped was a party [or privy] to the prior proceeding, (2) the cause of action in the case presently before the court is different from the cause of action in the prior adjudication, (3) the issue was actually litigated in the prior adjudication, and (4) the issue was necessarily determined in the prior litigation.
Id. If the moving party demonstrates each element of this test, the court must then determine whether the non-moving party “had a full and fair opportunity to litigate the issue in prior litigation.” Id.; see also Silva v. State, 106 N.M. 472, 474, 745 P.2d 380, 382 (1987).
In Shovelin we addressed for the first time whether the doctrine of collateral estoppel precluded relitigation of issues resolved in an administrative agency adjudicative decision. After reviewing other jurisdictions and authorities on the issue, we concluded that “administrative adjudicative determinations may be given preclusive effect if rendered under conditions in which the parties have the opportunity to fully and fairly litigate the issue at the administrative hearing.” Shovelin, 115 N.M. at 298, 850 P.2d at 1001.
A. Collateral Estoppel and Arbitration
Now we must consider as a matter of first impression the threshold question of whether the doctrine of collateral estoppel applies to arbitration awards. See, Sundance Mechanical & Util. Corp. v. Atlas, 118 N.M. 250, 254, 880 P.2d 861, 865 (1994) (noting but declining to reach this issue). Fortunately, this Court has already examined a closely related issue: the nature and degree of judicial review the courts should give to arbitration awards. In Fernandez v. Farmers Insurance Co., 115 N.M. 622, 625, 857 P.2d 22, 25 (1993), we reaffirmed “the strong public policy in this state ... in favor of resolution of disputes through arbitration.” We noted that the arbitration process “allows for the informal, speedy, and inexpensive final disposition of disputes, and also aids in relieving the judiciary’s heavily burdened caseload.” Id. (citations omitted). Therefore, we concluded that “[i]n order to promote judicial economy ..., the finality of arbitration awards [should be] enforced by strict limitations on court review of those awards.” Id. These considerations similarly support applying collateral estoppel to issues necessarily decided by arbitration as if they were determined by a court. Thus, we hold that “[w]hen arbitration affords opportunity for presentation of evidence and argument substantially similar in form and scope to judicial proceedings, the award should have the same effect on issues necessarily determined as a judgment has.” Restatement (Second) of Judgments § 84 cmt. c (1980).
We note that other jurisdictions that have considered the application of collateral estoppel to arbitration awards have reached a similar conclusion. See, e.g., In re American Ins. Co., 43 N.Y.2d 184, 401 N.Y.S.2d 36, 38-39, 371 N.E.2d 798, 801 (1977) (“Fundamental to our consideration of the present appeal is recognition that in general the doctrines of claim preclusion and issue preclusion between the same parties (more familiarly referred to as res judicata or direct estoppel) apply as well to awards in arbitration as they do to adjudications in judicial proceedings.” (Footnote omitted)); Neff v. Allstate Ins. Co., 70 Wash.App. 796, 855 P.2d 1223, 1225-26 (Ct.App.1993) (noting that an arbitration proceeding can be the basis for collateral estoppel when the parties received a full and fair opportunity to litigate the issues), review denied, 123 Wash.2d 1004, 868 P.2d 872 (1994); Manu-Tronics, Inc. v. Effective Management Sys., Inc., 163 Wis.2d 304, 471 N.W.2d 263, 266 (Ct.App.) (“Essential to arbitration remaining useful is the elementary principle that the doctrines of res judicata and collateral estoppel are applicable to arbitration awards.”), review denied, 475 N.W.2d 164 (Wis.1991). See also Restatement (Second) of Judgments § 84 (1980); Hiroshi Motomura, Arbitration and Collateral Estoppel: Using Preclusion to Shape Procedural Choices, 63 Tul.L.Rev. 29, 33-36 (1988) (listing use of collateral estoppel for arbitration in other jurisdictions).
Of course, in order for a court to apply collateral estoppel to an arbitration proceeding, the movant must still demonstrate the elements of collateral estoppel: the non-movant must be a party or privy to the prior proceeding; the present cause of action must be different from the one in the prior adjudication; and the issue to be precluded must have been actually litigated and necessarily determined in the prior litigation. In addition, because arbitration proceedings tend to be more informal than judicial proceedings, with fewer procedural safeguards, the court should be particularly vigilant in examining whether the arbitration proceeding provided the parties with a full and fair opportunity to litigate the issues. The Court in Shovelin set out a non-exhaustive list of factors to be weighed in making such a determination for administrative hearings which are equally applicable to arbitration decisions. These factors included whether the non-movant had the incentive to vigorously litigate the prior action, whether procedural differences between the two actions, such as representation by counsel, presentation of evidence, questioning of witnesses, and appellate review, would make preclusion unfair, and whether policy considerations exist to deny any preclusive effect. Shovelin, 115 N.M. at 299-301, 850 P.2d at 1002-04. Additionally, the formality of the proceedings, the scope of the arbitration, and the definiteness of the decision will influence whether an arbitrator’s factual findings should be given preclusive effect. Restatement (Second) of Judgments § 84 cmt. c (1980).
B. Arbitration of Statutory Rights
Having established that an arbitration decision should be given issue-preclusive effect under appropriate circumstances, we turn to the main issue in contention: Can a private arbitration award bind an administrative body? The MHC argues that a private arbitration decision should not preclude an administrative agency when it is enforcing statutory rights. For support, the MHC cites to a trilogy of U.S. Supreme Court cases denying preclusive effect to arbitration awards, Alexander v. Gardner-Denver Co., 415 U.S. 36, 94 S.Ct. 1011, 39 L.Ed.2d 147 (1974), Barrentine v. Arkansas-Best Freight System, Inc., 450 U.S. 728, 101 S.Ct. 1437, 67 L.Ed.2d 641 (1981), and McDonald v. City of West Branch, 466 U.S. 284,104 S.Ct. 1799, 80 L.Ed.2d 302 (1984). All three cases involved a similar set of circumstances. In each ease, an employee who claimed he was wrongfully discharged was forced to submit his claim to binding arbitration under his union’s collective bargaining agreement. After losing in arbitration, the employee filed a federal suit claiming violation of a statutory right. Gardner-Denver, 415 U.S. at 39-43, 94 S.Ct. at 1015-17 (asserting Title VII claim); Barrentine, 450 U.S. at 730-32, 101 S.Ct. at 1439-40 (claiming violation of the Fair Labor Standards Act); McDonald, 466 U.S. at 286, 104 S.Ct. at 1801 (alleging violation of 42 U.S.C. § 1983). Under these circumstances the U.S. Supreme Court refused to give the arbitration decision any preclusive effect in the subsequent suit involving the plaintiffs statutory rights. The Court held in each case that the arbitration proceedings required under the collective bargaining agreement did not provide an adequate forum for protecting the federal rights that statutes were designed to safeguard. See McDonald, 466 U.S. at 289-90, 104 S.Ct. at 1802-03 (reaffirming the holding of the two prior cases). It therefore allowed the individuals to pursue their statutory claims despite the prior arbitration.
However, this trilogy of cases differs significantly from the case before us. As the Court later explained in Gilmer v. Interstate/Johnson Lane Corp., 500 U.S. 20, 111 S.Ct. 1647, 114 L.Ed.2d 26 (1991),
First, [Gardner-Denver, Barrentine, and McDonald ] did not involve the issue of the enforceability of an agreement to arbitrate statutory claims. Rather, they involved the quite different issue whether arbitration of contract-based claims precluded subsequent judicial resolution of statutory claims. Since the employees there had not agreed to arbitrate their statutory claims, and the labor arbitrators were not authorized to resolve such claims, the arbitration in those cases understandably was held not to preclude subsequent statutory actions. Second, because the arbitration in those cases occurred in the context of a collective-bargaining agreement, the claimants there were represented by their unions in the arbitration proceedings. An important concern therefore was the tension between collective representation and individual statutory rights, a concern not applicable to the present case.
Id. at 35, 111 S.Ct. at 1657. The Gilmer Court emphasized that, in the Gardner-Denver trilogy, the employees’ contractual rights under the collective bargaining agreement were distinct from their statutory rights. Therefore, in bringing suit, the employees were not seeking review of the arbitrator’s decision but were instead asserting independent statutory rights. Id. at 34, 111 S.Ct. at 1656.
Although Gilmer involved a different issue, whether an agreement to arbitrate statutory rights should be enforced, id. at 26, 111 S.Ct. at 1652, its analysis distinguishing the Gardner-Denver trilogy is applicable to the present case. Unlike the proceedings in the Gardner-Denver line of cases, Atkins and Rex specifically agreed to arbitrate then-statutory claims and the arbitrator was authorized to resolve those claims. In addition, Rex and Atkins were in control of their arbitration claims, as opposed to the union-controlled grievance process in the Gardner-Denver cases. Thus the factors in Gardner-Denver that compelled the U.S. Supreme Court to deny preclusive effect to arbitration with respect to statutory rights are absent here, and the holding of Gardner-Denver is inapplicable to this case. Accordingly, the fact that Atkins’ arbitration proceedings involved statutory rights is not sufficient, in itself, to deny issue preclusive effect because she specifically agreed to arbitrate the statutory claims. As the Gilmer Court noted, “[b]y agreeing to arbitrate a statutory claim, a party does not forgo the substantive rights afforded by the statute; it only submits to their resolution in an arbitral, rather than a judicial, forum.” Id. (quoting Mitsubishi Motors Corp. v. Soler Chrysler-Plymouth, Inc., 473 U.S. 614, 628, 105 S.Ct. 3346, 3354, 87 L.Ed.2d 444 (1985)).
C. Privity Between Agencies and Private Parties
The MHC next argues that it cannot be collaterally estopped by the arbitration agreement between Rex and Atkins because it was not a party or privy to the proceedings. The MHC cannot be deemed a party to the first cause of action, having not participated in the private suit or in the subsequent arbitration proceedings. However, it may still be bound as a privy of Atkins. The concept of privity with respect to issue preclusion has been defined as “that relationship between two parties which is sufficiently close so as to bind them both to an initial determination, at which only one of them was present.” NLRB v. Donna-Lee Sportswear Co., 836 F.2d 31, 35 (1st Cir.1987) (applying issue preclusion to the NLRB); see also First Alabama Bank v. Parsons Steel, Inc., 747 F.2d 1367, 1378 (11th Cir.1984) (“A finding of privity is no more than a finding that all of the facts and circumstances justify a conclusion that non-party preclusion is proper.”), rev’d on other grounds, 474 U.S. 518, 106 S.Ct. 768, 88 L.Ed.2d 877 (1986); IB James W. Moore et al., Moore’s Federal Practice ¶0.411[1], at III-215 (2d ed. 1994) (noting that privity has generally been found to exist between parties who are representing the interests of the same individual).
Although the question of privity between an agency and a private individual is new to New Mexico, it has previously been examined in several federal cases that provide us with guidance. In EEOC v. Kimberly-Clark Corp., 511 F.2d 1352, 1361 (6th Cir.), cert. denied, 423 U.S. 994, 96 S.Ct. 420, 46 L.Ed.2d 368 (1975), the court considered whether the principles of res judicata or collateral estoppel barred the EEOC from bringing a claim of sex discrimination against Kimberly-Clark based on a prior private claim that had already been settled by the private parties. The court concluded that the EEOC was not a privy to the earlier settlement agreement because “the EEOC sues to vindicate the public interest, which is broader than the interests of the charging parties.” Id. Thus the court held that the EEOC was not barred by res judicata from using the earlier charges against Kimberly-Clark as a basis for its complaint. Id.
The court in EEOC v. McLean Trucking Co., 525 F.2d 1007, 1009 (6th Cir.1975), addressed a similar situation when the EEOC charged McLean Trucking with violating Title VII. The EEOC charge was based on the complaint of an individual who had already accepted an arbitration award in settling his private suit against McLean Trucking. The McLean Trucking court followed the Kimberly-Clark decision, stating:
EEOC argues that neither the acceptance of the arbitration award nor the filing or settlement of a separate action by Brown, the charging party, precludes EEOC’s right to bring an action in the public interest to eliminate discriminatory practices uncovered during investigation of the Brown charge. With this position we agree.
McLean Trucking, 525 F.2d at 1010.
In EEOC v. Goodyear Aerospace Corp., 813 F.2d 1539, 1541-42 (9th Cir.1987), the court examined a related question whether an employee’s settlement with her employer rendered an EEOC action based on her complaint moot. The court noted that although the employee’s personal claims were rendered moot,
[t]he EEOC’s right of action is independent of the employee’s private action rights. The EEOC “is not merely a proxy for the victims of discrimination,” but “acts also to vindicate the public interest in preventing employment discrimination.” Its interests in determining the legality of specific conduct and in deterring future viola tions are distinct from the employee’s interest in a personal remedy.
Id, at 1543 (quoting General Tel. Co. v. EEOC, 446 U.S. 318, 326, 100 S.Ct. 1698, 1704, 64 L.Ed.2d 319 (1980)) (citation omitted). Therefore, the court concluded: “By seeking injunctive relief ‘the EEOC promotes public policy and seeks to vindicate rights belonging to the United States as sovereign.’ ... [The employee’s] settlement does not moot the EEOC’s right of action seeking injunctive relief to protect employees as a class and to deter the employer from discrimination.” Id. Although the court cast the issue in terms of mootness, the same considerations apply in determining whether an agency’s action is precluded by the private settlement. See Secretary of Labor v. Fitzsimmons, 805 F.2d 682, 694 (7th Cir.1986) (en banc) (holding that in an ERISA claim, the Secretary of Labor’s interest is separate and distinct from the private plaintiffs’ interests and thus cannot be barred by the doctrine of res judicata after the private plaintiffs settle); Donovan v. Cunningham, 716 F.2d 1455, 1462-63 (5th Cir.1983) (noting in an ERISA claim that because the Secretary of Labor seeks to vindicate a broader public interest than the private litigants, the Secretary is not precluded from relitigating issues litigated in a prior private action), cert. denied, 467 U.S. 1251, 104 S.Ct. 3533, 82 L.Ed.2d 839 (1984).
These cases persuade us that an agency, enforcing a statutory scheme, is not in privity with the private complainant when the agency is acting to vindicate a broader public interest protected under the statute. Therefore, the agency cannot be bound by a private settlement to the extent that the settlement would prevent the agency from protecting that public interest. However, different considerations apply when the agency is acting solely for the private benefit of the complaining individual and is seeking a remedy which only benefits that individual.
The court in EEOC v. United States Steel Corp., 921 F.2d 489, 491 (3d Cir.1990) articulated this distinction in considering an EEOC action to recover pension benefits for a group of employees who had already settled their pension-benefit claims. In that case, the EEOC argued that it was not in privity with the individual grievants when it sought enforcement of the Age Discrimination in Employment Act on their behalf because it was protecting a broader public interest. Id. at 496. The court, however, held:
The Commission’s description of its enforcement role under the ADEA is accurate and important, but this description fails to distinguish between the EEOC’s role in protecting the public interest and its role in vindicating specific private claims. While it is true that the Commission has the responsibility to protect a vital public interest that transcends the interests of any or all aggrieved individuals, we have concluded ... that the Commission’s responsibilities include the representation of these grievants when it seeks individual relief on their behalf. Thus, when the Commission seeks individualized benefits under the ADEA for particular grievants, as it did in this case, the Commission functions to that extent as their representative, and the doctrine of representative claim preclusion applies.
Id.
This public interest-private benefit distinction was first noted in dicta by the court in Kimberly-Clark. As discussed earlier, that court held that the EEOC was not barred by res judicata from pursuing its claim against Kimberly-Clark because it sought to vindicate the public interest. However, the court went on to note that an earlier settlement by the grievants “may well limit the scope of relief that the EEOC may seek for the [grievants’] private benefit.” Kimberly-Clark, 511 F.2d at 1361. The court in Goodyear Aerospace subsequently applied this distinction under similar circumstances, noting that although the EEOC’s action was not rendered moot by the settlement, its claim for back pay on the claimant’s behalf was moot. The court held: “[A]ny recovery of back pay by the EEOC would go directly to [the claimant] who has freely contracted away her right to back pay. Under these circumstances, the public interest in a back pay award is minimal.” Goodyear Aerospace, 813 F.2d at 1543; see also FTC v. AMREP Corp., 705 F.Supp. 119, 124 (S.D.N.Y.1988) (noting that the Federal Trade Commission’s suit was barred to the extent that it sought redress for purchasers who had already settled their private claims); EEOC v. American Fed’n of Gov’t Employees Local 1617, 657 F.Supp. 742, 750-51 (W.D.Tex.1987) (noting that because the EEOC’s claim was no broader than the private grievant’s claim that had already been settled, the EEOC’s claim was moot); Brooks v. Stroh Brewery Co., 95 N.C.App. 226, 382 S.E.2d 874, 883-84 (holding that the Commissioner of Labor’s action for back pay under the Occupational Safety and Health Act of North Carolina was barred by a private settlement), review denied, 325 N.C. 704, 388 S.E.2d 449 (1989). But see EEOC v. Dayton Tire & Rubber Co., 573 F.Supp. 782, 786-87 (S.D.Ohio 1983) (holding that EEOC’s claim for greater back pay than that awarded in settlement was not barred because it vindicated the public interest through deterrence).
Accordingly, we are persuaded that when an agency acts on behalf of an individual claimant and seeks individual relief, it is in privity with that claimant and may be barred under the doctrine of collateral estoppel. However, the agency will be precluded only to the extent that it is not acting to vindicate the public interest.
In the case at bar the MHC argues that the purpose of the Manufactured Housing Act is to protect the general public. It therefore claims that by enforcing the Act, it is acting on behalf of the public interest. We agree that the Act expresses a strong consumer protection policy. It provides in part:
The purpose of the Manufactured Housing Act [this article] is to insure the purchasers and users of manufactured homes the essential conditions of health and safety which are their right and to provide that the business practices of the industry are fair and orderly among the members of the industry with due regard to the ultimate consumers in this important area of human shelter.
NMSA 1978, § 60-14-3 (Repl.Pamp.1989) (alteration in original). We also agree generally that when the MHC enforces the Act and the regulations promulgated thereunder, it is acting to vindicate an important public interest. Accordingly, the MHC’s conclusion that Rex violated MHD Regulation 207(B) and its decision to place Rex’s license on probation for six months cannot be barred by Atkins’ arbitration because the probation serves the public interest. However, the same cannot be said for the MHC’s order requiring Rex to pay Atkins.
In the earlier proceedings the arbitrator concluded that, under MHD Regulation 207(B), Atkins was only entitled to the remaining portion of her deposit less Rex’s expenses of $3,724.24. The MHC, however, continued to pursue the 207(B) claim on Atkins’s behalf for the $3,724.24 already resolved by arbitration. Yet, the benefit arising out of Rex’s return of the remaining portion of the deposit would inure solely to Atkins. The public interest in such an award is clearly minimal. Accordingly, the MHC should have been found to be in privity with Atkins with respect to its claim for the return of the $3,724.24.
Although a finding of privity does not end our inquiry into whether the doctrine of collateral estoppel applies, privity was the only element of collateral estoppel contested by the MHC. Therefore, we shall discuss the other elements only briefly. First, we note that the cause of actions in the two disputes are different. The arbitration involved a private cause of action for recovery of damages, whereas the administrative action was a disciplinary proceeding. Second, the issue of how much relief Atkins was entitled to under MHD Regulation 207(B) was actually litigated in the arbitration proceedings and the arbitrator reached a clear and unequivocal conclusion that necessarily determined the issue in Rex’s favor. Indeed, this issue was one of the main areas of contention between the parties in the arbitration.
Third, it is clear that Atkins had a full and fair opportunity to litigate the issues in the prior hearing. Atkins had ample incentive to litigate the prior action. The arbitration was her only chance to personally enforce her claim for damages under 207(B). She had no control over whether the MHC would pursue a disciplinary action against Rex nor over its choice of enforcement measures. In the arbitration the parties were represented by counsel and were given an opportunity to present evidence and argument. The arbitrator in this case was an attorney and was specifically authorized to rule on the statutory question of the application of MHD Regulation 207(B), which both parties stipulated was controlling. Further, his decision included extensive findings of fact in support of his conclusion. Accordingly, all the requirements of collateral estoppel are met and the MHC is estopped from proceeding by the prior arbitration award with respect to the disposition of the refund.
D. Waiver
The MHC next argues that, even if the elements of collateral estoppel are met, Rex waived his right to assert collateral estoppel by expressly consenting to the MHC proceeding. The MHC points to the settlement agreement between Rex and Atkins in which the parties agreed that “[t]he State will make its own determination on whether it wishes to proceed.” The MHC argues that with this statement Rex expressly consented to the relitigation of all issues by the MHC. However, this argument lacks merit. The relevant portion of the agreement states,
We have agreed that Ms. Atkins will not request the State suspend the licensing proceedings, however we also agreed that Ms. Atkins will not actively pursue or encourage those proceedings either. The State will make its own determination on whether it wishes to proceed. Ms. Atkins will of course, testify if asked to do so by either party.
When read in context, it is apparent that the statement is merely an agreement by Atkins not to take any further action with regard to the MHC investigation and an acknowledgement that the parties have no control over the MHC’s decision to pursue disciplinary action. The agreement makes no reference at all to collateral estoppel nor to a waiver of any defense.
An analogous argument was rejected in Deutsch v. Flannery, 823 F.2d 1361 (9th Cir.1987). In Deutsch, defendants stated that they “would ‘not oppose [plaintiffs] right to file a new complaint arising out of the matters involved in the case,’ ” when plaintiff decided not to appeal the court’s dismissal without prejudice of its claim. Id. at 1364 n. 2. The court noted that the letter made no mention of issue preclusion and that it was improbable that defendants would waive issue preclusion when plaintiff was entitled to refile the dismissed complaint. Accordingly, the court held that this statement was not a waiver, and instead merely confirmed “the uncontroversial legal proposition that [plaintiff] had the right to file a new action.” Id. Similarly, we cannot read the agreement between Rex and Atkins as constituting any express waiver of the defense of collateral estoppel.
Finally, the MHC contends that collateral estoppel should not affect its order against Rex because MHD Regulation 207(C) provided an alternate basis for its ruling. MHD Regulation 207(C) states that when no purchase is made, the buyer’s deposit must be refunded within five days. The MHC found, and Rex does not contest, that several months passed before Rex returned any portion of Atkins’ deposit in violation of MHD Regulation 207(C). The MHC argues that this conclusion is sufficient to support its decision, including its order requiring Rex to return the remaining deposit money to Atkins and its order attaching Rex’s consumer protection bond for that amount. However, the portion of the Manufactured Housing Act governing consumer protection bonds provides that such bonds serve “as indemnity for any loss sustained by any person damaged ... as a result of a violation of any regulation adopted by the division.” NMSA 1978, § 60-14-6(A) (Repl.Pamp.1989) (emphasis added). Accordingly, for a violation of MHD Regulation 207(C), the MHC was only entitled to attach Rex’s consumer protection bond to the extent Atkins was damaged by the delay in the return of her deposit, and it could only require that amount be returned to Atkins. In addition, while the MHC could properly suspend Rex’s license for a violation of MHD Regulation 207(C), it could not condition the staying of the suspension on the return of the $3,724.24.
Thus, Rex’s violation of MHD Regulation 207(C) does serve as an alternate basis for the MHC’s order but only to the extent that the order compensates Atkins for her losses due to that violation. However, because the order does not draw any distinction between Atkins’ losses resulting from the two violations, and because the losses are not coextensive, that portion of the order awarding a refund to Atkins cannot stand based on MHD Regulation 207(C) alone. Accordingly, paragraphs 1, 2, and 3 of the order — the paragraphs requiring Rex to pay Atkins $3,724.24 and imposing a thirty day suspension of Rex’s dealer’s license contingent upon payment — are reversed and remanded back to the MHC for redetermination in light of our holding that collateral estoppel bars any award of money to Atkins based on the violation of MHD Regulation 207(B). Paragraph 4 of the order placing Rex’s dealer’s license on probation for six months is affirmed. We note that this opinion does not affect the MHC’s determination that Rex violated MHD Regulation 207(B) and 207(C), and, consequently, upon remand the MHC is still entitled to discipline Rex, if it deems necessary, using the full panoply of measures under the Manufactured Housing Act designed to vindicate the public interest, including probation, license suspension, and civil penalties.
III. PEREMPTORY DISQUALIFICATIONS
Rex’s second claim of error on appeal is that the MHC violated the Uniform Licensing Act, NMSA 1978, § 61-1-7(0 (Repl.Pamp.1989), by allowing Rex only one peremptory disqualification of a committee member at the hearing. At the time of the hearing Section 61-1-7(0 provided:
Any board member or hearing officer may be disqualified by the filing of an affidavit of disqualification as in the case of judges, but this privilege of disqualification by affidavit may not be exercised in any case in which its exercise would result in less than a quorum of the board being able to hear or decide the matter. Any disqualification of a board member which would result in less than a quorum of the board being able to hear or decide the matter shall only be for good cause shown to the board, and in any case in which a combination of disqualifications by affidavit and for good cause would result in less than a quorum of the board being able to hear or decide the matter, the disqualification or disqualifications by affidavit which would result in removing the member or members of the board necessary for a quorum shall not be effective.
Id. (emphasis added). The MHC noted that the sentence allowing for disqualification by affidavit included the language “as in the case of judges.” The MHC interpreted this language to mean that it should follow the rules governing disqualification of judges. The relevant statute on disqualification of district court judges, NMSA 1978, § 38-3-9 (Repl.Pamp.1987), provides, in relevant part: “A party to an action or proceeding, civil or criminal, ... shall have the right to exercise a peremptory challenge to the district judge before whom the action or proceeding is to be tried and heard---- Each party to an action or proceeding may excuse only one district judge pursuant to the provisions of this statute.” See also SCRA 1986, Rule 1-088.1(A) (Repl.Pamp.1992) (“No party shall excuse more than one judge.”). Accordingly, the MHC permitted Rex only one disqualification by affidavit.
Rex counters that the phrase “as in the case of judges” should be read to modify the phrase “filing of an affidavit of disqualification” and should be viewed as merely providing guidance in the method of preparing affidavits. See NMSA 1978, § 38-3-10 (Repl.Pamp.1987) (discussing timing for filing an affidavit). Rex also points to the portion of the statute reading, “the disqualification or disqualifications by affidavit which would result in removing the member or members of the board necessary for a quorum shall not be effective.” Section 61-1-7(C) (emphasis added). Rex argues that the phrase “or disqualifications” indicates that the legislature contemplated allowing more than one peremptory disqualification.
In contrast, the MHC argues that the legislature inserted “or disqualifications” in recognition of the fact that more than one party may appear before the board and assert a peremptory disqualification. It points out that this interpretation comports with the rule discussing peremptory disqualification of judges in which each party has the right to an excusal. See § 38-3-9; SCRA 1986, Rule 1-088.1(B).
We find that the use of the phrase “as in the case of judges” is ambiguous as to what it modifies and to what it refers. “A statute is ambiguous when it can be understood by reasonably well-informed persons in two or more different senses.” State v. Elmquist, 114 N.M. 551, 552, 844 P.2d 131, 132 (Ct.App.1992). When a statute is ambiguous, it is within the authority of the agency charged with effecting that statute to interpret it. See State ex rel. Helman v. Gallegos, 117 N.M. 346, 357, 871 P.2d 1352, 1363 (1994). “Additionally, a reviewing court may, where appropriate, accord substantial weight to the interpretation given a statute or regulation by a body charged with administering such law.” State ex rel. Battershell v. City of Albuquerque, 108 N.M. 658, 662, 777 P.2d 386, 390 (Ct.App.1989); see also New Mexico Pharmaceutical Ass’n v. State, 106 N.M. 73, 75, 738 P.2d 1318, 1320 (1987) (administrative interpretations are persuasive). “However, a reviewing court will overturn a clearly incorrect administrative interpretation.” New Mexico Pharmaceutical Ass’n, 106 N.M. at 75, 738 P.2d 1318.
We find that the MHC’s interpretation of the statute is reasonable and facilitates the operation and achievement of the goals of the statute. Cf. Roberts v. Southwest Community Health Servs., 114 N.M. 248, 251, 837 P.2d 442, 445 (1992) (“Statutes should be construed so as to facilitate their operation and the achievement of the goals as specified by the legislature.”). In providing for peremptory disqualification, the legislature intended to allow the parties some control over the makeup of the tribunal without having to meet the rigors of showing disqualification for cause. It did not intend to hamper the agency’s ability to enforce the statutes. To read this statute as allowing more than one peremptory disqualification, however, would lead to contrary results. In the case in which the board has assigned a hearing officer to oversee the proceedings, permitting unlimited challenges would allow a party the opportunity to delay the hearing unnecessarily through repeated disqualifications. Cf. Rocky Mountain Life Ins. Co. v. Reidy, 69 N.M. 36, 41, 363 P.2d 1031, 1035 (1961) (noting potential for abuse with successive disqualifications). In addition, because peremptory challenges cannot be used to reduce the number of committee members below a quorum, in the case of multiple parties appearing before the board, one party could usurp all the available peremptory challenges by filing multiple affidavits first.
Rex suggests that this Court previously affirmed the use of multiple disqualifications under Section 61-1-7 in Reid v. New Mexico Board of Examiners in Optometry, 92 N.M. 414, 589 P.2d 198 (1979). The Reid opinion does make reference to the plaintiff having disqualified two board members under Section 61-1-7. Id. at 415, 589 P.2d at 199. However, the opinion does not disclose whether those disqualifications were peremptory or for cause, the latter of which would still be permissible under the MHC’s interpretation. More importantly, this reference, appearing in the facts of the case, is mere dictum. The Court clearly did not address the propriety of multiple peremptory disqualifications or the proper interpretation of the statute. Thus Reid is inapposite. Accordingly, we affirm the MHC’s decision holding that a party is entitled to only one peremptory challenge.
IV. CONCLUSION
For the foregoing reasons we affirm the MHC’s decision to allow Rex only one peremptory challenge, and we reverse paragraphs 1, 2, and 3 of the MHC’s order requiring Rex to pay Atkins $3,724.24 and imposing a thirty-day suspension of Rex’s dealer’s license to be stayed upon payment, and remand the order for further proceedings consistent with this opinion.
IT IS SO ORDERED.
RANSOM and FRANCHINI, JJ., concur.
. The Manufactured Housing Division (MHD) is an investigative and administrative body that regulates the manufactured-housing industry. The Manufactured Housing Committee (MHC) is a seven-member board that provides technical and policy advice for the MHD and adjudicates disputes involving violations of the Manufactured Housing Act and MHD regulations. See Manufactured Housing Act, NMSA 1978, §§ 60-14-4 to -5 (Repl.Pamp.1989).
. Initially, Rex appealed on a third ground as well, arguing that MHD Regulation 207 conflicted with the Uniform Commercial Code. However, Rex abandoned this claim at oral argument.
. In the Gardner-Denver line of cases, the Court also expressed several misgivings about the arbitration process which it cited as support for denying preclusive effect to arbitration. McDonald, 466 U.S. at 290-91, 104 S.Ct. at 1803-04 (reiterating the findings of the earlier cases). However, the Supreme Court has since reconsidered these misgivings. In Gilmer, the Court noted, "[W]e are well past the time when judicial suspicion of the desirability of arbitration and of the competence of arbitral tribunals inhibited the development of arbitration as an alternative means of dispute resolution.” Gilmer, 500 U.S. at 34 n. 5, 111 S.Ct. at 1656 n. 5 (quoting Mitsubishi Motors Corp. v. Soler Chrysler-Plymouth, Inc., 473 U.S. 614, 626-27, 105 S.Ct. 3346, 3353-54, 87 L.Ed.2d 444 (1985)).
. We note that the relevant cases focusing on this question have not consistently framed the issue in terms of privity. However, we conclude that the issue is best analyzed under that rubric. The common thread running through the various decisions limiting an agency’s statutory claim is the courts’ recognition that the agency is in fact acting on behalf of an individual claimant, as that claimant’s representative. See IB Moore, supra, ¶ 0.411 [12] n. 39, at III—291 ("In some cases an agency may act on complaint or otherwise pursue recovery on the part of individuals injured by infractions of the law. In such a case the government and the represented person are in privity and a judgment has res judicata effect.”).
In addition, although this question of privity has arisen more commonly in the context of analyzing claim preclusion, the general rule framed by the federal courts is equally applicable in examining privily under issue preclusion. See 18 Charles A. Wright, Arthur R. Miller & Edward H. Cooper, Federal Practice and Procedure § 4475, at 771-72 (1981) ("Thus issue preclusion is properly extended to bind or benefit nonparties who are closely related to the arbitration or the parties, so as to ensure reasonable finality to the award.”). Cf. Kimberly-Clark, 511 F.2d at 1361 (examining both claim and issue preclusion). | [
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] |
OPINION
DONNELLY, Chief Judge.
Plaintiff, as personal representative of the estate of Henry Trujillo, Jr., appeals from an order granting summary judgment and dismissing his wrongful death action against defendants Linda W. Treat and Thomas J. Treat (defendants). The sole issue on appeal is whether the district court erred in granting defendants’ motion for summary judgment. We reverse and remand.
On November 13, 1984, at approximately 8:45 p.m., decedent was struck and killed by an automobile driven by defendant Linda Treat (Treat). At the time of the accident, decedent was standing in the left lane of northbound U.S. Highway 85, near Belen. On January 3, 1985, plaintiff filed a wrongful death action against defendants and Gilbert Trujillo, doing business as El Nido Supper Club. In a prior appeal, this court affirmed an order of the district court granting a motion to dismiss Gilbert Trujillo as a defendant in the action. See Trujillo v. Trujillo, 104 N.M. 379, 721 P.2d 1310 (Ct.App.1986). Subsequent thereto, defendants moved for summary judgment. In support of this motion, defendants attached the affidavits of Mary Moya, a witness to the accident, and Frank Valles, the police officer who investigated the accident. Also before the court was the deposition of Treat, and her answers to interrogatories. On November 10, 1986, the district court granted defendants’ motion, determining that “there are no issues of material fact and that defendants are entitled to [summary] Judgment as a matter of law.”
Plaintiff argues that the district court erred in granting summary judgment. Specifically, plaintiff asserts that under our comparative negligence law, the question of whether Treat saw or should have seen decedent prior to impact so as to avoid fatally injuring him is a genuine issue of material fact subject to the jury’s determination. Defendants, on the other hand, contend that summary judgment was proper because there was nothing Treat could do to avoid hitting decedent and that the accident was unavoidable.
Summary judgment is proper if there are no genuine issues of material fact and the movant is entitled to judgment as a matter of law. SCRA 1986,1-056(C); Koenig v. Perez, 104 N.M. 664, 726 P.2d 341 (1986); Westgate Families v. County Clerk of Inc. County of Los Alamos, 100 N.M. 146, 667 P.2d 453 (1983). The movant need only make a prima facie showing that he is entitled to summary judgment. Koenig v. Perez; Goodman v. Brock, 83 N.M. 789, 498 P.2d 676 (1972). Upon making a prima facie showing, the burden then shifts to the party opposing the motion to show at least a reasonable doubt as to whether a genuine issue exists. Koenig v. Perez; Savinsky v. Bromley Group, Ltd., 106 N.M. 175, 740 P.2d 1159 (Ct.App.1987).
When considering a motion for summary judgment, the district court must give the party opposing the motion the benefit of all reasonable doubt in determining whether a genuine issue of material fact exists. Young v. Seven Bar Flying Serv., Inc., 101 N.M. 545, 685 P.2d 953 (1984); Knapp v. Fraternal Order of Eagles, 106 N.M. 11, 738 P.2d 129 (Ct.App.1987). Even where basic facts are undisputed, if equally logical but conflicting inferences can be drawn from the facts, summary judgment should be denied. Barber’s Super Markets, Inc. v. Stryker, 81 N.M. 227, 465 P.2d 284 (1970); Pena v. New Mexico Highway Dep’t Mountain States Mut. Ins. Co., 100 N.M. 408, 671 P.2d 656 (Ct.App.1983). Summary judgment is a drastic remedy which should be used with extreme caution. Cunningham v. Gross, 102 N.M. 723, 699 P.2d 1075 (1985); Cebolleta Land Grant, ex rel. Bd. of Trustees v. Romero, 98 N.M. 1, 644 P.2d 515 (1982).
It is well established that the driver of a motor vehicle has a duty to keep a proper lookout and to maintain proper control of his vehicle. SCRA 1986, 13-1202; see NMSA 1978, § 66-7-337 (Repl.Pamp. 1987); Horrocks v. Rounds, 70 N.M. 73, 370 P.2d 799 (1962); Ortega v. Koury, 55 N.M. 142, 227 P.2d 941 (1951); Martinez v. City of Albuquerque, 84 N.M. 189, 500 P.2d 1312 (Ct.App.1972). The duty to keep a proper lookout requires more than merely looking; it requires a person to actually see what is in plain sight or is obviously apparent to one under like or similar circumstances. SCRA 1986, 13-1203; see New Mexico State Highway Dep’t v. Van Dyke, 90 N.M. 357, 563 P.2d 1150 (1977). Similarly, a pedestrian has a duty to exercise due care for his own safety. SCRA 1986, 16-1604.
We recently reaffirmed the duty of a motorist to keep a proper lookout and to see that which could be seen in the exercise of ordinary care. See Trujillo v. Galio, 106 N.M. 486, 745 P.2d 711 (Ct.App.1987). The facts in Trujillo are similar to those in the instant case. In both Trujillo and the present case, defendant motorists were driving in a dark, unlit area, the victims were alleged to have been intoxicated, defendant motorists did not see the victims until shortly before impact, and defendant motorists unsuccessfully swerved to avoid the accident. In Trujillo, defendant’s wife, who was a passenger in the front seat, indicated that she saw plaintiff just before impact. This court held that whether defendant could have or should have seen a pedestrian was a question of fact to be determined by the factfinder after a consideration of all the attendant circumstances. Id. at-, 745 P.2d at 713. The factfinder, in Trujillo, determined that the driver was not liable.
Negligence and proximate cause are, likewise, generally questions of fact for the jury, unless reasonable minds cannot differ. See New Mexico State Highway Dep’t v. Van Dyke; Reynolds v. Swigert, 102 N.M. 504, 697 P.2d 504 (Ct.App. 1984); see generally 6 J. Moore, Moore’s Federal Practice, pt. 2, § 56.17(42) (1987); V. Schwartz, Comparative Negligence § 17.3 (2d ed.1986). New Mexico case law demonstrates that the question of whether a motorist could have avoided a collision with a pedestrian is normally a factual issue for the trier of fact. In Merrill v. Stringer, 58 N.M. 372, 271 P.2d 405 (1954), overruled on other grounds, Archuleta v. Pina, 86 N.M. 94, 519 P.2d 1175 (1974), defendant motorist testified that he did not see plaintiff pedestrian until the time of impact. Another driver, following closely behind defendant, saw plaintiff approaching the center line and was able to bring his vehicle to a stop. Based upon this evidence, our supreme court held that the trial court erred in directing a verdict for defendant where a factual issue existed as to whether the nighttime accident was unavoidable.
In Falkner v. Martin, 74 N.M. 159, 391 P.2d 660 (1964), a pedestrian was struck by defendant motorist while crossing a street at night. Defendant testified at trial that the plaintiff was wearing dark clothing and “suddenly loomed in front of the car.” Id. at 162, 391 P.2d at 662. No other eyewitness saw the pedestrian crossing the street until the accident occurred. Under these facts, the court in Falkner held that whether the driver was negligent was a factual question to be determined by the jury. Similarly, in Galvan v. City of Albuquerque, 85 N.M. 42, 508 P.2d 1339 (Ct. App.1973), this court held that summary judgment was not proper in an action wherein plaintiff cyclist was injured in a nighttime car and bicycle collision, and where a substantial fact issue existed as to whether plaintiff’s negligence was a contributing proximate cause of the accident.
Defendants assert that the affidavit of Officer Frank Valles, offered in support of their motion for summary judgment, establishes that Treat was not at fault because the “accident was due solely to [the decedent] standing in the road or crossing the road in a dark, unlit area * * Examination of this affidavit, however, indicates that it is, in part, conclusionary in nature, and omits any factual reference considering the speed at which Treat was traveling, the effectiveness of her headlights, and whether she was maintaining a proper lookout. In a summary judgment proceeding, an affidavit of an expert must explain how he arrived at his opinion, setting forth such supportive facts as would be properly admissible in evidence. Smith v. Klebanoff, 84 N.M. 50, 499 P.2d 368 (Ct.App.1972); see R. 1-056(E); Matney v. Evans, 93 N.M. 182, 598 P.2d 644 (Ct.App. 1979); Lay v. Vip’s Big Boy Restaurant, Inc., 89 N.M. 155, 548 P.2d 117 (Ct.App. 1976).
Defendants also offered the affidavit of Mary Moya, a witness driving behind Treat. Moya stated in her affidavit that she saw decedent hitchhiking in the median area and also saw him step onto the highway. Treat, however, stated in her deposition and answers to plaintiffs interrogatories that decedent was standing on the highway when she first saw him and that she did not know how far away her car was when she first saw him. Moya also indicated that Clarence Mora, another driver, who was ahead of Treat, saw decedent standing in the highway and was able to take evasive action to avoid a collision.
The principal question thus posed is whether reasonable minds could differ as to whether Treat maintained a proper lookout and exercised ordinary care in the operation of her automobile. The evidence submitted in support of defendants’ motion for summary judgment indicates that Treat was uncertain of the distance between decedent and her automobile when she first observed him. The record indicates that at least one other motorist observed decedent and was able to take evasive action to avoid hitting him. Additionally, Moya, who was driving behind Treat in the right-hand lane, observed decedent prior to the time that Treat first saw him. Summary judgment is not proper where there are conflicting material facts, or an inference exists as to whether defendant was comparatively negligent. Based on a review of the matters presented at the hearing on the motion for summary judgment, we cannot say, as a matter of law, that there were no issues of material fact. See Merrill v. Stringer; Trujillo v. Galio; see also Sweenhart v. Co-Con, Inc., 95 N.M. 773, 626 P.2d 310 (Ct.App.1981). Thus, the issue of Treat’s alleged negligence was not properly subject to resolution as a matter of law.
Reversed and remanded.
IT IS SO ORDERED.
MINZNER and GARCIA, JJ., concur.
. In addressing plaintiffs appeal, we do not consider the affidavit of Joseph R. Trujillo, attached to the brief-in-chief, since it was not timely presented to the district court at least one day prior to the hearing, or relied upon by the court below. See R. 1-056(C); Schmidt v. St. Joseph’s Hosp., 105 N.M. 681, 736 P.2d 135 (Ct. App.1987). | [
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OPINION
FLORES, Judge.
This case concerns an alleged breach of an oral agreement to exchange services for real property and an ownership interest in a business. The case originally began as a divorce proceeding between Joy Ortiz Nashan (Joy) and Charles Nashan, Jr. (Nashan). Nashan brought Joy’s father, Willie Ortiz (Ortiz), into the case because Ortiz refused to acknowledge that the marital community owned a house and a one-half ownership interest in the family business, and refused to transfer to the community legal title to the house and shares of stock in the business. Nashan alleged that the house and ownership interest were given to the marital community in exchange for his agreement to move to Santa Fe and work in the family business, and asked for a declaratory judgment establishing the marital community’s rights to the house and a portion of the business. In effect, Nashan’s pleadings requested specific performance of the alleged oral agreement. Since that agreement was oral, Ortiz moved for summary judgment on the ground that enforcement of the agreement was barred under the statute of frauds. Ortiz also maintained that the statute of limitations had run on Nashan’s cause of action for breach of contract. The district court granted Ortiz’s motion for summary judgment without specifying the basis for its decision. Nashan appeals from that judgment, and we reverse.
STANDARD OF REVIEW
Since this is a summary judgment case, Nashan argues that we must view the facts in the light most favorable to him, and that we must make all reasonable inferences from the evidence in his favor. See Knapp v. Fraternal Order of Eagles, 106 N.M. 11, 12-13, 738 P.2d 129, 130-31 (Ct.App.1987). Ortiz acknowledges that this is the appropriate standard for most summary judgment cases. In this case, however, since the statute of frauds is involved, he maintains that a different standard applies. According to Ortiz, in cases involving an oral agreement and, as here, an alleged part performance of that agreement that takes the case out of the statute of frauds, the performance must be “unequivocally referable” to the alleged agreement. Since that is the ease, Ortiz argues, even in reviewing the summary judgment this Court may determine whether any inference could be drawn from the evidence that would contradict the claim that an oral agreement existed. In other words, we need not draw all inferences from the evidence in favor of Nashan, but should only determine whether inferences contrary to Nashan could be made from the evidence.
As we discuss below, we agree that the “unequivocally referable” test is one means courts have used to decide whether an oral agreement existed and should be enforced. The existence of this test, however, does not change the standard of review for summary judgment in cases such as this one. See Hubbard v. Mathis, 72 N.M. 270, 383 P.2d 240 (1963) (in reviewing summary judgment granted to a defendant where the plaintiff claimed an oral agreement to exchange services for an interest in real estate, Supreme Court stated that the pleadings, depositions, affidavits, and admissions must be viewed in the most favorable aspect they will bear in support of the party opposing the motion). Thus, we must view the facts presented below in the light most favorable to Nashan and, drawing all inferences in his favor, determine whether he has raised a genuine issue of material fact regarding both the statute of frauds issue and the statute of limitations issue. If so, summary judgment should have been denied. See Knapp, 106 N.M. at 13, 738 P.2d at 131.
FACTS
According to Nashan, the formation of the oral contract and the terms of that contract were as follows. In 1973, Nashan and Joy were living in Chicago, and Nashan was working for his father, earning $14,000 per year. Ortiz asked Nashan to return to Santa Fe, where Nashan had gone to college and had met Joy, to become general manager of two new businesses that Ortiz and his wife (June) were just starting. As compensation for moving from Chicago, leaving his current employment, and working in the newly started family business, Nashan and, through him, the marital community, would receive a house in Santa Fe, would become equal partners in the new family business, and would have their moving expenses paid for the move from Chicago to Santa Fe. He was originally offered $14,000 per year as salary, but after he arrived in Santa Fe he agreed to accept $10,000 per year as his beginning salary.
In attempting to prove that the alleged oral agreement existed and should be enforced, Nashan introduced evidence by way of depositions, affidavits, and exhibits. We recite that evidence in the light most favorable to Nashan’s position. At the time Nash-an was approached by Ortiz with the idea of moving the Nashan family to Santa Fe, Nashan had been offered a different job in Chicago paying $16,000 to $18,000 per year. Nashan turned down the offer and agreed to accept Ortiz’s offer, taking a lower salary in reliance on the other portions of the compensation package offered by Ortiz. Upon moving to Santa Fe in 1973, Nashan became general manager of the family businesses, the primary focus of which was the operation of La Tertulia Restaurant in Santa Fe (the Ortizes had also started a corporation called Mercado Hispano Del Norte, Inc. — the two businesses were subsequently merged into the same corporation). At the time Nashan arrived to take the general manager position, the businesses were not doing well financially. For twenty years, Nashan regularly worked sixty-five hours per week in the restaurant and the other businesses, often putting in as much as eighty horn’s or more per week. Joy admitted in her deposition that the effort and time her husband put into the operation of the businesses was consistent with ownership, or the assumption of ownership, of the businesses. Throughout the twenty years that he worked as general manager, Nashan was paid a salary that was below market rates for such a position. In fact, he was approached several times about accepting similar positions in the food industry at substantially higher salaries, but rebuffed these approaches by saying he did not want to leave his position as part owner of the family-run business. In addition to his below-market salary, Nashan did receive other compensation that was in the nature of the benefits one derives from owning a business. He and Joy participated equally with Ortiz and June in dividing all the profits derived from the business. The two families took equal cash distributions from the business on a weekly basis during the year, and at the end of the year both families received equal cash bonuses. Both families had cars provided by the business, and the business paid for expenses such as accounting and tax preparation expenses and entertainment expenses for both families. Due at least in part to Nashan’s time and efforts, the family business became quite successful and profitable for both families.
Throughout the twenty-year period in which Nashan was general manager of the business, the Ortizes made frequent representations to other people and to the Nash-ans to the effect that the Nashans were co-owners of the family business. In 1975, when La Tertulia was merged into the corporation and became a corporate possession, the Ortizes issued a notice and policy statement to La Tertulia’s employees identifying the owners of the restaurant as Willie and June Ortiz and their children, Chuck and Joy Nashan. Later, as late as 1990, Nashan and Joy were identified as shareholders of the corporation in minutes of the corporation’s annual meeting. June provided information to a national publication, Who’s Who in America’s Restaurants, identifying both the Ortizes and the Nashans as owners of La Tertulia. In discussions with employees, customers, and other people, the Ortizes consistently identified the Nashans as co-owners of the family business.
In addition to receiving benefits similar to those received by the Ortizes, and to being identified as co-owners of the business, the Nashans incurred risks and shared hardships with the Ortizes. When Nashan first assumed his position with the business, and the restaurant had not yet begun doing well financially, Nashan agreed to delay depositing his paycheck until there was enough money in the bank to cover it, to ensure that the employees’ paychecks would be honored. Nashan, on several occasions, provided personal guarantees for credit that had been extended to the business, to ensure that the business could obtain the credit it needed in order to operate. Nashan and Joy (who also worked for the business, as a hostess at the restaurant) were not covered by workers’ compensation insurance because, in filings with the Workers’ Compensation Administration, they were identified as employees who owned at least ten percent or more of the outstanding stock of the business. Finally, the Nashans from time to time provided places to live for employees of the business, at reduced rent or no rent. They were not compensated for this by the business.
Regarding the portion of the agreement involving the house, the facts most favorable to Nashan include the following. The Ortizes initially gave the Nashans earnest money with which to purchase a house, but that sale fell through. A year or two after the Nash-ans moved, the Ortizes remodeled and provided a house to the Nashans that was located in the family compound in Santa Fe. Over the years, the Nashans have spent approximately $200,000 in remodeling the house and building an addition to it. They have also expended considerable personal effort and time in improving the house. The Ortizes have never asked for rent or for any monetary compensation for the use of the house.
According to the evidence submitted by Nashan, the Ortizes consistently acted as if the Nashans owned the house and were co-owners of the business. The first indication to the contrary occurred after Joy filed for divorce from Nashan. At that time, Ortiz repudiated the agreement by refusing to transfer legal title to the house and shares of stock in the business and threatening to have Nashan removed from the restaurant premises by force.
APPLICABLE LAW — STATUTE OF FRAUDS
Nashan makes two main arguments concerning the statute of frauds. He maintains that no statute of frauds applies to the oral agreement because it is an employment agreement for an indefinite term. He also contends that the agreement should be enforced in spite of,the statute of frauds, because he performed his part of the agreement and that performance was sufficient to remove the agreement from the statute of frauds. We hold that Nashan has raised genuine issues of material fact as to whether such an oral agreement as he describes actually existed, and as to whether it would be inequitable to deny enforcement of that agreement. Therefore, we need not address his contention that no statute of frauds applied to the agreement. We do note, however, that courts have consistently applied the statute of frauds doctrine to agreements, such as this one, requiring the exchange of services for present or future interests in real property. See Hubbard, 72 N.M. at 273, 383 P.2d at 242; In re McGee’s Estate, 46 N.M. 256, 127 P.2d 239 (1942).
In determining whether Nashan has made a sufficient factual showing to survive summary judgment on the statute of frauds issue, we must analyze what he was required to prove. Since he contends an oral agreement was made, he must of course prove that such an agreement actually existed. In addition, to avoid application of the statute of frauds and obtain specific performance of the alleged agreement, he must prove that he has performed his part of the agreement to such extent that it would be inequitable to deny enforcement of the agreement. See Alvarez v. Alvarez, 72 N.M. 336, 341, 383 P.2d 581, 584 (1963) (where an oral contract not enforceable under the statute of frauds has been performed to such an extent as to make it inequitable to deny effect to the contract, equity may consider the contract as removed from the statute of frauds); Montoya v. New Mexico Human Servs. Dep’t, 108 N.M. 263, 266, 771 P.2d 196, 199 (Ct.App.1989) (oral contract may be given effect when it has been performed to such extent that it would be inequitable to deny enforcement); see generally 2 Arthur L. Corbin, Corbin on Contracts §§ 425-442 (1950 & 1994 Pocket Part).
It is not a light matter to refuse to apply the clear rule of the statute of frauds, that oral contracts for the conveyance of property are not enforceable. For that reason, courts have demanded that a litigant wishing to establish that performance has removed the agreement from the statute of frauds prove the existence of the agreement by clear, convincing, and cogent evidence. Alvarez, 72 N.M. at 341, 383 P.2d at 584; Paulos v. Janetakos, 41 N.M. 534, 540, 72 P.2d 1, 4 (1937). In addition, courts have formulated a number of tests or factors that are applied to the plaintiffs evidence, to assist in deciding both whether an agreement existed and whether equity requires that the agreement be enforced.
Corbin has summarized the factors applied by the courts as follows: (1) the performance alleged by plaintiff must be in pursuance of the contract and in reasonable reliance thereon, without notice of any repudiation of the contract by defendant; (2) the performance must be such that the remedy of monetary restitution is not reasonably adequate, making it very unjust for the defendant to hide behind the statute of frauds; and (3) the performance must be one that is in some degree evidential of the contract and not readily explainable on any other ground. Corbin, swpra, § 425.
New Mexico case law is in accord with the general discussion contained in Cor-bin, although the language used in the opinions varies somewhat from that used by Professor Corbin. In Alvarez, our Supreme Court, citing Burns v. McCormick, 135 N.E. 273 (N.Y.1922) and Woolley v. Stewart, 118 N.E. 847, 848 (N.Y.1918), stated that in part-performance cases, there must be performance that is “unequivocally referable” to the agreement, meaning that the performance is such that it is unintelligible or at least extraordinary unless as an incident of ownership. Alvarez, 72 N.M. at 342, 383 P.2d at 585. We believe that the “unequivocally referable” test is another way of stating Corbin’s third requirement, that the performance be evidential of the existence of a contract and not readily explainable on some other ground. See Candelaria v. Sandoval, 84 N.M. 387, 389, 503 P.2d 1165, 1167 (1972). This requirement is imposed because the evidence of part performance is designed to show, among other things, that there must have been a contract or plaintiff would not have performed the acts that make up the part performance. Id. The “unequivocally referable” concept has been analyzed as requiring actions of part performance that are significant of ownership of the property, rather than some other agreement or relationship. Burns, 135 N.E. at 273. The Alabama Supreme Court has explained the test in plain language as meaning that an outsider, knowing all of the circumstances of a case except for the claimed oral agreement, would naturally and reasonably conclude that a contract existed regarding the land, of the same general nature as that alleged by the claimant. Smith v. Smith, 466 So.2d 922, 925 (Ala.1985).
Another test applied in prior New Mexico cases is the principle that equity will regard the bar of the statute of frauds as removed if plaintiffs performance is such that it would amount to fraud upon the plaintiff to use the statute as a defense. Hubbard, 72 N.M. at 273, 383 P.2d at 242; Paulos, 41 N.M. at 540, 72 P.2d at 4-5. This is simply another way of stating Corbin’s requirement that it would be highly unjust to refuse enforcement of the contract.
In cases such as this one, involving the alleged exchange of services for real property or ownership interests in real property, some prior decisions have indicated that the services performed must be extraordinary or exceptional, so that they are incapable of being compensated by a measurable monetary standard. Hubbard, 72 N.M. at 273, 383 P.2d at 242; Paulos, 41 N.M. at 540, 72 P.2d at 4. An alternative showing, that the plaintiffs whole course of life was changed by performance of the contract, may be made. In re McGee’s Estate, 46 N.M. at 259, 127 P.2d at 240; Annotation, Remedies for Breach of Decedent’s Agreement to Devise, Bequeath, or Leave Property as Compensation for Services, 69 A.L.R. 14, at 133 (1930). Corbin appears to regard the “change in course of life” factor as simply one way of showing that the performance is not of the type that is capable of being compensated with money. Corbin, supra, § 436. Both factors, in any event, appear to fit into the second and third tests mentioned by Corbin, that the remedy of restitution must be inadequate and that the performance must be evidential of the existence of a contract.
One quite specific factor that has been discussed by many courts is the issue of improvements to the property. Where the plaintiff has taken possession of the property and has made valuable, permanent, and substantial improvements, specific performance of an agreement to convey the property will often be granted. See, e.g., Shipp v. Thomas, 58 N.M. 190, 193, 269 P.2d 741, 742-43 (1954); Corbin, supra, § 434.
Some of the foregoing factors are relevant to the question of the existence of the agreement. Others are relevant mainly to the fairness issue. Some appear to be relevant to both inquiries. Whatever the purpose of each test, however, the main questions are the same for a court faced with a ease such as this one — was there actually an oral agreement such as that alleged by the plaintiff, and if so would it be inequitable to deny enforcement to the agreement? The factors should not be applied mechanically to determine whether the plaintiffs performance has met a particular test. Instead, the case must be viewed as a whole to determine whether specific performance of the agreement is required. See Corbin, supra, § 425.
APPLICATION OF THE LAW TO THE FACTS OF THIS CASE
The question in this case is whether, viewing the facts in the light most favorable to Nashan, he has raised a genuine issue of material fact concerning the existence of the agreement and the equities of enforcing or refusing to enforce the agreement. In response to Nashan’s brief in chief, Ortiz has relied heavily on the “unequivocally referable” factor and has dissected Nashan’s proof, positing an alternative explanation for each item of evidence presented. For example, Nashan pointed out the memorandum to La Tertulia employees presenting the Nashans as owners of the restaurant, along with the Ortizes. Ortiz theorizes that this representation of ownership might have been made to give Nashan more authority over the restaurant’s employees, some of whom had been with the restaurant longer than Nashan. We do not believe this is a proper approach. Instead, in reviewing the summary judgment, the circumstances must be viewed as a whole, in the light most favorable to Nashan, to determine whether he has met the burden imposed by the factors previously discussed. Doing so, the evidence favorable to Nashan may be summarized as follows.
Nashan was working at his parents’ business and living in Chicago, earning $14,000 per year and with an offer of a different job at higher pay. In response to Ortiz’s alleged offer, Nashan left his job, left Chicago, moved to Santa Fe, and took a $4,000 cut in pay. He worked long and hard at the family business for twenty years, at below-market salary rates, turning down overtures from other potential employers who were offering much higher salaries. The Nashans shared the benefits of ownership equally with the Ortizes, and also participated in the risks, such as granting personal guarantees for indebtedness and foregoing coverage under the workers’ compensation statute. The Ortizes and Nashans consistently identified themselves as co-owners of the restaurant. With regard to the house, the Nashans remained in the same house for almost twenty years and spent a substantial sum of money remodeling and building an addition, instead of purchasing a different residence.
Nashan has raised genuine issues of material fact concerning the tests or factors that his evidence must meet. For example, by moving from Chicago, giving up a possible career there with his parents’ business, turning down one job offer before he moved, and refusing several overtures concerning different employment after he joined the family business in Santa Fe, Nashan might convince a fact finder that he has established that the whole course of his life has been changed by performance of the contract. Under these circumstances, monetary restitution may not be an accurate measure of compensating Nashan for his actions, making specific performance appropriate. Cf. In re McGee’s Estate, 46 N.M. at 259, 127 P.2d at 240.
As to the existence of the contract itself, taking possession of the house and making substantial, extensive improvements to it, instead of spending the money on a different residence, is evidence of an agreement that the house belonged to the Nashans. Bennett v. Pratt, 228 Or. 474, 365 P.2d 622, 629-30 (1961); Shipp, 58 N.M. at 193, 269 P.2d at 742-43; Corbin, supra, § 434. In addition, Nashan’s evidence of the parties’ conduct over the course of twenty years also raises an issue of fact as to whether an agreement existed — the Ortizes acted as if the Nashans were co-owners of the business, and the Nashans did so as well.
Concerning Ortiz’s argument that Nashan’s performance is not “unequivocally referable” to the alleged contract, we note that the performance need not positively exclude every other possible explanation. Instead, the performance must be such that it indicates an agreement existed, and the performance must not be readily explained in the absence of such an agreement. Candelaria, 84 N.M. at 389, 503 P.2d at 1167.
We focus first on Nashan’s part performance with respect to the house. Taking possession of property and making substantial, valuable improvements to it is “one of the most satisfactory evidences of part performance.” Townsend v. Vanderwerker, 160 U.S. 171, 184, 16 S.Ct. 258, 262, 40 L.Ed. 383 (1895); see also, e.g., Bear Island Water Ass’n v. Brown, 125 Idaho 717, 874 P.2d 528, 533 (1994) (the most important acts constituting sufficient part performance are actual possession, permanent and valuable improvements, and these two combined); Ryan v. Earl, 618 P.2d 54, 57 (Utah 1980) (possession is an important fact, and when combined with permanent and valuable improvements, will almost always lead to specific performance); Hayt v. Hunt, 10 Colo. 278, 15 P. 410, 412 (1887) (most important acts constituting sufficient part performance are actual possession and making permanent, valuable improvements). The Nashans’ expenditure of $200,000 and substantial amounts of time and effort for permanent improvements to the house raises an issue of fact about whether those acts were performed in reliance on an agreement conveying the house to them. See Easley v. Easley, 333 S.W.2d 80 (Mo.1960) (grandson’s expenditure of time, labor, and money on improvements to house were sufficiently referable to an alleged oral agreement by grandfather to convey house to grandson in exchange for services; court opined that it was not reasonable that grandson would do the work and expend the money on a house merely on the hope that he would be allowed to live in it for some indefinite period of time).
We now consider Nashan’s performance with respect to the business. The mere facts that Nashan worked many hours for many years, and declined to pursue other job opportunities, may not be “unequivocally referable” to the contract. See Martin v. Scholl, 678 P.2d 274, 278-79 (Utah 1983) (ranch foreman’s long hours not atypical of such an employee’s life, and declining other offers is not sufficient part performance). This makes sense under the Bums and Smith formulations of the test, because working long hours and staying with the same employer instead of leaving are not necessarily actions that signify ownership of a business, or actions that only an owner would take. Loyal employees who are devoted to their work and their employer often do the same.
There is evidence in the record, however, of other behavior by the Nashans that raised an issue- of fact about whether such actions would be highly unusual for a non-owner employee. These actions include the following: (1) delaying cashing their own paychecks to ensure that the employees’ paychecks would be covered during the time the business was struggling; (2) foregoing workers’ compensation coverage, thereby saving the business money but rendering themselves self-insurers; (3) extending personal guarantees for credit lines from suppliers of the business; (4) providing free or low-cost housing for employees of the business, without any compensation from the business; (5) accepting less-than-market salaries for their positions, and instead taking the risk (along with the Ortizes) that the business would not do well financially; (6) having the company provide accounting and tax preparation services, as well as entertainment expenses. There is at least a genuine issue of fact as to whether an outsider viewing these facts would reasonably believe that these were the actions of an owner, not merely an employee. It is at least plausible, for example, that even an upper-level manager would expect some sort of compensation for providing housing for company employees, would not agree to delay cashing his own paycheck, and would hesitate to personally guarantee debts of the business. Therefore, we hold that the evidence was sufficient to overcome summary judgment on the question of whether Nash-an’s performance concerning the business was “unequivocally referable” to an agreement that he and his wife would have an ownership interest in the business.
In so concluding, we recognize Ortiz’s argument that an alleged oral contract between family members must be scrutinized even more closely than a contract between unrelated parties. There is some question as to whether such a heightened scrutiny should be applied in a case such as this one, involving extensive arm’s-length negotiations between a son-in-law, who is a college graduate, and a father-in-law. See Alvarez, 72 N.M. at 342, 383 P.2d at 585 (finding no necessity to apply heightened scrutiny where similar factors existed). We do believe, however, that a close family relationship between the parties is an important factor to consider, along with other circumstances, in deciding whether a party’s performance is “unequivocally referable” to a contract to convey real property. See, e.g., Smith, 466 So.2d at 926 (considering the history of the land and the parties’ relationship as twin brothers, one brother’s possession of the property could be viewed as referable to their relationship rather than the alleged agreement). For example, where the performance consists of the provision of services such as caring for an aging parent, other evidence might be necessary to demonstrate that the performance was referable to an agreement rather than to the love and devotion of the child. In this case, however, there is at least a fact question as to whether the Nashans would have invested such substantial amounts of time and money in the house merely because of the familial relationship between the parties.
We hold that Nashan has raised a genuine issue of material fact concerning the existence of the agreement. Also, due to the evidence of Nashans’ long period of possession of the house and the substantial and valuable improvements made to it, Nashan’s actions in connection with the business that could be viewed as more like those of an owner than an employee, the substantial changes in the couple’s life and Nashan’s forbearance from pursuing other opportunities, and the alleged fact that nothing indicating repudiation of the agreement occurred until after Joy filed for divorce, Nashan has raised a genuine issue of material fact as to whether equity requires that the alleged oral agreement be enforced. For that reason, if the district court granted summary judgment on the statute of frauds ground, that decision is reversed.
STATUTE OF LIMITATIONS
The statute of limitations on a breach of contract claim runs from the date the contract is breached. Smith v. Galio, 95 N.M. 4, 6, 617 P.2d 1325, 1327 (Ct.App.1980). Ortiz argues that the statute of limitations on Nashan’s claim began to run long ago, at approximately the same time the contract was formed. In support of that argument, he contends that the alleged agreement was breached when Nashan arrived in Santa Fe and Ortiz failed to turn over title to the house or any shares in the corporation.
This contention misconstrues the nature of the parties’ alleged agreement. Viewing the facts in the light most favorable to Nashan, what the parties contracted for was that the Nashans would receive a house and become part owners of the family business. According to the evidence introduced by Nashan, there was no breach until after Joy filed for divorce, when Ortiz repudiated the Nashans’ ownership of the house and business. Until that time, the Ortizes acted as if the Nashans owned both the house and part of the business—they allowed the Nashans to move into the house, make renovations, and build an addition; they consistently acknowledged the Nashans as part owners of the business to customers, employees, the general public, and state agencies; they allowed the Nash-ans to participate equally in the division of cash profits of the business; and the only time the issue of legal title ever came up, they reassured the Nashans by saying “Why do you want it now? It’s all—it belongs to both of you anyway.”
For purposes of the statute of limitations, Nashan’s cause of action for breach of the agreement regarding the house did not accrue until Ortiz challenged Nashan’s own ership interest. “[WJhere one person has paid a fall purchase price and otherwise performed all the conditions in an agreement for the purchase of land ..., and the vendee has fully performed and has entered into possession of the land, the statute [of limitations] does not run while the vendee is in possession -with the acquiescence of the vendor.” Frank v. Tavares, 142 Cal.App.2d 683, 298 P.2d 887, 890 (1956) (suit on oral agreement for sale of land). See Wooley v. Shell Petroleum Corp., 39 N.M. 256, 268, 45 P.2d 927, 934 (1935); cf. Garcia v. Garcia, 111 N.M. 581, 588, 808 P.2d 31, 38 (1991).
Likewise, for purposes of the statute of limitations, Nashan had no cause of action against Ortiz with respect to his alleged share of the ownership of the business as long as Nashan was treated as a co-owner and Ortiz did not repudiate Nashan’s claimed interest or refuse to respond to a demand by Nashan for a proper stock certifícate. At least as between the seller and purchaser of stock, “[i]ssuance of a stock certificate is not a prerequisite to the formation of a shareholder relationship.” Wilkinson v. Reitnauer, 421 Pa.Super. 345, 617 A.2d 1326, 1330 (1992). See 12A William M. Fletcher, Fletcher Cyclopedia of Corporations § 5613, at 349 (rev. ed. 1993) (“The ... title passes, if such is the intention of the parties, even though the stock may remain in the name or in the possession of the seller.”); Copeland v. Swiss Cleaners, 255 Ala. 519, 52 So.2d 223, 228 (1951). Given the evidence adduced by Nashan, we cannot say that his claim to an interest in the business is barred by the statute of limitations.
Ortiz also argues that no date was set for the performance of the contract, so the action for breach of contract accrued on the date the contract was formed. However, the cases cited by Ortiz in support of his proposition are cases involving money debts based on oral agreements. See, e.g., Akre v. Washburn, 92 N.M. 487, 489, 590 P.2d 635, 637 (1979).
CONCLUSION
Throughout this opinion, we have viewed the evidence in the light most favorable to Nashan, and have drawn all inferences from that evidence in his favor. Our factual assertions should not be interpreted as binding the district court upon remand for further proceedings. Applying our standard of review, we hold that Nashan has raised genuine issues of material fact that prevent summary judgment on both the statute of frauds ground and the statute of limitations ground. For that reason, we reverse and remand to the district court.
IT IS SO ORDERED.
HARTZ and PICKARD, JJ., concur. | [
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OPINION
ALARID, Judge.
This case arose out of a supermarket machine accident in which a young boy’s hand and arm were crushed by the ram-plate of a cardboard box baler or compactor. After a jury verdict the court entered judgment against the supermarket and its predecessors in interest. We consider whether the trial court erred in instructing the jury that appellant (Winn-Dixie, Texas, Inc.) was a “supplier” of chattels; whether New Mexico and Florida substantive laws should have been applied in construing two distinct indemnification clauses; and whether the cost award was appropriate. FACTS
Jerry Lee Eichel (plaintiff), who was sixteen years old and employed by Smith’s Food King, Inc. (third-party defendant Smith’s) at the time of the July 26, 1979 accident, sued five defendants for personal injuries sustained. The baler/compactor was manufactured by Goode, Inc. (defendant Goode) with a safety switch which prevented the dangerous operation of the product with its door open. The evidence indicates the safety device was removed by the baler’s original owner, Kimbell, Inc. (defendant and third-party plaintiff Kim-bell), thus allowing the machine to be operated with its door folded down in an open position. Once in an open position, the door obstructed safety signs affixed by the manufacturer which warned that the door be kept closed while operating the machine. Plaintiff was injured as he was operating the modified machine with its door open.
Plaintiff sued Goode, the manufacturer of the baler/compactor; Kimbell, the first owner-operator of the supermarket; WinnDixie, the second owner-operator of the supermarket; and Foodway Stores, Inc. Plaintiff also sued his employer, Smith’s', for workman’s compensation and that action was consolidated with this case.
Jury trial on the liability issues began March 7, 1983. At the close of evidence the court directed a verdict in favor of Goode.
The court before trial granted Kimbell’s summary judgment motion against WinnDixie based on indemnity arising from an indemnity clause contained in the parties’ August 28, 1976 sale of assets agreement. The indemnity agreement made Winn-Dixie, as the buyer of the supermarket under the agreement, liable to indemnify and hold harmless Kimbell “against all actions, suits, demands, damages, losses or expenses which may be threatened or incurred at any time * * * by reason of any claim, lien or tax arising out of the business purchased and conducted by WinnDixie, subsequent to August 28, 1976.”
The court, sitting without a jury, denied Winn-Dixie’s third party claim against Smith’s which alleged indemnity based on the parties’ August 8, 1978 sale of assets agreement.
Foodway Stores, Inc. was a solely-owned subsidiary of Kimbell, Inc., and was merged with Kimbell in early 1973. Consequently, independent claims against Food-way were not pursued.
Smith’s as plaintiff’s employer, was entitled to protection of the New Mexico Workmen’s Compensation Act, which does not permit plaintiff recourse' against his employer beyond those exclusive remedies provided under the Act. The compensation issues were settled before trial.
The trial court gave instructions that Kimbell and Winn-Dixie, in their sale of supermarket assets and equipment, were “suppliers” of chattels under Section 388 of the Restatement (Second) of Torts (1965). The court denied Winn-Dixie’s requested instruction on sale of the equipment (of which the baler/compactor was a part) “as is.”
The jury found plaintiff suffered $150,-000 total damages. The jury apportioned negligence as 55% for Kimbell, 25% for Winn-Dixie, 19% for Smith’s, and 1% for plaintiff. The court calculated the result ing award as $120,000 for plaintiff ($82,500 from Kimbell, and $37,500 from Winn-Dixie). Pursuant to the earlier summary judgment order, Winn-Dixie was held liable for Kimbell’s liability, plus necessary and reasonable attorney’s fees, expenses, and costs.
DISCUSSION
I. WHETHER WINN-DIXIE WAS A “SUPPLIER” OF CHATTELS UNDER RESTATEMENT (SECOND) OF TORTS SECTION 388
Appellant Winn-Dixie challenges the instruction that it was a “supplier” of chattels, which would under Section 388 invoke seller’s duty to warn buyer of a dangerous condition of the product sold. See Fabian v. E.W. Bliss Co., 582 F.2d 1257 (10th Cir. 1978); Richards v. Upjohn Co., 95 N.M. 675, 625 P.2d 1192 (Ct.App.1980). Section 388 provides as follows:
§ 388. Chattel Known to be Dangerous for Intended Use
One who supplies directly or through a third person a chattel for another to use is subject to liability to those whom the supplier should expect to use the chattel with the consent of the other or to be endangered by its probable use, for physical harm caused by the use of the chattel in the manner for which and by a person for whose use it is supplied, if the supplier
(a) knows or has reason to know that the chattel is or is likely to be dangerous for the use for which it is supplied, and
(b) has no reason to believe that those for whose use the chattel is supplied will realize its dangerous condition, and
(c) fails to exercise reasonable care to inform them of its dangerous condition or of the facts which make it likely to be dangerous.
Comment c. points out that Section 388 applies to sellers, lessors, donors, or lenders, irrespective of whether the chattel is made by them or by a third party. Thus, a “supplier” for Section 388 purposes is “any person who for any purpose or in any manner gives possession of a chattel for another’s use * * * without disclosing his knowledge that the chattel is dangerous for the use for which it is supplied * * * *” Restatement, supra, at 302.
Under the foregoing description, Winn-Dixie qualifies as a supplier of the baler/compactor. Winn-Dixie asserts that even if it was a supplier, Section 388 does not apply. Winn-Dixie argues that Section 388 was inapplicable as a matter of law because, under the evidence, Smith’s had notice as to the condition of the baler, and used the baler for over a year before the accident occurred. We do not agree with this matter of law argument; there was a factual issue, properly submitted to the jury, concerning Section 388.
Winn-Dixie further argues that Section 388 should not have been applied to it because it sold the business and equipment to Smith’s “as is.” Authorities upon which appellant relies are inapposite because they relate to disclaimer of warranties, not to liability premised on negligence for failure to warn of a known danger. See Fabian v. E.W. Bliss Co.; Jones v. Minnesota Mining and Manufacturing Co., 100 N.M. 268, 669 P.2d 744 (Ct.App.1983); Richards v. Upjohn Co. Courts have found that a bare “as is” clause cannot, without more, relieve a party of liability under tort law. Alger v. Abele Tractor & Equip. Co., 92 A.D.2d 677, 460 N.Y.S.2d 202 (Sup.Ct.1983); Fleming v. Stoddard Wendle Motor Co., 70 Wash.2d 465, 423 P.2d 926 (1967); Knipp v. Weinbaum, 351 So.2d 1081 (Fla.App.1977); Kopischke v. First Continental Corp., 610 P.2d 668 (Mont.1980); Turner v. Int’l Harvester Co., 133 N.J.Super. 277, 336 A.2d 62 (Super.Ct.1975). Compare NMSA 1978, UJI Civ. 14.33 (Repl.Pamp.1980). We agree with this view because it would serve no public policy to allow a contracting party to rely on the existence of a general “as is” clause in a contract to avoid his duties under the law of torts. See Jig The Third Corp. v. Puritan Marine Ins. Under. Corp., 519 F.2d 171 (5th Cir.1975).
II. WHETHER NEW MEXICO AND FLORIDA LAWS WERE APPROPRIATELY APPLIED TO TWO INDEMNIFICATION CLAUSES
The trial court on summary judgment applied New Mexico law in construing the indemnity provision contained in the 1976 Kimbell/Winn-Dixie asset sales contract. This clause made Winn-Dixie liable for the damages adjudged against Kimbell in this case. New Mexico law holds “that an express reference to indemnitee’s negligence [in the contract is not] necessary as a condition precedent to his being held harmless for his own negligence.” Metropolitan Paving Co. v. Gordon Herkenhoff & Assoc., 66 N.M. 41, 341 P.2d 460 (1959). Appellant on appeal challenges the trial court’s application of New Mexico law and contends the provisions in a lease agreement made the contract indemnity provision inapplicable. The record does not show, however, that appellant raised these issues below. “Issues not properly raised in the trial court and on which a ruling by the trial court was not properly invoked will not be considered on appeal.” In re Will of Skarda, 88 N.M. 130, 537 P.2d 1392 (1975). See also NMSA 1978, Civ.App.R. 11; Pillsbury v. Blumenthal, 58 N.M. 422, 272 P.2d 326 (1954); Gurule v. Albuquerque-Bernalillo Co. Econ. Opportunity Bd., 84 N.M. 196, 500 P.2d 1319 (Ct.App.1972). The issue is therefore not properly before this court.
Appellant also challenges the trial court’s application of Florida law in interpreting the indemnity provision contained in the 1978 Winn-Dixie/Smith’s asset sales contract. The indemnity clause provides:
Purchaser agrees to indemnify and hold harmless Seller against all actions, suits, demands, damages, losses or expenses which may be threatened or incurred at any time hereafter by reason of any claim, lien or tax arising out of the businesses purchased by Purchaser from Seller hereunder and conducted by Purchaser subsequent to August 23, 1978 (including any liabilities assumed by Purchaser hereunder). The indemnity provided herein shall include, but not be limited to, any indemnity against liability rather than against loss, so that Seller may look to Purchaser under such indemnity upon the assertion of any claims or causes of action against which Seller is to be indemnified hereunder, as well as any losses hereunder, including reasonable attorney’s fees.
This clause is virtually identical to the indemnification provision contained in the 1976 Kimbell/Winn-Dixie agreement. If New Mexico rather than Florida law was applicable, Winn-Dixie would have recourse against Smith’s for any damage judgment entered against it. Smith’s in such a case would not enjoy the shield of the Workmen’s Compensation Act exclusive remedy provision, NMSA 1978, § 52-1-8, because an employer may be express contract of indemnity relinquish the Act’s statutory protection. City of Artesia v. Carter, 94 N.M. 311, 610 P.2d 198 (Ct.App.1980).
In supporting its challenge to the application of Florida law, appellant argues that (1) New Mexico law should have applied because the Winn-Dixie/Smith’s agreement was actually a New Mexico contract; (2) in any case, Florida law would refer the problem back to New Mexico; and (3) the modern conflicts approach requires application of New Mexico law.
First, New Mexico follows the traditional conflicts of law analysis in determining the choice of law applicable to contracts. This court stated the rule as follows:
A contract is made “at the time when the last act necessary for its formation is done, and at the place where the final act is done.” Merriman v. Harter, 59 N.M. 154, 280 P.2d 1045 (1955). The place where the final act is done determines the applicable law for the interpretation of the contract. See Miller v. Mutual Benefit Health & Acc. Ass’n, 76 N.M. 455, 415 P.2d 841 (1966); Merriman v. Harter, supra; Spiess v. United Services Life Ins. Co., 348 F.2d 275 (10th Cir. 1965).
Satterwhite v. Stolz, 79 N.M. 320, 442 P.2d 810 (Ct.App.1968). See also Transradio Press Service v. Whitmore, 47 N.M. 95, 137 P.2d 309 (1943); Alexander Film Co. v. Pierce, 46 N.M. 110, 121 P.2d 940 (1942); Riblet Tramway v. Monte Verde Corp., 453 F.2d 313 (10th Cir.1972); Pound v. Insurance Co. of North America, 439 F.2d 1059 (10th Cir.1971); Haury v. Allstate Ins. Co., 384 F.2d 32 (10th Cir.1967).
Substantial evidence supports the trial court’s finding that the Asset Purchase Agreement was executed on August 8, 1978 in the State of Florida. There is evidence that initial negotiations occurred per telephone calls between the corporate offices of Winn-Dixie in Florida and Smith’s in Utah. Final negotiations took place in Florida for the convenience of Winn-Dixie. After three days of final negotiations, the Asset Purchase Agreement was executed in Florida. After the contract’s execution, either party could have enforced the agreement in a suit for specific performance. No meetings took place in Albuquerque, New Mexico, for the purpose of negotiating the sale. Under these facts, our conflicts rule refers New Mexico courts to Florida law in interpreting the meaning of the indemnity provision in the Asset' Purchase Agreement. Looking to Florida law as to the meaning of the indemnity provision does not conflict with New Mexico public policy. See Ratzlaff v. Seven Bar Flying Service, Inc., 98 N.M. 159, 646 P.2d 586 (Ct.App.1982); Church v. Church, 96 N.M. 388, 630 P.2d 1243 (Ct.App.1981); Matter of Estate of Voight, 95 N.M. 625, 624 P.2d 1022 (Ct.App.1981).
Second, Florida law does not, as suggested by appellant, refer the problem back to New Mexico. The court in Center Chemical Co. v. Avril, Inc., 392 F.2d 289 (5th Cir.1968), quoted from Walling v. Christian & Craft Grocery Co., 41 Fla. 479, 27 So. 46, 47 L.R.A. 608 (1899), in recognizing the proper rule for Florida. Center Chemical quoted as follows:
“[M]atters bearing upon the execution, interpretation, and validity of a contract are determined by the law of the place where it is made. Matters connected with its performance are regulated by the law prevailing at the place of performance. Matters respecting the remedy depend upon the law of the place where the suit is brought. * * *”
392 F.2d at 290. Contrary to appellant’s suggestion, the present case involves interpretation of a contractual provision, it does not concern a matter connected with performance under the contract. Our inquiry here focuses on the meaning of the indemnity provision by an application of the law of the proper forum. Consequently, whether or not the Center Chemical conflicts rule were applied, the proper law choice would be Florida, the place where the contract was made.
Third, appellant’s argument that modern conflicts of law rules should be applied and would require application of New Mexico law is without merit. This court cannot entertain appellant’s invitation to adopt the modern “center of gravity” or “grouping of interests” theory over our present “last act” rule. We must apply decisions of our Supreme Court. Alexander v. Delgado, 84 N.M. 717, 507 P.2d 778 (1973). We are bound by the traditional “last act” conflicts rule, established by our Supreme Court. Miller; Merriman.
Florida follows the majority rule on the question of whether the terms of a contract provide indemnity for one’s own negligence. Northwestern Nat’l Ins. Co. v. Dade County, 461 F.2d 1158 (5th Cir.1972); Gulf Oil Corp. v. Atlantic Coast Line Railroad Co., 196 So.2d 456 (Ct.App.), cert. denied, 201 So.2d 893 (Fla.1967). In Gulf Oil, in denying indemnification for negligence under a clause similar to the one used in the instant case, the Florida court said: “We * * * conclude that in order for an indemnity clause or contract to indemnify against an indemnitee’s own negligence, the clause or contract must exyressly state that such liability is undertaken by the indemnitor.” 196 So.2d at 459 (emphasis added). See also University Plaza Shopping Center, Inc. v. Stewart, 272 So.2d 507 (Fla.1973); Jackson v. Florida Weathermakers, 55 So.2d 575 (Fla.1952); Florida Power & Light Co. v. Elmore, 189 So.2d 522 (Fla.App. 1966); Nat Harrison Associates, Inc. v. Florida Power & Light Co., 162 So.2d 298 (Fla.App.1964).
Application of the Florida rule to the 1978 Winn-Dixie/Smith’s indemnity provision requires us to hold that the language of the indemnity clause is insufficient to make Smith’s liable to Winn-Dixie under the contract for Winn-Dixie’s own negligence. The language “indemnify and hold harmless Seller [Winn-Dixie] against all actions, suits, demands, damages, losses or expenses” would be sufficient under New Mexico law, but fails under Florida’s stricter rule. Absent an express statement that Smith’s undertakes liability for Winn-Dixie’s negligence, Winn-Dixie cannot prevail. The indemnity clause does not aid appellant. The issue was correctly decided by the trial court.
Appellant’s further argument that the indemnity clause contained in Kimbell’s lease to Winn-Dixie (the lease was separate from the Sale of Assets Contract), and in Winn-Dixie’s subsequent assignment of that lease to Smith’s, absolves Winn-Dixie of liability is also without merit. The lease assignment was executed after the master sale of assets contract and the language of the clause in any case specifically excluded negligent acts of the landlord from the indemnity provision’s terms.
III. WHETHER THE COST AWARD WAS APPROPRIATE
Winn-Dixie asserts that on the liability issues (not the indemnity issues) “[t]he court apportioned the costs as 70% to Plaintiff from Winn-Dixie.” This is incorrect. The trial court ruled that plaintiff was “to recover his costs against Kimbell and Winn-Dixie, Kimbell to pay 70% of such costs and Winn-Dixie to pay 30% of such costs.” Inasmuch as the jury determined that Winn-Dixie’s negligence was 25%, Winn-Dixie asserts “the trial court erred in requiring Winn-Dixie to pay more than 25%” because more than 25% does not accord with “the thrust of the comparative negligence doctrine * * * *”
Assessment of costs is within the discretion of the trial court. We will not interfere with the trial court’s discretionary assessment except when discretion is abused. NMSA 1978, Civ.P.R. 54(d) (Repl.Pamp.1980); Hales v. Van Cleave, 78 N.M. 181, 429 P.2d 379 (Ct.App. 1967). The liability cost assessment of 30% relates to Winn-Dixie’s direct liability for $37,500 of the net award to plaintiff of $120,000. However, a direct relation of percentage of fault to costs is not required, the matter being in the trial court’s discretion. Compare South v. Lucero, 92 N.M. 798, 595 P.2d 768 (Ct.App.1979). No abuse of discretion has been shown.
Having found no error in the trial court’s judgment on the issues discussed, we affirm. Appellant shall bear the cost of this appeal.
IT IS SO ORDERED.
WOOD and HENDLEY, JJ., concur. | [
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OPINION
GARCIA, Judge.
In 1982, plaintiff, David Stone (Stone), purchased a twenty-acre tract of land from the City of Portales (City). The City had owned the tract since at least 1942. Defendants Herman and Fern Rhodes (Rhodes) own the property that borders the tract on both the north and west sides. At the time Stone purchased the tract, it had been fenced on all four sides and the Rhodes were leasing it from the City. The fencing on the north side, however, is not straight but jogs off to the southeast. At the point where the fence jogs, vestiges continue due east straight across the northern boundary. The jog begins approximately halfway along the northern fence and has created a triangular strip in the northeast corner of the property. The controversy centers around the claims of ownership along the common boundary, and Rhodes’ claim to an easement across the triangular strip.
In 1985, Stone had his land surveyed. Thereafter, in conformity with the survey, Stone attempted to refence the property including the triangular strip. Rhodes interfered and prevented Stone from constructing the fence. Stone subsequently filed a petition for declaratory judgment asking the trial court to determine the valid boundaries between the properties.
The trial court found that the fence and vestiges between the tracts had existed for more than thirty years and had been ac quiesced in and recognized as the true boundary line between the tracts by both the City and Rhodes and their predecessors. In conclusion, the trial court determined that there existed clear and convincing evidence that the true boundary of Stone’s property included not only that property already fenced but that northeast triangular portion which jogs. Accordingly, the trial court dismissed Stone’s petition with prejudice. Stone appeals.
Stone raises three issues on appeal, two of which concern the finding of acquiescence, and a third dealing with Stone’s right to fence around the triangular strip, as to which the trial court made no finding. Because we hold that the doctrine of acquiescence has no application against a governmental entity, we need not reach Stone’s third issue. This appeal presents a matter of first impression: whether, by acquiescence, a party can obtain an ownership interest in property owned by a governmental entity, here, a municipality. We hold he cannot, and reverse.
Initially, we recognize that the trial court’s judgment is inconsistent with its findings of fact and conclusions of law. Although the trial court concluded that the triangular strip of property belonged to Stone, the court then dismissed Stone’s petition and granted Rhodes’ counterpetition. Rhodes’ counterpetition, however, asked the trial court to recognize the then existing fence dividing the properties as the true common boundary. In essence, given the specific wording on Rhodes’ counterpetition, Rhodes asked the trial court to grant legal ownership in the triangular strip to him. Rhodes admitted, however, both at trial and on appeal, that at no time was he claiming ownership in the strip. Accordingly, we note the ambiguity and hold, consistent with the trial court’s findings and conclusions, that Stone owns the triangular strip.
Acquiescence is an accepted principle for settling boundary disputes. Platt v. Martinez, 90 N.M. 323, 563 P.2d 586 (1977). A boundary may be established by long-recognition of the abutting owners, amounting to acquiescence. Cauble v. Beals, 96 N.M. 443, 631 P.2d 1311 (1981); Thomas v. Pigman, 77 N.M. 521, 424 P.2d 799 (1967). The doctrine of acquiescence is principally based on an agreement, expressed or implied, of adjoining landowners, whereby they recognize or acquiesce in a certain line as the true boundary of their properties. Montgomery v. Sellers, 48 Or.App. 719, 618 P.2d 5 (1980). Generally, in order to prevail under the doctrine of acquiescence, a party must show by clear and convincing evidence that he and his neighbor recognize a physical boundary as the true dividing line of their property. Heriot v. Lewis, 35 Wash.App. 496, 668 P.2d 589 (1983). The doctrine is premised on the presumption of an agreement between the parties fixing the dividing line between the properties through the long continued maintenance of a fence or other monument. The “boundary” is given such credence that after a certain period of time has lapsed, in the interest of peace and quiet, this dividing line is recognized as the true boundary dividing the properties. The purpose behind the doctrine lies somewhere between those supporting adverse possession and estoppel. Florence v. Hiline Equip. Co., 581 P.2d 998 (Utah 1978).
The doctrine of acquiescence, however, applies only to privately owned land and not to government land. In New Mexico, the State Land Commissioner, alone, has absolute dominion over state land. N.M. Const, art. XIII, § 2; In re Application of Dasburg, 45 N.M. 184, 113 P.2d 569 (1941). Accordingly, all New Mexico state land is to be disposed of as provided by law. N.M. Const, art. XIII, § 1. The majority rule is that title to land held by the state, in any capacity, cannot be obtained by adverse possession because the state cannot be bound by the defaults or negligence of her officers or agents. Sears v. Fair, 397 P.2d 134 (Okl.1964). Likewise, the public cannot lose its right in government lands because the government’s agents chose not to resist an en croachment by one of its own members whose duty it was, as much as any other citizen, to protect the state. Trigg v. Allemand, 95 N.M. 128, 619 P.2d 573 (Ct.App.1980) (citing Kempner v. Aetna Hose, Hook & Ladder Co., 394 A.2d 238 (Del.Ch., 1978)).
Moreover, in New Mexico a party may not obtain an easement by prescription over governmental property. Burgett v. Calentine, 56 N.M. 194, 242 P.2d 276 (1951). Unlike adverse possession, however, a party obtaining an easement by prescription obtains only the right to use of the land, and not ownership. See Hester v. Sawyers, 41 N.M. 497, 71 P.2d 646 (1937). Accordingly, we hold that since a private party cannot obtain mere use rights against state land, legal title against such lands likewise cannot be obtained by that party. Accordingly, we hold that title to state land cannot be obtained pursuant to the doctrine of acquiescence. This rule, likewise, applies to municipalities.
In the present case, the City owned the property from 1942 until 1982 when Stone purchased it. Thus, during that forty-year period, irrespective of the fact that the fence surrounding the tract did not include the northeast triangle, the Rhodes’ could not have obtained any interest, whatsoever, in the property regarding ownership or use, except the interest they maintained as lessees. When ownership in the tract was transferred from the City to Stone, however, the Rhodes’ claim of boundary by acquiescence began. Stone’s 1985 declaratory judgment suit, however, interrupted any acquiescence and, accordingly, the Rhodes presently obtain no ownership interest in the property. See Burgett v. Calentine.
Since the issue was not raised nor argued at the trial court, we do not determine whether the Rhodes now maintain an easement interest in the triangle. Further, the party arguing the existence of an easement has the burden of proof. Tresemer v. Albuquerque Pub. School Dist., 95 N.M. 143, 619 P.2d 819 (1980). Thus, in order that Rhodes obtain an easement across the northeast corner of Stone’s property, the issue must be properly raised before the trial court and its existence proven by Rhodes. This, they have not done. Accordingly, because we determine that the Rhodes presently have no legally recognized easement rights in Stone’s property, we need not discuss whether Stone’s construction of a fence impinges upon that claimed right.
In conclusion, because the trial court based its determination on the doctrine of acquiescence and because we have determined that the doctrine was inapplicable here because of governmental ownership of the land, we hold that no legal boundary has, as of yet, been determined. Accordingly, we remand to the trial court for a factual determination, including the presentment of additional evidence, if necessary, to determine the true common boundary between the properties.
IT IS SO ORDERED.
BIVINS and FRUMAN, JJ„ concur. | [
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] |
OPINION
BIVINS, Judge.
Defendant appeals from his convictions for attempted trafficking by possession with intent to distribute, and conspiracy. Our calendar notice proposed summary affirmance. Defendant filed a memorandum in opposition and a motion to amend the docketing statement to rephrase his first issue. Defendant’s motion to amend the docketing statement is granted. Not persuaded by defendant’s memorandum, we affirm his convictions.
FACTS
A courier for Federal Express attempted to deliver a package addressed to defendant at a Clovis address. The package was addressed to “Steve Curry, 120Í W. 6th Street, Apt. # 8, Clovis, New Mexico 88101.” The courier was unable to get an answer at apartment No. 8, so he posted a delivery notice on the door of apartment No. 8 and left the package with Ms. Chavez, who lived in apartment No. 9. While Ms. Chavez was cleaning house, her three-year-old daughter opened the package and brought to the mother a bag containing a white powdery substance. Ms. Chavez believed the white powder to be cocaine. She removed the delivery notice from the door of apartment No. 8 and then went to the Clovis Police Department, where she turned over the delivery notice and the package to Officer Casarez. Ms. Chavez then returned to her apartment.
Officer Casarez turned the package over to Detective Rice of the Clovis Police De partment Narcotics Section. The package contained a 9" X 12" envelope, two letter-size envelopes containing plastic bags of white powder, and one letter-size envelope containing twenty-four empty plastic bags, approximately 1" X 2" in size. Detective Rice tested the two bags containing white powder. The tests were positive for cocaine and amphetamine.
That afternoon, while Ms. Chavez was at her apartment with a friend, Ms. Valencia, defendant came to the door. Ms. Valencia answered the door, at which time defendant stated that he had called Federal Express about a package and learned it had been left with a “T. Chavez” at apartment No. 9. He asked Ms. Valencia if there was any package for him and she informed him that there was not. Defendant told her to look for a package, which she did, and she again told him there was no package. Detective Rice telephoned Ms. Chavez, at which time Ms. Chavez informed him that defendant had been to her apartment. Detectives Rice and Farkas then drove to the apartments at 1201 W. 6th Street in an unmarked vehicle and parked.
Ms. Chavez and Ms. Valencia attempted to leave apartment No. 9 when they were confronted by defendant. Defendant told Ms. Chavez that Federal Express had told him his package had been delivered to her. Ms. Chavez informed defendant she had placed the package between the screen and the front door of apartment No. 8. Ms. Chavez and Ms. Valencia got in their car and left. Detectives Rice and Farkas followed them to the State Police Complex where the details of the latest encounter with defendant were related to the detectives. When Ms. Chavez and Ms. Valencia returned to the apartments, defendant again confronted Ms. Chavez and asked about the package. Detective Rice obtained an arrest warrant and defendant was arrested later that evening.
DISCUSSION
1. Whether Attempted Trafficking by Possession with Intent to Distribute is a Crime Under New Mexico Law
Defendant maintains that an attempted violation of NMSA 1978, Section 30-31-20(A)(3) (Repl.Pamp.1987) is not a crime under New Mexico law. Under Section 30-31-20(A)(3), trafficking is defined as “possession with intent to distribute any controlled substance * * * * ” Under the general attempt statute, NMSA 1978, Section 30-28-1 (Repl.Pamp.1984), “[a]ttempt to commit a felony consists of an overt act in furtherance of and with intent to commit a felony and tending but failing to effect its commission.” Defendant argues that without possession there can be no intent to distribute. We disagree.
The package containing cocaine was addressed to defendant and he attempted to pick up the package on three different occasions. It is reasonable to infer that defendant intended to possess the package based on the fact that it was addressed to him and he tried to pick up the package. Defendant does not dispute that the amount of cocaine found in the package was inconsistent with personal use. Intent to distribute may be inferred when the amount of a controlled substance possessed is inconsistent with personal use. See State v. Donaldson, 100 N.M. 111, 666 P.2d 1258 (Ct.App.1983); State v. Quintana, 87 N.M. 414, 534 P.2d 1126 (Ct.App.), cert. denied, 423 U.S. 832, 96 S.Ct. 54, 46 L.Ed.2d 50 (1975).
Based on the amount of cocaine found in the package, it may be inferred that defendant intended to distribute the cocaine. Defendant failed to effect the crime of possession with intent to distribute because he never actually possessed the package. Nevertheless, the fact that defendant never actually possessed the package does not negate his intent to possess the package, as evidenced by defendant attempting to pick up the package, nor does it negate his intent to distribute the cocaine, as is evidenced by the amount of cocaine found in the package. Therefore, it is possible for a person to intend to possess a controlled substance and further to intend to distribute that controlled substance without the person actually possessing the controlled substance.
Defendant argues that one cannot attempt to have an intent. Defendant is not charged with attempted intent to distribute, but with attempted possession with intent to distribute. The attempt in this case is the attempt to possess the cocaine. As illustrated above, the attempt to possess the cocaine can be inferred from defendant’s attempt to pick up the package and the intent to distribute can be inferred solely from the amount of cocaine.
Arguing against his conviction for attempted trafficking, defendant points out that other jurisdictions have specific legislative enactments proscribing attempted trafficking. Although New Mexico has no specific statute proscribing attempted trafficking, our supreme court has applied the general attempt statute to the offense of trafficking cocaine by distribution. See State v. Lopez, 100 N.M. 291, 669 P.2d 1086 (1983). Since defendant can intend to distribute a controlled substance without actually possessing the substance, we see no reason why the general attempt statute should not be applied to the offense of trafficking by possession with intent to distribute.
2. Constitutionality of Section 30-31-20(A)(3)
Defendant contends that Section 30-31-20(A)(3) has been applied in an overbroad and unconstitutional manner. A statute is unconstitutionally overbroad if it not only forbids conduct constitutionally subject to proscription, but also sweeps within its ambit those actions ordinarily deemed to be constitutionally protected. State v. Gattis, 105 N.M. 194, 730 P.2d 497 (Ct.App.1986). Defendant has failed to show that Section 30-31-20(A)(3) sweeps within its ambit actions that would ordinarily be deemed to be constitutionally-protected activities.
Based on the reasons stated above, we affirm defendant’s convictions.
IT IS SO ORDERED.
GARCIA and APODACA, JJ., concur. | [
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OPINION
DONNELLY, Chief Judge.
Petitioner appeals from an order of the district court affirming an administrative order revoking his driver’s license pursuant to the New Mexico Implied Consent Act, NMSA 1978, Sections 66-8-105 to -112 (Repl.Pamp.1987). The second calendar notice proposed summary affirmance. Petitioner has responded with a timely memorandum in opposition. We are not persuaded by his memorandum, and affirm.
Petitioner was arrested for driving while under the influence of intoxicating liquor, in violation of NMSA 1978, Section 66-8-102 (Repl.Pamp.1987). He refused to submit to a chemical test to determine the alcohol content of his breath or blood. Pursuant to Section 66-8-111, the director of the Motor Vehicle Division of the New Mexico Transportation Department revoked petitioner’s driver’s license for a period of one year. Petitioner protested the revocation and the division held an administrative hearing at which petitioner argued in opposition to the division’s action. Following the hearing, the hearing officer upheld the revocation of petitioner’s license, and petitioner appealed to the district court of Bernalillo County. The district court affirmed the hearing officer’s decision and this appeal ensued.
Petitioner argues that an arrest for driving under the influence in violation of Section 66-8-102 does not trigger the provisions of the Implied Consent Act. He maintains that the Implied Consent Act requires both reasonable grounds to believe that a driver has been driving under the influence, and an arrest, before the driver’s license may properly be revoked. Petitioner also contends that the requisite arrest must be for an offense different than driving under the influence. See Section 66-8-102. He reaches this conclusion by reasoning that the Act assumes that an arrest will be based on probable cause, and that there would have been no need for the legislature to require both an arrest and reasonable grounds, unless the legislature intended that the arrest must be for an offense other than driving under the influ ence. Petitioner contends that, under the Act, a driver’s license may be revoked only if the arresting officer has reasonable grounds to believe the driver was driving under the influence, and the driver was arrested for a different offense. We disagree.
Section 66-8-lll(B) mandates that the director of the Motor Vehicle Division revoke a driver’s license upon receipt of a statement signed by a law enforcement officer, stating that the officer had reasonable grounds to believe that the driver was driving a motor vehicle within New Mexico while under the influence of intoxicating liquor or a controlled substance. The driver must also have been arrested. The statutory requirements for existence of both reasonable grounds to believe that the driver was driving under the influence and requiring his arrest are not mutually exclusive, but are complementary. § 66-8-102. Reasonable grounds alone are not sufficient to support a revocation. The officer must also arrest the driver, based on reasonable grounds as specified in Section 66-8-lll(B). Similarly, an arrest alone is not sufficient.
Petitioner argues that the language of the Implied Consent Act is clear, and that the courts may not interpret the statute contrary to its plain meaning. We agree that the language is clear, but disagree with petitioner’s interpretation. The Implied Consent Act requires that a driver’s license shall be revoked when: (1) a driver is arrésted in this state for an offense enumerated in the Motor Vehicle Code, NMSA 1978, Sections 66-1-1 to 66-8-137.1 (Repl.Pamp.1984, Cum.Supp.1987 & Repl. Pamp.1987); (2) the arresting officer has reasonable grounds to believe the driver was driving under the influence; and (3) the driver refuses to take a breath or blood alcohol test after he or she has been advised of the consequences of refusal. See § 66-8-111. This language includes arrests for driving under the influence contrary to Section 66-8-102, as well as other violations of the Motor Vehicle Code. Petitioner’s interpretation of the Implied Consent Act would do violence both to the express language of the Act and to its purpose. The purpose of the Act is to deter individuals from driving while under the influence and endangering the lives and property of others. We decline to adopt the narrow and restrictive interpretation urged by petitioner and, instead, apply the clear language of the Act upholding the validity of the revocation of petitioner’s license.
The decision of the trial court is affirmed.
IT IS SO ORDERED.
ALARID and MINZNER, JJ., concur. | [
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OPINION
SCARBOROUGH, Chief Justice.
James L’Allier filed a complaint against Brian Turnacliff seeking recovery for personal injuries sustained in an automobile accident in which L’Allier alleged Turnacliff operated a 1983 Porsche in an unlawful and tortious manner. Turnacliff had in effect an insurance policy with State Farm Insurance Company which provided liability insurance coverage for a 1985 Pontiac automobile he owned. Turnacliff answered the L’Allier complaint and tendered his defense to State Farm. State Farm intervened and sought a declaratory judgment that it was not obliged either to defend or indemnify Turnacliff. The trial court granted State Farm’s motion for summary judgment. Turnacliff appeals and argues that the trial court improperly construed the newly acquired car provision of the State Farm policy. We affirm.
Turnacliff, a Santa Fe County resident, traveled to California and negotiated the purchase of a 1983 Porsche on or around October 21, 1986. As a result of the negotiations, the California seller gave Turnacliff the keys to the Porsche and permitted Turnacliff to drive the car back to New Mexico, agreeing that further financial arrangements for payment would be made with Turnacliff’s father. On November 3, the title to the car was transferred to Turnacliff with a notation that payment was made on October 28. On November 26, while driving the Porsche, Turnacliff collided with L’Allier on Cordova Road in Santa Fe. The relevant language in Turnacliff’s State Farm insurance policy states:
Newly Acquired Car — means a car newly owned by you * * * if it * * * is an added car and * * * [is] owned by you * * * on the date of its delivery to you * * * but only if you tell us about it within 30 days after its delivery to you * * * and pay us any added amount due.
(emphasis in original).
The dispositive issue on appeal is whether, as a matter of law, the thirty-day notice period under the newly acquired car provision in Turnacliff s automobile insurance policy began to run when Turnacliff took delivery of the car. We hold that delivery is a critical element of ownership of a car, and when the circumstances indicate that the parties intended for ownership of the car to pass, delivery of the car is sufficient to trigger the running of the newly acquired car provision in an automobile insurance policy.
In this case, the dispute centers upon whether Turnacliff “owned” the car at the time of delivery on October 21, 1986. Turnacliff argues that although he had accepted delivery of the Porsche on or around October 21, the newly acquired car provision in his policy did not begin to run until he acquired an insurable interest in the car on October 28, the date the parties intended title to pass and Turnacliff became the “legal owner” of the car. Turnacliff points us to the definition of insurable interest set forth in Universal C.I.T. Corp. v. Foundation Reserve Ins. Co., 79 N.M. 785, 450 P.2d 194 (1969).
It is well settled that any person has an insurable interest in property, by the existence of which he will gain an advantage, or by the destruction of which he will suffer a loss, whether he has or has not any title in, or lien upon, or possession of the property itself.
Id. at 786, 450 P.2d at 195 (citations omitted). Clearly, a person may have an insurable interest in property without actually having “title” to the property. See Forsythe v. Central Mut. Ins. Co., 84 N.M. 461, 505 P.2d 56 (1973) (ultimate issue is not whereabouts of the legal title, but rather which party or parties have insurable interests).
According to the policy language, the newly acquired car provision began to run when the newly acquired car was “owned” and “delivered” to Turnacliff. Both parties agree that title to property passes when the parties intend it should pass. See Knotts v. Safeco Ins. Co. of America 78 N.M. 395, 432 P.2d 106 (1967). Furthermore, both agree that intent of the parties for title to pass is to be determined by reference to the facts and circumstances of each case. See Yahnke v. State Farm Fire and Casualty Co., 4 Ariz.App. 287, 419 P.2d 548 (1966); Everly v. Creech, 139 Cal.App.2d 651, 294 P.2d 109 (1956). The facts and circumstances of this case reveal that Turnacliff took delivery of the Porsche on October 21. Furthermore, the parties clearly intended that a sale take place on October 21. Title passed at the time of delivery. Only the details of payment and delivery of paper title remained to be completed. Turnacliff had an insurable interest at the time of delivery of the Porsche.
Finally, Turnacliff argues that payment of the premium is irrelevant. State Farm concedes that payment of the premium is irrelevant during the thirty-day period after delivery, and states correctly that without notice and premium payment, automatic insurance coverage expires when the thirty-day period ends. Turnacliff accepted delivery of the Porsche on October 21. He did not notify State Farm of the purchase, nor did he pay an additional premium within the thirty day period following delivery. Turnacliff had no coverage at the time of the accident. We affirm.
IT IS SO ORDERED.
SOSA, Senior Justice, and RANSOM, J., concur. | [
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] |
OPINION
STOWERS, Justice.
We have granted certiorari to consider whether the trial court correctly instructed the jury on the measure of damages in this action for negligent misrepresentation.
Respondents-plaintiffs, Cal and Keith Foutz, brought this case against petitioner-defendant, First Interstate Bank of Gallup (FIBG), for fraud and negligent misrepresentation in connection with a transaction involving the respondents, FIBG, and a nonparty, Robert Berni. The respondents claimed that they were fraudulently or negligently induced to enter into a continuing guaranty and a hypothecation agreement by an officer of FIBG, and sought rescission of these contracts. The trial court granted petitioner’s motion for a directed verdict on the fraud claim and on some of the claims of negligent misrepresentation, but denied the motion on the claim of negligent misrepresentation of the value of Berni’s assets. The jury returned a verdict in the amount of $75,000 for respondents and petitioner appealed. The court of appeals in a 2 to 1 decision affirmed the trial court. We agree with the dissenting opinion of the court of appeals and reverse and remand to the trial court to enter judgment for petitioner.
The basic facts are not in dispute and have been set out more fully in the court of appeals’ opinion. In 1981 the Foutzes entered into a business transaction with Berni. Each of the brothers contributed $50,-000 in cash to begin two businesses with Berni known as Buddy’s Used Cars and B & F Auto Service and Wrecker Service. Berni contributed a wrecker service, including a wrecker’s license and various car servicing equipment. The two businesses were managed and operated by Berni. Other than a written partnership resolution, there were no documents evidencing any contracts between the Foutzes and Berni. Thereafter, they had several disagreements about the operation of the businesses. In August 1981, Berni executed a $100,000 promissory note to Keith and Cal Foutz to reimburse them for their partnership investment. Berni made some payments on the note, but by December 1982 the note was past due.
In December 1982 or January 1983, the exact date is unclear in the record and briefs, Cal Foutz was told by an employee of FIBG that he was delinquent on a note. Since Cal was unaware of a past due note, he spoke with Kenneth Agee, who handled his accounts at FIBG and who was then its vice-president. Agee informed Cal that in September 1981 FIBG had extended Berni a $50,000 unsecured loan and in conjunction with this loan Berni had supplied FIBG with the partnership resolution. At the time of Cal’s meeting with Agee, the $50,-000 loan was past due and FIBG was looking to the Foutzes to make the payments.
After the initial meeting with Cal, another meeting was held with both Foutzes and Agee. FIBG agreed to loan Berni an additional $100,000 to pay the Foutzes’ promissory note and, thereby, increase Berni’s indebtedness to $163,703 (the other $63,703 was used to consolidate all of Berni’s outstanding loans with FIBG). The Foutzes agreed to put the $100,000 in a certificate of deposit (CD) at FIBG. The Foutzes also signed a continuing guaranty of this loan to Berni up to the amount of $150,000 as well as a hypothecation agreement pledging their CD as security for the loan to Berni (a hypothecation agreement gives a creditor a right over personal property belonging to another and the power to take or sell that property to satisfy the creditor’s claim). In the event Berni defaulted on his loan with FIBG, the hypothecation contract provided that the CD could be attached to satisfy Berni’s indebtedness. FIBG also took a security interest in all the assets of Buddy’s Used Cars and B & F Auto Service and Wrecker Service, and a security interest in Berni’s residence and some of his personalty. As a result of this transaction, the Foutzes obtained a return on their $100,000 partnership investment in the form of quarterly interest payments from the CD and Berni’s loans were consolidated and increased to $163,703.
The Foutzes received three quarterly interest payments on the CD for $7,200. Berni, however, defaulted on his loan. By a letter dated January 11, 1984, FIBG notified Cal that the bank had repossessed all collateral available to it under the loan agreement with Berni, and under the hypothecation agreement and continuing guaranty, it exercised its right to take the CD. At the time FIBG took the CD and applied it against the outstanding loan balance, there was a remaining balance in the amount of $21,741.08, which FIBG was expecting to satisfy out of the contract receivables from Buddy’s Used Cars.
At issue in this case is jury instruction No. 19 given by the trial court on the measure of damages available to respon dents in an action for negligent misrepresentation. That instruction, in relevant part, stated:
If you should decide in favor of the [respondents] on the question of liability, you must then fix the amount of money which will reasonably and fairly compensate them for any of the following elements of damages proved by the [respondents] to have resulted from the negligent misrepresentation as claimed: The value of the loss of the Certificate of Deposit. The value of the loss of interest on the Certificate of Deposit.
FIBG argues that this instruction is an improper statement of the damages under a theory of negligent misrepresentation because it instructs on the benefit of the bargain and not on actual out-of-pocket losses. The majority of the court of appeals did not agree with FIBG.
The court of appeals stated that the tort of negligent misrepresentation as articulated in the Restatement (Second) of Torts Section 552 (1977) was adopted in New Mexico in Stotlar v. Hester, 92 N.M. 26, 582 P.2d 403 (Ct.App.), cert. denied, 92 N.M. 180, 585 P.2d 324 (1978). Accord Garcia v. Rodey, Dickason, Sloan, Akin & Robb, P.A., 106 N.M. 757, 761-62, 750 P.2d 118, 122-23 (1988). Comments (a) and (b) to Section 552 indicate that damages for negligent misrepresentation are determined by out-of-pocket loss or reliance damages. That measure of damages is set forth in Section 552B and provides:
Damages for Negligent Misrepresentation
(1) The damages recoverable for a negligent misrepresentation are those necessary to compensate the plaintiff for the pecuniary loss to him of which the misrepresentation is a legal cause, including
(a) the difference between the value of what he has received in the transaction and its purchase price or other value given for it; and
(b) pecuniary loss suffered otherwise as a consequence of the plaintiffs reliance upon the misrepresentation.
(2) The damages recoverable for a negligent misrepresentation do not include the benefit of the plaintiffs contract with the defendant.
Restatement (Second) of Torts § 552B (1977). Because New Mexico follows the tort of negligent misrepresentation as set forth in the Restatement, it is not unreasonable to conclude that we would also follow the damages as set forth therein. Using 552B(l)(a) as the proper measure of damages, the court of appeals reasoned that, in the present case, the out-of-pocket loss was equal to the difference between the amount the Foutzes gave and the amount they received in the secured transaction with FIBG. In other words, the difference between what the Foutzes gave, a $100,000 CD plus unpaid interest, and what they received, nothing, was $100,000 plus interest. The majority opinion concluded that because the Foutzes gave the $100,000 CD and received nothing the value of the CD plus interest represented their out-of-pocket loss and instruction No. 19 correctly stated that measure of damages.
Jury instructions must state the law correctly and be based on the evidence. Pittard v. Four Seasons Motor Inn, Inc., 101 N.M. 723, 727, 688 P.2d 333, 337 (Ct.App.), cert. quashed, 101 N.M. 555, 685 P.2d 963 (1984). “All instructions must be read together and, if they fairly present the issues and the applicable law, they are sufficient.” Id. Reversal is warranted where the party complaining of faulty instructions shows evidence of prejudice. Jewell v. Seidenberg, 82 N.M. 120, 124, 477 P.2d 296, 300 (1970).
The dissent in the court of appeals’ opinion agreed that the proper measure of damages in the present case is the out-of-pocket loss and not the benefit of the bargain, but disagreed that instruction No. 19 corresponds to that out-of-pocket loss or that respondents’ proof established any out-of-pocket losses. Thus, the trial court’s instruction could be considered a correct statement of damages if respondents’ argument was accepted that what they gave in the transaction with FIBG was the $100,-000 CD; otherwise jury instruction No. 19 instructed on the benefit of the bargain, an inapplicable measure of damages in negligent misrepresentation.
We agree with the dissent that the instruction was on the benefit of the bargain and not on any out-of-pocket losses. At the time of the transaction with FIBG, the Foutzes had a past due $100,000 unsecured promissory note from Berni. No principal payments and only interest payments total-ling $3,400 had been made on the note even though the Foutzes should have received $40,000 by then. FIBG had four outstanding loans to Berni with balances totalling $63,703. These loans were secured by personalty and Berni’s mobile home. Berni wanted to consolidate them and in exchange was willing to give the bank a security interest in all of his business assets and in his personal residence. To refinance Berni’s loans, the bank gave the Foutzes a $100,000 CD that retired the unsecured promissory note from Berni. In exchange for the CD, the Foutzes agreed to hypothecate that CD as security for the Berni loan of $163,703, and also to sign a continuing guaranty of the Berni loan up to $150,000.
The dissent correctly pointed out that the Foutzes would not have had the CD had FIBG not advanced that amount of money to Berni. FIBG certainly did not advance without any expectation of security or collateral in return that additional $100,000 to Berni so that he could pay off the Foutzes’ promissory note. Instruction No. 19 directed the jury to award respondents the value of the CD, plus the value of the loss of the interest on the CD, if the jury found for respondents. The instruction allowed the Foutzes to recover the benefit of their bargain with FIBG and actually placed them in a better position than they occupied before entering into the transaction. As a result, the jury verdict in favor of respondents, which was for $75,000, represented the CD less 25 percent fault apportioned to respondents and Berni. Thus, the Foutzes recovered the benefit of their bargain, not their out-of-pocket losses.
The damages the Foutzes could have recovered under a theory of negligent misrepresentation, as set out in the Restatement, was the consideration they gave for entering into the transaction minus any value they received from that transaction, plus any pecuniary loss proximately resulting from reliance on the misrepresentation. The loss of the CD does not represent the difference between the value of what was received and its purchase price. Nor does it represent any other pecuniary loss as a result of reliance on the misrepresentation. It cannot be a pecuniary loss because the Foutzes would not have had the CD if they had not entered into the transaction with the bank, and, agreed that the CD could be attached if Berni defaulted. The Foutzes failed to present substantial evidence of any out-of-pocket damages they sustained as a result of their transaction with FIBG.
The verdict of the district court is reversed and judgment is entered in favor of petitioner.
IT IS SO ORDERED.
SCARBOROUGH, C.J., and RANSOM, J., concur.
WALTERS, J., specially concurs.
SOSA, Senior Justice, dissents. | [
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OPINION
BUSTAMANTE, Judge.
The Motor Vehicle Division (MVD) revoked Appellant Kenneth Marez’ (Marez) driver’s license pursuant to the New Mexico Implied Consent Act. NMSA 1978, §§ 66-8-105 through 66-8-112 (Repl.Pamp.1994). The revocation was based on Marez’ refusal to take a breath-alcohol test. Marez appealed to the district court of Bernalillo County. The district court affirmed the revocation. Marez now appeals the district court’s affirmance. We are asked to address whether the Implied Consent Act and the criminal driving-while-intoxicated (DWI) charging statute, NMSA 1978, Section 66-8-102 (Repl. Pamp.1994), are unconstitutional, in that they violate Marez’ Fifth Amendment privilege against self-incrimination and his Sixth Amendment right to counsel. We hold that there was no violation of Marez’ constitutional rights and that Marez has no standing to challenge the constitutionality of Section 66-8-102.
FACTS
On January 24, 1994, Marez was arrested and transported to the Bernalillo County Detention Center (BCDC). Marez does not challenge the arrest as such. At the BCDC the required provisions of the Implied Consent Act were read to him, advising him, among other things, that if he refused to submit to a chemical test of his breath, he could have his driver’s license revoked for a period of one year. Sections 66-8-lll(B), 66-8-112(E)(4)(b). Marez was then asked to submit to a breath test in order to determine his blood-alcohol level. Marez was not advised that he had the right to an attorney at that time; nor was he advised that he had the right to remain silent prior to submitting, or refusing to submit, to the breath test. Marez verbally indicated his refusal to submit to chemical testing of his breath.
At both the MVD revocation hearing and the district court hearing on the appeal, Marez argued that Section 66-8-102(D)(3), which added refusal to submit to chemical testing under the Implied Consent Act as an alternative basis for charging aggravated DWI, deprived him of his Fifth and Sixth Amendment rights because Marez was placed in the position of committing a crime if he refused the breath test. Marez argues this was improper because, at the same time, he was informed he could not consult with counsel before he made his decision whether to refuse the breath test, and the police officers did not provide Marez the standard Miranda warning before he was requested to decide if he would take the breath test. Miranda v. Arizona, 384 U.S. 436, 86 S.Ct. 1602, 16 L.Ed.2d 694 (1966). Marez asserted below and asserts here that the statutes cannot be applied constitutionally in the context of a civil revocation proceeding if they are unconstitutional in the criminal context.
The district court affirmed the revocation of Marez’ driver’s license. The court held that Marez’ oral refusal to take a breath test was not testimonial, and therefore his right to remain silent was not compromised. The court also found Marez was not entitled to consult with an attorney prior to manifesting his decision to refuse to submit to the breath test. The court found the Implied Consent Act and related statutory sections constitutionally valid, and held that Marez’ refusal to take the breath test was properly admitted as evidence against him at the administrative revocation hearing.
DISCUSSION
There is a well-established line of cases in both the New Mexico courts and the United States Supreme Court that approves the use of implied consent acts as a valid exercise of the police power of the state. See In re McCain, 84 N.M. 657, 660, 506 P.2d 1204, 1207 (1973); South Dakota v. Neville, 459 U.S. 553, 103 S.Ct. 916, 74 L.Ed.2d 748 (1983); State v. Sandoval, 101 N.M. 399, 683 P.2d 516 (Ct.App.1984). The provisions of the New Mexico Implied Consent Act essentially declare that the driver of a motor vehicle in this state impliedly consents to administration of a breath-alcohol test when arrested for any driving offense allegedly committed while under the influence of intoxicating liquor. Section 66-8-107. Upon refusal to take a test, no test may be administered in the absence of a search warrant, but the driver’s license can be revoked based solely on - the refusal. Section 66-8-111; State v. Richerson, 87 N.M. 437, 440, 535 P.2d 644, 647 (Ct.App.), cert. denied, 87 N.M. 450, 535 P.2d 657 (1975).
Under the New Mexico Implied Consent Act, evidence of a refusal to take a breath test is specifically admissible in a civil proceeding to revoke a person’s driver’s license. See Section 66-8-112(E)(4)(a). Additionally, in a criminal prosecution, our courts have held that evidence of a refusal is properly admitted to show consciousness of guilt or fear of test results. McKay v. Davis, 99 N.M. 29, 32, 653 P.2d 860, 863 (1982).
Marez contends that the entire body of civil implied consent case law, like the walls of Jericho, has now come tumbling down. Marez reaches his conclusion by asserting that the entire New Mexico DWI statutory scheme is unconstitutional as a result of the amendments to the criminal DWI statute that took effect in 1994. Marez focuses on Section 66-8-102(D). The amendment to the criminal DWI statute creates a new offense entitled “Aggravated DWI.” One potential element of aggravated DWI is the refusal to submit to chemical testing under the Implied Consent Act. Section 66-8-102(D)(3) states:
D. Aggravated driving while under the influence of intoxicating liquor or drugs consists of a person who:
(3) refused to submit to chemical testing, as provided for in the Implied Consent Act [66-8-105 to 66-8-112 NMSA 1978], and in the judgment of the court, based upon evidence of intoxication presented to the court, the person was under the influence of intoxicating liquor or drugs.
Marez asserts that since Section 66-8-102(D)(3) makes refusal of a breath-alcohol test a potential element of aggravated DWI, it is unconstitutional on its face. Marez takes this argument a step further and asserts that if Section 66-8-102(D)(3) is unconstitutional in a criminal setting, the Implied Consent Act is also unconstitutional, on its face and as applied, in both criminal and civil contexts because it may potentially be used to violate constitutional rights in the criminal prosecution.
We reject this “guilt by association” argument and hold that the Implied Consent Act is not rendered unconstitutional in the civil context just because a refusal to take a breath test under the Implied Consent Act may be used as an element of the criminal offense of aggravated DWI. The constitutional right to counsel is solely a right to counsel in “criminal prosecutions.” U.S. Const, amend. VI. See State v. Bristor, 236 Kan. 313, 691 P.2d 1, 2 (1984) (the United States Constitution Sixth Amendment right to representation by counsel applies only to the criminal defendant). Similarly, the privilege against self-incrimination protects a person from the use of certain evidence only if the evidence is to be offered in a “criminal case.” U.S. Const, amend. V. See Village of Menomonee Falls v. Kunz, 126 Wis.2d 143, 376 N.W.2d 359, 361-62 (Ct.App.1985).
Further, the civil revocation hearing contemplated by the Implied Consent Act and the criminal DWI prosecution are independent of each other and, as a result, one does not necessarily affect the outcome of the other. For example, a refusal to take the breath-alcohol test can support revocation of a driver’s license despite acquittal or dismissal of the criminal DWI charge. See McCain, 84 N.M. at 662, 506 P.2d at 1209; Price v. Reed, 725 P.2d 1254, 1260 (Okla.1986). See also State v. Bishop, 113 N.M. 732, 832 P.2d 793 (Ct.App.) (decision in civil revocation proceeding that the breath test given to defendant was not administered pursuant to the provisions of the Implied Consent Act is not binding on the subsequent criminal proceeding), cert. denied, 113 N.M. 690, 831 P.2d 989 (1992).
We need not consider the constitutionality of Section 66-8-102(D). If this appeal involved a criminal prosecution of Marez under that provision, a constitutional challenge would be appropriate. But this appeal concerns only the license-revocation proceeding. The record does not reveal whether any criminal prosecution was undertaken against Marez or whether any criminal penalties were assessed against him. Marez thus lacks standing to argue the unconstitutionality of the criminal statute. See De Vargas Sav. & Loan Ass’n v. Campbell, 87 N.M. 469, 473, 535 P.2d 1320, 1324 (1975) (“[T]o attain standing in a suit arguing the unlawfulness of governmental action, the complainant must allege that he is injured in fact or is imminently threatened with injury, economically or otherwise.”).
Marez attempts to avoid the standing question with his argument of global unconstitutionality. Constitutional review is not so blunt an instrument as envisioned by Marez. There are numerous examples of statutory provisions which have been selectively reviewed and deemed unconstitutional without affecting the viability of companion, non-offensive provisions. See, e.g., Giant Indus. Arizona v. Taxation & Revenue Dep’t, 110 N.M. 442, 444, 796 P.2d 1138, 1140 (Ct.App.1990) (“It is a fundamental principle that a part of a statute may be invalid and the remainder valid, where the invalid part can be separated from other portions, without impairing the force and effect of the remaining portions.”); Bradbury & Stamm Constr. Co. v. Bureau of Revenue, 70 N.M. 226, 230-31, 372 P.2d 808, 812-13 (1962). It is now a commonplace technique of legislative drafting to provide for survival of non-affected provisions if portions of a statute or regulation are found to be invalid. The statute that enacted Section 66-8-102(D) includes just such a severability provision. 1993 N.M. Laws, ch. 66, § 7. There is simply no reason why the purported unconstitutionality of the criminalization of the refusal to submit to chemical testing should affect the Implied Consent Act in other contexts.
CONCLUSION
We affirm the district court’s decision.
IT IS SO ORDERED.
HARTZ and PICKARD, JJ., concur. | [
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OPINION
BIVINS, Judge.
Defendant appeals a conviction for one count of great bodily injury by a motor vehicle, contrary to NMSA 1978, Section 66-8-101 (Repl.Pamp.1987). He raises three issues: (1) whether the prosecution improperly used one of its peremptory challenges to excuse a member of defendant’s race; (2) whether the trial court improperly excused a potential juror for cause; and (3) whether the statute under which he was charged and convicted is unconstitutionally vague. Defendant also renews his motion to amend his docketing statement to assert three additional issues, first raised in his memorandum in opposition to the first calendar notice by way of motion to amend the docketing statement. The motion was denied in the second calendar notice. We have reconsidered the denial and affirm it. The issues raised by defendant in his motion to amend the docketing statement are without merit. See State v. Rael, 100 N.M. 193, 668 P.2d 309 (Ct.App.1983). We are not persuaded by defendant’s other contentions and, therefore, affirm.
Defendant was involved in an automobile accident in which he hit another vehicle driven by the victim head-on. There was evidence presented at the trial that defendant had been driving while intoxicated. The victim suffered a fracture to the hip, resulting from the femur being driven back into the hip joint. The orthopedic surgeon who treated the victim testified regarding the treatment the victim had to undergo, which included an operation to insert pins in the bone to hold it in place while it healed. The surgeon testified regarding the normal healing time and the time it took the victim to heal. The surgeon also testified regarding rehabilitation time. The victim testified regarding his injury and rehabilitation. Based on all the evidence presented at trial, the jury convicted defendant.
JURY CHALLENGES
(a) Preliminary
Initially, we note that facts have been argued in the briefs that are not a part of the record. The facts are based on jury questionnaires, which were not made part of the record even though the trial court offered to do so. It is defendant’s burden to bring up a record sufficient for review of the issues he raises on appeal. See State v. Padilla, 95 N.M. 86, 619 P.2d 190 (Ct.App.1980). If he does not, all inferences will be resolved in favor of the trial court’s ruling. Id. This court will not consider any references made to the jury questionnaires. See Southern Union Gas Co. v. Taylor, 82 N.M. 670, 486 P.2d 606 (1971).
(b) Claim of Discriminatory Peremptory Challenge
Defendant argues that the prosecution improperly exercised a peremptory challenge against a potential juror of de fendant’s race. At voir dire, defense counsel had informed the trial court and the panel that both defendant and the victim are Navajo Indians. No questions were asked of any potential jurors regarding their race. During selection of the panel, the prosecution exercised a peremptory challenge against Ms. Clah. Defense counsel objected that Ms. Clah is a Navajo Indian and, therefore, the prosecution had to state the reasons for the challenge. The prosecution responded that, other than her appearance, there was no showing that Ms. Clah was of the same race as defendant, and that Ms. Clah was struck on the basis of her questionnaire. After some discussion regarding the questionnaire, the trial court allowed the challenge.
The state’s power to use peremptory challenges in criminal trials is limited by the equal protection clause of the federal Constitution. Batson v. Kentucky, 476 U.S. 79, 106 S.Ct. 1712, 90 L.Ed.2d 69 (1986); State v. Goode, 107 N.M. 298, 756 P.2d 578 (Ct.App.1988); State v. Sandoval, 105 N.M. 696, 736 P.2d 501 (Ct.App.1987). These cases hold that the state may not use its peremptory challenges in a racially-discriminatory manner to exclude members of a cognizable racial group from a jury simply because of such membership. They hold that a claim of discriminatory use of peremptory challenges must be examined under a two-step process. First, defendant must make a prima facie showing that the state’s challenges were exercised in a purposefully discriminatory manner. After defendant has made the requisite showing, the burden shifts to the state to come forward with a racially-neutral explanation for its challenges.
In order to establish a prima facie case, defendant must show that: (1) he is a member of a cognizable racial group; (2) the state has exercised its peremptory challenges to remove members of that group from the jury panel; and (3) these facts and any other relevant circumstances raise an inference that the state used its challenges to exclude members from the panel solely on account of their race. Batson v. Kentucky; State v. Goode; State v. Sandoval. In this case, there was no question that defendant is a Navajo Indian. However, there was a question raised about Ms. Clah’s race. She was not asked about her race and the only indication that she is a Navajo Indian, other than her appearance, was found on her questionnaire, which stated that she was bom and lived in Shiprock. We note the prosecution did not, however, contest the trial judge’s statement that Ms. Clah appeared to be a Navajo Indian.
Even assuming Ms. Clah is a Navajo Indian, defendant failed to show that an inference was raised that the state was using its challenges to exclude Navajo Indians from the jury panel. Meeting the first two criteria alone does not establish a prima facie case. The facts and circumstances surrounding the use of the challenge must raise the inference that the prosecution used the peremptory challenge to exclude persons from the jury on account of race. See Batson v. Kentucky; United States v. Chalan, 812 F.2d 1302 (10th Cir. 1987), petition for cert, filed August 8, 1988; United States v. Ratcliff, 806 F.2d 1253 (5th Cir.1986), cert. denied, 481 U.S. 1004, 107 S.Ct. 1625, 95 L.Ed.2d 199 (1987); People v. Staten, 746 P.2d 1362 (Colo.App. 1987); People v. Chevalier, 159 Ill.App.3d 341, 111 Ill.Dec. 460, 512 N.E.2d 1001 (1987); State v. Cantu, 750 P.2d 591 (Utah 1988). Some of the circumstances which will raise an inference of racial discrimination are: (1) a showing by defendant that his racial group is substantially underrepresented on the jury; (2) the susceptibility of the case to racial discrimination as, for example, where defendant and the victim are of different races; and (3) a showing that the state’s challenges have caused the jury to contain no members of defendant’s race. State v. Goode.
In this case, defendant made no attempt to show that his racial group was substantially underrepresented on the jury. Likewise, this is not a case susceptible to racial discrimination as both defendant and the ¡victim are Navajo Indians. See State v. Goode. There was no showing that the state’s challenge caused the jury to contain no members of defendant’s race. In fact, the record shows that at least two Navajo Indians sat on the jury.
Defendant argues that we should not rule against him solely on the ground that some members of his race remained on the panel. See generally United States v. Clemons, 843 F.2d 741 (3rd Cir.1988). We have not done so. Rather, we are not persuaded that the circumstances on which defendant relies permit an inference that the prosecution used its peremptory challenge to exclude Ms. Clah from the jury on account of race. Cf. id. Defendant notes that the prosecutor successfully removed two other jurors for cause, who were Indian or appeared to be Indian, and never questioned Ms. Clah during voir dire. Defendant contends these circumstances, when taken together with the other facts, raise the necessary inference. We disagree.
The fact that the prosecutor removed some other Indian jurors for cause does not support an inference that the prosecutor removed Ms. Clah for an improper reason. Cf. United States v. Chalan (where all other Indian jurors were removed from panel through challenges for cause, there is a substantial risk that the government improperly used its peremptory challenges to remove the remaining Indian juror). There must be other relevant factors to support the inference. See United States v. Clemons.
The fact that the prosecutor failed to question Ms. Clah during voir dire is relevant in evaluating the state’s explanation for its challenges. See State v. Goode. We do not think it is sufficient on these facts to support an inference of purposeful discrimination.
Based on the above, we find that defendant failed to establish a prima facie case of discriminatory use of the state’s peremptory chállenges. Therefore, we need not consider whether the state provided a racially-neutral explanation for the challenge.
(c) Claim of Improper Excusing of Juror for Cause
Defendant also claims the trial court erred in excusing juror Thomas for cause. During voir dire, Ms. Thomas stated that defense counsel was a personal friend and that her sister worked for him. Upon questioning, Ms. Thomas stated that she had not discussed the case with her sister. There was no further questioning of Ms. Thomas. The state moved to disqualify her for cause. The trial court excused Ms. Thomas for cause.
An accused is entitled to trial by an impartial jury. N.M. Const, art. II, § 14 (Cum.Supp.1988). An impartial jury means a jury where each and every one of the twelve is free from any partiality whatsoever. State v. McFall, 67 N.M. 260, 354 P.2d 547 (1960). It is the duty of the trial court to make sure there is a fair and impartial jury. In doing so, it must exercise discretion, and such discretion will not be disturbed unless there is a manifest error or a clear abuse thereof. State v. Cutnose, 87 N.M. 300, 532 P.2d 889 (Ct.App.1975), overruled on other grounds, State v. McCormack, 100 N.M. 657, 674 P.2d 1117 (1984). The trial court has a great deal of discretion in excusing a juror for cause. State v. Dobbs, 100 N.M. 60, 665 P.2d 1151 (Ct.App.1983).
Defendant has not shown that the trial court abused its discretion in excusing a potential juror who was acquainted with defense counsel, even though at the time of voir dire she had no knowledge regarding the case. Defendant supports his argument with cases where prospective jurors were not excused for cause based on their acquaintance with defendants. See, e.g., State v. Gilbert, 100 N.M. 392, 671 P.2d 640 (1983), cert. denied, 465 U.S. 1073, 104 S.Ct. 1429, 79 L.Ed.2d 753 (1984); Crespin v. Albuquerque Gas & Elec. Co., 39 N.M. 473, 50 P.2d 259 (1935). These cases are not persuasive, however, because the courts stated that the trial courts did not abuse their discretion in not excusing for cause, since there was no showing that the juror would be less than fair. These are not the facts in this case. Moreover, the fact that the jurors in Gilbert and Crespin were allowed to be empanelled despite their acquaintance with the defendants has no bearing on whether the trial court in the case before us abused its discretion in allowing the challenge for cause.
Defendant asserts the challenge should have been overruled because “there was no showing that Ms. Thomas could not be fair or impartial.” This is not the standard for review, because it in no way indicates an abuse of discretion. Defendant has a legal right only to impartial jurors, not to the impartial jurors of his choice. United States v. Puff, 211 F.2d 171, 184-185 (2d Cir.), cert. denied, 347 U.S. 963, 74 S.Ct. 713, 98 L.Ed. 1106 (1954), states in part:
[A] party is entitled to an array of impartial jurors to which he may direct his peremptory challenges____ [A] party is entitled to no more. Having no legal right to a jury which includes those who because of scruple or bias he thinks might favor his cause, he suffers no prejudice if jurors, even without sufficient cause, are excused by the judge. Only if a judge without justification overrules a challenge for cause and thus leaves on the panel a juror not impartial, does legal error occur.
See also United States v. Calhoun, 542 F.2d 1094 (9th Cir.1976), cert. denied, 429 U.S. 1064, 97 S.Ct. 792, 50 L.Ed.2d 781 (1977); 47 Am.Jur.2d Jury § 222 at 813 (1969) (“Discharging or excusing a qualified juror is not generally regarded as prejudicial or reversible error.” (footnote omitted)). Defendant has not argued that the jurors chosen were not impartial.
Based on the statements made during voir dire, we cannot say there was manifest error or a clear abuse of discretion in excusing Ms. Thomas for cause.
CONSTITUTIONALITY OF STATUTE
Defendant argues that the statute under which he was charged is unconstitutionally vague. The statute defines great bodily injury by a motor vehicle as “the injuring of a human being, to the extent defined in Section 30-1-12 NMSA 1978, in the unlawful operation of a motor vehicle.” § 66-8-101(B). Section 30-1-12 is the definitional section of the Criminal Code, NMSA 1978, Sections 30-1-1 to 30-28-3 (Repl.Pamp.1984 & Cum.Supp.1988). In that section, great bodily harm is defined as “an injury to the person which creates a high probability of death; or which causes serious disfigurement; or which results in permanent or protracted loss or impairment of the function of any member or organ of the body[.]” § 30-l-12(A). Defendant argues that the term “protracted impairment” is unconstitutionally vague, thus denying him due process.
A statute violates due process if its language is so vague that men of common intelligence must necessarily guess at its meaning and differ as to its application. State v. Ferris, 80 N.M. 663, 459 P.2d 462 (Ct.App.1969); see also Bokum Resources Corp. v. New Mexico Water Quality Control Comm’n, 93 N.M. 546, 603 P.2d 285 (1979). “Constitutional vagueness is based on notice and applies when a potential actor is exposed to criminal sanctions without a fair warning as to the nature of the proscribed proceedings.” State v. Segotta, 100 N.M. 498, 499-500, 672 P.2d 1129, 1130-1131 (1983); see also Bokum Resources Cory. v. New Mexico Water Quality Control Comm’n. Nevertheless, this court presumes that a statute is constitutional and will construe it so that it is not void for vagueness if a reasonable and practical construction can be given to its language. State v. Segotta. Simply because a term is not defined within the statute does not necessarily render it unconstitutional. Gruschus v. Bureau of Revenue, 74 N.M. 775, 399 P.2d 105 (1965). “The statute must be read and considered as a whole so as to ascertain its legislative intent, and the statute’s words and phrases are to be considered in their generally accepted meaning.” State v. Segotta, 100 N.M. at 500, 672 P.2d at 1131.
Neither the word “protracted” nor the word “impairment” has a technical meaning. Therefore, both words should be used in their ordinary sense. Defendant’s concern is with the term “protracted.” He claims that the word is capable of several meanings. However, “protracted” is defined as extended in time; long drawn out. Webster’s Third New International Dictionary 1826 (1966). The term is capable of reasonable application to varying fact patterns. See State v. Mentola, 691 S.W. 2d 420 (Mo.App.1985); People v. Obertance, 105 Misc.2d 558, 432 N.Y.S.2d 475 (1980). Other courts interpreting the same word in similar statutes have determined that what is considered protracted depends on the circumstances and is not so vague as to be unconstitutional. Walker v. State, 742 P.2d 790 (Alaska App.1987); State v. Welton, 300 N.W.2d 157 (Iowa 1981); People v. Obertance. We agree.
In its ordinary, common usage, protracted means a “lengthy or unusually long time under the circumstances.” People v. Obertance, 105 Misc.2d at 559, 432 N.Y.S. 2d at 476. The concept of protracted is not beyond the grasp of the jury nor so indefinite that it allows unstructured discretion in applying it. The fact finder must consider the circumstances and determine whether there was a protracted impairment.
This interpretation of the term “protracted” in the definition of great bodily harm comports with the supreme court’s interpretation of the terms “serious disfigurement” in this same statute. State v. Ortega, 77 N.M. 312, 422 P.2d 353 (1966). In Ortega, the supreme court held that the terms “disfigurement” and “serious” were to be used in their ordinary sense. The supreme court went on to say that it is a question of fact for the jury to determine whether the injuries sustained were sufficiently substantial to come within the definition of the statute.
The statute under which defendant was charged is not unconstitutionally vague. The term “protracted impairment” is capable of reasonable application by a jury of common intelligence after consideration of the circumstances involved.
Defendant’s conviction and sentence are affirmed.
IT IS SO ORDERED.
DONNELLY, C.J., and MINZER, J„ concur. | [
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] |
OPINION
GARCIA, Judge.
FACTS
The parties were married in 1973. At the time, they were Sikhs and believed in and practiced the Sikh religion. In June 1976, the parties’ oldest child, Hari Jap Singh Khalsa, was born, and in January 1981, the parties had a second child, Kartar Singh Khalsa. Both children’s Sikh names appear on their birth certificates and, while the parties were married, both children were raised as Sikhs. The family observed the requirements of their religion, including the wearing of distinct apparel and turbans, reading from the Guru Granath, the Sikh scriptures, and the assumption of Sikh names. Their adherence to principles and tenets of their faith continued throughout their marriage.
Marital discord ultimately lead to the breakdown of their marriage and in December 1982, mother filed an uncontested petition for divorce. Mother was granted the divorce and awarded sole custody of the two children.
In December 1983, mother remarried. Shortly thereafter, mother abandoned the Sikh religion and began discouraging the children from practicing Sikhism. Mother also began calling the children by other than their Sikh names. Father objected to the children not being raised as Sikhs, and the parties’ disagreements over religious differences escalated. In May 1984, father filed a motion requesting sole custody of the children or, in thé alternative, joint custody.
In violation of father’s discovery request, mother failed to timely disclose the names of any expert witnesses whom she planned to call at trial on her behalf. The day prior to trial, however, mother submitted a witness list naming two proposed, but previously undisclosed, experts: Dr. Lillian Gonzales-Ortiz, a psychologist, and Father William Kent Burtner, a Catholic priest. Over father’s objections, both witnesses testified.
In December 1986, following a hearing on the merits, the trial court entered its order regarding custody, visitation and child support. The court found that a material change in circumstances had occurred since the court’s last permanent order on custody, but concluded that joint custody was not in the children’s best interest. Accordingly, the court ordered that sole custody of the children remain with mother; that father have visitation with the children at his residence for one month each summer; and that the children not participate voluntarily or involuntarily in any Sikh religious activities with father. Father appeals.
ISSUES
Father raises the following five issues on appeal: (1) whether the trial court erred in denying father’s motion for joint custody; (2) whether the trial court erred in enjoining father from encouraging his children to practice and participate in the Sikh religion during their visits with father; (3) whether the trial court’s decision maintaining sole custody of the children with mother was based on an unconstitutional religious preference; (4) whether the trial court erred in admitting certain witness testimony; and (5) whether father was denied a fair trial due to the trial court’s cumulative errors. Under the specific facts of the present case, the trial court erred in allowing the surprise witnesses to testify and, thus, we reverse.
Although the first issue is dispositive of this case, we will nonetheless additionally address both the second and fourth.
ISSUE I & IV (Whether the trial court erred in denying father’s motion for joint custody based on the testimony of surprise witnesses.)
The trial court’s denial of father’s joint custody motion in the present case rests solely on the testimony of mother’s expert witness, Dr. Gonzales. All other experts indicated that both father and mother were good, loving parents, capable of serving as joint custodians. Dr. Gonzales, however, presented testimony to the effect that joint custody was not in the children’s best interest. This evidence, alone, would support the trial court’s finding that joint custody was not in the children’s best interest. Thus, if Dr. Gonzales’ testimony had been properly before the trial court, the trial court would be affirmed under our substantial evidence rule. See Sandoval v. Department of Employment Sec., 96 N.M. 717, 634 P.2d 1269 (1981).
A reviewing court may, however, reverse the trial court upon a finding of abuse of discretion. In State v. Hargrove, 81 N.M. 145, 464 P.2d 564 (Ct.App.1970), this court defined abuse of discretion as:
“[a]n erroneous conclusion and judgment, one that is clearly against the logic and effect of the facts and circumstances before the court, or the reasonable, probable, and actual deductions to be drawn from such facts and circumstances. * * * It is really a discretion exercised to an end or purpose not justified by, and clearly against, reason and evidence.”
Id. at 147, 464 P.2d at 566 (quoting Bowers, Judicial Discretion of Trial Courts § 12 (1931)). Here, the trial court abused its discretion in allowing both surprise witnesses to testify over father’s objections.
In preparing for litigation on custody, father served mother with interrogatories and requests for production. The interrogatories specifically asked mother for a list of witnesses and a summary of the witnesses’ testimony. Mother did not comply with her disclosure obligations. Father’s request for production sought all doc uments to be used at trial, information concerning the certificates of training or qualification of proposed experts, and any psychological evaluations of mother and children. Mother did not produce any of these documents or information.
In May 1985, father filed a motion to compel discovery; the motion was not heard by the court. Fifteen months later, on the afternoon before trial, father received a list of witnesses including the names of both Dr. Gonzales and Father Burtner. Attached to the list were psychological evaluation reports on mother and both children prepared by Dr. Gonzales.
Father immediately filed a written objection and moved to strike the proposed testimony of Dr. Gonzales and any exhibits. The following day, before trial, father again objected to the testimony of both-experts based on surprise and prejudice. Father informed the trial court that: (1) he had no prior knowledge of the witnesses’ testimony; (2) he had been given no opportunity to study the basis of the psychological evaluations; and (3) he had been provided no opportunity to obtain an independent review of the evaluations. Accordingly, father asked that the witnesses be prohibited from testifying and that the evaluations not be allowed into evidence.
Father’s objection was overruled. The judge noted, however, that mother’s concealment of the identities of expert witnesses was equal to “trying to have a smoking gun secreted,” and that mother’s counsel had frustrated the legal process. The trial court nonetheless concluded that counsel’s behavior should not jeopardize the rights of the parties and, thus, the parties would proceed to trial as scheduled. The court advised father to meet with both experts during the lunch hour and if the hour proved inadequate, father could renew his objection thereafter.
After lunch, before either expert took the stand, father renewed his objection to the experts’ testimony. The objection was again denied and both Dr. Gonzales and Father Burtner were allowed to testify. In the midst of Dr. Gonzales’ testimony, father again objected, informing the court that Dr. Gonzales’ testimony conflicted with the information she had given counsel during the lunch hour. Father moved to strike her testimony and continued to renew his objection based on surprise. His motion and objection were overruled.
In State v. Manus, 93 N.M. 95, 597 P.2d 280 (1979), overruled on other grounds, 98 N.M. 786, 653 P.2d 162 (1982), the supreme court addressed the issue of surprise witnesses. In Manus, defendant was on trial for murder. During discovery, the state submitted a list of witnesses it planned to call. At trial, however, the state called a non-disclosed witness, Seig, as a rebuttal witness. Defendant objected to Seig’s testimony on the basis of surprise. Based on that objection, the trial court postponed Seig’s testimony until the following day in order to allow defendant an opportunity to depose him. Subsequently, Seig was adequately cross-examined. Ultimately, defendant was found guilty of murder. Defendant appealed his conviction arguing, inter alia, that allowing Seig to testify was error.
Although the supreme court was critical of the state’s failure to disclose the witness’ identity prior to trial, the Manus court noted that mere failure to disclose, alone, was not grounds for reversal. The court stated that the party must show that he was prejudiced by such non-disclosure. In Manus, the court held that defendant was not prejudiced because defendant was given an opportunity to depose the witness before the witness took the stand and, as a result of such deposition, the witness was “vigorously and competently” cross-examined at trial. The court concluded that allowing the defendant an opportunity to depose removed the prejudice caused by the initial surprise. Such is not the case here.
The pertinent facts here are similar, at least initially, to those in Manus. As in Manus, the stakes here were high. “[T]he loss of a child through [the] legal process can be as serious as imprisonment in a criminal case.” In re Jason Y, 106 N.M. 406, 408, 744 P.2d 181, 183 (Ct.App.1987) (quoting Hernandez v. State ex rel. Arizo na Dep’t of Economic Sec., 23 Ariz.App. 32, 35, 530 P.2d 389, 392 (1975)). Here, as in Manus, mother had an obligation to comply with discovery, specifically good faith answers to interrogatories. SCRA 1986, 1-033(A). Father was not informed of the experts’ identities until shortly before trial. Moreover, father objected to the testimony of both experts. The similarities, however, end here.
While the trial court in Manus allowed the defense ample opportunity to depose the surprise witness, father, here, was given only one hour in which to question both expert witnesses and prepare for cross-examination. The interview was to take place over a break during the course of the proceedings. Upon returning from the lunch break, father specifically asked the trial court for an opportunity to depose Dr. Gonzales and informed the trial court that Dr. Gonzales’ testimony at trial conflicted with her statements given during the lunch hour. Without a deposition to impeach Dr. Gonzales, counsel operated at a significant disadvantage.
The court in Manus refused to reverse defendant’s conviction because the defense was given an adequate opportunity to depose the witness and defendant’s lack of prejudice was evidenced by counsel’s vigorous and competent crossexamination. In the present case, father was given an inadequate opportunity to interview both witnesses, was denied an opportunity to depose them, and was unable to vigorously or effectively cross-examine. The court’s offer to allow counsel one hour to meet with, interview and prepare for the cross-examination of two experts presented a true Hobson’s choice. Had father declined the offer, Manus may well have precluded a subsequent complaint.
In allowing both expert witnesses to testify, the trial court noted that mother had frustrated the legal process. The court stated that mother’s counsel’s behavior should not jeopardize the rights of the parties, and allowed both experts to testify. The trial court’s decision to allow Dr. Gonzales’ and Father Burtner’s testimony, however, in fact “jeopardized” the rights of father by not allowing him an adequate opportunity to interview, depose and prepare for an adequate cross-examination of both experts. Although the trial court admonished mother for her unwillingness to cooperate, the court nonetheless denied father’s objection, thus, jeopardizing his ability to adequately defend.
The surprise testimony of Dr. Gonzales is the only evidence supporting the trial court’s denial of joint custody. The balance of all other evidence indicated that both parents were capable of serving as joint custodians. The trial court’s decision to allow both Dr. Gonzales and Father Burtner to testify, however, was not justified by, and was clearly against “the logic and effect of the facts and circumstances before the court.” See State v. Hargrove, 81 N.M. at 147, 464 P.2d 566. Dr. Gonzales’ testimony is the only evidence supporting the court’s denial of joint custody. The balance of the evidence indicated that both parents were capable of serving as joint custodians. Thus, the trial court abused its discretion in allowing such testimony.
ISSUE II (Whether the trial court erred in enjoining father from encouraging his children from voluntarily or involuntarily participating in Sikh religious activities.)
This issue presents a matter of first impression. Although we need not address this issue because of our holding in issue 1, we deem it necessary to give guidance as to the scope of a court's intervention in religious beliefs and practices in child custody disputes.
Without any finding that participation in religious activities was harmful to the children here, the trial court enjoined the parties from freely discussing their religious beliefs with their children. Specifically, the trial court ordered that when the children were with father, they could not voluntarily or involuntarily participate in any Sikh activity, including any church activity, Sikh camp or Sikh day care center.
It is well established that in child custody matters the best interests and welfare of the children are the primary and controlling considerations. Schuerman v. Schuermann, 94 N.M. 81, 607 P.2d 619 (1980); In re Briggs, 91 N.M. 84, 570 P.2d 915 (1977); Boone v. Boone, 90 N.M. 466, 565 P.2d 337 (1977). Similarly, where there is a conflict between the parents regarding the religious faith and training of the children, the paramount concern is the welfare of the children. See Munoz v. Munoz, 79 Wash.2d 810, 489 P.2d 1133 (1971) (en banc).
Courts should proceed cautiously and with circumspection when dealing with religious issues. “[Ijntervention in matters of religion is a perilous adventure upon which the judiciary should be loath to embark.” Wojnarowicz v. Wojnarowicz, 48 N.J.Super. 349, 354, 137 A.2d 618, 621 (1958). In Munoz v. Munoz, the court noted:
The courts are reluctant * * * to interfere with the religious faith and training of children where the conflicting religious preferences of the parents are in no way detrimental to the welfare of the child. The obvious reason for such a policy of impartiality regarding religious beliefs is that, constitutionally, American courts are forbidden from interfering with religious freedoms or to take steps preferring one religion over, another. ******
Thus, the rule appears to be well established that the courts should maintain an attitude of strict impartiality between religions and should not disqualify any applicant for custody or restrain any person having custody or visitation rights from taking the children to a particular church, except where there is a clear and affirmative showing that the conflicting religious beliefs affect the general welfare of the child.
Id. 79 Wash.2d at 812-13, 489 P.2d at 1135 (citations omitted); see, e.g., Hanson v. Hanson, 404 N.W.2d 460 (N.D.1987); In re Marriage of Murga, 103 Cal.App.3d 498, 163 Cal.Rptr. 79 (1980); Compton v. Gilmore, 98 Idaho 190, 560 P.2d 861 (1977); Felton v. Felton, 383 Mass. 232, 418 N.E. 2d 606 (1981); Robertson v. Robertson, 19 Wash.App. 425, 575 P.2d 1092 (1978); Annotation, Religion as Factor in Child Custody and Visitation Cases, 22 A.L.R.4th 971 (1983); Note, The Religious Upbringing of Children After Divorce, 56 Notre Dame Law, 160 (1980).
In justifying a prohibition of religious restrictions on visitation rights, physical or emotional harm to the child cannot be assumed, but must be demonstrated in detail. Hanson v. Hanson; Felton v. Felton. Factual evidence of harm rather than “mere conclusions and speculation” is required. Robertson v. Robertson.
Thus, a custodial parent’s general testimony that the child is upset or confused because of the non-custodial parent’s religious practice is insufficient to demonstrate harm. Felton v. Felton; Munoz v. Munoz. Further, general testimony that the child is upset because the parents practice conflicting religious beliefs is likewise insufficient. Hanson v. Hanson (mother’s testimony that father, a member of the Pentecostal Apostolic church, had told the children, among other things, that the Catholic church believes in cannibalism, which upset the children, was insufficient to prohibit father from taking the children to his church); Munoz v. Munoz (parent’s speculation that six-year-old son, who attended both Mormon services with his mother and Catholic services with his father, was emotionally harmed thereby, was insufficient. The court concluded that duality of religious beliefs, do not, per se, create a conflict upon young minds.).
Although most disputes involve conflicting religious practices between the divorced parents, the same principles apply equally where one parent practices no religion. Robert O. v. Judy E., 90 Misc.2d 439, 395 N.Y.S.2d 351 (Fam.Ct.1977) (mother, a nonbeliever in organized religion, sought to enjoin non-custodial father from taking child to church services. The court recognized that although the building of moral character was possible without religious beliefs or training, the child’s interests were best served by allowing him to continue his religious training with father.).
A court’s reluctance to interfere with the religious upbringing of children, however, is not absolute. Religious restric tions placed upon visitation rights have been upheld where evidence of physical or emotional harm to the child has been substantial. See Funk v. Ossman, 150 Ariz. 578, 724 P.2d 1247 (App.1986) (court upheld order enjoining non-custodial parent from taking his eight-year-old son to formal Jewish religious training. Evidence presented at trial included the testimony of three psychologists, one of whom testified that child had anxiety problems caused by the religious differences of his parents which manifested itself in encopresis); Bentley v. Bentley, 86 A.D.2d 926, 448 N.Y.S.2d 559 (1982) (court affirmed order prohibiting non-custodial father from instructing his children in the teachings of the Jehovah’s Witnesses. The custodial mother was Catholic and the court found that the children were “emotionally strained and torn” as a result of the parties’ conflicting religious beliefs).
Thus, although the courts are reluctant to enjoin a non-custodial parent from practicing his religion with his children, the courts can and will enjoin such practice where the testimony concerning physical or emotional harm to the child is detailed and the best interests of the child will be served through the prohibition. Here, the evidence concerning the impact on the children consisted of testimony by Father Burtner and mother’s general testimony that the children appeared upset and disturbed after visitations with father. Because we have held that the trial court abused its discretion in permitting Father Burtner to testify, however, the trial court could not restrict father from practicing his religion with his children based on such testimony. Mother’s general testimony alone, however, was insufficient to support the restriction.
In sum, we adopt the view expressed in Munoz. Courts should adhere to a policy of impartiality between religions, and should intervene in this sensitive and constitutionally protected area only where there is a clear and affirmative showing of harm to the children. Restrictions in this area present the danger that court-imposed limitations will unconstitutionally infringe upon a parent’s freedom of worship or be perceived as having that effect.
Thus, we hold that, in determining whether a parent involved in a child custody dispute should be restricted from practicing or encouraging the child in a religious belief or practice, the trial court must consider the following:
1. Whether there exists detailed factual evidence demonstrating that the conflicting beliefs or practices of the parents pose substantial physical or emotional harm to the child;
2. Whether restricting the religious interaction between the parent and child will necessarily alleviate this harm; and
3. Whether such restrictions are narrowly tailored so as to minimize interference with the parents’ religious freedom.
Here, there was no evidence that either child was harmed by exposure to father’s religion. Accordingly, we further hold the trial court’s judgment enjoining both parents from freely discussing their religious beliefs with the children, and specifically prohibiting father from encouraging his children to participate in any Sikh activity, to be error.
CONCLUSION
The trial court erred in allowing both surprise expert witnesses to testify. Since Dr. Gonzales’ testimony provided the sole basis for the trial court’s denial of father’s joint custody request, and Father Burtner’s testimony provided the sole basis for the religious limitations, we remand to the trial court for a new trial. Father is awarded his costs on appeal.
IT IS SO ORDERED.
DONNELLY, C.J., and MINZNER, J., concur. | [
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OPINION
FLORES, Judge.
The City of Farmington (the City) appeals an order dismissing the charges against Defendant. Holding that Benally v. Marcum, 89 N.M. 463, 553 P.2d 1270 (1976), remains good law, we affirm.
A Farmington city police officer observed a vehicle weaving in its lane, repeatedly crossing the center divider, and speeding within the city limits. The officer engaged his emergency equipment in order to stop the vehicle. However, the vehicle sped off. A high-speed chase ensued, during which the officer observed Defendant, the driver of the vehicle, committing other traffic violations. The vehicle was finally pulled over. By this time, however, it was almost three miles within the boundaries of the Navajo Reservation. Defendant was identified as an enrolled member of the Navajo Nation.
At the time of the stop, the officer noted an odor of alcohol about Defendant, as well as slurred speech and bloodshot, watery eyes. Defendant was arrested and transported to the Farmington city police station. He was charged with a number of offenses, including driving under the influence of intoxicating liquor and/or drugs (DWI). He was convicted in magistrate court and appealed to district court, where his motion to dismiss for lack of jurisdiction was granted.
The district court relied on Benally, a New Mexico Supreme Court case where under nearly identical facts, a member of the Navajo Tribe was pursued onto the reservation and arrested for violation of city traffic ordinances. Id. at 464, 553 P.2d at 1271. Our Supreme Court held that the arrest was illegal because it violated tribal sovereignty by circumventing the procedure for extradition from the Navajo Reservation. Id. This holding was based on well-established law that Indian tribes have the right to self-government that may not be impaired or interfered with by the state, absent congressional approval. Id. at 465-66, 553 P.2d at 1272-73; see Williams v. Lee, 358 U.S. 217, 79 S.Ct. 269, 3 L.Ed.2d 251 (1959).
The extradition procedure of the Navajo Nation, see Navajo Trib.Code tit. 17, §§ 1001, 1002 (1970), remains essentially the same as it has been since its creation in 1956. Id. § 1951 (1978), legislative history. Here, in arresting Defendant and taking him into custody, without following the Navajo extradition procedure, the City chose not to comply with the Tribe’s own laws on this matter. This, in turn, challenges the Tribe’s right to make and enforce laws for Navajo citizens on Navajo land, which goes to the heart of the right of self-government. Therefore, on the strength of Benally, Defendant’s arrest must fail. Benally, 89 N.M. at 465, 553 P.2d at 1272 (citing Arizona ex rel. Merrill v. Turtle, 413 F.2d 683, 685-86 (9th Cir.1969)).
The City argues that Benally is no longer good law because of changes in New Mexico law that occurred after Benally. In 1981, New Mexico passed a fresh pursuit law for misdemeanors, authorizing New Mexico law enforcement officers to cross in-state jurisdictional lines in fresh pursuit of misdemeanants and place them under arrest. NMSA 1978, § 31-2-8 (Repl.Pamp.1984). Since Benally made reference to the fact that New Mexico law did not then authorize fresh pursuit arrest for mere misdemeanors, as op posed to felonies, the City now argues that the fundamental underpinnings for the Benally holding have been eliminated, and the case must fall. We do not agree.
First, the holding in Benally, that the arrest was illegal, was not based on the lack of a misdemeanor fresh pursuit law; rather, it was based on the existence of a valid procedure for extradition in the Navajo Tribal Code. Benally, 89 N.M. at 464, 553 P.2d at 1271. In deciding the issue of the legality of the arrest, our Supreme Court did not address whether the arresting officers had jurisdiction to pursue the defendant onto the reservation. Id. at 464-66, 553 P.2d at 1271-73. Because the authority of the officer to pursue an offender onto the reservation was not the basis for holding the arrest illegal in Benally, a state statute unilaterally changing the authority to pursue outside the City does not affect the legality of the arrest in this case.
Second, the City argues that the misdemeanor fresh pursuit statute does not interfere with tribal self-government because it is not directed at the same kinds of suspects as the Navajo extradition procedure. For example, the Navajo extradition procedure could arguably contemplate a more orderly and relaxed set of circumstances, which would allow time to petition the Governor of the Navajo Nation for assistance and otherwise proceed in due course through governmental channels, unlike a fresh pursuit situation. In this regard, we do not agree that the Navajo extradition procedure is only directed toward those suspects who can be pursued in a more leisurely fashion rather than those under fresh pursuit. We do not believe that it makes any difference whether the suspect has been freshly pursued onto the reservation or whether the suspect has been located on the reservation after some investigation. Either way, there is a Navajo tribal procedure for dealing with the suspect. Failure to follow that procedure violates tribal sovereignty.
The City also argues that the high degree of its own sovereign interest in the subject matter — prosecuting DWI offenders — is evidence that Benally should now yield to the weight of compelling public policy. However, as we held in State v. Yazzie, 108 N.M. 677, 777 P.2d 916 (Ct.App.), cert. denied, 108 N.M. 681, 777 P.2d 1325 (1989), the degree of state interest in the subject matter cannot be the determinative factor. In Yazzie, a serious crime with potential loss of evidence was involved, and yet this Court held that tribal-extradition procedure must be followed. The City may not excuse itself from compliance with Navajo law merely by reference to public policy, no matter how meritorious. Therefore, we hold that, based upon the continued viability of Benally, the arrest of Defendant in this case was illegal.
Determining that the arrest is illegal does not, however, dispose of this case. The second part of the Benally holding was that because the arrest was illegal, the district court did not have jurisdiction to try the defendant. In deciding this portion of Benally, the Court distinguished its earlier decision in State v. Wise, 58 N.M. 164, 267 P.2d 992 (1954), concluding that the pursuit involved in Wise was a felony fresh pursuit recognized by law, while the pursuit in Benally was a misdemeanor fresh pursuit not recognized by law.
The City argues that because misdemean- or fresh pursuit is now recognized, the basis for not following Wise no longer exists. In other circumstances we might agree. In fact, we have declined to follow Benally in other cases. See State v. Gibson, 113 N.M. 547, 557, 828 P.2d 980, 990 (Ct.App.), cert. denied, 113 N.M. 524, 828 P.2d 957 (1992); State v. Nolan, 93 N.M. 472, 474-75, 601 P.2d 442, 444-45 (Ct.App.), cert. denied, 93 N.M. 683, 604 P.2d 821 (1979). Here, however, we are concerned with the illegal arrest of an Indian on Indian land.
Indians retain a unique status in this country. See Worcester v. Georgia, 81 U.S. (6 Pet.) 515, 8 L.Ed. 483 (1832); Cherokee Nation v. Georgia, 30 U.S. (5 Pet.) 1, 8 L.Ed. 25 (1831). Respect for the sovereignty of an Indian government and the special status of its citizens, compels a state to consider jurisdictional factors differently from the more ordinary instance of an extraterritorial arrest of a citizen of another state or even a foreign government. Precedent supports the proposition that suspects arrested illegally in another state, or in another country, may nonetheless be subject to the criminal jurisdiction of the prosecuting state, and we do not disturb either the rationale or the conclusion of those cases. See United States v. Alvarez-Machain, 504 U.S. 655, 112 S.Ct. 2188, 119 L.Ed.2d 441 (1992); Gibson, 113 N.M. at 557, 828 P.2d at 990. We only observe that those cases do not account for the special factors enumerated herein, that are unique to considering a state’s unlawful arrest of Indians on Indian land.
As the City argues, and as discussed above, our Supreme Court in Benally did note the distinction between fresh pursuit arrest for felonies versus misdemeanors. Benally, 89 N.M. at 466, 553 P.2d at 1273. Our Supreme Court also addressed what it saw as the inherent unfairness in state prosecutions based upon an illegal arrest elsewhere and observed that the unfairness was “especially true when we consider that the Navajo Tribe has provided specific procedures for extraditing persons accused of crime from the reservation,” which the Court described as “the Navajo Tribal government’s exercise of the sovereign power vested in them.” Id. at 466-67, 553 P.2d at 1273-74.
This latter point regarding tribal sovereignty proves to be the distinction that makes a difference — the abiding bedrock that makes Benally as compelling a result today as it was when authored almost twenty years ago. The Navajo Nation has specific laws regarding fugitive Navajo criminal suspects and how they will be treated; precisely the type of law that goes to tribal governance of its own people. Therefore, it is clearly a matter of tribal interest that must be protected. See Chino v. Chino, 90 N.M. 203, 561 P.2d 476 (1977). The state courts cannot ignore these laws without a degree of infringement on tribal sovereignty that cannot be sanctioned. Therefore, even though a state court may exercise personal jurisdiction over a citizen of another state or foreign country who has been illegally arrested and returned for criminal prosecution, we believe that when the suspect is an Indian illegally arrested on Indian land, the court may not exercise its jurisdiction over his or her person. Contra Davis v. Muellar, 643 F.2d 521 (8th Cir.), cert. denied, 454 U.S. 892, 102 S.Ct. 387, 70 L.Ed.2d 206 (1981); State v. Spotted Horse, 462 N.W.2d 463 (S.D.1990), cert. denied, 500 U.S. 928, 111 S.Ct. 2041, 114 L.Ed.2d 125 (1991); but see, Felix S. Cohen, Handbook of Federal Indian (Law 358 (1982 ed.) (discussing Benally with approval and characterizing cases to the contrary as “ill-considered”).
In conclusion, we hold that the arrest of Defendant on the Navajo Reservation is illegal and that the district court does not have jurisdiction to hear the charges against him. Accordingly, the order of dismissal is affirmed.
IT IS SO ORDERED.
APODACA, C.J., and BOSSON, J., concur.
. We note that intergovernmental agreements to facilitate extradition are, at least theoretically, available for these parties to consider. We also observe the language of New Mexico’s Mutual Aid Act, NMSA 1978, Sections 29-8-1 to -3 (RepI.Pamp.1994), whereby a "public agency,’’ including municipalities and Indian governments may agree to exercise reciprocal law enforcement authority by a process of cross-deputization. Although some New Mexico governmental authorities may have such agreements with the Navajo Nation, it does not appear that the Navajo Nation and the City of Farmington have entered into any such agreements. | [
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OPINION
DONNELLY, Chief Judge.
Proficient Food Company (PFC) appeals the administrative decision and order of the Taxation and Revenue Department (Department) denying its protest to an assessment of gross receipts tax, assessing interest and penalties upon it for food and supplies sold by PFC to restaurants in New Mexico. PFC raises three issues on appeal: (1) whether the New Mexico gross receipts tax levied against it violates the commerce clause of the United States Constitution, article I, section 8, clause 3; (2) whether the Blanket Exemption Certificate obtained by PFC substantially complies with the requirements of NMSA 1978, Section 7-9-43 (Repl.1986) of the Gross Receipts and Compensating Tax Act, entitling it to deduct the receipts from the sales of food to Denny’s; and (3) whether the proper tax to be levied against PFC is the compensating tax, not the gross receipts tax. We affirm.
The parties stipulated to the material facts. On December 6, 1985, the Department issued a notice of assessment against PFC for payment of state gross receipts tax, and accrued penalty and interest in the total amount of $262,274.21. PFC protested the assessment and following a hearing, an administrative hearing officer upheld the validity of the assessment.
PFC is a California corporation, registered with the Department for tax purposes. PFC owns and operates a food and restaurant supply business with a warehouse located in Arlington, Texas. During the audit period, PFC sold food and other restaurant supplies to Denny’s and Grandy’s restaurants for use in New Mexico. The sales arrangement between PFC, Denny’s and Grandy’s was negotiated and administered outside New Mexico. PFC, however, obtained orders for deliveries by telephoning restaurants and taking down the orders over the phone. The ordered goods were delivered by PFC in its own trucks from its warehouse in Texas to the restaurants in New Mexico.
PFC does not maintain an office or other place of business in New Mexico and none of its employees, agents or salesmen reside within the state. PFC’s customer service-representatives sometimes travel from Texas to New Mexico in order to respond to complaints or other matters on an unscheduled basis. The food and other supplies sold by PFC to New Mexico restaurants are invoiced and paid for by Denny’s and Grandy’s through their corporate headquarters located outside New Mexico.
During the audit period, records indicated that PFC had deducted the receipts from its sales of food to Denny’s and Grandy’s, but failed to supply the Department with non-taxable transaction certificates within the sixty days provided for in Section 7-9-43. PFC did, however, obtain a form entitled, “Blanket Exemption Certificate,” and submitted it to the Department from Denny’s Incorporated.
I. COMMERCE CLAUSE
The Gross Receipts and Compensating Tax Act, NMSA 1978, Section 7-9-4 to -82 (Repl.1986), provides for the imposition of a gross receipts tax on any person engaging in business in this state based upon the privilege of engaging in business within New Mexico. The Act also raises a presumption that all receipts by persons engaging in business are subject to the gross receipts tax. § 7-9-5. Receipts, however, from transactions in interstate commerce are subject to deduction from gross receipts to the extent that the tax would be unlawful under the United States Constitution. § 7-9-55.
The United States Supreme Court has defined a four prong test to determine whether a state tax violates the commerce clause of the federal constitution. Com plete Auto Transit, Inc. v. Brady, 430 U.S. 274, 97 S.Ct. 1076, 51 L.Ed.2d 326 (1977). Under Brady the Court reaffirmed the rule that the commerce clause of the United States Constitution does not preclude a state from imposing a nondiscriminatory, properly apportioned state tax upon foreign corporations performing exclusively interstate business when the tax is related to the corporation’s local activities and the state has provided benefits and protections for those activities for which it is justified in seeking a fair and reasonable return. In order to avoid conflict with the commerce clause, the test enunciated in Brady requires a showing that: (1) a sufficient nexus exists between the activity being taxed and the taxing state; (2) the tax is fairly apportioned; (3) the tax imposed does not discriminate against interstate commerce; and (4) the tax is fairly related to services provided by the state. On appeal, PFC asserts that the first three prongs of this test have not been met; it does not address the fourth requirement.
In Tyler Pipe Industries, Inc. v. Washington State Department of Revenue, 483 U.S. 232, 107 S.Ct. 2810, 97 L.Ed.2d 199 (1987), the Supreme Court held that there was a sufficient nexus between the state of Washington and the sale of products manufactured outside Washington but sold in Washington, to permit the imposition of a state gross receipts tax upon the corporation. In upholding the gross receipts tax assessed against the corporation’s sales, the Court held that the tax was valid despite the fact that Tyler Pipe maintained no office in Washington, had no employees residing within the state and owned no property within the state. Tyler Pipe’s solicitation of sales was directed by executives who maintained offices outside Washington and by an independent contractor within Washington.
PFC attempts to distinguish Tyler Pipe on the basis that the Court found the independent contractor, as the corporation’s agent, acted daily on behalf of the taxpayer and its activities on behalf of Tyler Pipe within Washington were substantial in nature. Although the record herein does not indicate the frequency with which PFC’s representatives contact the restaurants in New Mexico, PFC acknowledges that orders for food and other products sold by it are taken directly over the phone from purchasers in New Mexico. Additionally, the record indicates that PFC’s employees deliver food and supplies to restaurants within this state and that PFC’s representatives have followed a policy of visiting restaurants in New Mexico as needed to respond to complaints or other matters.
PFC argues that it is not engaged in the business of selling in New Mexico and that all selling activities are concluded when the order is accepted and the goods identified and placed in transit from its locations in Texas. PFC characterizes its activities in New Mexico as limited to delivery of the goods from its trucks. This characterization, however, is contradicted by the stipulated facts which establish that PFC also sends representatives to the restaurants in New Mexico to respond to complaints and other matters and that its employees directly call the restaurants in New Mexico to take orders. Although PFC challenges the inference that its placement of these calls constitutes a solicitation of sales in New Mexico, from the record before us the hearing officer could properly conclude otherwise from the facts presented. PFC’s on-going relationship with Denny’s and Grandy’s does not obviate the necessity of determining the specific needs of its customers at various times and the placing of specific sales orders in response to calls PFC makes to its customers. Furthermore, the fact that PFC did not have a resident agent or representative within New Mexico does not negate the substantial nexus between its activities in New Mexico and this state. PFC’s activities in this state are significantly associated with its ability to establish and maintain a market in New Mexico for sales. See Tyler Pipe Indus., Inc. v. Washington Dep’t of Revenue.
PFC has not established that the activities of its representatives who visit the restaurants in New Mexico, the delivery of the goods by its trucks to the restaurants in New Mexico and the calls placed by its employees to the restaurants in New Mexico are not decisive factors in establishing and holding its New Mexico market. See Norton Co. v. Department of Revenue, 340 U.S. 534, 71 S.Ct. 377, 95 L.Ed. 517 (1951).
PFC’s activities adequately support New Mexico’s jurisdiction to impose a gross receipts tax on PFC. Tyler Pipe Indus., Inc. v. Washington State Dep’t of Revenue. See also General Trading Co. v. State Tax Comm’n, 322 U.S. 335, 64 S.Ct. 1028, 88 L.Ed. 1309 (1944) (tax upheld where out-of-state merchant had traveling sales agents). Compare EVCO v. Jones, 409 U.S. 91, 93 S.Ct. 349, 34 L.Ed.2d 325 (1972) (impermissible tax levied on out-of-state sales of reproducible educational materials); National Bellas Hess, Inc. v. Department of Revenue, 386 U.S. 753, 87 S.Ct. 1389, 18 L.Ed.2d 505 (1967) (impermissible tax levied where seller’s only connection with customers in taxing state was by mail or common carrier); Miller Bros. Co. v. Maryland, 347 U.S. 340, 74 S.Ct. 535, 98 L.Ed. 744 (1954) (impermissible tax levied where seller accepted no mail or telephone orders; products delivered to customers in Maryland were ordered at Delaware store; no C.O. D.’s accepted).
The gross receipts tax assessed against PFC was limited to the receipts from the products sold by it to New Mexico restaurants. The Act defines gross receipts as the “total amount of money * * * received from selling property in New Mexico.” NMSA 1978, § 7-9-3(F) (Repl.1986). The Act defines selling as “any transfer of property for consideration.” § 7-9-3(B). Although not explicitly stated in the stipulated facts, the hearing officer determined it was reasonable to infer that the products delivered to the restaurants in New Mexico were sold in New Mexico, despite the fact that the invoices were handled by the corporate offices outside the state. See Pittsburgh & Midway Coal Mining Co. v. Revenue Div., Taxation & Revenue Dep’t, 99 N.M. 545, 660 P.2d 1027 (Ct.App.1983) (sale occurred in New Mexico when title and risk of loss pass to purchaser in New Mexico and tax may be imposed on those sales). We agree. Because the tax was imposed only on the gross receipts of sales to the restaurants operating in New Mexico, it was fairly apportioned to PFC’s activities within this state. See Tyler Pipe Indus., Inc. v. Washington State Dep’t of Revenue; Standard Pressed Steel Co. v. Washington Dep’t of Revenue, 419 U.S. 560, 95 S.Ct. 706, 42 L.Ed.2d 719 (1975). The tax imposed by this state also is fairly related to the services provided by New Mexico to PFC.
PFC additionally argues that if New Mexico may validly impose a gross receipts tax on its activities in this state, PFC could be subjected to double or triple taxation. PFC asserts that Texas could subject it to a tax for engaging in business in Texas, with the tax measured by the gross sales from its Texas place of business including those sales to the New Mexico restaurants. California, it contends, could also impose a tax for operating as a corporation in California and measure this tax by PFC’s total receipts from all places of business, including Texas and New Mexico. As a general rule a court will not decide theoretical or constitutional questions unless necessary to the disposition of the case. See In re Bunnell, 100 N.M. 242, 668 P.2d 1119 (Ct.App.1983). Moreover, PFC’s argument overlooks the fact that the Act provides a credit against gross receipts, sales, compensating or similar taxes paid to other states, Section 7-9-79. The cases PFC relies upon for this contention are inapposite to the facts of the present case. E.g., J.D. Adams Mfg. Co. v. Storen, 304 U.S. 307, 58 S.Ct. 913, 82 L.Ed. 1365 (1938) (Indiana may not impose gross receipts tax for out-of-state sales of goods manufactured in Indiana); Western Live Stock v. Bureau of Revenue, 303 U.S. 250, 58 S.Ct. 546, 82 L.Ed. 823 (1938) (valid tax imposed on preparation, printing and publication of advertising in New Mexico and sums received for it).
We conclude the assessment of a gross receipts tax on the total receipts of goods sold to the New Mexico restaurants will not subject PFC to double or triple taxation and is fairly apportioned to its activities within this state. Tyler Pipe Indus., Inc. v. Washington State Dep’t of Revenue; Standard Pressed Steel Co. v. Washington.
New Mexico’s gross receipts tax applies equally to in-state and out-of-state sellers since it charges a uniform rate for any sale of property in New Mexico regardless. of the location of the seller. § 7-9-3(F). As noted above, the Act also provides a tax credit against taxes paid to other states. The present case is, therefore, distinguishable from Tyler Pipe and Armco v. Hardesty, 467 U.S. 638, 104 S.Ct. 2620, 81 L.Ed.2d 540 (1984), where the Court determined the tax was facially discriminatory. In both of these cases, the states had imposed a gross receipts tax on persons engaged in the business of selling tangible personal property at wholesale. However, in-state manufacturers who were liable for a manufacturing tax were exempt from the -payment of the tax. Out-of-state manufacturers, however, who were responsible in their state for a manufacturing tax were deemed discriminated against since they still remained liable for the gross receipts tax. In Tyler Pipe the Court indicated that a repeal of the manufacturing tax or a credit to out-of-state manufacturers for manufacturing taxes paid to other states would presumably cure the discrimination. Tyler Pipe Indus., Inc. v. Washington State Dep’t of Revenue. Therefore, because New Mexico’s gross receipts tax imposes a uniform tax for doing business in New Mexico and a credit for similar taxes paid to other states, it does not discriminate against interstate commerce.
The gross receipts tax assessed against PFC did not violate the commerce clause of the United States Constitution.
II. NON-TAXABLE TRANSACTION CERTIFICATES
The Act allows a seller to deduct sales of tangible personal property made to a buyer who resells the property in the ordinary course of business. NMSA 1978, § 7-9-47 (Repl.1986). However, the buyer is required to deliver a non-taxable transaction certificate (NTTC) to the seller. Id. If the seller does not have possession of the NTTC within the time allowed, the deductions claimed shall be disallowed. § 7-9-43(B). The NTTCs “shall contain the information, and be in a form, prescribed by the division” and a properly executed NTTC shall be conclusive evidence that the proceeds from the transaction are deductible from gross receipts. § 7-9-43. A buyer’s right to use a NTTC may be suspended for failing to pay the compensating tax on the subsequent use of the property. NMSA 1978, § 7-9-44 (Repl. 1986).
The secretary of the Department has the authority to issue regulations concerning the use and possession of NTTCs. NMSA 1978, § 7-l-5(A) (Repl.1986); Rainbo Baking Co. v. Commissioner of Revenue, 84 N.M. 303, 502 P.2d 406 (Ct.App.1972). The Department has adopted regulations limiting the use of. NTTCs to buyers or lessees who have applied for and received authority to issue the NTTCs. G.R.Reg. 43:2(e). The buyer is to issue NTTCs to sellers on the “serially numbered form[s] specifically issued to the buyer or lessee by the Revenue Division.” Id. This regulation also requires the buyer to account for all NTTCs issued to it and prohibits the use of the NTTCs by anyone other than the person to whom it was issued. Id. The parties have stipulated that the Department’s acceptance of certificates issued by the Multistate Tax Commission is not relevant to this case.
PFC does not argue that the regulations issued by the Department regarding NTTCs are an improper implementation of the Act’s provisions. See § 7-l-5(G) (presumption of proper implementation). Instead, PFC argues that it substantially complied with Section 7-9-47 by its timely possession of the Blanket Exemption Certificate and that it should not be penalized for Denny’s failure to provide it with a timely and proper NTTC. Although the Blanket Exemption Certificate contained the general information needed, it was not in a form prescribed by the Department and would require revamping of the Department’s processing and verification procedures. PFC’s observation that the statute requires the NTTC to be in a form prescribed by the Department rather than in any other form does not provide PFC any relief. The form prescribed by the Department required the NTTC to be serially numbered by the Department for verification purposes. There is no dispute that the Blanket Exemption Certificate relied upon by PFC failed to meet this requirement.
The Department argues that if Denny’s were permitted to use its own form as an NTTC, the Department would lose control over dispensing of, accounting for, and revoking of a buyer’s authority to use the NTTCs. According to the Department, this would in turn deprive it of an essential enforcement tool in closely scrutinizing the deductions claimed and ensuring that the buyer is registered and continues to be registered with the state. Deductions are to be construed narrowly but reasonably and must be clearly established by the taxpayer claiming the deduction. Chavez v. Commissioner of Revenue, 82 N.M. 97, 476 P.2d 67 (Ct.App.1970). Although simplification of reporting requirements is to be encouraged, PFC cites no authority to support its argument that the Blanket Exemption Certificate qualifies it for the deduction. Cf. Leaco Rural Tel. Coop., Inc. v. Bureau of Revenue, 86 N.M. 629, 526 P.2d 426 (Ct.App.1974) (taxpayer’s holding of NTTCs in compliance with statute but improperly issued by buyer were conclusive proof that transactions were deductible despite fact that transactions were not sales of tangible personal property).
PFC has failed to clearly establish its right to claim the deduction provided for in Section 7-9-47. Although we do not favor a rule which exhaults form over substance, PFC’s failure to possess an NTTC in the' form prescribed by the Department and to procedurally present the form in a timely and proper manner provided a valid basis for denying the deductions claimed. See § 7-9-43. Where a party claiming a right to an exemption or deduction fails to follow the method prescribed by statute or regulation, he waives his right thereto. See Dillard v. New Mexico State Tax Comm’n, 53 N.M. 12, 201 P.2d 345 (1948); see also Cottonwood Gulch Found, v. Gutierrez, 102 N.M. 667, 699 P.2d 140 (Ct.App.1985) (nonprofit educational foundation’s failure to apply for property tax exemption precluded county assessor from granting tax exempt status, even though the state constitution expressly exempts such property). The Department did not err in disallowing the deductions claimed on the Blanket Exemption Certificate.
III. COMPENSATING TAX
PFC next argues that it should not be liable for gross receipts tax because the appropriate tax is the compensating tax. In answer, the Department maintains that the Act contemplates the gross receipts tax as the predominant tax and the compensating tax applies only when gross receipts cannot be collected. See § 7-9-7. The Department asserts that neither Denny’s nor Grandy’s owe tax under Section 7-9-7 for' property acquired in New Mexico. The Department also notes that Denny’s may have a claim for refund of compensating taxes erroneously paid, but that it is not a party to this action.
As observed above, the record supports a finding that PFC is engaged in the business of selling property in New Mexico, and is therefore liable for payment of this state’s gross receipts tax on the receipts of such sales. §§ 7-9-3 and -4. PFC cites no authority for its proposition that the voluntary payment of compensating tax by the buyer relieves the seller of liability for gross receipts tax otherwise collectible. Hence, this contention may properly be disregarded upon appeal. See In re Adoption of Doe, 100 N.M. 764, 676 P.2d 1329 (1984). Moreover, a party seeking an exemption or deduction has the burden of establishing his right thereto. See Chavez v. Commissioner of Revenue.
We affirm the decision and order of the administrative hearing officer.
IT IS SO ORDERED.
ALARID and GARCIA, JJ., concur.
. The Brady Court rejected the rule that a state tax on the privilege of doing business was per se unconstitutional when applied to interstate commerce. Complete Auto Transit, Inc. v. Brady, 430 U.S. 274, at 288-289. | [
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] |
OPINION
RIORDAN, Justice.
Plaintiffs C.L. Buescher and J.L. Buescher (Bueschers) brought a quiet title suit in district court against Martin A. Jaquez and Stella B. Jaquez (Jaquezes). The district court determined that the Jaquezes were the owners of the subject property and entered judgment in favor of the Jaquezes and against the Bueschers.. The Bueschers appeal. We affirm.
The issues presented are:
I. Whether the district court erred when it applied NMSA 1978, Section 7-38-66 (Cum.Supp.1980) instead of NMSA 1953, Section 72-31-66 (Supp.1975) to determine whether the Jaquezes had received proper notice of the tax sale.
II. Whether there was substantial evidence to support the district court’s finding that the tax sale was invalid.
On February 25, 1982, the Bueschers filed suit against the Jaquezes in the district court of Otero County to quiet the title to Lot 11, Block 13, of James Canyon Estates, Otero County, New Mexico (property) in the Bueschers. The Bueschers claimed ownership of the property based on a Tax Deed issued to them after they purchased the property at a tax sale held on October 14, 1981. The Jaquezes answered, claiming that they owned the property. The Jaquezes’ claim of ownership was based on their 1976 purchase of the property from Carolyn Luna. The Jaquezes also claimed that they never received notice of ary taxes due or of the tax sale as required by Section 7-38-66. After a non-jury trial, the district court entered judgment in favor of the Jaquezes and against the Bueschers, concluding that since the Jaquezes had not received proper notice of the tax sale, the tax sale was void under Section 7-38-66.
I. Controlling Statute.
On appeal, the Bueschers argue that the district court erred when it applied Section 7-38-66 instead of Section 72-31-66, its predecessor, to determine whether the Jaquezes received proper notice of the tax sale from the Property Tax Division of the Taxation and Revenue Department of the State of New Mexico (Department). The relevant difference between Section 7-38-66 and Section 72-31-66 is the type of notice required and the effect of failure to receive the required notice. Section 7-38-66 provides in pertinent part:
B. [t]he [Department shall notify by certified mail, return receipt requested, to the address as shown on the latest property tax schedule each property owner whose real property will be sold that his real property will be sold to satisfy delinquent taxes * * *.
******
D. Failure of the [Department to mail the notice by certified mail, return receipt requested, or failure of the [Department to receive the return receipt shall invalidate the sale; provided, however, that the receipt by the department of a return receipt indicating that the taxpayer does not reside at the address shown on the latest property tax schedule shall be deemed adequate notice and shall not invalidate the sale, (emphasis added).
Section 72-31-66 provides in pertinent part:
B. * * * the [Department shall notify by certified mail each property owner whose real property will be sold that his real property will be sold to satisfy delinquent taxes * * *.
******
D. Failure to receive the notice of sale does not affect the validity of the sale, (emphasis added).
Section 7-38-66 invalidates a tax sale if the Department fails to send notice of the tax sale, by certified mail, return receipt requested, or if the Department fails to receive the return receipt. On the other hand, Section 72-31-66, the former law, requires only that the notice of sale be sent by certified mail and that failure of the delinquent taxpayer to receive the notice does not invalidate the sale. The Bueschers claim that since Section 72-31-66 was the statute in effect on the date the tax lien arose, January 1, 1977, the district court should have applied it. We disagree.
In State v. Thomson, 79 N.M. 748, 751, 449 P.2d 656, 659 (1969), this Court noted that a tax sale held in 1937 was “controlled by the law in effect at that time, (citations omitted).” We hold that a tax sale must comply with the requirements of the statute in effect at the time of the tax sale. Thus, it was necessary for the Department to comply with the notice requirements of Section 7-38-66, the statute in effect at the time of the property tax sale, October 14, 1981.
Therefore, we determine that the district court properly applied the requirements of Section 7-38-66 to determine whether the Jaquezes received proper notice of the tax sale.
II. Substantial Evidence.
The Bueschers also argue that even if the district court applied the proper statute, there was insufficient evidence for the district court to find: that the Jaquezes gave proper notice of their current address to the Otero County Treasurer’s Office (Treasurer’s Office), which the Treasurer’s Office failed to record; and that the Bueschers failed to prove that the Department received the return receipt required by Section 7-38-66 from the Jaquezes.
This Court has determined that in reviewing a district court’s decision on appeal, conflicts are to be resolved in favor of the prevailing party if supported by substantial evidence. Toltec International, Inc. v. Village of Ruidoso, 95 N.M. 82, 619 P.2d 186 (1980). In Toltec, this Court stated:
(1) that substantial evidence means such relevant evidence as a reasonable mind might accept as adequate to support a conclusion; (2) that on appeal all disputed facts are resolved in favor of the successful party, with all reasonable inferences indulged in support of a verdict, and all evidence and inferences to the contrary disregarded, and (3) that although contrary evidence is presented which may have supported a different verdict, the appellate court will not weigh the evidence or foreclose a finding of substantial evidence.
Id. at 84, 619 P.2d at 188 (citations omitted).
In the present case, the record shows that Stella Jaquez asked her sister-in-law, Anna Marie Walters (Walters), to give the Otero County officials the Jaquezes’ correct address, 8500 Viscount. Walters testified that when she went to the Otero County Assessor’s Office (Assessor’s Office) in early 1978, the correct address was written down by the Assessor’s Office, but that she was not given any kind of written proof the correction was made. Walters further testified that she told the Jaquezes she had given the Otero County officials the Jaquezes’ correct address. The Chief Deputy Assessor, Tom Garcia, Jr. (Garcia), testified that notices of change of address are made in both the Assessor’s Office and in the Treasurer’s Office. In addition, Garcia testified that if a change of address is made in the Treasurer’s Office, it is possible that the Assessor’s Office may not receive notice of the change. Garcia also testified that it is not common practice to give receipts to persons who have made address changes. Therefore, Garcia testified, a taxpayer would have no way of knowing if an address correction had failed to make it from the Treasurer’s Office to the Assessor’s Office for the tax schedule to be changed.
The Otero County Treasurer, Martha Nolan (Nolan), testified that the tax state- merits on the property for 1977 and 1978 listed the Jaquezes’ address as 1019 Southwest National Bank Building, and that the tax statements for the property for 1979 and 1980 listed a correction on the Jaquezes’ address as 8500 Viscount. In addition, Nolan testified that the correction was probably made in 1978 or 1979, but certainly not later than 1980. Nolan also testified that the 1980 tax schedule did not show the address change as made on the tax statements. The record also indicates that notice of the tax sale, return receipt requested, was mailed to the Jaquezes, but not to the correct address as listed on the 1979 and 1980 tax statements.
The Jaquezes had taken appropriate steps to change the address to which the notice was mailed. An actual change of address was given to the county authorities, who apparently did not follow through and change the Jaquezes’ address on the tax schedule.
Therefore, we determine that there was substantial evidence for the district court to make its findings.
The judgment of the district court is affirmed.
IT IS SO ORDERED.
PAYNE, C.J., and FEDERICI, J., concur.
. NMSA 1978, Section 7-38-66 (Cum.Supp.1980) is the applicable statute in the present case. It is currently compiled as NMSA 1978, Section 7-38-66 (Repl.Pamp.1983).
. The tax schedule is the master document maintained by the County Assessor with the name and address of the property tax owner and the address to which the tax statement is to be sent. The tax statement is the form mailed to the tax payer informing him of the taxes due for the year. | [
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OPINION
MINZNER, Judge.
Plaintiff Dawn Adrian Swindle (“Swindle”) sued General Motors Acceptance Corporation (“GMAC”) and Bill Swad Chevrolet, Inc. (“Swad”) for fraud, revocation of acceptance, and various statutory violations arising from her purchase of a 1981 Chevrolet Citation from Swad. Swad entered a Special Appearance and moved to dismiss for lack of personal jurisdiction. Following discovery and a hearing, the trial court granted Swad’s motion. Swindle appeals.
FACTS
Swad is an authorized Chevrolet dealership in Columbus, Ohio, engaged in the business of the sale and repair of new and used motor vehicles. Swindle, who was then an Ohio resident, visited Swad in February 1981 to purchase an automobile.
Following negotiations, Swindle signed a Retail Installment Contract on February 27, 1981 to purchase a Citation, represented to her as a new automobile under warranty. Swad subsequently requested that Swindle stop by the dealership to execute a second Installment Sale Contract. Swad indicated that the second contract would make no changes in the substantive terms of the parties’ agreement but was necessary because the first contract contained arithmetic mistakes. Swindle signed the second contract on March 2, 1981, before the terms were typed on the document. Swad subsequently completed the second contract.
Swad then .assigned the contract to GMAC in Ohio. GMAC’s business consists, in part, of financing purchases of automobiles from dealers by retail purchasers. Following Swindle’s move to New Mexico, the contract was transferred from the Ohio GMAC office to a New Mexico GMAC office.
The second contract includes a higher cash price, a higher total finance charge, a higher deferred payment price, and higher monthly installment payments. The second contract also represents that the Citation is
“Used” rather than “New” as indicated on the first Retail Installment Contract. In signing the second contract, Swindle relied on Swad’s allegations that the second contract made no substantive change.
Swindle moved to New Mexico in August 1981. She did not discover the discrepancy in the two contracts’ terms until September 1982.
Swindle filed suit against Swad and GMAC in Bernalillo County District Court. Swad moved to dismiss for lack of jurisdiction. The parties then conducted discovery. Swad filed affidavits in support of the Motion to Dismiss, and Swindle filed an Amended Complaint, in which she claimed that Swad and GMAC had acted in concert to induce her to sign the second contract. Swindle did not file any affidavit contesting Swad’s factual representations or offering additional evidence.
The trial court granted the Motion to Dismiss. The only questions presented on appeal are whether Swad is subject to jurisdiction under New Mexico’s long-arm statute, NMSA 1978, Section 38-1-16, and whether Swad has consented to the exercise of in personam jurisdiction by New Mexico. Based on the jurisdictional allegations in the amended complaint and on the record at the hearing before the district court, we conclude that Swad is not subject to jurisdiction either under the statute or by consent, and we affirm the trial court’s order dismissing Swindle’s complaint against Swad.
I. PREPARATION AND ASSIGNMENT OF A FRAUDULENTLY INDUCED RETAIL INSTALLMENT SALES CONTRACT BY AN OUT-OF-STATE CAR DEALER TO A NATIONWIDE FINANCE COMPANY AS “COMMISSION OF A TORTIOUS ACT” OR AS TRANSACTING BUSINESS WITHIN NEW MEXICO.
We first consider whether Swad submitted to jurisdiction within the meaning of Section 38—1—16(A)(1) or (3) by its preparation of the Retail Installment Sales Contract, its assignment of the contract to GMAC, and GMAC’s subsequent transfer of the assigned contract to New Mexico. Swindle argues that Swad has transacted business in New Mexico under Section 38-1-16(A)(1) or committed a tortious act within New Mexico under Section 38-l-16(A)(3).
A state court may exercise personal jurisdiction over a nonresident defendant only so long as sufficient “minimum contacts” exist between the defendant and the forum state. World-Wide Volkswagen Corp. v. Woodson, 444 U.S. 286, 100 S.Ct. 559, 62 L.Ed.2d 490 (1980). Our courts have equated the “transaction of business” and “the commission of a tortious act” required by our long-arm statute with the due process “minimum contacts” standard. Telephonic, Inc. v. Rosenblum, 88 N.M. 532, 543 P.2d 825 (1975); Tarango v. Pastrana, 94 N.M. 727, 616 P.2d 440 (Ct.App.1980). Swad’s contacts with New Mexico do not satisfy the standard.
The record reveals that Swad has never been authorized to do, nor has it ever done, business in New Mexico. The contracts were prepared in Ohio and assigned to GMAC in Ohio. Swad has not advertised in New Mexico or conducted any other business activities in New Mexico. It has no employees, facilities or agents in New Mexico.
Citing Blount v. T D Publishing Corp., 77 N.M. 384, 423 P.2d 421 (1966), Swindle analogizes Swad’s position to that of a manufacturer of a defective product, who must answer for an injury caused by the product wherever injury occurred if the manufacturer has chosen to distribute its product nationally. We find Swindle’s analogy unpersuasive.
To satisfy constitutional due process requirements in applying this theory, we must find that Swad has purposely availed itself of the privilege of conducting activities in New Mexico. World-Wide Volkswagen Corp. v. Woodson. For example, we might apply this theory if Swad itself had sold a defective product in a nationwide market. That is not the case. Although Swad assigned many of its contracts to GMAC during 1980-82, the record indicates that Swad is an independent, local dealer. Although Swad sold some automobiles to nonresidents, the record indicates that its sales area is Ohio. Under the circumstances of this case, we must reject the analogy.
World-Wide Volkswagen expressly distinguished local retailers and regional distributors from national manufacturers and protected the former from suit in distant forums in which they themselves transacted no business. Swindle’s argument ignores the distinction World-Wide Volkswagen has held due process requires. Swad has not purposefully affiliated with New Mexico within the meaning of Blount.
Further, Swindle’s allegations that a defective product has injured her within New Mexico are insufficient to bring her under the long-arm statute. In Roberts v. Piper Aircraft Corp., 100 N.M. 363, 670 P.2d 974 (Ct.App.1983), this court recognized a negligent act committed outside New Mexico, which caused injury within New Mexico, as a tortious act under the long-arm statute. The Roberts court identified the place of a wrong as that place in which the last event necessary to render the actor liable occurs. If Swindle’s allegations are true, Swad became liable in tort when it misrepresented the contents of the second contract and Swindle relied, to her financial disadvantage, on the misrepresentation by signing the contract. Thus, Swad’s liability arose in Ohio rather than New Mexico.
Although plaintiff has alleged that she did not discover the misrepresentation until she had moved to New Mexico, we do not think, under the facts of this case, that fraud has been committed in New Mexico. There is no allegation or evidence that Swad's tortious activity continued after Swindle moved to New Mexico.
It is true that Swindle’s liability on her contract continued when she moved to New Mexico, but Swad’s alleged tortious activity did not continue in New Mexico as a result of Swindle’s move. To classify Swindle’s continued liability on her contract as suffi cient injury committed within New Mexico under Roberts would expand our long-arm statute beyond constitutional due process limits. New Mexico cannot exercise personal jurisdiction over a nonresident defendant solely on the basis of a plaintiffs residency at the time of the lawsuit. Tarango v. Pastrana; cf. Green v. Advance Ross Electronics Corp., 86 Ill.2d 431, 56 Ill.Dec. 657, 427 N.E.2d 1203 (1981) (in action claiming breach of fiduciary duty, allegation that defendant had caused diminution of funds of Illinois corporation an insufficient basis for long-arm jurisdiction when- all cash payments made to defendant were drawn on Texas bank account; court found that the consequences upon which the party seeking jurisdiction relied were too remote and impact on jurisdiction was too broad).
Finally, Swindle argues that Swad is subject to New Mexico jurisdiction either because GMAC was Swad’s agent for repossession under the contract, or on the basis of a general agent-principal relationship between Swad and GMAC. This argument is without merit. The trial court found that Swad and GMAC were not involved in an agent-principal relationship. Swindle had the burden of proving this jurisdictional allegation. State v. Columbia Research Corp., 92 N.M. 104, 583 P.2d 468 (1978). The record as a whole does not support the allegation. Swindle cannot rely upon GMAC’s conduct to assert jurisdiction over Swad.
II. CONSENT TO JURISDICTION IN NEW MEXICO.
Swad agreed, in assigning the contract to GMAC, that a buyer could litigate all claims and defenses against GMAC and that Swad would indemnify GMAC for the unpaid price of the automobile and for expenses. Swindle argues that these clauses represent a consent by Swad to accept jurisdiction wherever these issues might be litigated.
While it is true that a party may agree in advance to submit to the jurisdiction of the courts of a certain state, Telephonic, Inc. v. Rosenblum, such an agreement must be “deliberately and understandingly made, and language relied upon to constitute such a waiver must clearly, unequivocally and unambiguously express a waiver of this right.” Id. at 537, 543 P.2d at 830. No such waiver appears in either the contract notice provisions, which are required by federal regulation, or in the language of indemnity. See 16 C.F.R. § 433.2 (1982). Thus, Swad has not consented to jurisdiction in New Mexico.
For the foregoing reasons, we affirm the trial court’s decision that it lacked personal jurisdiction over Swad.
IT IS SO ORDERED.
DONNELLY, C.J., and NEAL, J., concur. | [
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] |
OPINION
MINZNER, Judge.
Iva Green (appellant), a recipient of Aid to Families with Dependent Children (AFDC) benefits, appeals from a fair hearing decision. That decision affirmed action by the Socorro County office declaring appellant ineligible for her basic monthly grant and accompanying benefits. The New Mexico Human Services Department (HSD) affirmed the hearing officer’s decision that the county correctly applied the “lump sum rule”; because appellant had received a nonrecurring lump sum payment, she was ineligible for a period of time calculated by dividing the nonrecurring payment, together with all income for that month, by the basic monthly grant. See Muckey v. New Mexico Dep’t of Human Servs., Income Support Div., 102 N.M. 265, 694 P.2d 521 (Ct.App.1985). Appellant’s sole argument on appeal is that HSD is equitably estopped from imposing a period of ineligibility. Cf. id. Appellant does not challenge on appeal the correctness of HSD’s application of the lump sum rule. Consequently, that issue is not before us. We vacate the fair hearing decision and remand for further proceedings.
The hearing officer ruled against appellant on the theory that “[wjhether she was correctly or incorrectly informed of the subsequent closure is not at issue____ The county had no choice but to terminate assistance.” To the extent HSD rejected appellant’s equitable estoppel argument as irrelevant, the decision was incorrect as a matter of law and must be reversed. See § 27-3-4(F).
Equitable estoppel is a theory not generally used against the state. See generally Peltz v. New Mexico Dep’t of Human Servs., Income Support Div.; Peltz v. New Mexico Dep’t of Health & Social Servs., 89 N.M. 276, 551 P.2d 100 (Ct.App. 1976). However, equitable estoppel will be applied against the state where right and justice demand it. State ex rel. Dep’t of Human Servs. v. Davis, 99 N.M. 138, 654 P.2d 1038 (1982). In fact, HSD concedes on appeal that an exception exists for “rare cases.”
The requisite elements of equitable estoppel are outlined in Stuckey’s Stores, Inc. v. O’Cheskey, 93 N.M. 312, 600 P.2d 258 (1979), appeal dismissed, 446 U.S. 930, 100 S.Ct. 2145, 64 L.Ed.2d 783 (1980). Relating to the party estopped, “ ‘[cjonduct which amounts to a false representation or concealment of material facts’ ” must be shown, along with knowledge of true facts and an intention or expectation that the innocent party will act on those representations. Id. at 324, 600 P.2d at 270 (quoting Westerman v. City of Carlsbad, 55 N.M. 550, 555-6, 237 P.2d 356, 359 (1951)). The court noted that representations that are contrary to the essential facts to be relied on, even when made innocently or by mistake, will support the application of the estoppel doctrine. The party claiming estoppel must have lack of knowledge of the true facts in question, must have relied on the estopped party’s conduct, and must have taken action which changes his or her position prejudicially. Id.
In this case, appellant testified at the fair hearing that she had a telephone conversation with Ronald Raff, her caseworker, on the day she received the lump sum payment. According to her testimony, Raff said the money “was hers” and that she could do “whatever she wanted” with it; he also assured her that the two checks she received would not affect her benefits significantly, with the exception of a minor alteration in Décember. Based on this information, appellant spent the money on clothes for the children, Christmas gifts, past indebtedness, and automobile repairs.
Raff testified that it was possible that such a conversation occurred, although he did not recall it. Raff stated that he routinely informs clients that they may keep a lump sum of money received and are not required to forward such checks to HSD. Raff did recall discussing the lump sum with appellant during a periodic review, which- occurred in mid-December 1986.
Appellant’s father also testified at the hearing. He had listened to a telephone conversation between appellant and Raff from an extension. Mr. Green testified that Raff told appellant the money was hers and that she did not have to forward the checks to HSD. There would “probably be” some effect, Raff would have to “make corrections in it, but it wouldn't be a great deal.” Mr. Green also stated that Raff did not indicate for how long a period those corrections might be made.
Appellant urges this court to hold that Raff’s testimony does not conflict with that of herself and her father. We disagree. Raff testified it was not his practice to advise clients by telephone about the effect of a lump sum and that he first discussed the lump sum rule with appellant at a personal interview in December. Cf. State v. Chavez, 84 N.M. 247, 501 P.2d 691 (Ct. App.1972) (failure to remember not a denial). Further, the two checks were for vastly different amounts; one was a back payment and the other the first of a series of monthly grants. It is possible that appellant failed to tell Raff exactly how much she had received. Under these circumstances, there is conflicting evidence relating to the conduct of the party to be es-topped: whether a representation was made and to what it referred. The evidence involves not only the credibility of the witnesses but also the inferences their testimony will support.
Thus, there is a factual dispute on whether Raff made the representations on which appellant claimed to have relied. The decision below failed to resolve this dispute. The only findings of fact concern the date appellant received the payment and the two different dates HSD proposed termination. Here, we cannot be sure how the hearing officer would have resolved the factual dispute. Thus, we cannot affirm the decision as right for the wrong reason. Cf. State ex rel. State Highway Dep’t of N.M. v. Strosnider, 106 N.M. 608, 747 P.2d 254 (Ct.App.1987) (correct decision of trial court will not be reversed if, under any reasonable view of the facts and law, the judgment is proper). Because the credibility of the witnesses is at issue, this is not an appropriate case for us to make independent findings. Cf. Cibola Energy Corp. v. Roselli, 105 N.M. 774, 787 P.2d 555 (Ct. App.1987). In addition, the findings of fact do not permit us to determine whether the other elements of equitable estoppel are present.
The second termination notice appellant received indicated medical benefits were terminated February 1, 1987. The hearing officer concluded that “closure should have been effective December 1986.”
On the record before us, it is unclear whether appellant was ineligible for medical benefits in January, 1987 and thus will be required to repay sums expended for surgery in that month. It is also unclear whether she postponed her surgery from November to January in reliance on Raff’s statements. This makes it impossible to evaluate the extent to which “right and justice” demand application of the doctrine of equitable estoppel.
Because the hearing officer apparently believed appellant’s argument had no basis in law, he made no findings on the issues raised by her defense in light of the evidence. We are not able to make our own findings because of the nature of the evidence. Under these circumstances, it is appropriate to remand the case to the hearing officer and to HSD for entry of additional findings. Compare Mora v. Martinez, 80 N.M. 88, 451 P.2d 992 (1969) (case should be remanded where trial court failed to make proper findings of fact and conclusions of law) with Taylor v. Department of Human Servs., 98 N.M. 314, 648 P.2d 353 (Ct.App.1982) (cause reversed and remanded with instructions to reinstate claimant until such time as a fair hearing has been held according to law). On remand, the hearing officer shall make specific findings of fact concerning the elements of equitable estoppel and determine whether or not “right and justice” support application of that doctrine.
Under NMSA 1978, Section 27-3-3(D) (Repl.Pamp.1984), the director is required to review the decision of the hearing officer and the “recipient, or his representative, shall be notified in writing of the director’s decision and the reasons for the decision." (Emphasis added.) Although the director in this case signed a form paragraph entitled “Final Decision” and inserted a check mark indicating “[djecided in favor of DEPT.,” his signature and the check mark fail to comply with Section 27-3-3(D) because they do not indicate the reason for his decision. Specifically, the director failed to indicate whether he adopted or approved the findings and conclusions of the hearing officer or whether he reached his decision on some other basis. Compliance with Section 27-3-3(D) is necessary for meaningful appellate review. Decisions of an administrative officer must adequately reflect the basis for his or her determination and the reasoning used in arriving at such determination. Cf. Akel v. New Mexico Human Servs. Dep’t, 106 N.M. 741, 749 P.2d 1120 (Ct.App.1987) (non-attorney hearing officer required to issue decision adequately reflecting basis for determination and reasoning used).
For the above reasons, the fair hearing decision is set aside, and the case is remanded for further proceedings not inconsistent with this opinion. No costs are awarded.
IT IS SO ORDERED.
DONNELLY, C.J., and BIVINS, J., concur. | [
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OPINION
RANSOM, Justice.
The New Mexico State Corporation Commission (Commission) denied the application of Burlington Northern Railroad Company (Burlington) to close its agency station located at Des Moines, New Mexico. Burlington has removed the cause for review by this Court pursuant to Article XI, Section 7 of the New Mexico Constitution. We hold that the Commission’s order was reasonable and just and will be enforced.
Following an application from Burlington seeking permission to close its agency station at Des Moines, the Commission held a public hearing in Raton, New Mexico, on September 5, 1986. At that hearing, Burlington presented its evidence in support of discontinuing a base agency service at Des Moines. No formal intervenor protested against the application. However, members of the public, including a state senator, the mayor of Des Moines, and a representative of Twin Mountain Rock, a major Burlington customer, expressed opposition to the closing. In addition, the Commission received and incorporated into the record letters of protest offered by Twin Mountain and members of the Eastern Plains Council of Governments.
The Burlington agency station at Des Moines is currently staffed by one local agent, Ted Kirkendall, who is on duty forty hours per week. Kirkendall’s duties include communicating with customers, collecting revenue, preparing inbound waybills and furnishing the Denver office with information for the outbound waybills, monitoring the station grounds, and correctly spotting railroad cars. Burlington proposes to eliminate Kirkendall’s position and handle all his duties from its Denver office. The Denver agency is staffed with approximately sixty-five employees, is open twenty-four hours a day, seven days a week, and maintains a system-wide computer facility. Burlington’s customers in Union County who wish to order cars, release loaded cars, or obtain information on shipping rates, schedules, freight charges, etc., may choose either to call Denver toll free or to deal with Kirkendall in Des Moines, who must then relay the matter to the Denver facility where it is handled by computer.
Additionally, Kirkendall performs certain safety functions. He visually inspects trains as they roll by to detect equipment malfunctions or other unsafe conditions. In the event of a derailment or other railroad emergency, Kirkendall serves as a relay point for information between local firefighters, Burlington’s wrecking and safety crews, and the Amarillo, Texas, company under contract to Burlington to handle major derailments and the clean-up of hazardous spillage.
Burlington’s three major customers are Twin Mountain, Big Chief Stone, and Kaiser Coal. The revenues for the years 1983 through the first half of 1986 attributable to Des Moines and its assigned blind sidings, where no agent is present, were as follows: $465,000 in 1983; $510,711 in 1984; $478,695 in 1985; and $301,621 for the first half of 1986. A station in the Burlington system must have approximately $400,000 in annual revenue to break even for the year. The total expense for the Des Moines station, which included a percentage of the entire system’s operating costs, the wages and benefits of Kirkendall and two relief workers, and station maintenance costs, was as follows: $42,708 in 1983; $44,988 in 1984; $44,864 in 1985; and $56,906 in the first half of 1986. Over ninety-five percent of the total annual expense is attributable to wages and fringe benefits.
Under Article XI, Section 7 of our constitution, this Court is mandated to decide a case such as this one on its merits. Our scrutiny, therefore, is more exacting than that normally accorded administrative decision-making. In reviewing a Commis sion order on its merits, instead of examining evidence to substantiate the Commission’s findings, we make an independent determination that it is more likely than not that the Commission’s order is just and reasonable. Missouri Pac. R.R. v. State Corp. Comm’n, 93 N.M. 753, 754, 605 P.2d 1152, 1153 (1980). The Commission’s order may be affirmed only “if supported by ‘satisfactory and substantial evidence.’ The term ‘satisfactory’ implies a weighing procedure.” Atchison, T & S.F. Ry. v. Corporation Comm’n, 99 N.M. 205, 207, 656 P.2d 868, 870 (1982) (quoting Mountain States Tel. & Tel. Co. v. Corporation Comm’n, 99 N.M. 1, 6, 653 P.2d 501, 506 (1982)). This is not, however, a de novo review of the record where we substitute our judgment for that of the Commission. Seward v. Denver & Rio Grande R.R., 17 N.M. 557, 578-80, 131 P. 980, 987-88 (1913); but see Village and Citizens of Grenville v. State Corp. Comm’n, 53 N.M. 259, 260, 206 P.2d 259, 260 (1949) (“[T]he cause has been removed for trial de novo provided by Sec. 7 of Art. 11 of this state’s Constitution.”). It is simply that we do not indulge in any presumptions in favor of the agency decision, Mountain States Tel. & Tel. Co., 99 N.M. at 6, 653 P.2d at 506; but while the Commission’s findings are not binding upon this Court, State v. Mountain States Tel. & Tel. Co., 54 N.M. 315, 323, 224 P.2d 155, 161 (1950), it is an overstatement to imply that such findings are ignored in the weighing process. We recognize the expertise of the Commission in public utility management.
In determining the reasonableness of an order concerning the removal of local station agents, this Court engages in a cost-benefit analysis, balancing the convenience to the shipper and the benefit to the public in maintaining the agent, compared to the potential economic waste to the railroad of having to maintain an agent. Missouri Pac. R.R., 93 N.M. at 755, 605 P.2d at 1154. Factors to be considered in this analysis are the expense of maintaining the station, the revenue derived by the railroad from the operation of the station, the mun-ber of people to be benefited, the demand for services, the proximity and accessability of other stations, any inconvenience to the public, the nature of the service remaining or to be substituted, and all other facts and circumstances. Id.; Atchison, T. & S.F. Ry., 99 N.M. at 208, 656 P.2d at 871.
As a preliminary matter, we note that before utilizing this balancing test previous courts first would make clear whether safety was in issue. Seward, 17 N.M. at 594, 131 P. at 993 (where safety is questioned, there is involved a different proposition than the interests of the public and the expense entailed upon the railroad company); Randall v. Atchison, T. & S.F. Ry., 34 N.M. 391, 392, 281 P. 479, 480 (1929) (“No question of the need of an agent * * * for public safety is involved * * *.”); Denton Bros. v. Atchison T. & S.F. Ry., 34 N.M. 53, 54, 277 P. 34, 35 (1929) (“The public safety is not involved. It is a matter of public convenience only.”); Southern Pac. Co. v. State Corp. Comm’n, 76 N.M. 257, 259, 414 P.2d 489, 490 (1966) (“It is not contended that an agent at the station is required for public safety.”); Missouri Pac. R.R. v. State Corp. Comm’n, 93 N.M. 753, 605 P.2d 1152 (1980) (no issue of public safety to consider in setting aside Commission’s order denying discontinuation of mobile agent at Hobbs, N.M.).
Having made this observation, we do not submit that where safety is at issue we should depart entirely from a balancing of the respective interests of the public and the railroad, provided the activity at issue is not unreasonably dangerous. When le-’ gitimate public safety concerns are implicated, however, evidence that the railroad will experience some economic detriment in maintaining an agent will be insufficient to weigh against the reasonableness of an order denying the elimination of that agent. See Railroad Comm’n v. Eastern Texas R.R., 264 U.S. 79, 85, 44 S.Ct. 247, 249, 68 L.Ed. 569 (1924) (“[T]he State has power to regulate [a railroad’s] operations in the interest of the public, and to that end may require it to provide reasonably safe and adequate facilities for servicing the public, even though compliance be attended by some pecuniary disadvantage.”).
During the hearing, three safety concerns were raised: right-of-way fires, hazardous materials spillages, and the elimination of Kirkendall’s performance of roll-by inspections. Burlington argues that Kirkendall simply is not involved in either extinguishing right-of-way fires or dealing with hazardous spillages. Further, Burlington maintains that the absence of Kirkendall’s visual inspection of passing trains will have no adverse safety ramifications. This function is performed by nearly all of Burlington’s employees, as required by its safety rules. Also, Burlington has installed warning devices on the track that mechanically detect problems on moving trains.
Admittedly, Kirkendall has no role in the actual extinguishment of a fire or in the actual clean-up of a hazardous spillage. Kirkendall, however, would be instrumental in assembling the initial response team, the volunteer fire department, and would be involved in coordinating the various entities responding to an emergency. Furthermore, we would be reluctant to discount the importance of Kirkendall’s roll-by inspections. See Atchison, 99 N.M. at 208, 656 P.2d at 871.
In weighing the order’s impact upon the railroad’s interest, Burlington concedes that because of present contractual obligations it will not be able to reduce significantly current expenditures if it were to close the Des Moines agency. Nor do the expenses represent significant economic waste. Burlington’s inability to discontinue personal customer service at Des Moines, however, impedes it from centralizing operations at its system-wide computerized facility at Denver. In addition to the Des Moines station, at the time of the hearing, Burlington was also seeking to close stations in Texline, Texas, and Trinidad, Colorado, leaving the 450 mile stretch between Denver and Amarillo without local agencies. Burlington needs to streamline and to eliminate duplicative services to remain competitive in the marketplace.
Furthermore, elimination of a local agent would not result in any appreciable degradation in the quality of customer service. Burlington’s witness testified that in other sections of its system customers relying on regional computerized centers experienced no problems with Burlington’s delivery of service. Those opposing the agency closing opined that the quality of service might suffer if the local agent was removed. There was nothing to substantiate these speculative apprehensions. In fact, Burlington attempted to assuage the fears of Twin Mountain by arranging for Twin Mountain’s computer to interface directly with Burlington’s in Denver. Moreover, Kirkendall is available only forty hours a week whereas Denver is accessible toll-free, seven days a week, twenty-four hours a day. The evidence was abundant to demonstrate the public would benefit, rather than be inconvenienced, by the elimination of customer services at Des Moines.
Notwithstanding the absence of significant short-term savings to Burlington in closing the Des Moines agency, if the only issue were the convenience of the public, we would have to conclude that the evidence weighs against the reasonableness of requiring the agency to remain open. However, legitimate public safety concerns have been raised. See Atchison, 99 N.M. at 208, 656 P.2d at 871 (placing into the balance the safety of the travelling public). Burlington’s plan to supplant Kirkendall with direct communications with Denver does not address the loss of the safety functions currently executed by him. Burlington contends that Kirkendall’s place in the communications loop during an emergency can be fullfilled by either calling Denver or Ft. Worth. Burlington’s train-master, who resides in Trinidad, Colorado, stated that he could be in Des Moines in an hour to an hour and one half to relay information to entities responding to an emergency.
In an emergency, time is of the essence. Because of Kirkendall’s ties to the community, he has the ability to contact quickly members of the Des Moines volunteer fire department. The evidence preponderates that, under the present system, the removal of Kirkendall could compromise public safety. Burlington did not produce sufficient evidence to allay the legitimate safety concerns of the community and the Commission. We find the Commission’s denial of Burlington’s application to close its agency station at Des Moines reasonable and just. The order will be enforced.
IT IS SO ORDERED.
SCARBOROUGH, C.J., and WALTERS, J., concur.
. Article XI, Section 7 of the New Mexico Constitution provides in pertinent part as follows:
The commission shall have power * * * to require railway companies to provide and maintain ... agents and facilities * * * for receiving and delivering freight and express * * * whenever in the judgment of the commission the public interests demand, and as may be reasonable and just. * * * The commission shall have power * * * upon a hearing, to determine and decide any question given to it herein * * *. Any company, corporation or common carrier which does not comply with the order of the commission within the time limited therefor, may file with the commission a petition to remove such cause to the supreme court * * *.
[T]he said court shall have the power and it shall be its duty to decide such cases on their merits____
. Traditionally, the court reviewed administrative action to determine whether it was supported by substantial evidence. See Duke City Lumber Co. v. New Mexico Envtl. Improvement Bd., 101 N.M. 291, 681 P.2d 717 (1984). The deference afforded agency action wassuchthatthe court would consider only evidence favorable to the agency and would ignore evidence to the contrary. Id. at 293, 681 P.2d at 719. This minimal judicial intrusion represented by a substantial evidence standard of review has been supplanted now by whole record review in the normal appeal of administrative decision-making. See id.; National Council on Compensation Ins. v. New Mexico State Corp. Comm’n, 107 N.M. 278, 756 P.2d 558 (1988). Under whole record review, to conclude that an administrative decision is supported by substantial evidence, the reviewing court needs to find evidence that is credible in light of the whole record. "No part of the evidence may be exclusively relied upon if it would be unreasonable to do so.” National Council of Compensation Ins., 107 N.M. at 282, 756 P.2d at 562. | [
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] |
OPINION
MINZNER, Judge.
On the court’s own motion, the prior opinion of this court is withdrawn and the following opinion substituted therefor.
Plaintiffs Q. Lee and Kim Pittard brought this action to recover damages suffered when David Leroy Perales (“Perales”) sexually assaulted their son. Perales was an on-duty employee of the hotel Four Seasons Motor Inn, Inc., at the time of the incident. D.B. Investment Properties, Inc. is a successor in interest to the Four Seasons.
Mrs. Pittard and her son were on the hotel’s business premises on January 15, 1978 as guests of Mrs. Pittard’s parents, who were registered guests of the hotel. The hotel was open to the public for business purposes on that day. In fact, the hotel was conducting several promotional activities designed to attract customers, guests, and invitees on January 15, including a special Super Bowl promotion.
Perales was working at the hotel on January 15 as a steward assisting in the preparation of banquets. He admitted to being intoxicated when he reported for duty and to further consumption of alcohol while on duty. Perales left the banquet area while on duty and encountered the boy near the hotel’s swimming pool area. He enticed the boy into a hotel bathroom, locked the door behind them, and sexually assaulted the boy. Perales was later apprehended in the hotel's kitchen area and admitted the sexual assault.
Plaintiffs sought by pretrial discovery to require the hotel to produce the personnel file it maintained on Perales. The hotel failed to produce the file, contending that it had been lost.
Plaintiffs sought recovery against the hotel under several causes of action: (1) respondeat superior; (2) breach of duty to care for the safety of guests and invitees; (3) failure to provide adequate security; (4) negligent hiring; (5) negligent retention; and (6) inadequate supervision. Following plaintiffs’ presentation of their case to the jury, the trial court granted directed verdicts on the negligent hiring and retention claims but denied directed verdicts as to the others. Plaintiffs moved for discovery sanctions against the hotel for its loss of Perales’ personnel file. The trial court denied plaintiffs’ request for a directed verdict on the negligent hiring and retention claims as a sanction but refused to allow testimony regarding foreseeability on matters relating to the lost file. The jury returned a verdict for the hotel on those issues submitted to it. Plaintiffs raise three issues on appeal:
(1) the trial court erroneously instructed the jury on the hotel’s duty to care for the safety of guests and invitees;
(2) the trial court erred in failing to direct a verdict for plaintiffs on the negligent hiring and retention claims as a sanction for the hotel’s loss of the personnel file; and
(3) the trial court erred in directing a verdict on the negligent hiring and retention claim.
We affirm the trial court with respect to issues (1) and (2). We reverse the trial court with respect to issue (3) and remand the case for a new trial on that issue.
1. Discovery Sanction for Lost Personnel File.
NMSA 1978, Civ.P.Rule 37(B)(2) (Repl.Pamp.1980) authorizes the trial court to impose sanctions against a party for the failure to obey an order to provide or permit discovery. When evidence is willfully destroyed or lost, the trial court may, in its discretion, direct a verdict against a guilty party. United Nuclear Corp. v. General Atomic Co., 96 N.M. 155, 629 P.2d 231 (1980), appeal dismissed, 451 U.S. 901, 101 S.Ct. 1966, 68 L.Ed.2d 289 (1981). Choice of sanctions imposed under this rule lies within the sound discretion of the trial court. Only a clear abuse of discretion will warrant reversal of the choice of sanctions. Id.
The record reveals that the hotel’s insurance adjuster prepared a report on the incident, using Perales’ personnel file, some ten months after the incident. The report' was given to plaintiffs’ counsel on the first day of trial. Plaintiffs learned in June 1981 that Perales’ personnel file had been lost. Plaintiffs requested production of the file in November 1982, one month before trial. They renewed the motion the day before trial and filed a motion in limine to restrain the hotel from arguing the foreseeability of Perales’ actions. No written discovery order was filed with regard to the personnel file.
At trial plaintiffs renewed their complaint regarding the file and alleged “willful misconduct.” Plaintiffs requested that the trial court preclude the hotel from raising the defense of foreseeability. The trial court accepted the hotel’s contention that the personnel file had been lost and found no culpable conduct on the part of the hotel.
Plaintiffs argue on these facts that the trial court erred when it failed to direct a verdict or enter default judgment against the hotel on the negligent hiring, retention, and supervision claims. We disagree.
The facts of this case do not support a conclusion that the trial court abused its discretion with respect to discovery sanctions. Severe sanctions such as denying a party the right to a hearing on the merits should be' imposed only where there is a willful or bad faith failure to comply with a discovery order. United Nuclear Corp. v. General Atomic Co. Plaintiffs have failed to point to any violation of a discovery order here. Moreover, there is sufficient evidence in the record to support the trial court’s finding that loss of the file was not culpable but inadvertent. The file was lost long before any motion to produce was served on the hotel. We will not disturb the trial court’s ruling.
2. Jury Instruction on Hotel’s Standard of Care.
Plaintiffs object to Instruction 10 given by the trial court on the hotel’s general duty of care. That instruction read:
The proprietor of a hotel is not an insurer of the safety of its guests against the acts of third persons. Additionally, the obligation of the proprietor of a hotel does not include an insurance of the guest’s person against the wilful or negligent acts of its employees not acting in the scope of their employment. The proprietor of a hotel is under a duty only to exercise reasonable care for the safety of the hotel’s guests.
Instructions must correctly state the law and be based on the evidence. All instructions must be read together and, if they fairly present the issues and the applicable law, they are sufficient. A reviewing court must consider the instructions as a whole. Blackburn v. State, 98 N.M. 34, 644 P.2d 548 (Ct.App.1982). A party complaining of faulty instructions must show prejudice before reversal is warranted. Jewell v. Seidenberg, 82 N.M. 120, 477 P.2d 296 (1970).
Plaintiffs argue that the instruction prejudiced them in several ways. Their claim of prejudice primarily concerns a theory of liability that has been recognized in New Mexico but with respect to which we have little case law. It differs from a claim of respondeat superior.
A plaintiff injured by an employee’s assault may sue under a theory of respondeat superior. Dessauer v. Memorial General Hospital, 96 N.M. 92, 628 P.2d 337 (Ct.App.1981). In order to recover under a respondeat superior theory, the plaintiff must demonstrate that the employee was acting within the scope of his employment. Gonzales v. Southwest Security and Protection Agency, Inc., 100 N.M. 54, 665 P.2d 810 (Ct.App.1983). Plaintiffs were unsuccessful on their respondeat superior claim.
Our case law recognizes that an innkeeper may be liable for an assault upon a guest or invitee by an employee under a second theory:
Naturally, an innkeeper is not and cannot be an insurer of a guest or patron against personal injuries inflicted by another person on the premises, other than his servants or agents. Nevertheless, the proprietor of a place of business who holds it out to the public for entry for his business purposes, is subject to liability to guests who are upon the premises and who are injured by the harmful acts of third persons if, by the exercise of reasonable care, the proprietor could have discovered that such acts were being done or about to be done, and could have protected against the injury by controlling the conduct of the other patron.
Coca v. Arceo, 71 N.M. 186, 189, 376 P.2d 970, 973 (1962).
Coca cites 2 Restatement of Torts Section 348 (1934) as authority for the rule. That provision is now embodied in Restatement (Second) of Torts Section 344 (1965), which states:
A possessor of land who holds it open to the public for entry for his business purposes is subject to liability to members of the public while they are upon the land for such a purpose, for physical harm caused by the accidental, negligent, or intentionally harmful acts of third persons or animals, and by the failure of the possessor to exercise reasonable care to
(a) discover that such acts are being done or are likely to be done, or
(b) give a warning adequate to enable the visitors to avoid the harm, or otherwise to protect them against it.
“Third persons” include servants acting outside the scope of their employment. Restatement (Second) § 344 comment b.
Plaintiffs first contend that the instruction was erroneous because there was no set of facts under which the jury could have found Perales to be a third person within the meaning of the language quoted from Coca. They argue that because Perales was on duty and on the premises at the time of the assault he could not be a third person. This argument is clearly erroneous. The Restatement specifically defines employees acting outside the scope of their employment as “third persons.” The mere fact that an employee is on duty does not mean that every action he takes is within the scope of employment.
Plaintiffs next contend that the hotel should be strictly liable for the assault. They claim that the “other than his servants or agents” language in Coca means that an innkeeper is an insurer of a patron for injuries inflicted by a servant. We disagree. Coca cites Section 348 of the Restatement as support for the proposition. That section has been replaced in the second edition by Section 344, which holds possessors of land to a “reasonable care,” not strict liability, standard. Had the supreme court intended in Coca to impose a strict liability standard for the acts of servants outside the scope of employment, it could have done so explicitly. The fact that it did not is convincing evidence that negligence is the proper standard to be applied.
Even Tobin v. Slutsky, 506 F.2d 1097 (2nd Cir.1974), upon which plaintiffs rely, does not impose strict liability upon innkeepers. Innkeepers are held to a “reasonable care commensurate with the quality of the accomodations offered” standard. To-bin also recognizes that “[n]o matter how strict the standard, however, the hotel is not an insurer * * *.” 506 F.2d at 1103.
There are cases which seem to hold innkeepers to a higher standard for assaults by employees acting outside the scope of duty under a theory of implied breach of a legal or contractual obligation of an innkeeper to treat guests with due consideration for their safety and comfort. See Crawford v. Hotel Essex Boston Corp., 143 F.Supp. 172 (D.Mass.1956); Clancy v. Barker, 71 Neb. 83, 98 N.W. 440 (1904), adhered to on reh’g, 71 Neb. 91,103 N.W. 446 (1905). We decline to follow these cases to the extent that they do impose a higher standard. These decisions draw an analogy which we do not find persuasive between common carriers and innkeepers. Moreover, New Mexico does not recognize degrees of negligence but applies in all cases an “ordinary care under the circumstances” standard. NMSA 1978, UJI Civ. 6.5 (Repl.Pamp.1980) and Committee Comment thereto.
Plaintiffs finally contend that the trial court “completely negated” the jury’s ability to impose liability if Perales were found to have acted outside the scope of employment. We agree that the instruction does not clearly point out that the hotel could be liable if Perales acted outside the scope of employment and if the jury found that the hotel violated its duty to exercise reasonable care to provide for the safety of business visitors. The instruction might have tracked the Restatement provision much more closely.
Plaintiffs waived their right to raise this particular complaint with regard to the instruction. A party objecting to a jury instruction must specifically guide the mind of the trial court to the claimed error. NMSA 1978, Civ.P.R. 51(1) (Cum.Supp. 1983); Poorbaugh v. Mullen, 99 N.M. 11, 653 P.2d 511 (Ct.App.), cert. denied, 99 N.M. 47, 653 P.2d 878 (1982). Plaintiffs never raised this specific objection to the trial court. Rather, they argued that Perales could not have been a third party, a contention inconsistent with recovery under the business proprietor theory, and argued that strict liability was the correct standard. Plaintiffs offered an instruction, which was refused, based on NMSA 1978, UJI Civ. 13.10 (Repl.Pamp.1980), which is adopted from Restatement (Second) of Torts Sections 342, 343 (1965). Plaintiffs never tendered an instruction which correctly tracks Section 344.
The trial court is affirmed on the jury instruction issue.
3. Directed Verdict on the Negligent Hiring and Retention Claims.
Negligent hiring and retention is a second theory which a plaintiff may assert to recover against an employer for an employee’s assault outside the scope of employment. La Lone v. Smith, 39 Wash.2d 167, 234 P.2d 893 (1951); 34 A.L.R.2d 372 § 9 (1954). The trial court granted the hotel’s motion for a directed verdict on these claims, citing F & T Co. v. Woods, 92 N.M. 697, 594 P.2d 745 (1979). Plaintiffs argue that Woods is distinguishable on its facts, and that there was sufficient evidence of foreseeability to submit the claim to the jury. We agree.
A directed verdict should be granted only when reasonable minds cannot differ as to the result to be reached. Owen v. Burn Construction Co., 90 N.M. 297, 563 P.2d 91 (1977). In reviewing the grant of a directed verdict the appellate court must view the evidence in the light most favorable to the non-moving party. Loucks v. Albuquerque National Bank, 76 N.M. 735, 418 P.2d 191 (1966).
In Woods, the plaintiff was raped by defendant’s employee. The employee had delivered a television set to the plaintiff in the course of the defendant’s business. The employee returned to plaintiffs residence five days later while off duty, broke into the residence, and committed the rape.
Plaintiff sued on a negligent hiring and retention theory. The court noted that a substantial portion of the record was directed at the employer’s inquiry or lack thereof into the employee’s past and to the employer’s actual knowledge of the employee’s past criminal record. The employee was an ex-convict. The defendant’s manager had been visited prior to the rape in question by a detective who was investigating previous rapes in the area. The manager was told that a “colored person” was suspected, although the particular employee was not singled out by the detective as a suspect. The perpetrator was one of two black employees. The manager was also aware of the fact that a purse belonging to a previous rape victim had been found in defendant’s trash area.
The Woods court recognized the negligent hiring and retention cause of action. The court stated, however, “It is not enough that plaintiff prove that defendant was negligent in hiring or retaining Sanders. In addition, plaintiff must prove that the negligent hiring or retention of Sanders was the proximate cause of the rape.” 92 N.M. at 699-700, 594 P.2d at 747-48. The court expressly equated the proximate cause requirement imposed with a foreseeability requirement.
Proximate cause is that which in a natural and continuous sequence unbroken by any new independent causes produces the injury and without which the injury would not have occurred. Lopez v. Maez, 98 N.M. 625, 651 P.2d 1269 (1982). Foreseeability is imposed to preclude a finding of liability where defendant’s conduct was part of the causal chain of the injury but the resulting injury could not have been reasonably foreseen by the defendant. F & T Co. v. Woods. Foreseeability does not require that the particular consequence should have been anticipated, but rather that some general harm or consequence be foreseeable. Gilbert v. New Mexico Const. Co., 39 N.M. 216, 44 P.2d 489 (1935); Pisel v. Stamford Hospital, 180 Conn. 314, 430 A.2d 1 (1980).
The Woods court held as a matter of law that no evidence had been introduced in the case which would justify submission of the claim to the jury. The employee’s criminal conduct was not foreseeable, given the facts of that case, from the defendant’s hiring or retaining of the employee. The rape occurred off the business premises while the employee was off-duty. Moreover, no specific indications of any violent behavior on the part of the employee were brought to the employer’s attention. Knowledge of a past criminal record and unfocused police questioning did not make the employee’s conduct foreseeable.
This case is distinguishable. Plaintiffs’ son was sexually assaulted by defendant’s employee, Perales, on the business premises while Perales was on duty. Perales admitted to having a drinking problem during the period of employment with defendant, and of being violent when he drank. Perales also admitted to being drunk while on duty on the day in question.
There was evidence from which a jury might find that defendant was aware or should have been aware that Perales had a drinking problem and a propensity for violence. Two incidents had occurred on hotel property shortly before the assault which gave rise to this lawsuit. Perales was terminated from his job as dishwasher for drinking prior to the incident that gave rise to this lawsuit. Shortly after that termination, Perales went to defendant’s place of business to inquire about reinstatement. He was drunk, interfered with the kitchen’s operation, and became violent when he was asked to leave the premises. He was forcibly subdued by defendant’s security personnel and he left under threat of criminal prosecution.
Further, defendant later rehired Perales as a steward. Perales’ position as a steward required him to help in the preparation of banquets. He had some contact with customers and other invitees in this connection. He was not closely supervised and had access to alcoholic beverages, which he consumed with some regularity while on duty. Other employees were aware of Perales’ behavior in this regard.
We hold that plaintiffs have introduced sufficient evidence to entitle them to reach the jury. Notice of an employee’s alcoholism and tendency toward violent behavior may make sexual assault by that employee foreseeable to the employer. The jury, rather than the judge, should determine foreseeability on these facts. Ortega v. Texas-New Mexico Railway Co., 70 N.M. 58, 370 P.2d 201 (1962); Hersh v. Kentfield Builders, Inc., 385 Mich. 410, 189 N.W.2d 286 (1971).
This cause is remanded to the trial court for a new trial on the negligent hiring and retention claim. We affirm the trial court with respect to the other issues on appeal.
IT IS SO ORDERED.
DONNELLY, C.J., concurs. | [
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OPINION
STOWERS, Justice.
This appeal is from the judgment of the district court reversing a decision of the New Mexico State Personnel Board (Board). Jose E. Jimenez (Jimenez) was dismissed from employment by the Corrections and Rehabilitation Department (Department). Jimenez appealed his dismissal to the Board and a hearing was held before a hearing officer designated by the Board pursuant to NMSA 1978, Section 10-9-18(E) (Repl.Pamp.1983). Upon review of the evidence presented at the hearing, the Board upheld the Department’s dismissal of Jimenez. This matter was then brought before the district court upon a writ of certiorari. The district court issued the writ and reviewed the Board’s decision. The district court found that there was not substantial evidence in the record before the Board to support its finding that Jimenez had been negligent and inefficient in performing his duties as an employee of the Department, and reversed the Board’s decision. The Board and Department appeal. We reverse the district court.
The primary issue to be decided is whether the district court erred in ruling that the Board’s decision to sustain the dismissal was not supported by substantial evidence.
On the night of December 9, 1979, Jimenez was the guard on duty in Tower 1 of the New Mexico State Penitentiary. Jimenez began his post as guard at approximately 7:05 p.m. that evening. At about 6:45 p.m. that same night, ten inmates escaped from the Penitentiary. An eleventh inmate, Harmon Ellis (Ellis), escaped at approximately 7:30 p.m. Following an investigation into the mass escape, Jimenez was dismissed for violation of State Personnel Board Regulations 602.3(a), “negligent or inefficient performance,” and 602.-3(e), “conduct tending to interfere with the efficient operation of the agency,” because he failed to detect the escape of prisoner Ellis. The guard who was on duty in Tower 1 during the earlier escape of the ten other inmates was also dismissed by the Department.
The New Mexico laws governing state personnel administration are found in the Personnel Act, NMSA 1978, Sections 10-9-1 to -25 (Repl.Pamp.1983). The procedure for appealing an order of dismissal is found in Section 10-9-18, which provides that the district court shall affirm the Board’s decision unless the decision is found to be:
(1) arbitrary, capricious or an abuse of discretion;
(2) not supported by substantial evidence; or
(3) otherwise not in accordance with law.
§ 10-9-18(G). In the present case, the district court’s order entered on January 20, 1983, stated in pertinent part:
[TJhere is insufficient Substantial evidence on the record before the State Personnel Board to support their conclusion that the Petitioner [Jimenez] was negligent or inefficient in the operation of the agency in failing to detect the escape of an inmate while Petitioner [Jimenez] was the guard on duty in Tower 1 of the New Mexico State Penitentiary on December 9, 1979.
The scope of review on appeal before this Court is the same as that before the district court. Lloyd McKee Motors, Inc. v. New Mexico State Corporation Commission, 93 N.M. 539, 602 P.2d 1026 (1979). Moreover, this Court recently modified the substantial evidence rule and adopted the whole record standard of review. Duke City Lumber Co. v. New Mexico Environmental Improvement Board, 101 N.M. 291, 681 P.2d 717 (1984). Substantial evidence is “such relevant evidence as a reasonable mind might accept as adequate to support a conclusion.” Baca v. Employment Services Division of Human Services, 98 N.M. 617, 619, 651 P.2d 1261, 1263 (1982) (quoting Toltec International, Inc. v. Village of Ruidoso, 95 N.M. 82, 84, 619 P.2d 186, 188 (1980)). In order to determine whether the decision by the Board is supported by substantial evidence in the record as a whole, the district court was required to review the evidence in the light most favorable to the Board’s decision. Duke City Lumber Co., 681 P.2d at 720 (quoting New Mexico Human Services Department v. Garcia, 94 N.M. 175, 176-177, 608 P.2d 151, 152-153 (1980)).
After reviewing the record before us, we find that the district court erred in holding that there was not substantial evidence for the Board to conclude that Jimenez should have detected the escape of Ellis, and failing to do so, was negligent or inefficient in the performance of his duties. The record indicates that Jimenez was the guard on duty in Tower 1 during the Ellis escape. An investigation into the escape revealed that, to escape, Ellis climbed out of the cell block facing Tower 1 and ran across a fifty-yard wide open space. The tower had an unobstructed view of this area and was also equipped with a spotlight. Upon reaching a perimeter fence, Ellis walked beside it for a period of time. .This fence was illuminated by large fluorescent lights. Although there was evidence of a blind spot in the fence, this would only hide someone lying down next to it and not an escapee such as Ellis who was actually pacing up and down. There was testimony that the Ellis escape may have occurred while Jimenez was releasing members of a visiting basketball team. However, had Ellis made his escape at this time, the tower was equipped with a mirror to enable Jimenez to detect any activity behind him. Finally, the prison warden, who was knowledgeable in the operation of the prison and familiar with the tower and the escape route, testified that Jimenez should have detected the escape of prisoner Ellis.
The experience and knowledge of a state agency should be accorded deference. Stokes v. Morgan, 101 N.M. 195, 680 P.2d 335 (1984). There was substantial evidence in the record to support the Board’s conclusion that Jimenez was negligent or inefficient in the performance of his duties by failing to detect the escape of prisoner Ellis. The judgment of the district court is reversed and the Board’s decision is reinstated.
IT IS SO ORDERED.
RIORDAN, J., and TONY SCARBOROUGH, District Judge, concur.
SOSA, Senior Justice, and WALTERS, J., dissenting. | [
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OPINION
WOOD, Judge.
Richard Garcia was coach and manager of a softball team. On Sunday, April 4, 1982, Richard left home about 12:30 p.m. and returned about 5:30 p.m. During this period he was driven to a practice field; the team practiced about two hours; after practice new uniforms were distributed and some of the team members went to a Pizza Hut; and Richard was returned to his home. There is an inference from the evidence that Richard died during the evening of April 4, 1982. Plaintiff, as personal representative of Richard’s estate, sued under New Mexico’s Minimum Wage Act. NMSA 1978, §§ 50-4-20 through -30 (Orig. Pamp. and Cum.Supp.1984). The complaint sought payment for six hours of “work” in connection with team activities on April 4, 1982, liquidated damages and attorney fees. Section 50-4-26. The trial court ruled against plaintiff at the close of plaintiff’s case; plaintiff appealed. We discuss: (1) dismissal at the close of plaintiff’s case, and (2) the meaning of employment under the Minimum Wage Act.
Dismissal at Close of Plaintiffs Case
It was a nonjury trial. The trial court dismissed at the close of plaintiff's case-in-chief. The trial court made findings of fact and conclusions of law, and entered judgment dismissing the complaint with prejudice “pursuant to the Court’s granting of Defendant’s Motion to Dismiss.” This procedure was authorized by NMSA 1978, Civ.P. Rule 41(b) (Repl.Pamp.1980). The trial court weighed the evidence, gave the evidence the weight the court believed it deserved, and dismissed. This was a judgment on the merits. Herbert v. Sandia Savings & Loan Association, 82 N.M. 656, 486 P.2d 65 (1971).
Plaintiff contends that defendant did not move for dismissal under Civ.P. Rule 41(b). The words defendant’s counsel used were: “[A]t this time I move for a directed verdict * * The use of the words “directed verdict” were inappropriate because there was no jury. See NMSA 1978, Civ.P.R. 50(a) (Repl.Pamp.1980). This being a non-jury trial, the motion for a directed verdict was, in effect, a motion to dismiss under Civ.P.Rule 41(b). Vallejos v. C.E. Glass Co., 583 F.2d 507 (10th Cir.1978); see Lentino v. Fringe Employee Plans, Inc., 611 F.2d 474 (3d Cir.1979); 5 J. Moore, J. Lucas & J. Wicker, Moore’s Federal Practice H 41.13[1] at 41-177 (2d ed. 1982). See also Herbert v. Sandia Savings & Loan Association where there was a motion under Civ.P.Rule 41(b), and the headnote refers to the motion as a motion for a directed verdict.
Plaintiff also contends that the trial court did not dismiss the case under Civ.P. Rule 41(b). According to plaintiff, the trial court ruled as a matter of law that plaintiff had no cause of action. “Under this approach, all evidence favorable to the plaintiff together with all inferences favorable thereto are accepted. The rules for a Directed Verdict should apply.” See Archuleta v. Pina, 86 N.M. 94, 519 P.2d 1175 (1974), for. how a trial court must view the evidence in ruling on a motion for a directed verdict. Plaintiff’s argument is based on a trial court finding “that no prima facie ease has been made” and a conclusion “that there was no judiciable cause of action * * Plaintiff’s argument disregards the context of the finding and conclusion. Considering all of the trial court’s findings and conclusions, particularly the evidentiary details revealed therein, it is clear that the trial court did weigh the evidence and did enter a judgment on the merits under Civ.P. Rule 41(b). We refer to several of the evidentiary findings in the next issue.
Employment Under the Minimum Wage Act
Section 50-4-21 states:
As used in the Minimum Wage Act [50-4-19 to 50-4-30 NMSA 1978]:
A. “employ” includes suffer or permit to work;
B. “employer” includes any individual, partnership, association, corporation, business trust, legal representative or any organized group of persons employing one or more employees at any one time, acting directly or indirectly in the interest of an employer in relation to any employee, but shall not include the United States, the state or any political subdivision thereof; and .
C. “employee” includes any individual employed by any employer * * * [with exclusions not pertinent in this case].
The Minimum Wage Act was enacted by 1955 N.M.Laws, ch. 200. The above-quoted definitions were included in the original enactment and have not been changed, although Section 50-4-21 has been amended frequently. See the history line to Section 50-4-21. The above-quoted definitions require an employee-employer relationship.
Plaintiff contends that the evidence showed that Richard worked for defendant. He refers us to evidence, essentially uncontradicted, that the name of the team was the name of the defendant; that this name was on the uniform worn by team members; and that defendant financed a portion of the costs of the team. Plaintiff’s view is that the use of defendant’s name and its financial support of the team constituted advertising, helped labor relations and good will, and these items were directly and indirectly beneficial to defendant.
Plaintiff’s “benefit” argument is based on a misreading of Section 50-4-21(B). The phrase “acting directly or indirectly in the interest of an employer” is concerned with an entity identifiable as “an employer in relation to any employee * * This portion of the statute, which defines “em ployer” does not determine who is an employee. See Donovan v. Sabine Irrigation Co., 695 F.2d 190 (5th Cir.1983).
Plaintiff asserts that defendant employed Richard because it suffered or permitted Richard to coach and manage the team, and Richard had been the coach since the team was formed in 1979 or 1980. Plaintiff contends that Richard “worked” for defendant on April 4, 1982, because Richard arranged for the team practice on that day, participated in that practice and distributed new uniforms at the conclusion of the practice. According to plaintiff, all of this was in the interest of defendant. The trial court did not agree.
The trial court found that Richard was not employed by defendant. Richard had left his employment with defendant in 1980 and gone to work for another business. The trial court found that Richard was not paid for coaching and managing the team and “[i]t was never contemplated or agreed that Richard * * * was to be paid for coaching or managing * * *.” Richard was not an exception, nobody on the team was paid or expected to be paid. The trial court found that the team was not related to employment by defendant. Some members of the team were employees of defendant, some were not. The trial court found that team membership was voluntary; that Richard’s participation was solely on a voluntary basis; that team members decided who would be on the team; that defendant had “no control or any input” concerning the team or who would be on the team. The evidence is that defendant made a financial allowance to the team of a fixed amount each year. The team determined how the allowance would be spent—registration fee for the city league, uniforms, equipment, travel expenses. Any expenses over and above defendant’s allowance were the team’s responsibility, and such expense was met by team members. The trial court also found that Richard had no employment contract with defendant.
In the preceding paragraph, we have referred to trial court findings and evidence supporting the findings. The findings are supported by substantial evidence. Plaintiff contends the findings and evidence are largely irrelevant and argues that facts such as pay, contract, control and voluntary action have nothing to do with a minimum wage claim. Specifically, plaintiff asserts that the findings and evidence we have reviewed have nothing to do with whether defendant suffered or permitted Richard to work.
In arguing the meaning of “work,” both parties cite extensively to workmen’s compensation cases. We do not consider these cases because they deal with statutory definitions which differ from the definitions in the Minimum Wage Act. Compare Section 50-4-21(A) with NMSA 1978, Section 52-1-16 (Cum.Supp.1984), which defines “workman” for compensation purposes. Plaintiff was unsuccessful in the separate worker's compensation suit, see Memorandum Opinion in Garcia v. American Furniture Co., Ct.App. No. 7796 (Filed June 21, 1984). That result does not dispose of the minimum wage claim.
The definitions in Section 50-4-21, quoted above, are similar to definitions in the Fair Labor Standards Act of 1938, a federal statute which dealt with minimum wages for employees engaged in or providing goods for interstate commerce. See 29 U.S.C.A. § 203(d), (e) and (g) (1978). The definition of “employ” is almost identical. Accordingly, it is appropriate to look to decisions of federal courts determining the meaning of “employ” in the federal statute, and to consider those federal decisions as persuasive authority in deciding the meaning of “employ” in the New Mexico statute. Benavidez v. Benavidez, 99 N.M. 535, 660 P.2d 1017 (1983); Featherstone v. Bureau of Revenue, 58 N.M. 557, 273 P.2d 752 (1954); Lopez v. Singh, 53 N.M. 245, 205 P.2d 492 (1949).
Walling v. Portland Terminal Co., 330 U.S. 148, 150-151, 152, 67 S.Ct. 639, 640, 641, 91 L.Ed. 809 (1947), discussed whether trainees were employees under the federal statute, stating:
The Fair Labor Standards Act fixes the minimum wage that employers must pay all employees who work in activities covered by the Act. There is no question but that these trainees do work in the kind of activities covered by the Act. Consequently, if they are employees within the Act’s meaning, their employment is governed by the minimum wage provisions. But in determining who are “employees” under the Act, common law employee categories or employer-employee classifications under other statutes are not of controlling significance. See N.L.R.B. v. Hearst Publications, 322 U.S. 111, 128-129 [64 S.Ct. 851, 859, 88 L.Ed. 1170 (1944)] This Act contains its own definitions, comprehensive enough to require its application to many persons and working relationships which, prior to this Act, were not deemed to fall within an employer-employee category. See United States v. Rosenwasser, 323 U.S. 360, 362-363 [65 S.Ct. 295, 296, 89 L.Ed. 301 (1945) ].
* * * * * *
Section 3(g) of the Act defines “employ” as including “to suffer or permit to work” and § 3(e) defines “employee” as “any individual employed by an employer.” The definition “suffer or permit to work” was obviously not intended to stamp all persons as employees who, without any express or implied compensation agreement, might work for their own advantage on the premises of another. * * * [S]uch a construction would sweep under the Act each person who, without promise or expectation of compensation, but solely for his personal purpose or pleasure, worked in activities carried on by other persons either for their pleasure or profit. * * * The Act’s purpose as to wages was to insure that every person whose employment contemplated compensation should not be compelled to sell his services for less than the prescribed minimum wage. The definitions of “employ” and of “employee” are broad enough to accomplish this. But, broad as they are, they cannot be interpreted so as to make a person whose work serves only his own interest an employee of another person who gives him aid and instruction.
Walling v. Jacksonville Terminal Co., 148 F.2d 768, 770 (5th Cir.1945),-states: “A purely voluntary service, for which no one intends there shall be pay, is not employment, but a gift. * * * The words ‘suffer or permit to work’ must be understood with common sense.”
Bowman v. Pace Co., 119 F.2d 858, 860 (5th Cir.1941), states:
It is not the purpose of the Fair Labor Standards Act to create new wage liabilities, but where a wage liability exists, to measure it by the standards fixed by law. If one has not hired another expressly, nor suffered or permitted him to work under circumstances where an obligation to pay him will be implied, they are not employer and employee under the Act.
In determining whether a person is an employee under the Minimum Wage Act “the ultimate issue is whether as a matter of ‘economic reality’ the particular worker is an employee.” Weisel v. Singapore Joint Venture, Inc., 602 F.2d 1185, 1189 (5th Cir.1979). This ultimate issue is a question of fact which requires consideration of the “total employment situation. * * *” Wirtz v. Lone Star Steel Co., 405 F.2d 668, 669 (5th Cir.1968).
Facts such as pay, contract, control and voluntary action are part of the total employment situation which disclose the economic reality. The trial court’s findings and the substantial evidence supporting the findings were relevant to plaintiff’s minimum wage claim that Richard worked for defendant in coaching and managing the softball team. The trial court’s findings support the conclusions that Richard was not an employee and that plaintiff was not entitled to recover under the Minimum Wage Act.
The trial court’s findings, which were relevant and supported by substantial evidence, do not, as plaintiff claims, show judicial bias against minimum wage claimants. As to this claim of bias, see Armijo v. Albuquerque Anesthesia Services, Ltd., 101 N.M. 129, 679 P.2d 271 (Ct.App.1984). Plaintiff also asserts that a representative of defendant attempted to create bias because the representative testified that, in denying the wage claim, he did not evaluate the Minimum Wage Act. This assertion overlooks the representative’s testimony that hours spent in participation with the softball team were not work for the company.
This case was set on the September docket for oral argument. The setting is vacated; oral argument is unnecessary. Garcia v. Genuine Parts Co., 90 N.M. 124, 560 P.2d 545 (Ct.App.1977).
The judgment of the trial court is affirmed. Plaintiff is to bear the appellate costs.
IT IS SO ORDERED.
DONNELLY, C.J., and HENDLEY, J., concur.
. The trial court referred to the team as a baseball team. Counsel refer to both a baseball and a softball team. A team member said it was a softball team. The type of "ball" played makes no difference in'this case. We use "softball” on the basis that the team member's knowledge was superior to that of counsel or the court. | [
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OPINION
PAYNE, Justice.
This appeal comes before us on writ of certiorari to the court of appeals. McCall was convicted of three counts of fraud, three counts of securities fraud, three counts of conspiracy to commit fraud, and two counts of solicitation to commit fraud. The court of appeals set aside all of the convictions except for those of conspiracy to commit fraud. We issued a writ of certiorari to consider whether the fraud and securities fraud convictions were properly set aside. We reverse the court of appeals and reinstate the convictions for both fraud and securities fraud.
The relevant facts are summarized in the court of appeals opinion.
The court of appeals reversed the fraud convictions because it held that a victim is an essential element of the crime of fraud; but there was no individual victim. The court reasoned that no lender suffered any loss in any of the three transactions for which McCall was convicted. Therefore, proof of misrepresentations without evidence of damages is not sufficient to convict him of perpetrating a fraud.
Although damages are essential to recover on a civil claim for fraud, Bank of Commerce v. Broyles, 16 N.M. 414, 120 P. 670 (1911), rev’d on other grounds, 234 U.S. 64, 34 S.Ct. 730, 58 L.Ed. 1214 (1914), monetary loss is not a requisite of a criminal conviction. The court of appeals relies on Annot., 53 A.L.R.2d 1215, § 2 (1957), to assert that injury or loss is an essential element of the crime of fraud. And from this proposition, the court extrapolated that absent damages to the financial entities which gave up the money, the convictions cannot stand. However, this Annotation does not state that the crime requires financial losses; to the contrary, it reads in relevant part:
[T]he courts are divided on the question whether an actual financial loss is required to constitute the crime [of obtaining a thing of value under false pretense], and whether, in credit transac tions, the adequacy of the security offered, though misrepresented, constitutes a defense.
* * * [A] majority of courts [have held] * * * that a pecuniary loss by the victim is not an essential element of the crime and that the adequacy of the security offered to obtain a loan or credit, if materially misrepresented, constitutes no defense.
Id. at 1215-16 (emphasis added).
New Mexico, consistent with the majority of jurisdictions, does not require pecuniary loss by the victim as an element of the crime. The only elements are stated in NMSA 1978, Section 30-16-6 (Cum.Supp. 1983). The statute provides that fraud is the “intentional misappropriation or taking of anything of value which belongs to another by means of fraudulent conduct, practices or representations.” Id. The plain language of this section provides that the crime occurs with the taking or misappropriation. The relevant issue in evaluating McCall’s fraud convictions is whether he acquired the loans by fraudulent conduct, practices, or representations. State v. Stettheimer, 94 N.M. 149, 607 P.2d 1167 (Ct.App.1980) (fraudulent obtainment of a loan may be the basis for a criminal fraud conviction); see also Survey on New Mexico Law: April 1, 1980-March 1980, 12 N.M. L.Rev. 229, 255.
The court of appeals erred in holding that repayment by the borrowers negated any loss and precluded the fraud conviction. Previous decisions have rejected the defense of repayment. In State v. Schifani, 92 N.M. 127, 584 P.2d 174 (Ct.App.), cert. denied, 92 N.M. 180, 585 P.2d 324 (1978), the defendant obtained money by fraudulently representing that he would invest it. He argued his statements should be ignored because he repaid the money, and, therefore, his fraud conviction should be set aside. But the court of appeals correctly reasoned that “Defendant’s fraud was complete when he got the money from the victims; repayment did not mitigate defendant’s offense.” Id. at 130, 584 P.2d at 177 (citations omitted); see generally State v. Thoreen, 91 N.M. 624, 578 P.2d 325 (Ct.App.) (the crime of fraud is complete once the taking occurs), cert. denied, 91 N.M. 610, 577 P.2d 1256 (1978).
The policy advanced in Stettheimer supports the fraud convictions; that is, due to fraudulent representations, the creditor is forced to assume a greater risk than he would have assumed if the debtor’s representations had been true. 94 N.M. 149 at 153, 607 P.2d 1167 at 1171.
In addition, the policy expounded in People v. Martin, 102 Cal. 558, 36 P. 952 (1894), supports the fact that the manner of acquisition is dispositive of whether there was a crime; pecuniary loss by a victim is irrelevant. There, the defendant was convicted of obtaining money by false pretenses. He asserted that his victim’s conduct was dishonest, therefore the state was barred from prosecuting. But the court held that “The offense is committed against the public, and not against the individual. The guilty party is prosecuted in the interest of the state, and not in the interest of the party defrauded of his property.” Id. 36 P. at 953; see also People v. Webb, 143 Cal.App.2d 402, 300 P.2d 130 (1956) (jury instruction that murder was an offense against the public and not the individual held to be proper).
This policy expressed in Martin is especially applicable here. MFA loans are provided by the government to facilitate housing for low income persons. See State v. Griffin, 100 N.M. 75, 665 P.2d 1166 (Ct. App.1983). If one person fraudulently obtains money from the fund, an eligible borrower may be precluded from being considered for a loan, due to depleted funds. The crime is against the public both in a real sense as well as theoretically.
The court of appeals also set aside McCall’s securities fraud convictions. The court reasoned that because there was insufficient evidence of fraud, there could be no conviction for securities fraud. Because we find that the proof for the fraud convictions was adequate, we also reverse the court of appeals on this issue and reinstate the securities fraud convictions.
In light of our reversal of the court of appeals, point III(B) of its opinion, which deals with the disparity of sentences imposed, is no longer applicable even if correct. We point out that under NMSA 1978, Crim.P. Rule 57.1 (Repl.Pamp.1980), the trial court has authority to modify a defendant’s sentence.
IT IS SO ORDERED.
RIORDAN and STOWERS, JJ., concur.
FEDERICI, C.J., not participating.
SOSA, Senior Justice, not participating. | [
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OPINION ON MOTION TO DISMISS
WALTERS, Justice.
Appellants, Taos Ski Valley and Twining Associates, have entitled their appeal as one against Public Service Commission. Public Service Commission (Commission) filed a motion in this court to dismiss the appeal contending, among other things, that the order of the commission appealed from was a statutorily required approval of rates set by the Twining Water and Sanitation District (District) and was an integral act necessary to make effective the District’s decision to impose a surcharge against all property within the District. The Commission forcefully argues that the appeal is really from a decision of the Water and Sanitation District.
At oral argument on the Commission’s motion, it was not disputed that the underlying objection of appellants is to the amount of the surcharge imposed by the District, and peripherally, to the Commission’s approval which, under NMSA 1978, Section 73-21-16(L), the Commission is required to give before rates, tolls or charges fixed by the District may be enforced.
It is thus apparent that appellants’ objection is to the result of a specifically required act by the Commission contained within the statutory scheme relating to exercise of the powers and duties of a Water and Sanitation District, and not to a kind of proceeding over which the Public Service Commission has jurisdiction under NMSA 1978, Section 62-6-4 (Repl.Pamp.1984), nor to the acts of a kind of entity to be regulated by the Commission as described in NMSA 1978, Section 62-3-3(E) (Repl.Pamp. 1984), of the Public Utility Act.
Water and Sanitation Districts are special districts described as governmental subdivisions with quasi-municipal powers, Section 73-21-9(1), and municipalities are expressly excluded from Commission regulatory jurisdiction (unless the municipality voluntarily elects to come within the operation of the Public Utility Act and under the supervision and regulation of the Commission), by Section 62-3-3(E).
The question of appellate jurisdiction arises because the Water and Sanitation District Act is silent on the matter of appeals, although it does provide in Section 73-21-12 that the district court may remove directors; in Section 73-21-13 that the district court shall fill any vacancy which the board of directors fails to fill; in Section 73-21-40 that the district court shall order the setting of rates and creation of a sinking fund, where required, if the board of directors fails to do so; and in Section 73-21-33 that the “validity of any proceeding” by the District shall be determined promptly by the court and, for the purpose of the Act, “[t]he courts shall be open at all times.” The meaning of “courts” is not given in the Act, but it appears from the other sections we have cited that “district court” was intended.
We have examined the appellate procedure provided for all other “Special Districts,” addressed in Chapter 73 of the New Mexico Statutes, to assist in determining the legislature’s intent regarding appeals from Water and Sanitation District proceedings.
Petitions to organize or change an Artesian Conservancy District, or to appeal the decision of the state engineer affecting the waters of the district, are made to the district court. NMSA 1978, Sections 73-1-3, -11, -14, -15, -26.
Officers of Ditches or Acequias Corporations may be removed by the district court, and appeals from appraisements made under that Act are to the district court. NMSA 1978, Sections 73-2-29 and -62. Section 73-3-10 provides for appeals of fines assessed against abusive or neglectful conduct of a ditch commissioner to the district court.
The district court has jurisdiction to approve formation of and fill commissioner vacancies in Drainage Districts, Sections 73-6-17, 73-6-28; to control and direct commissioners in their duties, Section 73-6-31, and to try issues arising from objections to work proposed by the commissioners in their biennial reports to the court, Sections 73-6-33, et seq.
Article 17 of Chapter 73 on “Special Districts” contains several provisions for district court resolution of disputes questioning the validity of the proceedings of any Conservancy District under the Conservancy Act. See, e.g., NMSA 1978, Section 73-17-18.
It is provided in the Article governing Soil and Water and Watershed Districts, NMSA 1978, Section 73-20-45(A), that those districts may sue and be sued, just as is provided for Water and Sanitary Districts in Section 73—21—16(C), which implies, at least, that suits contesting proceedings by officials of a special district, should originate in district court. The implication is especially strong in Chapter 21 on Water and Sanitation Districts since hearings in district court, referred to above, are clearly spelled out in various provisions of Article 21.
We are persuaded, having perused all of the provisions relating to remedies for a party affected by proceedings conducted by officials of Special Districts (of which the Water and Sanitation District is one), that protests or appeals from such proceedings must first be brought in district court.
This matter, therefore, is transferred, under our superintending powers, to the District Court of Taos County for further proceedings. We do not reach the other points raised in the Commission’s motion.
IT IS SO ORDERED.
RIORDAN and STOWERS, JJ., concur. | [
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OPINION
GARCIA, Judge.
Fletcher R. Catron (Catron), personal representative, appeals from an order fixing his fee, attorney fees and costs. We affirm in part, reverse in part, and remand for a new hearing.
This ease comes before the court for decision after it was submitted to an advisory committee pursuant to an experimental plan. See Patterson v. Environmental Improvement Div., 105 N.M. 320, 731 P.2d 1364 (Ct.App.1986); Boucher v. FoxworthGalbraith Lumber Co., 105 N.M. 442, 733 P.2d 1325 (Ct.App.1986); Stoll v. Dow, 105 N.M. 316, 731 P.2d 1360 (Ct.App.1986). The committee was, however, unable to complete its work within the time prescribed by the court. We nonetheless acknowledge the aid of attorneys Ray O. Sage, Lawrence M. Pickett and Michael L. Winchester, who devoted both time and effort. We express our gratitude for their voluntary service.
FACTS
This appeal involves a contested estate proceeding. The settlement of the estate of Beatrice M. Greig has been laborious, protracted, and undoubtedly, expensive. The litigation history includes a will contest, the probate proceedings, a prior appellate review and two related district court lawsuits. The estate has been in litigation for over ten years. See In re Will of Greig, 92 N.M. 561, 591 P.2d 1158 (1979). The present appeal is from the trial court’s order which set fees for the estate’s personal representative and lawyers and denied certain costs.
As part of the settlement of the estate, Catron applied for an award of fees and costs for himself and his attorneys. Ca-tron presented unrebutted testimony showing that, as personal representative of the estate, he had spent 192 hours on estate matters. More than half of that time, 98.5 hours, was spent performing legal work, including drafting pleadings, preparation of briefs, handling the appeal, and litigating matters with Rueckhaus. The remainder of his time, 93.5 hours, was spent in usual probate administrative duties. Catron’s attorneys (his own law firm) spent an additional 130 hours providing legal services occasioned by the various proceedings involving the estate.
A hearing was conducted on Catron’s application. Catron argued that his personal representative’s fee should be $13,-088.40 based on 192 hours at $65 per hour, plus 4.825 percent state gross receipts tax. Moreover, Catron argued that the fees for his law firm should be an additional $8,861.94 based on 130 hours at $65 per hour plus applicable state gross receipts tax, and that his firm should recover costs of $1,412.50, the major portion of which included reimbursement for a law clerk hired to do legal research on behalf of the estate.
Rueckhaus objected, arguing that NMSA 1978, Section 45-3-719 placed a statutory limit on a personal representative’s fee. In support of his argument, Rueckhaus offered the expert testimony of a probate lawyer who testified:
[T]he formula for the compensation of personal representatives or administrator or executors — and [sic] they were formerly known — has not changed as it was originally enacted in '91. As it states, the Plaintiffs are entitled to compensation of a very specific amount, either 10 or five — either 10% or 5% on the first portion of the estate and then a small percentage on the balance of the estate.
The witness relied on a 1933 supreme court decision, In re Keel’s Estate, 37 N.M. 569, 25 P.2d 806 (1933), which stands for the proposition that a trial court has no discretion in setting an administrator’s fee; rather, the statutory schedule must be applied.
Accordingly, Rueckhaus’ expert represented to the trial court that no discretion could be exercised: “[W]hen we’re dealing with Personal Representative fees, I think we’re bound by 45-3-719 and the prior history of that, and I think the Court is required to apply the statutory fee schedule.”
Based on a probate estate of $3,043, which was taken from a 1978 estate inventory, and upon the court’s request, the witness calculated the statutory fee to be $302. Accordingly, the trial court awarded Catron, as personal representative, “the statutory fee of $302.” The trial court found, however, that through the combined efforts of Catron and the estate attorneys, the estate was valued at $15,000. The court denied the law firm’s request for reimbursement for the costs of legal research performed by its law clerk.
ISSUE 1
Whether the court erred in awarding a personal representative’s fee of $302. Although the trial court found that Ca-tron spent 192 hours in his duties as personal representative, the court, citing Section 45-3-719, awarded Catron only $302. Given the diminutive nature of the fee award, it is apparent the court believed it was limited in its award to the formula set out in Section 45-3-719. We first note that Rueckhaus’ expert witness testified that $302 was the only permissible fee under the statute. Second, we do not believe that the trial court would award Catron only $1.57 ($302 divided by 192 = $1.57) per hour as personal representative had it not believed that the formula controlled.
Prior to 1976, former statute NMSA 1953, Section 31-10-1 read in pertinent part:
Compensation for administrators and executors. Administrators and executors shall be entitled to a compensation of ten (10) per cent on the first three thousand dollars ($3,000) and of five (5) per cent on all amounts in excess of the first three thousand dollars ($3,000) upon property at its appraised value * * * *
In 1976, however, the state legislature modified the statute’s introductory language by adopting a new section, NMSA 1976-77 Interim Supplement, Section 32 A-3-719 (now codified as Section 45-3-719), which provides in pertinent part:
Unless otherwise ordered by the court, a personal representative shall be entitled to a compensation of not more than ten percent on the first three thousand dollars ($3,000) and of not more than five percent on all amounts in excess of the first three thousand dollars ($3,000) upon property at its estimated value * * * * [Emphasis added.]
Courts assume that the legislature will not enact useless statutes or amendments. See State ex rel. Bird v. Apodaca, 91 N.M. 279, 573 P.2d 213 (1977). When the legislature enacts a new law or amends an existing one, it does so for the express purpose of changing the law as it previously existed. Id. There would have been no need to add the language “[u]nless otherwise ordered by the court’’ had the legislature wished to restrict the trial court’s discretion.
While the prior statute and the cases interpreting it restricted the trial court’s exercise of discretion, the 1976 amendment granted the court authority to modify the general compensation formula. We recently held, however, that the amended statute continues to restrict the trial court’s authority to award compensation with respect to certain kinds of assets. See In re Estate of Corwin, 106 N.M. 316, 742 P.2d 528 (Ct.App.1987). Thus, the introductory phrase does not give the trial court authority to award fees above the reduced percentages provided for certain liquid assets. Id. Nevertheless, on these facts, the trial court had the authority to award reasonable fees above the amount authorized by the general compensation formula.
Even if the trial court had determined that the facts and circumstances concerning this estate did not warrant a fee award other than that provided in Section 45-3-719, the award could not be upheld. Although the fee award coincided with the calculation presented by Rueckhaus’ witness, based on an estate valued at $3,043, the trial court specifically valued the estate at $15,000. The statutory fee based on an estate of $15,000 exceeds $302. Thus, the court’s fee award is not supported by the findings. See Watson Land Co. v. Lucero, 85 N.M. 776, 517 P.2d 1302 (1974). Accordingly, we hold the trial court erred in awarding only $302 in personal representative fees.
We remand this case for a new hearing so that the court may consider whether the facts and circumstances surrounding this case warrant a fee award above that provided by the formula. On remand, Catron, as personal representative, bears the burden of showing an entitlement to compensation above that provided by statute. He must show that the services for which he seeks additional compensation are not usual to an ordinary estate administration, and further he must show the reasonable value of his services to the estate, considering the value of the estate. See 31 Am.Jur.2d Executors and Administrators § 497 (1967).
Further, the trial court apparently believed it was restricted in awarding fees under Section 45-3-719 irrespective of the fact that Catron spent 98.5 hours of time performing legal work. However, an attorney who performs legal work as a portion of his personal representative duties is entitled to attorney fees for that time. See In re Estate of Brown, 653 P.2d 928 (Okl. 1982); In re Estate of Hackett, 51 III.App.3d 474, 9 Ill.Dec. 592, 366 N.E.2d 1103 (1977); see generally 31 Am.Jur.2d Executors and Administrators § 500 (1967).
Although the majority rule seems to be that such compensation is not authorized in the absence of statute, see Annot., Right of Executor or Administrator to Extra Compensation for Legal Services Rendered by Him, 65 A.L.R.2d 809 (1959), we believe the introductory phrase added in 1976 authorizes an allowance beyond Section 45-3-719 for the performance of extraordinary services including legal services. In view of this addition to the statute, on remand, in addition to compensation as personal representative under Section 45-3-719, the trial court may award Catron attorney fees under NMSA 1978, Section 45-3-720 for the 98.5 hours of legal services he rendered. Catron must show, however, that those legal services are not ordinarily performed by a personal representative and were not duplicative of those legal services rendered by his firm. Further, Catron must show the reasonable value of such services. See In re Estate of Hackett.
Part of the dispute between Catron and Rueckhaus concerned a trust created by Greig prior to her death. In July 1983, Catron was successful in obtaining a district court judgment compelling Rueckhaus to convey the estate assets to him. The judgment further provided that “to the extent that the assets of the estate of Beatrice Greig are insufficient, the assets of the Beatrice Greig Living Trust are available for the reasonable expenses of estate administration as may be allowed ****’’
At the personal representative’s fee hearing, the parties disagreed as to whether the trial court could consider the value of the trust assets in setting the fee. We hold it cannot. Section 45-3-719 requires that a personal representative shall be entitled to compensation “upon property at its estimated value which shall come into his possession____” (Emphasis added.) Cf. In re Estate of Wylie, 342 So.2d 996 (Fla.App. 1977) (appointive assets not to be included in calculating donee’s executor fees and attorney fees). Here, the trial court concluded that only estate assets were to “come into” Catron’s possession. Accordingly, on remand, only estate assets may be considered in setting the personal representative’s fee.
ISSUE 2
Whether the court erred in its award of attorney fees and its denial of costs.
It is undisputed that Catron’s attorneys are, likewise, entitled to compensation for their services. In re Ferrill, 99 N.M. 503, 660 P.2d 593 (1983). The compensation authorized for attorneys is generally the same as that allowed personal representatives. § 45-3-720. Upon a showing of proper cause, however, the trial court may award a different fee. Id.
The trial court’s findings and conclusions indicate that in setting the attorney compensation, the court considered the value of Greig’s estate, time expended, the benefits of litigation and the corollary district court lawsuit. Based on these considerations, the trial court awarded attorney fees of $6,000 and denied counsel’s request for reimbursement of costs.
There is much discretion vested in the trial court on matters concerning the appropriateness of attorney fees and the awarding of costs. Fryar v. Johnsen, 93 N.M. 485, 601 P.2d 718 (1979). The test is not what we would have done had we heard the fee request, but whether the trial court’s decision was clearly against the logic and effect of the facts and circumstances before the court. See State v. Hargrove, 81 N.M. 145, 464 P.2d 564 (Ct.App.1970). Stated otherwise, our inquiry is limited to the question of whether the trial court’s decision was beyond the bounds of all reason. See State v. Smith, 92 N.M. 533, 591 P.2d 664 (1979); Paternoster v. La Cuesta Cabinets, Inc., 101 N.M. 773, 689 P.2d 289 (Ct.App.1984); Newman v. Basin Motor Co., 98 N.M. 39, 644 P.2d 553 (Ct.App. 1982). Under the facts and circumstances of this case, we do not view the trial court’s award, concerning costs and fees, as an abuse of discretion.
CONCLUSION
In sum, because the $302 award is not supported by the findings and because the court erred in believing it was without discretion to alter the statutory fee formula, we reverse and remand for a new hearing so that an appropriate personal representative fee may be awarded. We affirm, however, the trial court’s decision regarding attorney fees and costs.
IT IS SO ORDERED.
BIVINS and MINZNER, JJ., concur. | [
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OPINION
DONNELLY, Chief Judge.
Defendant Van Ruiten appeals from an order of the trial court revoking his driver’s license for failure to submit to a blood-alcohol test. On appeal defendant argues that: (1) the police officer did not have reasonable grounds to stop his vehicle; and (2) the trial court erred in denying his motion for recusal and his motion to strike plaintiffs requested findings of fact and conclusions of law. We affirm.
Shortly before noon on November 2, 1985, state police Officer Jerry Varnell was patrolling State Road 18 between Dora and Portales. Officer Varnell received a radio dispatch from the Portales Police Department informing him that an individual suspected to be a drunk driver was driving a blue and white Ford pickup truck bearing license number HK-3518. An unidentified person had phoned police and informed the dispatcher, Jeff Wilkerson, that he had observed a man in a 7-11 store in Portales who was very intoxicated. The citizen-informer told the dispatcher that the intoxicated man had left the store in the described vehicle and was observed to be heading south on State Road 18.
Approximately fifteen minutes later, Officer Varnell saw a vehicle matching the description going south on State Road 18. Officer Varnell checked the speed of the vehicle and found it to be within the permissible limit. He followed the vehicle for about one-half mile before stopping it. The officer administered several field sobriety tests and arrested defendant when he determined that defendant failed these tests. Defendant refused to take a blood-alcohol breath test.
I. BASIS FOR STOPPING THE VEHICLE
Under the Implied Consent Act, NMSA 1978, Sections 66-8-105 to -112 (Repl. Pamp.1987), the administrative hearing is limited to certain issues including:
(1) whether the law enforcement officer had reasonable grounds to believe that the person had been driving a motor vehicle within this state while under the influence of intoxicating liquor; (2) whether the person was arrested; * * * (4)(a) whether the person refused to submit to a test; and (b) whether the law enforcement officer advised [the person] that the failure to submit to a test could result in revocation of his privilege to drive[.]
§ 66-8-112(E). Defendant does not contest the determination of both the director and the trial court that reasonable grounds existed for the revocation of his driver’s license. Instead he argues that the police officer that stopped his vehicle did not have reasonable grounds to make an investigatory stop. Section 66-8-112(E) does not expressly mention “investigatory stops”; however, we assume, as do the parties, that such is implicit in the issues to be decided at the administrative hearing.
The parties argue the propriety of the stop as if this were a criminal case. This is an appeal from an administrative proceeding to revoke defendant’s driver’s license. We need not decide whether a lesser standard applies. We hold the stop legal under the standard for criminal cases.
A police officer may, in appropriate circumstances approach a person for purposes of investigating possible criminal behavior even though there is no probable cause to make an arrest. Terry v. Ohio, 392 U.S. 1, 88 S.Ct. 1868, 20 L.Ed.2d 889 (1968); State v. Galvan, 90 N.M. 129, 560 P.2d 550 (Ct.App.1977). The officer must have a reasonable suspicion that the law has been or is being violated. State v. Galvan. If a stop is made by a police officer, he must have specific, articulable facts which give rise to a reasonable suspicion that a law has been or is being violated. State v. Ray, 91 N.M. 67, 570 P.2d 605 (Ct.App.1977). The facts and inferences are to be judged by an objective standard. Id. In analyzing the sufficiency of the facts and inferences, the critical inquiry is: “Would the facts available to the officer warrant the officer, as a person of reasonable caution, to believe the action taken was appropriate?” State v. Cobbs, 103 N.M. 623, 626, 711 P.2d 900, 903 (Ct.App. 1985) (quoting State v. Galvan, 90 N.M. at 131, 560 P.2d at 552).
We first examine the facts available to Officer Varnell and determine what inferences logically flow from those facts. Officer Varnell had received a dispatch describing a vehicle traveling south on State Road 18, possibly driven by a person under the influence of intoxicating liquor. While traveling north on that road, Officer Varnell spotted the described vehicle traveling south. He turned around and followed the vehicle for approximately one-half mile before verifying that it was the vehicle described in the dispatch.
The next inquiry is whether the information relayed in the dispatch, coupled with tbe officer locating and identifying the vehicle would warrant a person of reasonable caution in believing that defendant was violating a law justifying an investigatory stop. State v. Ray. Defendant argues that if the police receive a tip, there must be corroborating evidence to establish the reliability of the information. See State v. Jones, 96 N.M. 14, 627 P.2d 409 (1981). This corroboration is only required to establish probable cause for arrest.
In a case similar to the one before us, the Supreme Court of Vermont upheld the grounds for stopping an intoxicated driver. In State v. Lambert, 146 Vt. 142, 499 A.2d 761 (1985), a police officer, although without personal knowledge and observing no erratic behavior before the stop, based the stop of defendant’s car on third-hand hearsay. A woman notified the police that her daughter called to say another daughter and two young grandchildren were riding with the woman’s husband, who was intoxicated. The woman gave the police a description of the car, the license plate number, the names of the occupants, and a general description where the car could be located. While the familial relationship of the .caller in Lambert no doubt lent credibility, absent an indication to the contrary, we believe the information given here from a citizen-informant could be relied on by the officer to raise a reasonable suspicion.
In State v. Michael G., 106 N.M. 644, 647, 748 P.2d 17, 20 (Ct.App.1987), this court held that:
[Cjitizen-informants are subject to much less stringent credibility verification requirements than ordinary police informants’ statements * * *. A person who purports to be a witness or a victim of a crime may be presumed reliable, although police and other government officials must remain alert to the existence of particular circumstances that would indicate unreliability. [Citations omitted.]
In this case, the officer had sufficient information to form a reasonable suspicion that defendant was driving while intoxicated. Based on that reasonable suspicion, the officer had a reasonable basis for stopping defendant in order to investigate.
II. CLAIM OF IMPARTIALITY: FAILURE TO STRIKE REQUESTED FINDINGS AND CONCLUSIONS
Defendant argues that the conduct of the trial court in attempting to obtain plaintiff’s requested findings and conclusions gave rise to an appearance of impropriety. He argues that the appearance of impropriety occurred because of the trial court’s apparent personal interest in ensuring that the state submit its requested findings and conclusions. Defendant asserts that this action violated the rule that no judge should sit in any cause in which he has an interest. See SCRA 1986, 21-200; 21-400. We disagree with defendant’s analysis. An “ ‘interest’ necessary to disqualify a judge must be a present pecuniary interest in the result, or actual bias or prejudice, and not some indirect, remote, speculative, theoretical or possible interest.” State ex rel. Anaya v. Scarborough, 75 N.M. 702, 705, 410 P.2d 732, 734 (1966); State ex rel. Bardacke v. Welsh, 102 N.M. 592, 698 P.2d 462 (Ct.App.1985); see also Rule 21-400. The alleged bias and prejudice must stem from an extrajudicial source and must result in a decision on a basis other than what the judge learned from sitting in the particular case. United Nuclear Corp. v. General Atomic Co., 96 N.M. 155, 629 P.2d 231 (1980), appeal dismissed & cert. denied, 451 U.S. 901, 101 S.Ct. 1966, 68 L.Ed.2d 289 (1981).
In this case, the trial court’s decision had already been made and the parties had been informed of its ruling. Because the trial court had decided in plaintiff’s favor, it was reasonable for the trial court to want to see requested findings of fact and conclusions of law from plaintiff. We cannot say that its request for those findings and conclusions shows a bias or prejudice that would necessitate recusal.
Defendant argues that, because the findings and conclusions were untimely filed, they should be stricken. The cases cited by defendant for this proposition, however, are inapposite. In those cases, the party appealing failed to request findings and conclusions and this court held that it would not review evidence where the appellant fails to tender specific findings and conclusions. See Dillard v. Dillard, 104 N.M. 763, 727 P.2d 71 (Ct.App.1986); Pedigo v. Valley Mobile Homes, Inc., 97 N.M. 795, 643 P.2d 1247 (Ct.App.1982); Fidelity Nat’l Bank v. Lobo Hijo Corp., 92 N.M. 737, 594 P.2d 1193 (Ct.App.1979). Such is not the case here. Plaintiff did not fail to file requested findings and conclusions and then seek a review of the evidence on appeal. It is not improper for a trial judge to request counsel to submit requested findings of fact and conclusions of law.
The issue in this case is similar to a trial court’s granting of continuances, extensions of time or amendments of pleadings. These matters are within the sound discretion of the trial court. Cf. Camp v. Bernalillo County Medical Center, 96 N.M. 611, 633 P.2d 719 (Ct.App.1981) (granting or denying of motion of continuance rests in the sound discretion of the trial court and will not be interfered with except for a showing of an abuse of discretion). This court’s review is limited to whether the trial court abused its discretion in allowing plaintiff to file its requested findings of fact and conclusions of law more than ten days after the trial court entered its decision. An abuse of discretion occurs when the trial court’s ruling is clearly against all logic under the circumstances before the court. Jaramillo v. Fisher Controls Co., 102 N.M. 614, 698 P.2d 887 (Ct.App.1985). We do not find that it was against all logic for the trial court to allow plaintiff to file its requested findings and conclusions beyond the ten-day limit of the local rule.
The revocation of defendant’s driver’s license for failure to submit to a blood-alcohol test is affirmed. The denials of defendant's motion to recuse and his motion to strike plaintiff’s requested findings and conclusions are also affirmed.
IT IS SO ORDERED.
BIVINS and APODACA, JJ., concur. | [
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OPINION
MINZNER, Judge.
Appellant Catarino Hernandez appeals from a judgment quieting title to a 0.2678-acre tract of land, located within the city of Las Cruces, New Mexico, in favor of appellees Alfonso and Jessie Cabrera. He appeals in his own right and as survivor of Isaura Hernandez, who died while this appeal was pending. Appellant is Alfonso Cabrera’s uncle and resides on an adjoining tract. The tract of land at issue is a fenced lot upon which a dwelling is located.
Appellees claim title to the property as joint tenants under a deed from Rosalia Amada Cabrera (Rosalia), Alfonso Cabrera’s mother and appellant’s sister. Rosalia entered into possession of the property under a warranty deed from her mother, Antonia Hernandez (Antonia), dated January 20, 1951, and resided there until her death in 1983. In 1976, she executed a warranty deed in favor of appellees, reserving a life estate. Upon Rosalia’s death, appelles assumed possession of the property, made improvements, and rented the house.
Appellant claims title to the subject property under a quitclaim deed from Georgia S. Jones (Jones) dated July 19, 1950. Jones’ title derived from a tax deed. The record indicates that Antonia attempted to convey an interest she had inherited from her husband by deeding portions to two of her children. In June 1950, she conveyed to appellant and Isaura the lot on which appellant resides. Appellant subsequently paid Jones $1.00 for a quitclaim deed, in the belief that his father had lost the property Antonia attempted to convey by failing to pay taxes.
The trial court held that appellant’s deed from Jones was void, because it was based upon a double assessment of taxes, and that appellees had title to the property by virtue of their deed from Antonia. Alternatively, the trial court found that appellees had acquired title by adverse possession. Appellant contends that the trial court erred in all three holdings.
We affirm the trial court’s holding that appellees acquired title by adverse possession. We do not consider the claims based upon the parties’ respective titles. C & F Realty Corp. v. Mershon, 81 N.M. 169, 464 P.2d 899 (1969).
Under the relevant New Mexico statute, in order to establish title by adverse possession a person must establish: (1) a good faith claim of right under color of title; (2) possession that is actual, visible, exclusive, hostile, and continuous for ten years; and (3) payment of taxes. NMSA 1978, § 37-1-22. All elements must be proved by clear and convincing evidence. Birtrong v. Coronado Bldg. Corp., 90 N.M. 670, 568 P.2d 196 (1977). If any one of the elements necessary to establish title to land by adverse possession is missing, the claimant will not obtain title. Id.; Pan American Petroleum Corp. v. Candelaria, 403 F.2d 351 (10th Cir.1968).
Appellant concedes that appellees’ possession of the property from the time of Rosalia’s death was adverse. However, he contends that Rosalia’s initial possession of the subject property was permissive and, since appellees’ adverse possession falls short of the required time period, appellees’ claim must fail. Appellant also contends that because he regularly used a roadway traversing the tract in issue to reach his own residence, and maintained and improved the property, Rosalia’s possession could not be deemed exclusive. We disagree with both contentions.
With respect to the first contention, appellant admits the trial court applied the clear and convincing standard of proof, but he apparently argues that Rosalia’s possession must be presumed to have been permissive. See Apodaca v. Hernandez, 61 N.M. 449, 302 P.2d 177 (1956) (possession originating in cotenancy is presumptively permissive; where the original occupation of property is permissive, an adverse holding must be expressly declared and notice of such change brought to the attention of the owner); accord Norgong v. Whitehead, 225 Minn. 379, 31 N.W.2d 267 (1948) (existence of close family relationship between claimant and record owner of land creates inference that original possession by claimant was permissive and such possession will be presumed to continue as permissive rather than hostile until and unless contrary evidence is affirmatively shown). Alternatively, he argues that there was an insufficient showing of hostility, because he and Rosalia were brother and sister. See Fehl v. Horst, 256 Ore. 518, 474 P.2d 525 (1970) (where there is a close family relationship between the owner of property and claimant, courts have required a greater showing that possession was hostile or adverse). Finally, he argues that there was uncontroverted evidence of permission.
Appellant’s reliance on a presumption of permissiveness is misplaced. Rosalia and appellant were not co-tenants, each of whom was entitled to consider the other’s possession permissive. See Apodaca v. Hernandez.
Further, the evidence shows that they were not in a relationship that would support an inference of permissive possession. Cf. Fehl v. Horst (where a claimant had assumed the management and control of a building owned by his elderly mother-in-law, the court refused to consider the claimant’s actions adverse while the owner was alive). However, even if such an inference arose solely from the relationship, there was sufficient evidence to rebut it.
Rosalia entered into possession of the subject property under a recorded deed in her own name, and it is undisputed that appellant was aware of it. By his own admission, Rosalia always treated and took care of the house and property as an owner. In fact, from 1951 to 1976 she mortgaged the property on eleven different occasions. It is also undisputed that the house was built for Rosalia by her father and that she lived in the house until her death in 1983. Additionally, with appellant’s knowledge, Rosalia paid ad valorem taxes on the property, which were assessed in her name. It is difficult to imagine what more Rosalia could have done to establish hostile or adverse possession of the tract in issue.
Finally, Isaura testified that Rosalia moved onto the tract in issue without permission. Appellant’s testimony on this issue was equivocal. Thus, the record does not contain uncontroverted evidence of permission. Acquiescence is not necessarily the same as permission. Weldon v. Heron, 78 N.M. 427, 432 P.2d 392 (1967). “On the contrary, there may be adverse possession where possession is with forbearance of the owner who knew of such possession and failed to prohibit it.” Id. at 428, 432 P.2d at 393.
No New Mexico case addresses appellant’s second contention, which is that his use of Rosalia’s property precludes a finding of exclusivity. Nevertheless, other authorities have held that possession may be exclusive, notwithstanding that the land is subject to non-possessory rights, such as easements. See Kouri v. Burnett, 415 P.2d 963 (Okla.1966); 2 C.J.S. Adverse Possession § 58 (1972). The fact that another person uses the property by permission of claimant, or in subordination to her claim, does not necessarily preclude a finding of exclusiveness of possession. 2 C.J.S., supra, § 54. Possession need not be absolutely exclusive if it is of the kind expected of an owner under like circumstances. See Grimstad v. Dordan, 256 Or. 135, 471 P.2d 778 (1970).
Allowing a brother and sister-in-law to use a roadway across the tract to gain access to their residence is not an act inconsistent with the use an owner would make of the land. Rosalia’s possession may be considered exclusive even though others used the property with her permission.
Exclusive possession for purposes of establishing adverse possession means that the claimant exercises dominion and control for herself and not for another. See 7 R. Powell, The Law of Real Property § 1013(2)(d) (1987). Nevertheless, the claimant’s actions must exclude the owner from exercising dominion and control. Id.
In reviewing the sufficiency of the evidence to support the trial court’s finding of exclusiveness, the evidence must be viewed in favor of upholding the finding. C & F Realty Corp. v. Mershon. Because the evidence on the record supports an inference that Rosalia’s possessory acts limited appellant to permissive use, the finding is supported by substantial evidence.
As to appellant’s contention that he repaired, maintained, and improved the land, the evidence was conflicting concerning whether these actions were undertaken merely as gratuitous assistance to Rosalia, in subordination to her claim, or as a landowner in his own right and for his own benefit. Where evidence in an adverse possession claim is conflicting, and there is substantial evidence to support the trial court’s decision, that decision will not be set aside on appeal. Smith v. Borradaile, 30 N.M. 62, 227 P. 602 (1922).
In this case, a family member was in residence on the property for over thirty years under a warranty deed from appellant’s own grantor and parent. With appellant’s knowledge, she paid taxes on that property and otherwise dealt with the property as an owner. On these facts, appellant’s use of a roadway and contributions towards repair and maintenance do not preclude a finding of exclusivity.
Accordingly, we affirm the judgment of the trial court. No costs are awarded. Appellees’ request for attorney fees, being unsupported by statutory authority, is denied. See Alber v. Nolle, 98 N.M. 100, 645 P.2d 456 (Ct.App.1982).
IT IS SO ORDERED.
GARCIA and APODACA, JJ., concur. | [
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OPINION
DONNELLY, Chief Judge.
The Subsequent Injury Fund (Fund) appeals from a district court judgment determining that it is 80% liable for worker’s compensation benefits payable to plaintiff under the Subsequent Injury Act (Act), NMSA 1978, Sections 52-2-1 to -13 (Repl. Pamp.1987 & Supp.1988). The Fund raises six issues on appeal; however, we determine that its challenge to the sufficiency of the evidence to support the trial court’s finding of actual knowledge of the existence of a preexisting physical impairment is dispositive and reverse.
Plaintiff was diagnosed as suffering from Reiter’s Syndrome. The disease is a form of arthritis which affects the body’s joints, primarily the spine, knees, ankles and neck. Although plaintiff has had the disease for a number of years, the underlying ailment was first diagnosed by a physician, Dr. Albert Rizzoll, in November 1984, four years after she began her employment with Push Button, Inc., a company later acquired by Plastech Research Division (Plastech). Thereafter, plaintiff experienced occasional flare-ups of the disease resulting in tenderness and soreness in her joints but continued to work for Plastech as a machine operator.
On June 6, 1985, plaintiff twisted her back while cleaning a machine during her employment. She was examined by Dr. Barry M. Diskant, who also diagnosed plaintiffs underlying condition as Reiter’s Syndrome, and found that her work-related accident resulted in an aggravation of her preexisting condition. Plaintiff returned to work following this injury, but frequently missed work because of pain and stiffness. On January 31, 1986, plaintiff filed suit against Plastech and its workmen’s compensation carrier, CNA Insurance Company. Thereafter, Plastech filed a third-party complaint against the Fund.
In February 1987, after the worker’s compensation action had been commenced, Plastech filed with the Department of Insurance a certificate of preexisting physical impairment. The certificate was signed by plaintiff and Dr. Barry M. Diskant, and it indicated that Dr. Diskant had examined plaintiff on June 21, 1985, and had determined that plaintiff had a 5% preexisting impairment due to Reiter’s Syndrome.
Plastech’s claim for relief against the Fund was tried by the district court in September 1987. Shortly before trial, plaintiff and Plastech entered into a settlement agreement resolving plaintiff’s claims against Plastech. The settlement, however, did not include the Fund. The trial court found that Janice Lang, an accounting analyst for Plastech, became acquainted with plaintiff when plaintiff began work in 1984, and that “[wjhen Ms. Lang first met [plaintiff] up until the date of the incident in question, she felt [plaintiff] had a handicap or physical defect of an ‘arthritic’ type that might affect her work and job ability. In addition, [plaintiff] complained to Ms. Lang of backaches and feeling stiff while at work.”
The trial court concluded that “[plaintiff’s] employer, Plastech, knew that [plaintiff] suffered a handicap or physical defect prior to June 5, 1985 based upon Janice Lang’s observations and complaints to Ms. Lang by [plaintiff],” and thus had actual knowledge of plaintiff’s preexisting disability; that plaintiff was permanently and partially disabled to 75% as a result of the accident; and plaintiff was “entitled to future compensation benefits based on a 75% disability.” The trial court apportioned 80% liability against the Fund and 20% liability against Plastech.
Sufficiency of Evidence
The Fund contends that the information and observations of Lang concerning claimant’s handicap were insufficient to constitute an exception to the rule that plaintiff is required to file a timely certificate of preexisting impairment as a prerequisite to any recovery against the Fund under the Subsequent Injury Act.
In Vaughn v. United Nuclear Corporation, 98 N.M. 481, 650 P.2d 3 (Ct.App.1982), this court held that the Fund could be held liable for a portion of a worker’s disability under the Act when the certificate of preexisting physical impairment was filed after a subsequent injury, so long as the employer had actual knowledge of the worker’s disability. Thus, the Vaughn court found that the language “at any time” constituted a permissive, and not a mandatory, filing requirement. The “actual knowledge” exception in Vaughn was reaffirmed by the New Mexico Supreme Court in Fierro v. Stanley’s Hardware, 104 N.M. 50, 716 P.2d 241 (1986). See Duran v. Xerox Corp., 105 N.M. 277, 731 P.2d 973 (Ct.App.1986). But see § 52-2-6 (containing changes enacted by 1988 amendment).
The Fund contends that the record fails to contain substantial evidence to support the trial court’s finding and conclusion that Plastech had “actual knowledge” of plaintiff’s preexisting impairment. We agree that the record fails to show that the employer had the requisite actual knowledge to bring this cause within the exception provided in Vaughn. The Fund submitted requests for admissions to Plastech pursuant to SCRA 1986, 1-036. The requests for admissions and Plastech’s written responses provided, in part:
5. Prior to June 6, 1985, Plastech Research Division was unaware that Plaintiff * * * suffered from an arthritic condition.
RESPONSE: Admitted.
6. Prior to June 6, 1985, Plastech Research Division was unaware that Plaintiff * * * was undergoing treatment for Reiter’s Syndrome.
RESPONSE: Admitted although we deny we did not know she was being treated by Dr. Rizzoli.
Rule 1-036(B) specifically provides that “[a]ny matter admitted under this rule is conclusively established unless the court on motion permits withdrawal or amendment of the admission.” Plastech argues that its admission no. 5 was a typographical error. Plastech, however, did not seek permission from the trial court for leave to amend or withdraw the admission; thus, the admission was binding in its effect. See also SCRA 1986, 12-216(A).
Plastech argues that even if its response to the request for admissions is not considered harmless error, the testimony of Janice Lang, nevertheless, constituted sufficient evidence to support the trial court’s finding that Plastech had “actual knowledge” of the fact that plaintiff was suffering from a preexisting physical impairment. Testimony seeking to contravene the admissions of Plastech was improper. The failure of a responding party to move to have admissions withdrawn or amended precludes attempts to dispute the admitted fact and forecloses consideration of evidence to the contrary. See Fleitz v. Van Westrienen, 114 Ariz. 246, 560 P.2d 430 (Ct.App.1977); Taylor v. Cameron & Barkley Co., 161 Ga.App. 750, 289 S.E.2d 820 (1982); W. W. & W.B. Gardner, Inc. v. Park West Village, Inc., 568 P.2d 734 (Utah 1977); see also Jensen v. Pioneer Dodge Center, Inc., 702 P.2d 98 (Utah 1985).
Because our disposition of this point is dispositive, we do not reach the remaining issues raised by the Fund.
The judgment against the Fund is reversed and the cause is remanded with directions to enter judgment for the Fund.
IT IS SO ORDERED.
BIVINS and FRUMAN, JJ., concur. | [
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OPINION
SCARBOROUGH, Chief Justice.
Respondents-appellants, Andralene. Ray and James Ray, are the maternal grandparents of two minor children, Michael Patrick Normand and Andrew James Normand. Petitioner-appellee, Clyde Normand, is the natural father of the children. The children were legally adopted by and in the actual physical custody of the Rays. By means of a writ of habeas corpus, Normand sought custody of the children. The trial court granted the writ, awarded physical custody of the children to Normand, voided the adoption decree and reinstated Normand’s parental status. The Rays appeal. We affirm in part and reverse and remand in part with instructions.
Clyde Normand and Sharon Normand were married in 1971. They obtained a Texas divorce in 1974. Normand was on active duty in the United States Army and legally resided in Texas. Michael Patrick and Andrew James were born to the marriage. At the time of the divorce, the trial court awarded custody of the children to the mother. Later in 1975, with the consent of Normand, custody was awarded to Andralene Ray. In January 1978, Normand petitioned the Texas district court for custody of his children. The Rays contested the petition and in July 1978, a jury trial was held to decide the question. The jury awarded custody to Normand and the decree was entered August 1, 1978. That same day, the Rays left with the children to Nacogdoches, Texas without informing Normand. Over the course of the next few years, the Rays moved to different cities in Texas several times without informing Normand of their whereabouts. Eventually, in 1982, the Rays returned to Chaparral, New Mexico, with the children. Meanwhile, Normand’s many efforts to locate the children were unsuccessful.
In June 1985, the Rays sought to legally adopt the children in New Mexico. The Rays did not inform the New Mexico trial judge of the 1978 Texas child custody decree. They told the judge that Normand had abandoned the children and that they could not locate him. Based on these representations, the New Mexico district court entered an order terminating Normand’s parental rights together with a judgment of adoption. In 1987, Normand located the Rays in New Mexico, and filed a petition for a writ of habeas corpus, the object of which was to obtain physical custody of his children. The New Mexico court granted the writ and held that the 1978 Texas custody judgment was valid and entitled to enforcement in New Mexico under the doctrine of full faith and credit. The trial court held that the Rays committed fraud in procuring the judgment of adoption. The trial court also ruled that the judgment of adoption was null and void.
The Rays first argue that the trial court lacked jurisdiction to set aside the adoption decree. They argue that a judgment of adoption could not be contested on any grounds including fraud more than one year after the entry of judgment. NMSA 1978, Section 40-7-15(C) (Repl.Pamp.1983) (repealed by Laws 1985, Ch. 194, § 39) (current version at 40-7-31 (1986)). Furthermore, the Rays argue that Normand’s writ of habeas corpus was an impermissible collateral attack on the judgment of adoption. We disagree. The New Mexico Constitution confers upon the district court the power to issue writs of habeas corpus. N.M. Const, art. VI, § 13. Also, the trial court had personal jurisdiction over the parties. Both the children and the Rays were residing in New Mexico when Normand filed the petition for writ of habeas corpus. Clark v. LeBlanc, 92 N.M. 672, 593 P.2d 1075 (1979). By its very nature, a habeas corpus proceeding attacks the basis upon which the “body” is held by another. See definitions and annotations in 1 Bouvier’s Law Dictionary (3d Rev.Ed.1914) 1400-07; Black’s Law Dictionary (4th Rev.Ed. 1968) 837. We previously held that, “habeas corpus is an available remedy by which to consider controversies involving the issue of custody of infants. This remedy has been recognized in this jurisdiction since early times.” Roberts v. Staples, 79 N.M. 298, 300, 442 P.2d 788, 790 (1968) (citations omitted). At no time did Normand receive notice of the adoption proceedings. This fact alone warrants the voiding of the adoption decree. See Eaton v. Cooke, 74 N.M. 301, 393 P.2d 329 (1964). The Rays failed to provide Normand with notice of the adoption proceedings as required by our rules of civil procedure. See NMSA 1978, § 40-7-11(C) (Repl.Pamp.1983). We have held that, “[b]y failing to follow statutory procedures, due process of law was violated and no subsequent act could correct the defect.” Nesbit v. City of Albuquerque, 91 N.M. 455, 459, 575 P.2d 1340, 1344 (1977) (citation omitted). Normand was never personally served with a copy of ■the summons and complaint in the adoption proceedings. Although the Rays published notice in a New Mexico newspaper while Normand was in Texas, substitute or constructive service of process is not acceptable nor is it authorized when notice by personal service is required by statute. SCRA 1986, 1-004. The record before us supports the trial court’s conclusion that the Rays knew Normand’s whereabouts. They knew he was in the Army and could be reached through the office of a military personnel locator they were in communication with on a regular basis. Yet, the Rays made no meaningful effort to contact Normand. The statute requires that notice of the filing of a petition of adoption shall be given to any parent of the minor child to be adopted even if the parent’s consent is excused because of abandonment. NMSA 1978, § 40-7-11(A) and (B) (Repl.Pamp. 1983). Furthermore, personal service would be required because Subsection C requires notice to be accomplished in a manner appropriate under the rules of civil procedure for service of process in a civil action in New Mexico. NMSA 1978, § 40-7-11 (Repl.Pamp.1983). The trial court was correct in concluding that substitute service of process by publication was inadequate.
The Rays next argue that Normand abandoned his children and was not entitled to any notice of the adoption proceedings. Respondents confuse the issue of consent to adopt with the necessity for notice. See NMSA 1978, § 40-7-7(A) (Repl.Pamp.1983). It is true Normand had no contact with his children for several years. However, this was brought about by no fault of Normand’s, but by the Rays who hid the children from him. Normand searched for the children but was unable to locate them. Substantial evidence in the record supports the trial court’s conclusion that the adoption judgment was obtained through fraud. We have recognized that in considering whether a parent has abandoned a child, “ ‘conscious disregard of the obligations owed by a parent to the child’ excludes acts which are beyond the control of the parent.” Adoption of Doe v. Heim, 89 N.M. 606, 619, 555 P.2d 906, 919 (Ct.App.1976), cert. denied, 90 N.M. 8, 558 P.2d 620 (1976).
The Rays further argue that the trial court erred in voiding the adoption judgment without any notice to them. The Rays had notice of the habeas corpus action, appeared personally at court proceedings, presented testimony, and cross-examined witnesses. This claim is frivolous. The trial court did not err in voiding the judgment of adoption on these grounds.
The Rays next argue that the Texas custody judgment is not entitled to full faith and credit in New Mexico. We disagree. New Mexico has long accorded full faith and credit to valid judgments of other states. See e.g. Ex parte Mylius v. Cargill, 19 N.M. 278, 142 P. 918 (1914); Allgood v. Orason, 85 N.M. 260, 511 P.2d 746 (1973). The Rays did not prove that the Texas custody judgment was void or invalid. Therefore, the trial court properly gave full faith and credit to the Texas custody judgment.
Finally, the Rays argue that the trial court erred in excluding evidence dealing with the fitness of the respective parties to have the custody of the Normand children. Early in the proceedings, the trial court indicated it was disinclined to hear such testimony. Nevertheless, the Rays made at least one effort to tender evidence as to what custodial arrangement would be in the best interests of the minor children. The trial court erred in not allowing evidence on this issue. We have recognized that when a habeas corpus order is “prose cuted as a means of determining custodial rights of children, however, the inquiry is generally broader than that normally involved in habeas corpus [where] [t]he child’s welfare becomes a prime consideration irrespective of the parties’ interests____” Roberts, 79 N.M. at 300, 442 P.2d at 790. This case is remanded with instructions to the trial court to hold a hearing to take evidence and enter an appropriate order to determine what custodial arrangement will be in the best interests of the minor children. In all other respects, the trial court judgment is affirmed.
IT IS SO ORDERED.
STOWERS and WALTERS, JJ., concur. | [
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] |
OPINION
RANSOM, Justice.
This action arose out of an oral agreement between Dennis McCoy, an Oklahoma cattle dealer doing business as T.C. Cattle Co., and William Chandler, a cattle broker from Texas. McCoy agreed to ship cattle to New Mexico Cattle, Inc. (feedlot) in Union County, New Mexico, for delivery to Chandler. The cattle consisted of four lots of steers and two lots of heifers with a combined total value of $119,122.30. They were delivered to the feedlot in March 1986, after which time McCoy provided invoices to Chandler, which described the cattle and set out the sales price. Subsequently, McCoy demanded payment. Chandler refused.
Without McCoy’s knowledge, Chandler obtained a loan from First National Bank in Clayton (bank) and pledged as collateral the subject cattle. A financing statement and a security agreement covering the cattle were filed of record. The bank claims that it had no knowledge of any interest McCoy may have had in the cattle when it made the loan to Chandler.
McCoy sued to recover the cattle, claiming he was to retain title until payment was made by Chandler. Initially, the interested parties agreed that the cattle should be fed by the feedlot and sold at an appropriate time with the proceeds paid into the court. McCoy subsequently filed a motion for partial summary judgment seeking release of the cattle from the feedlot. The bank filed a counter motion for partial summary judgment, arguing that it had perfected a security interest in the livestock superior to any claim of McCoy. The court entered judgment for the bank, relying upon the facts specifically pled in McCoy’s complaint and certain provisions of the Uniform Commercial Code (U.C.C.), NMSA 1978, Sections 55-1-101 to 55-9-507. We affirm.
The court ruled that the bank’s perfected security interest in the subject cattle was superior to any interest or right of McCoy. The court determined Chandler’s liability included the principal amount of the loan totaling $84,461.95 plus $9,814.94 in accrued interest and a per diem interest payment thereafter of $31.24. Further, the court enforced the agister’s lien of the feedlot for the care, feeding, and maintenance of the cattle and ruled that the feedlot had a right to have this lien satisfied in the amount of $65,819.02 plus accrued interest of $7,212.32 and a per diem interest payment thereafter of $19.83. The court assigned the agister’s lien a second priority behind the bank’s claim. Based upon the above determinations as to the priority of lien interests, McCoy’s claims against the feedlot, its owner and president, and the bank president were dismissed. Default judgment was entered against Chandler, who was duly notified of the hearing but failed to appear. The district court also determined that Chandler had committed a fraud against McCoy and, after a damages hearing, awarded McCoy actual damages in the amount of $139,459.49 for the value of the cattle plus interest and $90,000 in punitive damages. This award received third priority behind the other two claims.
Summary judgment. Once the bank made a prima facie showing of no genuine issue of material fact and that as a matter of law it was entitled to summary judgment, see Goodman v. Brock, 83 N.M. 789, 498 P.2d 676 (1972), the burden then shifted to McCoy to show at least reasonable doubt as to whether a genuine issue for trial existed. Koenig v. Perez, 104 N.M. 664, 726 P.2d 341 (1986). McCoy asserts that a genuine issue of material fact existed regarding the terms of the oral agreement as described in his deposition testimony.
In granting summary judgment, the district court based its decision on shipping bills showing the six lots of cattle to be delivered to the feedlot for Chandler and ruled that McCoy’s verified complaint presented “positive and definite facts * * * that cattle were shipped by McCoy and * * * delivered to Chandler * * The deposition testimony of McCoy described a scenario whereby no obligation was created on the part of Chandler to purchase any of the cattle after delivery. Indeed, McCoy contends that according to their agreement Chandler had the right to reject any or all of the cattle. McCoy believed that once the cattle arrived at the feedlot, Chandler would inspect and sort the cattle and then negotiate a purchase price with McCoy. McCoy admits that Chandler did go to the feedlot and inspect the subject cattle, but claims that Chandler failed to engage in the selection and sorting process, thereby falling short of compliance with the terms of the agreement. Therefore, argues McCoy, no interest in the cattle was created in Chandler.
McCoy believes the district court disregarded (or perhaps weighed) his deposition testimony on this point. See In re Adoption of Jane Doe, 87 N.M. 253, 531 P.2d 1226 (Ct.App.), cert. denied sub nom. Doe v. Roe, 87 N.M. 239, 531 P.2d 1212 (1975) (a party who chooses to plead specific facts is bound by what has been specifically pleaded). In affirming, we do not disregard the deposition testimony. Giving due consideration to McCoy’s deposition testimony, we agree with the trial court that it is incredible and unreasonable to infer that six separate lots of cattle were shipped by McCoy from Oklahoma to New Mexico without his having concluded a contract of sale as alleged .in his verified complaint. The specific agreement between buyer and seller is simply not a material issue. What is material is the fact that delivery was made by a seller to a buyer, and that fact is not in dispute.
Intention to conclude a contract: Identification of the cattle to the contract; Price left to be agreed. McCoy argues that, because the cattle had not been identified to the contract, title to these cattle had not passed to Chandler under NMSA 1978, Section 55-2-401(1). He asserts that Chandler’s interest was consequently too slight to permit attachment of the bank’s security interest. We disagree. Section 55-2-401(1) states:
[Tjitle to goods cannot pass under a contract for sale prior to their identification to the contract (Section 2-501 [55-2-501 NMSA 1978]), and unless otherwise explicitly agreed the buyer acquires by their identification a special property as limited by this act [chapter]. Any retention or reservation by the seller of the title (property) in goods shipped or delivered to the buyer is limited in effect to a reservation of a security interest. Subject to these provisions and to the provisions of the article on secured transactions (Article 9), title to goods passes from the seller to the buyer in any manner and on any conditions explicitly agreed on by the parties * * *.
The clause on which McCoy relies refers to Section 55-2-501. This section provides: “The buyer obtains a special property and an insurable interest in goods by identification of existing goods as goods to which the contract refers even though the goods so identified are nonconforming and he has an option to return or reject them.” § 55-2-501(1). The subject cattle in this case both were in existence and were the goods to which the oral agreement referred. The allegations that McCoy shipped the cattle to Chandler in New Mexico subject to Chandler’s right to return some or all of the cattle and subject to further negotiations on the price do not raise material issues of fact as to whether a contract existed. The fact that the transaction was a “sale or return” does not negate the existence of the contract. See § 55-2-326. The buyer and seller may enter into a binding sales contract notwithstanding that they have yet to agree on a price. See § 55-2-305.
Effect of delivery. Because McCoy delivered the cattle under the contract, title passed to Chandler even though McCoy may have retained certain security inter ests in the cattle, as discussed below. Section 55-2-401(2) provides:
[U]nless otherwise explicitly agreed title passes to the buyer at the time and place at which the seller completes his performance with reference to the physical delivery of the goods, despite any reservation of a security interest and even though a document of title is to be delivered at a different time or place; and in particular and despite any reservation of a security interest by the bill of lading
McCoy also claims that because the cattle were delivered to the feedlot and not to Chandler personally, it was necessary under Section 55-2-705 for the feedlot as bailee to notify Chandler that the goods were being held for him. Absent such notification, McCoy, as seller, could stop delivery of the goods. See Ceres, Inc. v. ACLI Metal & Ore Co., 451 F.Supp. 921 (N.D.Ill.1978).
It should be noted that under Ceres, it is the seller who has the burden of showing that acknowledgement was not given to the buyer. Id. at 924. McCoy has failed to alert us to evidence that he attempted to stop delivery before Chandler was notified by the feedlot that the cattle were being held for him. McCoy admits that Chandler went out to view the cattle at the feedlot with the feedlot owner, Gene Atchley, before obtaining a loan from the bank and before McCoy alleged he attempted to reclaim the cattle. Thus, McCoy failed to exercise his rights under Section 55-2-705 in a timely fashion.
The buyer’s power to create a security interest in a third party under Article 2. Because the goods were delivered to Chandler under the contract, he had the power to create a security interest in a third party. This interest attached even though Chandler was found to have committed a fraud against McCoy and thus only had voidable title to the cattle. Section 55-2-408(1) allows certain transferors to pass greater title than they themselves claim. See In re Samuels & Co., 526 F.2d 1238, 1242 (5th Cir.) (party with perfected security interest in bankrupt buyer’s after-acquired inventory took priority over unpaid seller of cattle) cert. denied sub nom. Stowers v. Mahon, 429 U.S. 834, 97 S.Ct. 98, 50 L.Ed.2d 99 (1976). “Section [2-403(1) ] gives good faith purchasers of even fraudulent buyers-transferors greater rights than the defrauded seller can assert. This harsh rule is designed to promote the greatest range of freedom possible to commercial vendors and purchasers.” Id. Section 2-403(1) provides:
A purchaser of goods acquires all title which his transferor had or had power to transfer except that a purchaser of a limited interest acquires rights only to the extent of the interest purchased. A person with voidable title has power to transfer a good title to a good faith purchaser for value. When goods have been delivered under a transaction of purchase the purchaser has such power even though: * * * (d) the delivery was procured through fraud punishable as larcenous under the criminal law.
Given our discussion above, it is clear that the cattle had been delivered under a “transaction of purchase” and hence that Chandler was a “purchaser.” See § 55-1-201(33) (Cum.Supp.1988). The court in In re Samuels & Co. held that under the comparable section of the Texas U.C.C. it is transfer of possession to the defaulting buyer which gives him the power to transfer good title to a good faith purchaser for value. 526 F.2d at 1246-47. Once McCoy delivered the cattle pursuant to his agreement with Chandler, under Section 2-403(1) Chandler had the power to transfer good title to a good faith purchaser for value.
The term “purchaser” is defined broadly under the U.C.C. to include an Article 9 secured party. Id. at 1242. Under Section 55-1-201(19), the only matter material to good faith is honesty in the conduct of the transaction at hand. Chandler had possession of the shipping invoices and represented that he had already paid for the cattle when he negotiated for the loan. McCoy has identified no fact that places into dispute the good faith status of the bank with respect to the bank’s conduct in this trans action with Chandler. Therefore, the bank acquired a valid security interest in its dealing with Chandler, which the bank perfected by filing.
Comment 2 to Section 55-2-403 notes that the policy underlying the section as a whole is the protection of good faith purchasers such as Article 9 secured parties against “hidden interest[s].” Whether McCoy shipped the cattle to Chandler under a title-retention contract as alleged in his complaint, or whether he shipped the cattle to the feedlot pursuant to the agreement described in his deposition testimony, his retained interest in the cattle was indeed “hidden” from the view of the bank as a “good faith purchaser” within the meaning of Section 55-2-403.
It is with such considerations in mind that the court in In re Samuels & Co. stated that “[t]he Code’s overall plan * * * typically favors good faith purchasers,” 526 F.2d at 1241, and, “[a]ny seeming unfairness * * * resulting from the Code’s operation is illusory, for the sellers could have protected their interest * * * if they had merely complied with the U.C.C.’s purchase-money provisions.” Id. at 1247-48. Clearly, McCoy could have protected his interests in this case.
The seller’s security interests under Articles 2 and 9. The next question is therefore whether McCoy, by virtue of his status as seller, had a superior interest to that of the bank or Chandler’s other creditors in the subject collateral. McCoy claims that he possessed such an interest by virtue of NMSA 1978, Section 55-9-113. That section provides:
A security interest arising solely under the article on sales (Article 2) is subject to the provisions of this article except that to the extent that and so long as the debtor does not have or does not lawfully obtain possession of the goods:
(a) no security agreement is necessary to make the security interest enforceable; and
(b) no filing is required to perfect the security interest; and
(c)the rights of the secured party on default by the debtor are governed by the article on sales (Article 2).
(Emphasis added.)
McCoy argues that because Chandler lacked documents of title to the cattle an issue of fact existed about whether Chandler’s possession was unlawful and whether McCoy had a perfected security interest in the cattle, thus precluding summary judgment in favor of the bank. McCoy points out that under NMSA 1978, Sections 77-9-21 and 77-9-22, possession of livestock, including cattle, without the necessary documents of title is prima facie evidence that possession is unlawful. Thus, McCoy argues, because there is prima facie evidence that Chandler’s possession was unlawful, McCoy met his burden of showing that he retained a security interest in the cattle, which was perfected before Chandler secured a loan from the bank using the same cattle as collateral.
McCoy’s argument must fail. Even if McCoy established that he held a security interest under Section 55-9-113, the bank would still prevail in this case. A security interest under Section 55-9-113 is one that arises as a matter of law under Article 2. In re Samuels & Co., 526 F.2d at 1247. Under Subsection (c) of Section 55-9-113, the rights of a seller are governed by Article 2 on sales. Comment 2 to Section 55-9-113 refers the reader to Sections 55-2-705, 2-706, and 2-707(2) in particular, which govern the seller’s remedies regarding stoppage of delivery and resale after breach. In addition, the court in Holiday Rambler Corp. v. Morris, 32 U.C. C.Rep. 1222 (D.Kan.1981), aff'd sub nom. Holiday Rambler Corp. v. First National Bank & Trust, 723 F.2d 1449 (10th Cir. 1983), held that a seller’s security interest allowed invocation of the right of reclamation under Section 55-2-702. Id. at 1226. However, the shipping invoices in this case indicate that the last of the cattle were delivered to the feedlot on March 29, 1986. McCoy alleged in his motion for partial summary judgment that he first made an attempt to have the cattle released to him on April 12, 1986. His attempt to invoke his reclamation rights thus came after expiration of the ten day period provided by Section 55-2-702. See Holiday Rambler Corp., 32 U.C.C.Rep. at 1226.
In addition to an Article 2 security interest created, as a matter of law under the U.C.C., a seller may create an Article 9 security interest by express agreement. Id. McCoy’s oral title-retention contract with Chandler may have constituted an attempt to create such a security interest. However, such an interest, if created, falls outside the provisions of Section 55-9-113 and, like other Article 9 security interests, must be evidenced by a written agreement and filed before it could take priority over the perfected security interest of the bank. An oral agreement fails to meet this standard on both counts. The trial court therefore properly concluded that the bank, as a secured party, took priority over McCoy.
Based upon the foregoihg, we therefore affirm the district court’s entry of summary judgment.
IT IS SO ORDERED.
SCARBOROUGH, C.J., and WALTERS, J., concur.
. By stipulation of all the parties, plaintiff Kevin D. O'Brien, co-owner of T.C. Cattle Co., was dismissed with prejudice as a party to the lawsuit on January 9, 1987. | [
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OPINION
GARCIA, Judge.
Following a jury trial, defendant, Vincent Wiberg, was convicted of driving while under the influence of alochol, in violation of NMSA 1978, Section 66-8-102(A) (Repl. Pamp.1987); vehicular homicide while driving under the influence of alcohol, in violation of NMSA 1978, Section 66-8-101(A) (Repl.Pamp.1978); great bodily harm by vehicle while driving under the influence of alcohol, in violation of Section 66-8-101(B); and reckless driving, in violation of NMSA 1978, Section 66-8-113(A) (Repl.Pamp. 1987). He appeals from his convictions. We affirm in part and reverse in part.
ISSUES
Several issues were raised in defendant’s docketing statement and in his motion to amend. Of these, four have been briefed. The remaining issues are deemed abandoned. See State v. Fish, 102 N.M. 775, 701 P.2d 374 (Ct.App.1985). We discuss the following four issues: (1) whether the trial court erred in denying defendant’s motion to suppress the results of a blood-alcohol test, since the nurse who withdrew the blood was not employed by a physician or hospital; (2) whether defendant’s right to an impartial trial was denied by the trial court’s failure to excuse, for cause, a juror who expressed reservations about the use of alcohol; (3) whether driving under the influence of alcohol (DWI) is a lesser included offense of vehicular homicide while driving under the influence of alcohol; and (4) whether defendant’s reckless driving conviction merges with his vehicular homicide conviction.
FACTS
Defendant had been drinking. He admitted consuming at least two bourbons with beer chasers earlier in the evening. While operating his truck at a speed of approximately 40 miles per hour, defendant failed to stop at a stop sign, ran through the intersection and collided with a motorcycle on which Dennis Trujillo and Audra Fasulo were riding. Trujillo was killed and Fasulo suffered severe disfiguring and disabling injuries.
Defendant was arrested at the scene for DWI. Due to defendant’s own injuries, no field sobriety tests were conducted. He was escorted to the University of New Mexico Hospital. Officer Conner Dailey testified that when he observed defendant at the hospital, he had an odor of alcohol on him, his eyes appeared bloodshot, his speech was slurred, and while sitting on the hospital bed, he swayed back and forth.
At the hospital, Sherman Henderson (Henderson), a licensed registered nurse, withdrew a sample of defendant’s blood approximately two hours after the accident. Henderson was not, however, employed by a hospital or physician at the time he obtained a sample of defendant’s blood. Rather, he was employed by Western Temporary Services, an agency under contract with the Albuquerque Police Department, to draw blood samples, test and screen blood. Defendant’s blood sample indicated that he had a .16 percent blood-alcohol level.
Defendant moved to suppress the test results contending that Henderson was not qualified to extract the blood sample because he was neither employed by a hospital nor a physician. The motion was denied. Subsequently, test results of the blood sample were introduced at defendant’s trial.
ISSUE 1 (Admissibility of blood-alcohol test results.)
Defendant’s chief contention is that NMSA 1978, Section 66-8-103 (Repl. Pamp.1987) requires that a nurse who withdraws blood for a blood-alcohol test be employed by a hospital or physician. Defendant then argues that Section 66-8-103; NMSA 1978, Sections 66-8-109(A) and 66-8-110(A) (Repl.Pamp.1987) require that blood-alcohol test results based upon blood withdrawn by a nurse who is not employed by a hospital or a physician, as well as expert testimony based on those test results, be suppressed. Finally, defendant argues that the admission of the blood-alcohol test results and testimony concerning the results was so damaging that it cannot constitute harmless error.
Because we believe that Section 66-8-103 does not require that a registered nurse or licensed professional nurse be employed by a hospital or physician as a prerequisite to the admissibility of blood test evidence, we do not discuss defendant’s remaining two contentions.
The relevant portion of Section 66-8-103 provides: “Only a physician, licensed professional or practical nurse or laboratory technician or technologist employed by a hospital or physician shall withdraw blood from any person in the performance of a blood-alcohol test.” Defendant’s argument, similar to that advanced and rejected in State v. Trujillo, 85 N.M. 208, 510 P.2d 1079 (Ct.App.1973), is that the comma separates classes, or members of a class, and therefore the placement of the comma between the word “physician” and all the other listed occupations, together with the use of “or” between the other occupations, indicates a legislative intent to group all the occupations listed after “physician” into one class commonly subject to the employment requirement. Defendant further argues that due to the penal implications involved in the use of blood-alcohol testing, strict construction of Section 66-8-103 is required. Finally, defendant argues that the requirement for independent employment by a hospital or physician ensures the reliability of the blood-alcohol test. We disagree. The requirement of employment by a hospital or physician applies only to “technologists.”
We have previously acknowledged that the cited language in Section 66-8-103 is ambiguous. See State v. Trujillo. In Trujillo, we ascertained the legislative intent of the statute by applying rules of construction. Statutes are to be read and understood primarily according to their grammatical sense, unless it is apparent that the author intended something different. Aet na Finance Co. v. Gutierrez, 96 N.M. 538, 632 P.2d 1176 (1981); In re Goldsworthy’s Estate, 45 N.M. 406, 115 P.2d 627 (1941).
Although use of a comma after “physician” and the failure to use a comma between the other occupations listed in Section 66-8-103 may support the inference that the other occupations are grouped together, defendant’s conclusion that all members of the group are subject to the employment condition does not follow from that grouping alone. In Trujillo, we characterized the same argument as an “expansive reading of the statute” which required adding words which were not part of the statute as enacted. Nonetheless, while defendant’s grammatical argument may, at first glance, seem to have merit, there is another rule of statutory construction which we believe is applicable. It is the “last antecedent doctrine.” See In re Goldsworthy’s Estate. The doctrine provides that relative and qualifying words, phrases and clauses are to be applied to the words or phrase immediately preceding, and are not to be construed as extending to or including others more remote. Id. Here, the qualifying words are “employed by a hospital or physician.” We apply that phrase to the preceding term “technologist” but not to the more remote terms. See id.
Pursuant to the doctrine of the last antecedent, the grammatical sense of the language in Section 66-8-103 would be that the employment condition does not apply to a licensed professional nurse. In the absence of a showing that something different was intended by the legislature, we believe that this is how the statute should be read and understood.
In Trujillo, we settled on a construction of the statute that would accomplish the legislative purpose of deterring drunk drivers and aid in discovering and removing the intoxicated driver from the highways. The construction urged upon us in Trujillo would have thwarted that salutary, and indeed necessary, legislative purpose. So too, here, the construction urged by defendant would significantly and unnecessarily limit the classes of individuals who could assist in furthering the statute’s legislative purpose.
Henderson is a licensed registered nurse. He obtained an associate degree in nursing and has successfully completed competency and licensing examinations administered by the State of New Mexico. A registered nurse is one who practices professional nursing, and whose name is listed in the register of licensed registered nurses maintained by the state board of nursing. NMSA 1978, § 61-3-3(C) (Repl.1986). Section 61-3-3(A) defines professional nursing as:
[T]he performance of any act in which substantial knowledge derived from the biological, physical and behavioral sciences is applied:
(1) to the care, counsel and health teaching of persons who are either experiencing changes in the normal health processes or who require assistance in the maintenance of health, in the management of illness, injury or infirmity or in the achievement of a dignified death; or
(2) to the administration of medications and treatments as prescribed by a person authorized in this state to prescribe such medications and treatments.
Before one can qualify for licensure as a professional nurse, there is a graduation requirement from a four-year high school course of study or its equivalent, the graduation from an approved school of nursing, and the successful completion of the national licensing examination for registered nurses. NMSA 1978, §§ 61-3-13; 61-3-14 (Repl.1986). New Mexico does not impose greater experience, educational qualifications or skill requirements on professional nurses who are employed by physicians or hospitals, as opposed to those professional nurses who are not. The requirements to be a licensed professional nurse or registered nurse are sufficiently rigorous to fulfill the purpose of Section 66-8-103, that is, the safety of the subject and the reliability of the sample. See Steere Tank Lines, Inc. v. Rogers, 91 N.M. 768, 581 P.2d 456 (1978).
Our statutory interpretation is consistent with our holding in Trujillo. Moreover, in furthering the purpose of the Implied Consent Act, see NMSA 1978, Section 66-8-105 to -112 (Repl.Pamp.1987), to deter drunk driving and to aid in discovering and removing intoxicated drivers from the highways, a construction of the statute requiring that licensed professional nurses be employed by a physician or hospital would needlessly impose burdens on the discovery and removal of the intoxicated driver and, thus, thwart the legislative policy.
Citing State v. Garcia, 91 N.M. 664, 579 P.2d 790 (1978), defendant argues that the penal implications of Section 66-8-110 support a strict construction of Section 66-8-103. Defendant’s reliance on Garcia, however, is misplaced. Defendant argues for strict construction of Section 66-8-103, not Section 66-8-110. The purpose behind a penal statute is to punish an offense against the state. See Denison v. Tocker, 55 N.M. 184, 229 P.2d 285 (1951). This is not the purpose of Section 66-8-103. See State v. Trujillo. Accordingly, Section 66-8-103 is not a penal statute.
Defendant’s last argument is that the withdrawal of a blood sample by a registered nurse employed by a hospital or physician, as opposed to Henderson, who was under contract to the police department, will avoid the threat or suggestion of a personal interest in obtaining a favorable sample. We are not persuaded that this is a valid reason for adopting defendant’s statutory interpretation. Moreover, this argument goes to the weight the fact finder should give the evidence, and not to its admissibility. See State v. Copeland, 105 N.M. 27, 727 P.2d 1342 (Ct.App.1986).
In conclusion, we hold that Section 66-8-103 does not require a licensed professional nurse or registered nurse to be employed by a hospital or physician in order to withdraw blood for blood-alcohol tests. Accordingly, we affirm the trial court’s ruling on this point.
ISSUE 2 (Denial of right to an impartial jury.)
Defendant contends that his right to an impartial jury was denied by the trial court’s refusal to strike a particular juror for cause. Juror Eberle (Eberle), who was originally selected as an alternate juror, became a deliberating juror during the course of the trial. Defendant argues that her view on the use of alcohol denied him the right to an impartial jury.
During voir dire, Eberle stated that she believed alcohol was the cause of many problems, that she was a member of Mothers Against Drunk Drivers (MADD) and that, years before, her own mother had belonged to the Christian Temperance Union. Eberle revealed that during her childhood she signed a pledge that she would never drink nor smoke and she had kept that promise. She stated that although she hated liquor, she had only compassion for those taken over by alcohol. Based on her responses, defense counsel inquired whether her views on alcohol or membership in MADD would make it difficult for her to remain neutral in judging the facts of the case. Eberle denied it would. She indicated that although she considered drinking a sin, her personal beliefs would not interfere with the facts if she really “weighed them well.” Similarly, when asked if her membership in MADD would cause her to believe that because drinking was involved it was just “too much” and that she would have a “commitment,” Eberle did not agree. She responded: “Well, as I said before, I hate liquor, but I have compassion for the person consumed by it.” Based on Eberle’s responses, the court denied defendant’s strike for cause.
An accused is entitled to a trial by a fair and impartial jury. N.M. Const, art. II, § 14. An impartial jury means a jury where each and every one of the twelve is totally free from any partiality whatsoever. State v. Dobbs, 100 N.M. 60, 665 P.2d 1151 (Ct.App.1983). The trial court, however, has a great deal of discretion in dismissing a juror for cause, and its decision will not be disturbed absent a manifest error or clear abuse of that discretion. State v. Martinez, 95 N.M. 445, 623 P.2d 565 (1981), overruled on other grounds, Fuson v. State, 105 N.M. 632, 735 P.2d 1138 (1987). The burden of establishing partiality is upon the party making the claim. State v. Baca, 99 N.M. 754, 664 P.2d 360 (1983).
In support of his argument that he was denied the right to an impartial jury, defendant relies on State v. Sims, 51 N.M. 467, 188 P.2d 177 (1947) and Alvarez v. State, 92 N.M. 44, 582 P.2d 816 (1978). Neither Sims nor Alvarez, however, support defendant’s claim. In Sims, the prospective juror specifically stated that his bias or prejudice would cause him to find against the defendant, but then under skillful questioning by the trial court and the prosecutor, the juror declared he would return a verdict in accordance with the law and the evidence. In the present case, Eberle only indicated her aversion to alcohol-and her view that it caused many problems. She never stated, as did the juror in Sims, that she would find against defendant or that she believed that someone accused of a crime probably committed that crime if they had been using alcohol. Moreover, here, as opposed to Sims, it was defense counsel who “rehabilitated” Eberle when, in response to defense counsel’s question, she denied any inability to be fair.
In Alvarez, defendant’s jury included some jurors who had previously reached a guilty verdict in a different case based on the testimony of the same prosecution witness who would be called in Alvarez. The witness was the sole witness to the alleged sale of heroin and the state’s case hinged on his testimony. The supreme court determined that those jurors should have been excused for cause: “The jurors, having sustained the credibility of the witness once before should not be allowed to overcome the implied bias in this situation by avowals of impartiality given in response to leading questions by the trial court and the prosecutor. * * * [Tjhese jurors cannot be judges of their own impartiality.” Id. 92 N.M. at 46, 582 P.2d at 818 (citing Temple v. State, 15 Okl.Cr. 176, 175 P. 733 (1918)).
The trial court determined that by reaching a verdict of guilty in the previous case, the jurors had passed on the credibility of the state’s sole witness and demonstrated a bias in favor of the state. There is no such similar showing here.. Once Eberle indicated that she could be impartial, defendant made no further inquiry. Under the circumstances, defendant did not sustain his burden in demonstrating Eberle’s partiality. See State v. Baca, cf. State v. Dobbs (effort to elicit more information than appears in the record should have been made where jurors were questioned about their ability to be impartial and counsel made no further inquiry after their responses).
Because defendant has not shown that Eberle was partial, and for the other reasons stated above, we hold the trial court did not abuse its discretion in refusing to strike Eberle for cause. See State v. Baca; State v. Martinez. Accordingly, defendant was not denied his right to an impartial jury. See State v. Dobbs.
ISSUE 3 (DWI conviction precluded.)
Defendant was convicted of both vehicular homicide and DWI. He contends that he could not be convicted of DWI under the facts of this case because DWI was a lesser included offense of vehicular homicide committed by DWI. Defendant asserts that a conviction for the higher offense bars a simultaneous conviction, under double jeopardy, of the lesser. Accordingly, he argues that his DWI conviction should be stricken and the six-month sentence vacated. We disagree.
Defendant’s argument is based on an erroneous belief that the lesser included offense concept of double jeopardy precludes a simultaneous conviction for the lesser included offense. A conviction or acquittal of a lesser offense necessarily included in a greater offense bars a subsequent prosecution for the greater offense. State v. Sandoval, 90 N.M. 260, 561 P.2d 1353 (Ct.App.1977). Thus, the lesser included offense concept protects against retrial. See id.
Merger is an aspect of double jeopardy; it is concerned with whether more than one offense has occurred, and is applied to prevent a person from being punished twice for the same offense. State v. McAfee, 78 N.M. 108, 428 P.2d 647 (1967); State v. Maes, 100 N.M. 78, 665 P.2d 1169 (Ct.App. 1983). The doctrine of merger is applicable here. Under the concept of merger, defendant can properly be convicted of both the lesser and greater offenses but can only be punished for one of those offenses. See State v. Quintana, 69 N.M. 51, 364 P.2d 120 (1961); State v. Maes. The sentence to be vacated is that imposed for the lesser offense because it is that offense which merges with the greater offense. State v. Jacobs, 102 N.M. 801, 701 P.2d 400 (Ct.App.1985). Accordingly, defendant’s DWI offense merges with his vehicular homicide offense, and defendant’s six month sentence for the DWI conviction must be vacated. See id.
ISSUE 4 (Merger of reckless driving and vehicular homicide.)
Following his convictions, defendant was sentenced to imprisonment for three years on the vehicular homicide conviction, three years on the great bodily harm conviction, six months on the driving while under the influence conviction, and ninety days on the reckless driving conviction, all sentences to run consecutively. The trial court suspended three years and nine months of the total sentence, ordering probation for that period of suspension.
Defendant argues that the acts constituting reckless driving — driving carelessly and heedlessly in willful disregard of the rights or safety of others, without due caution, and at a speed or in a manner so as to endanger or be likely to endanger any person according to Section 66-8-113(A), are necessarily the same acts to be proven for the conviction of vehicular homicide by driving under the influence of alcohol. Specifically, he argues, recklessness was the act of driving under the influence. Defendant argues that other evidence of his driving under the influence is insufficient to support the conviction of vehicular homicide. See State v. Sisneros, 42 N.M. 500, 82 P.2d 274 (1938). Accordingly, defendant argues that the sentence for reckless driving should be vacated.
The double jeopardy concept of “merger of offenses” requires that one offense necessarily involve the other. State v. Jacobs. A necessarily included offense does not have any element not included in the greater offense so that it is impossible to commit the greater offense without necessarily committing the lesser included offense. Id. A comparison of the elements of vehicular homicide by DWI and reckless driving, however, shows that all of the elements of the reckless driving offense are not necessarily included in the offense of vehicular homicide by DWI. See § 66-8-113(A). The state concedes on appeal that defendant’s DWI conviction under count III must be vacated and has merged.
In determining necessarily included offenses, however, we no longer consider the statutory elements of the offenses in a vacuum. State v. Brecheisen, 101 N.M. 38, 677 P.2d 1074 (Ct.App.1984). Instead, we regard the offenses in light of the facts before us. See State v. DeMary, 99 N.M. 177, 655 P.2d 1021 (1982); State v. Jacobs.
Here, there was evidence that defendant was the driver of the truck and that he ran a stop sign. Further, defendant smelled of alcohol, had slurred speech, swayed back and forth while on a hospital bed, and admitted to drinking at least two bourbons with beer chasers prior to the accident. Defendant more importantly, had a .16 percent blood-alcohol level. This evidence is sufficient to convict defendant of DWI. See City of Portales v. Shiplett, 67 N.M. 308, 355 P.2d 126 (1960).
While evidence of intoxication might bear upon the question of whether a defendant is guilty of reckless driving, it does not necessarily prove it. Intoxication is but one circumstance to be considered by the fact finder in deciding the issue. See State v. Sisneros. There was testimony in this case to the effect that defendant ran a stop sign prior to the collision. This fact, along with the evidence of intoxication, would allow a fact finder to reasonably find defendant guilty of reckless driving. Id.; cf. State v. Myers, 88 N.M. 16, 536 P.2d 280 (Ct.App.1975) (circumstances of intoxication attending running a red light might reasonably lead jury to a finding of recklessness). Here, however, defendant was convicted of vehicular homicide while driving under the influence of intoxicating liquor, and not while driving recklessly. Hence, given the facts of this particular case, defendant’s conviction of reckless driving is not necessarily included in his conviction of vehicular homicide while driving under the influence. Accordingly, there is no merger of the two convictions. See State v. Jacobs.
CONCLUSION
For these reasons, we affirm all four of defendant’s convictions; however, defendant’s sentence for the DWI conviction must be vacated. Accordingly, we remand to the trial court to vacate defendant’s six month DWI sentence.
IT IS SO ORDERED.
DONNELLY, C.J., and MINZNER, J., concur. | [
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OPINION
SCARBOROUGH, Chief Justice.
Petitioner, Giorgio Spadaro, filed a verified Petition for Writ of Mandamus against Theresa Trahan, respondent, to obtain disclosure of certain documents from the University of New Mexico (UNM) Part-Time Student Employment Office (the Employment Office).
Petitioner alleged that Trahan was the custodian of Employment Office records “required by law to be kept or kept necessarily in discharge of duties imposed by law.” Spadaro further alleged that he utilized the services of the Employment Office to obtain domestic help by means of job postings, and that Trahan, without explanation, cancelled his job posting based on complaints by student employees. Spadaro asserted a right of access to the complaints under the New Mexico Inspection of Public Records Act, NMSA 1978, Section 14-2-1, (Orig.Pamp.). Spadaro filed an amended verified petition for writ of mandamus which formally joined the University of New Mexico Board of Regents as an additional respondent and alleged the same cause of action as that alleged in the initial petition. Trahan filed an answer to the amended petition, denied the essential allegations of the amended petition, and affirmatively asserted that Trahan was not the custodian of records of the Employment Office. Trahan also asserted that the records in question were not public records under the New Mexico Inspection of Public Records Act or the Family Education and Privacy Act, 20 U.S.C. § 1232(g) (1982); that there was a mandatory duty to refuse to disclose the records; that the records should remain confidential; and that a reasonable explanation had been given to Spadaro regarding Trahan’s refusal to disclose the records.
By agreement of the parties, Theresa Trahan was dismissed as a respondent and John Whiteside was substituted in her place as the custodian of all records concerning part-time student employment. No writ of mandamus nor amended writ appears in the court file. Whiteside filed a motion for judgment on the pleadings and the case was submitted to the trial court on stipulated findings of fact. The trial court granted the motion. We affirm.
Spadaro, a citizen of the State of New Mexico, posted a job listing through the Employment Office, a division of the UNM Department of Financial Aid. The University of New Mexico is not required either by statute or Regents’ policy to operate the Employment Office, which is a referral agency providing service at no cost to persons interested in employing UNM students. Job listings are directed only to enrolled UNM students. The Employment Office determines what jobs are appropriate for student referral. Spadaro’s job notice sought a female student who was willing to exchange childcare and light housekeeping duties for room and board.
Spadaro interviewed at least two UNM students as a result of the job posting. During September 1983, Trahan informed Spadaro that his job posting was cancelled because she received two separate complaints from interviewees that the required duties were not those specified by the job listing. Spadaro sought copies of the complaints filed against him. Respondents refused to provide copies of the complaints, but the University’s President, Tom Farer, responded to the request by stating that the job postings were provided as a convenience for students and would be removed if a complaint was received. Farer further explained that removal of the job posting did not mean that a complaint necessarily had credence, but only that it was no longer convenient to continue a particular posting.
Spadaro seeks to compel disclosure of the complaints or to receive a reasonable explanation regarding the removal of the job listing, and first argues that the trial court erred in concluding that the student complaints are “not public records under the New Mexico Inspection of Public Records Acts, Section 14-2-1 to 14-2-3 NMSA 1978.” This issue is dispositive.
NMSA 1978, Section 14-2-1 (Cumm. Supp.1987) provides:
Every citizen of this state has a right to inspect any public records of this state except:
A. records pertaining to physical or mental examinations and medical treatment of persons confined to any institutions;
B. letters of reference concerning employment, licensing or permits;
C. letters or memorandums which are matters of opinion in personnel files or students' cumulative files;
D. as provided by the Confidential Materials Act [14-3A-1, 14-3A-2 NMSA 1978]; and
E. as otherwise provided by law.
The threshold inquiry we must make is whether the student complaints requested by Spadaro are “public records” within the meaning of Section 14-2-1. We agree with the trial court that the student complaints are not public records. Neither the courts nor the legislature have defined “public records” within the context of the New Mexico Inspection of Public Records Act. However, in 1963, the New Mexico Attorney General defined a “public record” as a record made by a public official who is authorized by law to make it. AG Op. No. 55 (1963). Respondent argues that we should adopt this definition of public records for purposes of disclosure under the New Mexico Inspection of Records Act. We agree that a definition of “public records” for the purposes of the New Mexico Inspection of Public Records Act would be helpful to the courts in deciding what records should be disclosed, but it is for the legislature to provide the definition.
Appellant argues that we should apply State ex rel. Newsome v. Alarid, 90 N.M. 790, 568 P.2d 1236 (1977) to the facts of this case. Newsome is not authority for Spadaro’s claim that student complaints are subject to disclosure. Newsome did not define “public records.” Newsome’s basic assumption was that all records there dealt with were public records for purposes of the Inspection of Public Records Act. The Supreme Court in Newsome dealt with statutory exceptions to disclosure under the Act, carved out a non-statutory “confidentiality exception” to disclosure under the Act, and required the trial court to conduct an in camera examination of documents prior to disclosure when a claim of confidentiality had been asserted. A “rule of reason” analysis for each instance where a claim of confidentiality is raised was approved by this Court. This is essentially a balancing test which requires the trial court to balance the fundamental right of all citizens to have reasonable access to public records against countervailing public policy considerations which favor confidentiality and nondisclosure. The rule of reason analysis is applicable only to claims of confidentiality asserted for public records that do not fall into one of the statutory exceptions to' disclosure contained in Section 14-2-1. Such an analysis is not available nor applicable to the facts in this case. The trial court properly concluded that the student complaints are not public records. Therefore, they are not subject to discovery under the New Mexico Inspection of Public Records Act. The Act simply does not apply.
The parties have stipulated that UNM is not required by statute or policy to operate the Employment Office. Since the Employment Office is neither a creature of statute nor created by university policy, there is no mandatory obligation or duty to make or keep a record of student complaints received by the Employment Office. The complaints are not before us for review nor were they before the trial court. The content of the complaints is unknown. Whether they are written or verbal is not known. We do know, however, from the stipulated facts before us, that there was no legal mandate for the operation of the Employment Office, where the events complained of took place. Spadaro argues that “[i]t is illogical to assume that the duty to keep records imposed on the Financial Aid Office would not apply to a recognized division maintained by that office, even though there is no specific statute or formal Regent’s policy to maintain such a sub-department.” No authority is cited for this argument, nor is any authority cited for Spadaro’s further argument that “employees of the Employment Office are public officers working for the Financial Aid Office.” The stipulation before us does not establish that any officers, employees, or agents of any public office ever received or now possess any records of student complaints for which disclosure is now sought by Spadaro. John Whiteside is identified in the stipulation as the custodian of records for the Employment Office. This office is identified as a division of the UNM Department of Financial Aid, but Whiteside is not identified as an employee or agent of the Department of Financial Aid or as an agent of any university department. Theresa Trahan, who was initially identified by Spadaro as the custodian of student complaints, has been dismissed from the case. Although she is identified as the person who initially received the two student complaints about which Spadaro complains, her relationship to the University has never been defined or described in the record. It is unclear what became of the complaints after they were received by Trahan. The record does reflect, however, that “Spadaro has been consistently refused access to the students’ complaints maintained by the Part-Time Employment Office.” Neither this office nor its employees have been identified as a public office or public employees.
The trial court properly granted judgment to Whiteside. This case was submitted to the trial court on an agreed statement of facts. Since the agreed statement of facts go beyond the pleadings, we treat the motion for judgment on the pleadings as though it were a motion for summary judgment. Whiteside made a prima facie showing of entitlement to summary judgment. Whiteside was not obliged to show beyond all possibility that no genuine issue of fact existed. Once a prima facie showing was made, Spadaro had the burden of demonstrating at least a reasonable doubt as to whether a genuine issue of fact exist-. ed. Kerman v. Swafford, 101 N.M. 241, 243, 680 P.2d 622, 624 (Ct.App.1984). The party opposing the motion carries his burden of proof by setting forth specific facts, admissible in evidence, showing that there is a genuine issue for trial. Storey v. University of N.M. Hosp./BCMC, 105 N.M. 205, 207, 730 P.2d 1187, 1189 (1986). The evidence presented by Spadaro failed to establish that the student complaints were a record made or kept by a public official. In Sanchez v. Board of Regents of Eastern N.M. Univ., 82 N.M. 672, 486 P.2d 608 (1971), the Supreme Court found that a university faculty salary schedule was not a public record within the meaning of Section 14-2-1. Similarly, the student complaints here are not public records. The judgment of the trial court is affirmed.
IT IS SO ORDERED.
SOSA, Senior Justice and STOWERS, J., concur.
WALTERS and RANSOM, JJ., dissent. | [
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OPINION
FRUMAN, Judge.
Tenneco Oil Company and Navajo Refining Company appeal from the New Mexico Water Quality Control Commission’s adoption of regulations establishing numerical standards for fourteen organic compounds in groundwater. The issues raised in this consolidated appeal are: (1) what standard of review should this court apply; (2) whether the Commission’s decision was arbitrary, capricious, or an abuse of discretion, or otherwise not in accordance with law; and (3) whether the decision was based on substantial evidence. We affirm.
I. BACKGROUND
Prior to the adoption of the regulations, the Commission received testimony and evidence at its public hearing on September 4-6, 1985. Then, at its public meeting on December 10-11, 1985, the Commission considered the evidence presented at the earlier hearing, voted to adopt the regulations, and asked its counsel to compile a statement of reasons based on the discussions during that meeting. This compilation was adopted at a public meeting on January 14, 1986. The regulations establishing the numerical standards were filed two weeks later.
II. STANDARD OF REVIEW
The Water Quality Act, NMSA 1978, Sections 74-6-1 to -13 (Repl.1986) specifically provides for judicial review of regulations adopted by the Commission. Section 74-6-7(A) states that “appeals shall be upon the record made at the hearing,” and subsection (C) requires a regulation to be set aside if it is: “(1) arbitrary, capricious or an abuse of discretion; (2) not supported by substantial evidence in the record * * * or (3) otherwise not in accordance with law.” (Emphasis added.)
While the parties agree that Section 74-6-7(A) and (C) sets forth the standard of review applicable to this appeal, they disagree as to what constitutes the record for review. Navajo argues that based on the Open Meetings Act, NMSA 1978, Sections 10-15-1 to -4 (Repl.Pamp.1987), only the transcript and minutes of the Commission’s December public meeting comprise the record, since a public body may deliberate and vote only at a public meeting. § 10-15-1. The Commission contends that Section 74-6-7 mandates that our review include the record of the two public meetings and the public hearing and cites to Duke City Lumber Co. v. New Mexico Envtl. Improvement Bd., 101 N.M. 291, 681 P.2d 717 (1984), for support. Tenneco also relies on Duke City Lumber Co. when it claims that the substantial evidence rule requires that we examine the entire administrative record. We agree with Tenneco and hold that our review must encompass the record of the three Commission sessions.
In Duke City Lumber Co., the standard of review in the Air Quality Control Act, NMSA 1978, Sections 74-2-1 to -17 (Repl. Pamp.1983), was considered in an appeal from the denial of a variance. The court construed the judicial review provisions and decided to:
expressly modify the substantial evidence rule * * * and supplement it with the whole record standard for judicial review of findings of fact made by administrative agencies. A review of the whole record is clearly indicated in those cases where the administrative agency serves not only as the factfinder but also as the complainant and prosecutor.
101 N.M. at 294, 681 P.2d at 720.
Although Duke City Lumber Co. involved adjudication rather than rule-making, Section 74-2-9 of the Air Quality Control Act is similar to Section 74-6-7 of the Water Quality Act in providing that: “appeals shall be upon the record made at the hearing ” and the court of appeals shall set aside the denial of a variance “not supported by substantial evidence in the record.” (Emphasis added.) We therefore find that Duke City Lumber Co.’s express application of the whole record standard of judicial review to findings of fact made by administrative agencies in general controls where the Commission acts in its rule-making capacity.
III. COMPLIANCE OF THE RULE-MAKING PROCEDURE WITH THE LAW
Appellants maintain that the Commission’s decision in setting numerical standards should be set aside, pursuant to Section 74-6-7(C), because it was arbitrary, capricious, or an abuse of discretion, or otherwise not in accordance with law. Appellants allege that the Commission’s rule-making failed to meet various procedural and statutory requirements. Each allegation will be considered separately.
A. Consideration of six criteria mandated by statute.
Appellants claim that the record does not contain evidence of the Commission’s consideration of factors two through six, found in Section 74-6-4(D) of the Water Quality Act; thus, the Commission’s decision was arbitrary, capricious, and not in accordance with law. The Commission responds that it did consider all factors and gave them the weight it deemed appropriate. The Commission acknowledges that, as proponent of the regulations, it has the initial burden of proof in establishing that it did consider all six factors. Cf. International Minerals & Chem. Corp. v. New Mexico Public Serv. Comm’n, 81 N.M. 280, 466 P.2d 557 (1970) (holding that the common-law rule that the moving párty has the burden of proof applies to administrative agencies).
In delineating the Commission’s duties and powers, Section 74-6-4(D) requires that it:
shall adopt * * * regulations to prevent or abate water pollution in the state * * *. Regulations shall not specify the method to be used to prevent or abate water pollution, but may specify a standard of performance for new sources which reflects the greatest degree of effluent reduction which the commission determines to be achievable through application of the best available demonstrated control technology * * * including where practicable, a standard permitting no discharge of pollutants. In making its regulations, the commission shall give weight it deems appropriate to all facts and circumstances, including but not limited to:
(1) character and degree of injury to or interference with health, welfare and property;
(2) the public interest, including social and economic value of the sources of water contaminants;
(3) technical practicability and economic reasonableness of reducing or eliminating water contaminants from the sources involved and previous experience with equipment and methods available to control the water contaminants involved;
(4) successive uses, including but not limited to, domestic, commercial, industrial, pastoral, agricultural, wildlife and recreational uses;
(5) feasibility of a user or a subsequent user treating the water before a subsequent use; and
(6) property rights and accustomed uses * * *.
The record contains considerable evidence for all fourteen organic compounds on factor one, injury to health and welfare. The Commission interpreted factor two to mean principally the public health interest, and there is evidence that this interest is better served by preventing groundwater contamination, rather than by costlier remedial action or mitigation. Regarding factor three, an Environmental Improvement Division witness testified as to the availability and cost of treatment technologies for remedial actions in cleaning groundwater contaminated by the two general chemical categories to which the fourteen compounds belong. The witness explained the significance for treatment technologies of grouping classes of compounds by their physical and chemical properties, and testified that the cost of contamination prevention was less than the cost of mitigation. Evidence was also presented on the availability of treatment technologies for the prevention of contamination by the subject compounds. For one prevention technology — pond lining — the record includes examples of its installation by several New Mexico companies and its cost. Factor four, successive use, was considered in the context of protection for the highest standard of groundwater use, that is, a drinking-water standard. Also made part of the record is a Commission report that ninety percent of the water used by three-fourths of the state’s population is supplied by public systems having groundwater sources. As to factor five, feasibility of treatment before a subsequent use, an EID witness testified that, depending upon the particular process, a municipal water treatment system may not be adequate to remove the subject contaminants from groundwater. On factor six, there is evidence relating to in-state property damage caused by contamination by the general classes of subject compounds, such as damage to a municipal public water well. Having reviewed the record, we conclude that the Commission made a prima facie showing that it did consider the six criteria listed in Section 74-6-4(D).
Appellants further contend that Section 74-6-4(D) requires the record to contain the Commission’s consideration of every part within the six factors for each organic compound, and because that consideration is absent, the regulations should be set aside as arbitrary and capricious.
In construing statutes, the reviewing court must give effect to the intention of the legislature. Atencio v. Board of Educ., 99 N.M. 168, 655 P.2d 1012 (1982). The plain language of a statute is the primary indicator of that intent. General Motors Acceptance Corp. v. Anaya, 103 N.M. 72, 703 P.2d 169 (1985). Although the reviewing court will not read into a statute language that is not there, it will read an act in its entirety and construe each part in order to produce a harmonious whole. See Westgate Families v. County Clerk, 100 N.M. 146, 667 P.2d 453 (1983).
Section 74-6-4 requires that water quality standards be adopted as a guide to water pollution control and that regulations be promulgated to prevent or abate water pollution. Subsection (D) directs the Commission, in making its regulations, to “give weight it deems appropriate to all facts and circumstances,” including the six factors, and it “may specify a standard of performance for new sources which reflects the greatest degree of effluent reduction which [it] determines to be achievable * * * including where practicable * * * no discharge of pollutants.” (Emphasis added.) That subsection does not indicate how the six factors are to be considered. We read the emphasized language as providing the Commission with reasonable discretion in its consideration of the six factors and in the weight it gives to each factor.
An agency’s rule-making function involves the exercise of discretion, and a reviewing court will not substitute its judgment for that of the agency on that issue where there is no showing of an abuse of that discretion. See Apex Oil Co. v. Federal Energy Admin., 443 F.Supp. 647 (D.D. C.1977); Bayonet Point Hosp., Inc. v. Department of Health & Rehabilitative Servs., 490 So.2d 1318 (Fla.App.1986). Cf. Conwell v. City of Albuquerque, 97 N.M. 136, 637 P.2d 567 (1981) (holding that in reviewing an adjudicative proceeding, the reviewing court generally may not substitute its judgment for that of the administrative decision maker). Rules and regulations enacted by an agency are presumed valid and will be upheld if reasonably consistent with the statutes that they implement. Hi-Starr, Inc. v. Washington State Liquor Control Bd., 106 Wash.2d 455, 722 P.2d 808 (1986).
A party challenging a rule adopted by an administrative agency has the burden of showing the invalidity of the rule or regulation. See Agrico Chem. Co. v. State Dep’t of Envtl. Regulation, 365 So.2d 759 (Fla.App.1978). The reasonableness of an administrative rule or regulation is not purely a legal question; a factual basis must appear. Pan Am. Petroleum Corp. v. Federal Power Comm’n, 352 F.2d 241 (10th Cir.1965). To successfully challenge a rule promulgated by an agency exercising its delegated legislative authority, the challenger must show, in part, that the rule’s requirements are not reasonably related to the legislative purpose but are arbitrary and capricious. See State, Marine Fisheries Comm’n v. Organized Fishermen of Florida, 503 So.2d 935 (Fla. App. 1987). Cf. Conwell v. City of Albuquerque (holding that judicial review of an administrative adjudication is limited to determining whether the agency acted fraudulently, arbitrarily or capriciously, whether its order was supported by substantial evidence, and whether its action was within the scope of its authority). “ ‘Arbitrary and capricious action has been defined as willful and unreasoning action, without consideration and in disregard of facts and circumstances * * *. Where there is room for two opinions, [the] action is not arbitrary and capricious even though one may believe an erroneous conclusion has been reached.’ ” Hi-Starr, Inc., 106 Wash.2d at 464, 722 P.2d at 814 (quoting State v. Rowe, 93 Wash.2d 277, 284, 609 P.2d 1348, 1351 (1980)). See also Garcia v. New Mexico Human Servs. Dep’t, 94 N.M. 178, 608 P.2d 154 (Ct.App.1979), rev’d on other grounds, 94 N.M. 175, 608 P.2d 151 (1980).
Qur review of the record indicates that the Commission reasonably exercised its discretion in weighing the facts and circumstances and acted in accord with the mandate of Section 74-6-4(D) in its consideration of the six factors.
B. Statement of reasons.
Appellants claim that the Commission’s statement of reasons for adopting the numerical standards was a post hoc rationalization, and, therefore, the regulations should be set aside. They allege that the statement of reasons was invalid because it was compiled after the Commission voted to adopt the numerical standards and because it contained assertions that had not been articulated by the Commission.
There is no statutory requirement that the Commission make formal findings in its rule-making process. In City of Roswell v. New Mexico Water Quality Control Comm’n, 84 N.M. 561, 505 P.2d 1237 (Ct.App.1972), we held that although the record must indicate the Commission’s reasoning and basis for adopting regulations, formal findings are not required. See also Bokum Resources Corp. v. New Mexico Water Quality Control Comm’n, 93 N.M. 546, 603 P.2d 285 (1979).
Post hoc rationalizations are defined as “explanations of counsel for administrative decisions not employed by the agency and subsequent to the occurrence of the administrative action being reviewed.” Smith v. F.T.C., 403 F.Supp. 1000, 1009 (D.Del.1975). The courts are not free to accept such post hoc rationalizations, Burlington Truck Lines, Inc. v. United States, 371 U.S. 156, 168, 83 S.Ct. 239, 245, 9 L.Ed.2d 207 (1962), since “in dealing with a determination or judgment which an ... agency alone is authorized to make, [a reviewing court] must judge the propriety of such action solely by the grounds invoked by the agency.” Securities & Exch. Comm’n v. Chenery Corp., 332 U.S. 194, 196, 67 S.Ct. 1575, 1577, 91 L.Ed. 1995 (1947).
However, in Independent U.S. Tanker Owners Comm. v. Lewis, 690 F.2d 908, 920 (D.C.Cir.1982), it was observed that statements of purpose do have a value:
The preparation of a statement of basis and purpose should play an integral part in the decisionmaking [sic] process. It ensures thoughtful consideration of the various issues raised before a decision is published. Even if the decision is made first and staff members are then instructed to prepare a supporting statement, that statement is likely to be scrutinized by the decisionmakers themselves before it is issued. And as long as the decision has not already been announced it is freely changeable if they are dissatisfied with the statement. [Emphasis in original.]
In this case, the Commission voted to adopt the numerical standards at its December public meeting. It then asked its counsel to compile a statement of reasons based on its discussions by summarizing and identifying the weight it gave to the six statutory criteria. Then, at the public meeting on January 14, 1986, the Commission reviewed and edited the statement of reasons and voted to adopt it. The numerical standards were formally filed on January 30, 1986.
Applying the foregoing principles to the facts here, we conclude that the statement of reasons is not a post hoc rationalization as it was compiled, edited and adopted before the regulations were filed. See Independent U.S. Tanker Owners Comm. v. Lewis; Smith v. F.T.C.
C. Alleged alteration of the record.
Tenneco alleges that the Commission impermissibly altered the minutes of its December meeting in order “to obscure the public record” as to whether.it had obeyed the statutory mandate. The alleged alteration is found in a comparison between the transcripts of the December meeting and the January meeting, where a draft of the minutes of the earlier meeting was under review:
[December 10, 1985]
[Chairman]:
# * * * * *
I think there is one basic question underlying the record and that question is what is the evidentiary threshold necessary for regulation of a chemical as toxic or as a human cancer risk. Part of that question it seems to me necessarily for a rule-making body like the Commission has to be how does this Commission meet its mandated responsibility to prevent and abate water pollution from specific chemicals when that threshold has not been achieved * * *.
[January 14, 1986]
[Commission Member]: In the middle of the second paragraph, in the sentence that starts “How does the Commission as a rulemaking body meet its mandated responsibility to prevent and abate water pollution from specific chemicals when that evidentiary threshold has not been achieved.” My understanding was that the comment was something on the order of this: When hard data may be unavailable because the inquiry is at the frontiers of science. I don’t know whether that change conforms * * *.
Mr. Chairman: That certainly was the intent of the comment, since the Chair made the comment. Are you suggesting that the phrase as drafted be changed as you have worded it?
[Commission Member]: Yes.
This change was incorporated into the final December minutes.
Minutes are “a series of brief notes taken to provide a record of proceedings.” Webster’s Third New International Dictionary 1440 (1966). Tenneco has not shown that the minutes are required to be a verbatim transcript. Additionally, as both colloquies appear verbatim in the transcript of record, we find no alteration that would obscure the public record.
D. Technical achievability of the numerical standards.
Navajo argues that the adoption of the numerical standards was arbitrary and capricious because they may not be technically achievable. For the requirement that an agency must demonstrate the achievability of the proposed standard, Navajo relies on National Lime Ass’n v. Environmental Protection Agency, 627 F.2d 416 (D.C.Cir.1980) (holding that the new source performance standards for lime-manufacturing plants were arbitrary and capricious because of inadequate proof of achievability from the EPA test data). National Lime Ass’n considered Section 111 of the Federal Clear Air Act, 42 U.S.C. § 7411 (Supp. I 1977), which requires that new source performance standards reflect “the degree of emission limitation * * * achievable through the application of the best technological system * * * which * * * the Administrator determines has been adequately demonstrated.” 42 U.S.C. § 7411(a)(1)(C). Navajo likens the technically achievable standard in National Lime Ass’n to the requirement in Section 74-6-4(D)(3) of the Water Quality Act that the Commission shall give weight to “technical practicability” in its rule-making.
Section 111 of the Federal Clean Air Act can be distinguished from Section 74-6-4(D). The former requires a twofold showing that: (1) the proposed standard be “achievable” and (2) the control system considered to meet the standard be “adequately demonstrated.” 42 U.S.C. § 7411(a); National Lime Ass’n, 627 F.2d at 430. The latter requires only a showing that the proposed standard be “achievable through application of the best demonstrated control technology.” Section 74-6-4(D)(3) directs the Commission, in determining achievability, to consider technical practicability, economic reasonableness, and previous experience with the methods available. As set forth in part 111(A) of this opinion, the record contains evidence of such consideration.
Section 3-101 of the Commission’s regulations states the preventive purpose in the use of the numerical standards. It provides that if the existing concentration of contaminants is below the limit of the standard, degradation of the groundwater up to that limit will be allowed. If the existing concentration of contaminants in the groundwater exceeds the limit, no further degradation of the groundwater will be permitted.
Navajo alleges that an EID witness established the technical impossibility of meeting the numerical standards. We disagree. In the following testimony cited by Navajo, the witness explains EID practices in remedial clean-up actions, and not in prevention:
Q. What is the purpose of making numerical standards?
A. The numerical standards, as I said in my direct testimony, are largely used for preventive purposes. In remedial investigations, they are used as cleanup targets * * *. If the technology is inadequate to purify the water down to the level of the standard — the numerical standard, then that’s the best we can do.
From our review of the evidence, we find that the numerical standards are achievable through demonstrated control technology for the purpose of prevention. We conclude that the adoption of the numerical standards was not arbitrary and capricious, as they are technically achievable within the meaning of Section 74-6-4(D).
E. Disclosure of basic data.
Tenneco claims that EID, as a constituent agency of the Commission, failed to disclose the data on which the numerical standards were based and that the failure was contrary to law. Specifically, Tenneco had asked EID’s expert witnesses if they were relying on any single key reference out of the list of six references EID provided prior to the public hearing. The witnesses responded that there was “no singular key reference for any one of those standards” and that standard setting was far too complex a subject to rely on only one key reference.
Tenneco contends that without a key reference designation, it was denied an opportunity to comment on the reference material. Tenneco cites no New Mexico authority for this designation requirement. Rather it relies on United States v. Nova Scotia Food Products Corp., 568 F.2d 240 (2nd Cir.1977) (holding that the Food and Drug Administration’s failure to disclose the scientific data on which it relied in promulgating its regulations for processing smoked whitefish was procedurally erroneous). Nova Scotia Food Products Corp. can be distinguished because there, the FDA failed to disclose references, while here, the EID provided references on which its numerical standards were based but was simply unable to reduce those references to a single key reference.
Section 74-6-6 provides that: the Commission shall give thirty-day advance notice of a public hearing; it shall provide copies of proposed regulations; and at the hearing, it “shall allow all interested persons reasonable opportunity to submit data, views or arguments orally or in writing and to examine witnesses testifying at the hearing.” These requirements were met. In addition, two public meetings were held regarding the hearing, and Tenneco was allowed to supplement the record with post-hearing documents before the regulations were filed.
Given the extensive nature of the public meetings and public hearing, with an opportunity to present evidence and cross-examine witnesses and with the prehearing disclosure of the six references, we find that the allegation of concealment of basic data is without merit.
F. Protection without the numerical standards.
Navajo contends that the numerical standards should be set aside because the Commission has other means to protect groundwater, since all fourteen compounds could be included with the toxic pollutants defined and listed in Section 1-101.UU of the Commission’s regulations. Tenneco does not dispute that the compounds for which the Commission set standards are capable of causing ill effects on health; rather, it questions the Commission’s compliance with the law in establishing the standards.
A principal reason given by the Commission for the adoption of numerical standards was to protect the public health through the prevention of water pollution. The record indicates that the list of toxic pollutants in Section 1-101.UU applies to remedial actions in the discharge permitting process and not to prevention. There was testimony that it would be highly inefficient and difficult to regulate contaminant dischargers by relying on Section 1-101.UU and that numerical standards would give specific notice to the regulated community of the limits in discharging.
The Commission has the power to adopt water quality standards and to promulgate “regulations to prevent or abate water pollution”; it also has the discretion to “specify a standard of performance for new sources” to reduce effluents, including a “standard permitting no discharge of pollutants.” § 74-6-4. We conclude from our review of the record that the Commission’s adoption of numerical standards was a reasonable exercise of that statutory power.
IV. SUBSTANTIAL EVIDENCE
Appellants argue that the adoption of numerical standards is not based on substantial evidence because the Commission ignored the testimony of opponents’ witness and because the record does not contain sufficient evidence to allow the consideration of the six criteria mandated in Section 74-6-4(D).
Section 74-6-7(C)(2) of the Water Quality Act requires this court to set aside regulations that are “not supported by substantial evidence in the record.” Substantial evidence is such relevant evidence as a reasonable mind might accept as adequate to support a conclusion. Rinker v. State Corp. Comm’n, 84 N.M. 626, 506 P.2d 783 (1973).
For administrative appeals, the substantial evidence rule is supplemented with the whole record standard for judicial review of findings of fact made by administrative agencies. Duke City Lumber Co. v. New Mexico Envtl. Improvement Bd. In a whole record review, the review is “not * * * limited to those findings most favorable to the agency order.” Groendyke Transp., Inc. v. New Mexico State Corp. Comm’n, 101 N.M. 470, 477, 684 P.2d 1135, 1142 (1984). The reviewing court must also look to evidence that is contrary to the findings and then decide whether, on balance, the agency’s decision was supported by substantial evidence. See Trujillo v. Employment Sec. Dep’t, 105 N.M. 467, 734 P.2d 245 (Ct.App.1987). When the agency’s decision is supported by substantial evidence the reviewing court does not reweigh the evidence to reach a contrary result; however, when the evidence as a whole does not support the agency’s decision, that decision cannot be upheld. See and cf. Cibola Energy Corp. v. Roselli, 105 N.M. 774, 737 P.2d 555 (Ct.App.1987).
Applying the whole record standard to the facts and circumstances in this case, we hold that there is substantial evidence in the record as a whole to support the Commission’s adoption of the numerical standards.
Federal courts have also found that the substantial evidence standard of review calls for a deference to the agency’s conclusions where they are based on judgments on the “frontiers of scientific knowledge.” See, e.g., Hercules, Inc. v. Environmental Protection Agency, 598 F.2d 91, 106 (D.C. Cir.1978); Industrial Union Dep’t, AFL-CIO v. Hodgson, 499 F.2d 467, 474 (D.C. Cir.1974). Similarly, in a determination of possible impairment to a water supply, the New Mexico Supreme Court has stated that: “[t]he special knowledge and experience of state agencies should be accorded deference.” Stokes v. Morgan, 101 N.M. 195, 202, 680 P.2d 335, 342 (1984).
Navajo urges us to incorporate the legal residuum rule into our standard of review. In that event, the Commission’s action would require support by some evidence that would be admissible in a jury trial. See Duke City Lumber Co. v. New Mexico Envtl. Improvement Bd. Navajo acknowledges that in New Mexico, the legal residuum rule applies only in adjudicative proceedings, and not in rule-making proceedings. We are not persuaded by Navajo’s argument, as it has failed to show that this rule-making proceeding is sufficiently like an adjudication so as to invoke the legal residuum rule.
For the foregoing reasons, we affirm the Commission’s decision adopting regulations that set numerical standards for the fourteen organic compounds in groundwater.
IT IS SO ORDERED.
DONNELLY, C.J., and APODACA, J., concur.
. These organic compounds are: vinyl chloride, l-l-dichloroethane, 1-2-dichloroethane, 1-2-di-bromoethane, 1-1-1-trichloroethane, 1 — 1—2—tri-chloroethane, 1-1-2-2-tetrachloroethane, methylene chloride, chloroform, toluene, ethyl benzene, xylenes, napthalenes and monomethylnapthalene compounds, and benzo-a-pyrene.
. The two general chemical categories to which the subject compounds belong are volatile organic compounds and polynuclear aromatic hydrocarbons. | [
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OPINION
WALTERS, Justice.
The Mountain States Telephone and Telegraph Company, hereinafter Mountain Bell, petitioned the New Mexico State Corporation Commission (SCC) for a determination that its third-party billing and collection services were not subject to regulation by the SCC. Mountain Bell collects through a recording function its interexchange carrier customers’ use of long-distance lines belonging to other telephone companies and then bills and collects the fees for such long-distance service. Once Mountain Bell determines that users are delinquent in their long-distance service accounts, it also terminates telephone service to those customers under a denial for nonpayment (DNP) procedure. The SCC previously has regulated the DNP aspect of Mountain Bell’s services to the interexchange carriers.
After conducting hearings, the SCC found that the billing service was an integral component of telecommunications service as a whole, that Mountain Bell had a monopoly over such service, and that the service included recording the transmission of telephone signals, which in turn involved the transmission of data within the network itself. From these findings, the SCC concluded that it had jurisdiction to regulate the service and entered an order accordingly.
Uncertain about which procedure to employ to obtain review of the SCC’s order, Mountain Bell both sought to appeal the order under the Telecommunications Act, NMSA 1978, Section 63-9A-18 (Cum.Supp. 1988), and to remove the SCC decision for an independent review by this court pursuant to N.M. Const, art. XI, § 7. We undertake our review in accordance with the removal procedure because the sole issue for consideration is whether the SCC has jurisdiction under article XI, section 7 to regulate the service that Mountain Bell provides to other telecommunication carriers.
The constitution empowers the SCC with the duty to regulate telecommunications service to the public. In re Generic Investigation into Cable Television Serv., 103 N.M. 345, 350, 707 P.2d 1155, 1160 (1985); N.M. Const, art. XI, § 7. Telecommunication services generally involve the transmission of signals, images, sounds, or data by wire, lightwaves, or electromagnetic means. NMSA 1978, § 63-9A-3(L) (Cum.Supp.1988). We have held that the broad, plenary authority which our constitution bestows upon the SCC extends to all of the rates and charges of telephone companies and other transmission companies. In re Generic Investigation, 103 N.M. at 349, 707 P.2d at 1159. In construing article XI, section 7, we have stated that it is “difficult to conceive of a more clear and all-inclusive grant of power for a governmental agency.” Mountain States Tel. & Tel. Co. v. New Mexico State Corp. Comm’n, 90 N.M. 325, 331, 563 P.2d 588, 594 (1977). The SCC also has the authority to regulate the cost of facilities needed for telecommunications services which, in turn, affect the cost of providing those telecommunications, even if no transmission of signals is provided by the facilities. See In re Regulation of Rates, Terms, and Conditions for Provision of Pole Attachment Space to Cable Television, 102 N.M. 720, 722, 699 P.2d 1072, 1074 (1985); N.M. Const, art. XI, § 7.
Authority is specifically granted to the Commission to regulate a public telecommunications service under the New Mexico Telecommunications Act. NMSA 1978, §§ 63-9A-1 to — 20 (Cum.Supp.1988). As defined in the Telecommunications Act, “public telecommunications service means the transmission of signs, signals, writing, images, sounds, messages, data or other electromagnetic means originating and terminating in this state regardless of actual call routing.” NMSA 1978, § 63-9A-3(L) (Cum.Supp.1988). The services rendered here by Mountain States as described above entail timing calls through switching operations, and transmitting such recorded data to its billing department. Clearly, transmission of signals is an integral part of the service, and that service (which carries with it a charge to the carriers who are using the service) must also fall within the SCC’s authority and power to regulate tariffs. See, In re Generic Investigation, 103 N.M. at 348-49, 707 P.2d at 1158-59; see also In re Regulation of Rates, Terms, and Conditions for Provision of Pole Attachment Space to Cable Television, 102 N.M. at 722, 699 P.2d at 1074. When a telephone company offers service to others, which necessarily requires the use of facilities employed in providing telecommunications services by the telephone company, then SCC has constitutional authority to regulate the charges and rates for the service, and the duty to determine matters of public convenience and necessity relating to use of telephone company facilities.
Moreover, the actions that Mountain Bell takes, insofar as it instigates termination for nonpayment of the unique privileges of telephone service, is distinctly a matter of public concern. DNP action impacts directly on the public interest because customers cannot obtain telephone service elsewhere if their local services are terminated. The SCC correctly determined that it should regulate Mountain Bell’s DNP service on delinquent accounts because public convenience and necessity is incontestably implicated.
Accordingly, - the SCC’s order denying Mountain Bell’s petition is affirmed in all respects.
IT IS SO ORDERED.
SCARBOROUGH, C.J., SOSA, Senior J., and STOWERS and RANSOM, JJ„ concur. | [
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] |
OPINION
This matter is before the Court after disciplinary proceedings held pursuant to SCRA 1986, 17-211 wherein Earl E. Hartley agreed not to contest allegations that were set forth in two consolidated Specifications of Charges. The Court adopts the recommendation of the Disciplinary Board Panel, accepts the stipulations agreed to by Hartley and disciplinary counsel, and hereby suspends Hartley indefinitely from the further practice of law.
Hartley was Treasurer for the State of New Mexico from July 1983 through November 1984. During his tenure as Treasurer,. the 1984 Western States Treasurers Conference was held in New Mexico. In his capacity as host-state treasurer, Hartley solicited and received approximately $62,675.00 from various banks, financial institutions, and individuals in addition to the $7,500.00 advanced by the Western States Treasurers Association for the conference. The disciplinary charges that were filed against Hartley arose from his appropriating a portion of those funds to his own use.
The monies that Hartley collected on behalf of the Conference were deposited into two accounts. The expenses of the Conference totaled approximately $41,545.00, and the $21,130.00 in excess of the expenses incurred was the lawful property of the Western States Treasurers Association.
During the summer of 1984, Hartley wrote a. letter to the President of the Western States Treasurers Association and enclosed a check for $10,000.00, which he represented as a return of the Association’s $7,500.00 advance plus profits; he retained some money to pay bills of the Conference that were then outstanding. Hartley then paid certain personal expenses in the approximate amount of $4,328.00 from the remaining funds belonging to the Western States Treasurers Association and derived from the 1984 Western States Treasurers Conference. ' Those “expenses” were not in furtherance of or related to the business of the Western States Treasurers Association or the 1984 West ern States Treasurers Conference or even to Hartley’s duties as New Mexico State Treasurer.
Hartley caused a second check to be paid to the “Western Treasurers Association” in the amount of $2,091.08 during October of 1984. By sending this check, Hartley led the President of the Western States Treasurers Association into believing that the Association had received the net proceeds of the 1984 Western States Treasurers Conference. In fact, however, approximately $7,600.00 of the proceeds from the conference was retained by Hartley in a second bank account in New Mexico unbeknownst to the Association.
Criminal proceedings were subsequently brought against Hartley, and he was ordered to make restitution to the Western States Treasurers Association in the amount of $4,300.00 in conjunction with his guilty plea. He made restitution by writing a check from his attorney trust account. It was later learned that the funds contained in the trust account were actually Hartley’s personal assets.
Hartley admittedly violated NMSA 1978, Code of Prof. Resp., Rules 1-102(A)(6) and 9-102(A) (presently SCRA 1986, 16-804[H] and 16-115[A]) when he engaged in this conduct. We also note that such conduct would be violative of NMSA 1978, Code of Prof. Resp., Rules 1-102(A)(3) and 1-102(A)(4) (presently SCRA 1986, 16-804[B] and [C]).
Generally, when an attorney engages in intentional conduct involving dishonesty, he or she is disbarred. See Matter of Duffy, 102 N.M. 524, 697 P.2d 943 (1985); Matter of Ayala, 102 N.M. 214, 693 P.2d 580 (1984). This is true even where restitution has been made to persons injured by the lawyer’s misconduct. Matter of Stewart, 104 N.M. 337, 721 P.2d 405 (1986). In the instant case, however, we take into consideration the facts that Hartley is seventy-five years of age, has not practiced law for ten years, and has expressed his intention never to practice law again. The Court concludes that the public interest will be adequately protected by the proposed sanction and that the more severe sanction of disbarment would serve no purpose other than retribution. As we have previously noted on frequent occasions, the purpose of attorney discipline is not to punish the attorney.
IT IS THEREFORE ORDERED that Earl E. Hartley be, and he hereby is, suspended indefinitely but for a minimum of five (5) years from the practice of law pursuant to SCRA 1986, 17-206(A)(3) effective August 2,1988. Should he ever decide to petition for reinstatement after that period, said reinstatement will not be automatic but shall occur only after a reinstatement proceeding conducted pursuant to SCRA 1986, 17-214 where Hartley will have the burden of demonstrating by clear and convincing evidence that he has the requisite moral qualifications and is once again fit to resume the practice of law. Any petition for reinstatement must be accompanied by a showing that Hartley has taken and passed the Multistate Professional Responsibility Examination and that he has reimbursed the disciplinary board its costs in bringing this action.
IT IS FURTHER ORDERED that Hartley shall file with this Court on or before (10 days from effective date of suspension) evidence of his compliance with all the requirements of SCRA 1986, 17-212 and serve a copy of his affidavit of compli- - anee upon disciplinary counsel.
IT IS FURTHER ORDERED that the Clerk of the Supreme Court strike the name of Earl E. Hartley from the roll of those persons permitted to practice law in New Mexico and that this Opinion be published in the State Bar of New Mexico News and Views and in the New Mexico Reports.
Costs of these proceedings in the amount of $75.24 are hereby assessed against Hartley and must be paid to the Disciplinary Board on or before October 1, 1988.
IT IS SO ORDERED.
(s) Tony Scarborough TONY SCARBOROUGH, Chief Justice
(s) Dan Sosa, Jr. .DAN SOSA, JR., Senior Justice
(s) Mary C. Walters MARY C. WALTERS, Justice
(s) Richard E. Ransom RICHARD E. RANSOM, Justice | [
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OPINION
HARTZ, Judge.
Precision Welding and Manufacturing and its insurer, United States Fidelity & Guaranty Company (collectively referred to as “Precision”), appeal from an adverse decision by the Workers’ Compensation Administration. The claimant, James Lyes McMains (‘Worker”), sought compensation benefits from Precision based on an alleged accidental injury to his lower back while working for Precision on July 13, 1992. Worker also sought benefits from Aztec Well Service and its insurer, Mountain States Mutual Casualty Company (collectively referred to as “Aztec”), for an alleged prior injury to his lower back while working for Aztec on March 27,1991. Precision contends on appeal that it owes no compensation benefits because (a) there was no injury arising out of Worker’s employment with Precision, (b) Worker willfully suffered the 1992 injury, and (c) even if the 1992 injury was otherwise compensable, it did not result in any increased impairment. It further contends that even if it is liable for some benefits, the workers’ compensation judge (WCJ) erred in apportioning liability for permanent partial disability benefits equally between Precision and Aztec and in assessing against Precision 100% of the liability for future medical benefits. By a separate memorandum opinion we affirm the decision of the WCJ on each of the issues raised by Precision on appeal, except the assessment for future medical benefits. This opinion, which contains the portion of the memorandum opinion meriting publication, addresses only future medical benefits.
I. BACKGROUND
We view “ ‘the evidence in the light most favorable to the agency decision, but [we] may not view favorable evidence with total disregard to contravening evidence.’” Herman v. Miners’ Hosp., 111 N.M. 550, 552, 807 P.2d 734, 736 (1991) (quoting National Council on Compensation Ins. v. New Mexico State Corp. Comm’n, 107 N.M. 278, 282, 756 P.2d 558, 562 (1988)). Worker injured his lower back on March 27, 1991, while working for Aztec. He received treatment from Dr. Robin Glass, a chiropractor. His pain resolved by May 15, 1991, when Dr. Glass released him to return to work without restrictions. Aztec paid Dr. Glass’s bills and paid Worker temporary total disability benefits from the date of injury until the date of Worker’s release to return to work. Rather than returning to Aztec, Worker began work at Precision. He had a relapse of lower back pain in June 1991 and received one treatment by Dr. Glass. From that time until July 13, 1992, Worker had muscle soreness typically associated with the kind of heavy labor he performed, but he suffered no pain from his injury at Aztec, visited no doctors, and took no medication.
On July 13, 1992, Worker was cleaning up Precision’s shop and preparing for the next job. He lifted and stacked several steel bars weighing about 160 pounds each and swept the shop. About 15 to 20 minutes later Worker was walking around the shop looking for his next task when he suddenly felt excruciating pain in his lower back and fell to his knees. He was not wearing a lumbar support belt, although he testified that he occasionally wore one at work. At trial on May 20, 1993, Worker testified that the pain from his injury at Precision had been unrelenting and continuous. Although he had returned to work as an ironworker with another employer in November 1992, he explained that he needed the job because he had no money, was starving, and had become homeless.
The WCJ determined, and the parties do not dispute, that Worker’s claim is governed by NMSA1978, Sections 52-1-1 to -70 (Repl. Pamp.1991) (the “1991 Act”). Because Worker’s wages with his most recent employers equalled or exceeded his wages with Aztec and Precision, the parties agreed that Worker’s permanent partial disability rating would equal his impairment. See § 52-1-26(D).
II. APPORTIONMENT OF FUTURE MEDICAL BENEFITS
Precision contends that the WCJ erred in ordering it to pay for all future medical care required as a result of Worker’s work injuries, without any contribution from Aztec. We agree.
The WCJ made the following four findings:
4. Worker is entitled to lifetime medical care for future treatment that is designated by a health care provider to be directly attributed to his work injury with [Aztec];
5. Worker is not currently in need of lifetime medical care for treatment of the work injury occurring at [Aztec] because the subsequent and overlapping injury to the same area of the body and the resulting treatment, the accident with [Precision] created the need for medical treatment; [sic]
6. Worker is entitled to and in need of lifetime medical care for future medical treatment as a result of the injury with [Precision]. The injury occurring at [Precision] is basically the injury that “broke the camel[’]s back” and all medical treatment necessary after the July 13, 1992, work accident and injury shall be paid for by [Precision]. But for this second accident, Worker had not been in need of medical treatment;
7. Unless otherwise designated by the health care provider, [Precision] will pay one hundred percent (100%) of all future medical care Worker may need as a result of his work injuries[J
She also entered the following conclusions of law:
3. Worker is entitled to, but not in need of, medical treatment for the March 27, 1991, injury;
4. Worker is entitled to and in need of medical treatment for the July 13, 1992, work injury with [Precision]. All medical care for the back injury resulting after July 13, 1992, shall be paid one hundred percent (100%) by [Precision.]
We agree that Precision has the primary responsibility for payment of future medical benefits. See Gonzales v. StankeBrown & Assocs., 98 N.M. 379, 386, 648 P.2d 1192, 1199 (Ct.App.1982). We have recently held, however, that Section 52-l-47(D) applies to medical benefits. Brewster v. Cooley & Assocs. 116 N.M. 681, 685, 866 P.2d 409, 413 (Ct.App.1993). Section 52-l-47(D) states:
[T]he compensation benefits payable by reason of disability caused by accidental injury shall be reduced by the compensation benefits paid or payable on account of any prior injury suffered by the worker if compensation benefits in both instances are for injury to the same member or function or different parts of the same member or function or for disfigurement and if the compensation benefits payable on account of the subsequent injury would, in whole or in part, duplicate the benefits paid or payable on account of such prior injury.
In other words, to the extent that future medical expenses are necessary as a result of Worker’s accident at Aztec (and hence are payable by Aztec), Precision is entitled to a reduction in its liability. (It is undisputed that the Aztec and Precision injuries were to the same member or function.)
The WCJ’s conclusions of law reject the possibility of such a reduction in Precision’s liability, apparently on the ground that Aztec would be immune from any potential future liability for medical care arising from the 1991 accident. Yet, Aztec is liable for future medical care arising from the 1991 accident that would be required even if the 1992 accident had not occurred. Consequently, Aztec is immune only if there is no possibility of a need for such future medical care. That is, Aztec is immune only if there is no possibility that Worker would need future medical care for his back injury had there been no accident in 1992. Perhaps the WCJ believed that to be the case. If so, her determination was premature.
Unlike the practice in a typical tort case, future medical benefits cannot be denied in a workers’ compensation proceeding based solely on a prediction regarding future medical needs. In Graham v. Presbyterian Hospital Center, 104 N.M. 490, 723 P.2d 259 (Ct.App.1986), the trial court had dismissed with prejudice a claim for future medical benefits. We held that a trial court “is without authority to limit or restrict in advance future medical benefits once a compensable injury is established.” Id. at 491, 723 P.2d at 260. We later elaborated:
[W]here there was an accidental injury arising out of and in the course of employment, where there is a claim for current and past medical benefits together with a claim for unspecified and unspecifiable future medical benefits, and where the court finds that the defendants are not liable for the past and current medical expenses, either because plaintiff has fully recovered or because plaintiff is faking pain or for whatever reason, the court may dismiss the main part of the claim with prejudice, but it cannot dismiss the claim for future medical benefits with prejudice. In this situation, a court may enter a judgment for future medical benefits, but such a judgment would be essentially meaningless. If plaintiff incurred medical expenses relating to a work-related injury in the future, he would still have to prove them in order to recover. Thus, the better course may be to dismiss the claim for future medical expenses without prejudice.
Id. at 492, 723 P.2d at 261. In St. Clair v. County of Grant, 110 N.M. 543, 548, 797 P.2d 993, 998 (Ct.App.1990), we further explained:
Since the trial court cannot practically determine the worker’s future medical needs at the time of entry of a judgment finding disability, Section 52-1-49 authorizes entry óf a judgment directing the payment of a worker’s reasonable and necessary future medical expenses and invests the court with continuing jurisdiction to enforce such orders.
In light of the WCJ’s finding that Worker’s disability was caused by both the 1991 accident at Aztec and the 1992 accident at Precision, she could not properly rule that future medical care could not possibly be the responsibility, even in part, of Aztec. We therefore set aside the ruling regarding apportionment of future medical benefits.
III. CONCLUSION
For the reasons discussed above, we reverse the apportionment of liability for future medical payments.
IT IS SO ORDERED.
DONNELLY and BOSSON, JJ., concur. | [
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OPINION
DONNELLY, Chief Judge
Plaintiff appeals from four separate orders entered by the trial court: (1) dismissal of plaintiff’s complaint without prejudice; (2) denial of plaintiff’s first motion , for reconsideration; (3) denial of a restraining order; and (4) denial of plaintiff’s second motion for reconsideration. On appeal plaintiff raises three points, each of which may be fairly summarized under the single issue of whether the trial court erred in dismissing his complaint which alleged discriminatory practices by the Albuquerque City Police Department and without according plaintiff a hearing in the district court on the merits.
Initially, we review a threshold jurisdictional issue to determine whether plaintiff’s appeal is timely. We dismiss plaintiff’s appeal on a jurisdictional basis.
FACTS
On June 17, 1983, plaintiff filed an appeal in the District Court of Bernalillo County seeking review of an administrative decision rendered by the Albuquerque Police Department under Albuquerque, N.M. Municipal Ordinance Section 2-9-25(B)(3) (1980). The appeal alleged that plaintiff had been discriminatorily passed over for promotion. Thereafter, the City moved to dismiss the appeal on the grounds that plaintiff had failed to exhaust his administrative remedies.
The following chronology of events then transpired:
Order dismissing plaintiffs
appeal Nov. 22,1983
Plaintiff files motion to set
aside or reconsider Dec. 14, 1983
Order denying first motion to
reconsider Feb. 28,1984
Plaintiff files second motion to
set aside or reconsider Mar. 28,1984
Plaintiff files motion for
restraining order Apr. 20,1984
Order denying motion for
restraining order May 3,1984
Order denying second motion to reconsider May 21,1984
Plaintiff files notice of appeal June 20,1984
The order of November 22, 1983 dismissing plaintiff’s appeal stated that the City’s motion to dismiss the action was granted on the grounds that plaintiff had failed to exhaust his administrative remedies. The order further provided that “IT IS ORDERED that the Complaint be dismissed without prejudice.” Plaintiff filed a notice of appeal to this court on June 20, 1984. He appealed from the orders of the district court entered November 22, 1983, February 28, 1984, May 3, 1984, and May 21, 1984.
Albuquerque Municipal Ordinance Section 2-9-25 provides, inter alia, for an administrative appeal by city employees from actions of city officers which have improperly denied an employee a promotion or advancement in grade. Under Section 2-9-25(C), appeals from a denial of a promotion or advancement are denominated “Class II” grievances. Subsection E of the ordinance specifies the administrative review procedure which includes requiring an aggrieved employee to initially discuss the action complained of with his immediate supervisor, and if the matter is not thereby satisfactorily resolved, to “make a formal written complaint of his or her grievance to his * * * department head within ten (10) calendar days of the occurrence of the grievable action.” The department head is then required, within ten calendar days of the receipt of the written grievance, to render a decision to the chief administrative officer of the city. Thereafter, the chief administrative officer is directed to appoint a hearing officer to investigate and hear the grievance.
Under the Municipal Ordinance, the hearing officer is required to render a written report setting out his findings and recommendations. The ordinance further provides that the “decision of the Chief Administrative Officer shall be reviewable in District Court * * *. Appeal of the decision of the Chief Administrative Officer shall be taken within ninety (90) days of the final adverse decision of the Chief Administrative Officer.” Municipal Ordinance § 2-9-25(E)(8).
On March 22, 1983, Frank Kleinhenz, Chief Administrative Officer for the City, notified plaintiff in writing that his request for a hearing on his grievance had been denied and that “the issue of the promotional process is not a grievable matter.” Plaintiff filed an appeal from the decision of Kleinhenz on June 17, 1983 with the district court.
JURISDICTION TO HEAR APPEAL
Does this court have jurisdiction to hear the appeal of plaintiff from the order of dismissal of the district court entered November 22, 1983 and the lower court's subsequent orders filed on February 28, May 3, and May 21, 1984?
(A) Finality of Order
The district court entered its order dismissing plaintiff's action on November 22, 1983, “without prejudice.” Thereafter, on December 14, 1983, plaintiff filed a “Motion To Set Aside Order Dismissing Case Or In The Alternative Motion To Reconsider Order Dismissing Case.” Under NMSA 1978, Civ.App.Rule 3(a) (Repl.Pamp.1984), plaintiff was required to file an appeal from the district court’s order of dismissal within thirty days of the entry of the order, unless the order was not final, or the December 14, 1983 motion served to toll the time for the filing of plaintiff’s appeal.
The order of the district court dismissing plaintiff’s appeal specified that the dismissal was “without prejudice” predicated upon plaintiff’s failure to exhaust his administrative remedies. Plaintiff contends the order of dismissal was not a final order and hence did not necessitate that an appeal be taken therefrom within the thirty-day period prescribed by Civ.App. Rule 3(a) and NMSA 1978, Section 39-3-2.
The issue of whether a district court’s dismissal “without prejudice” of an action seeking review in the district court from a lower court or quasi-judicial decision of an administrative agency, constitutes a final appealable order, is a matter of first impression in New Mexico.
In Chavez v. Chenoweth, 89 N.M. 423, 553 P.2d 703 (Ct.App.1976), this court held that a dismissal “without prejudice” “ordinarily imports further proceedings.” See also Montoya v. Anaconda Mining Co., 97 N.M. 1, 635 P.2d 1323 (Ct.App.1981). The test of whether a judgment is final so as to permit the taking of an immediate appeal, lies in the effect the judgment has upon the rights of some or all of the parties. To determine whether an order is final, the order should be given a practical rather than a technical construction. Clancy v. Gooding, 98 N.M. 252, 647 P.2d 885 (Ct.App.1982). Whether an order is “final” may at times be difficult to ascertain. Gillespie v. United States Steel Corp., 379 U.S. 148, 85 S.Ct. 308, 13 L.Ed.2d 199 (1964). See also Hernandez v. Home Education Livelihood Program, Inc., 98 N.M. 125, 645 P.2d 1381 (Ct.App.1982).
An order dismissing a party’s entire complaint without authorizing or specifying a definite time for leave to file an amended complaint, is a final order for purposes of appeal. E.g., Watkins v. Local School Board of Los Alamos Schools, 88 N.M. 276, 540 P.2d 206 (1975) (dismissal without prejudice with leave to amend within twenty days constitutes a final order where no action to amend is taken and no appeal was pursued from the order of dismissal); Montoya v. Anaconda Mining Co. Compare Garver v. Public Service Co. of New Mexico, 77 N.M. 262, 421 P.2d 788 (1966) (order of dismissal with leave to amend in ten days and which did not make provision for final dismissal after ten-day period, held to be interlocutory in nature).
The Supreme Court of Utah held in Honerine Min. & Mill Co. v. Tallerday Steel Pipe & Tank Co., 30 Utah 449, 85 P. 626 (1906), that a final judgment of dismissal “without prejudice” may, depending upon the nature of the case, constitute a final judgment. The court stated:
It is true that to constitute a final judgment it is not essential that there be a final determination of the rights of the parties with reference to the subject-matter of the litigation, but merely with reference to the particular suit. It is the termination of the particular action which marks the finality of the judgment. A decision which terminates the suit, or puts the case out of court without an adjudication on the merits, is, nevertheless, a final judgment.
Id. 30 Utah at 451, 85 P. at 626, 627. We think the rationale discussed in Honerine Min. & Mill Co. is applicable in the present case.
The district court stated in its order of dismissal that plaintiff had failed to exhaust his administrative remedies. Under these facts the order of dismissal “without prejudice” was a final order necessitating a timely appeal in order to preserve appellate review.
(B) Dismissal Without Prejudice
Plaintiff argues that the words “without prejudice” contained in the order of dismissal evinces an intent not to clothe the order with finality, hence, an immediate appeal was not required. We disagree. The phrase “without prejudice,” as set out in the order, indicates it was a final order but that the dismissal was not intended to be res judicata as to the merits of the controversy so as to preclude plaintiff from pursuing a new action once he exhausted available administrative remedies.
The words “without prejudice” when used in an order or decree generally indicate that there has been no resolution of the controversy on its merits and leave the issues in litigation open to another suit as if no action had ever been brought. Marquez v. Juan Tafoya Land Corp., 96 N.M. 503, 632 P.2d 738 (1981); Meeker v. Walker, 80 N.M. 280, 454 P.2d 762 (1969). See also Restatement (Second) Judgments, § 20 (1982). A dismissal “without prejudice” gives the complainant the right to state a new and proper cause of action, if he can, and does not take away any rights of defense to the action. The designation of the dismissal of an action “without prejudice” is in the nature of a judgment. Thompson-Hayward Chemical Co. v. Cyprus Mines Corp., 8 Kan.App.2d 487, 660 P.2d 973 (1983).
On December 14, 1983, plaintiff filed a motion to set aside or reconsider the order of dismissal dated November 22, 1983. A motion to set aside or to amend a judgment, if timely filed, will extend the time within which to appeal. Civ.App.R. 3(d). See Chavez-Rey v. Miller, 99 N.M. 377, 658 P.2d 452 (Ct.App.), cert. denied, 99 N.M. 358, 658 P.2d 433 (1983). This rule, however, does not provide solace to plaintiff under the facts in the present case. The failure of the trial court to rule within thirty days of the filing of plaintiffs first motion to set aside or reconsider the order of dismissal, amounted to a denial of the motion by operation of law. Civ.App.R. 3(d). Thus, the thirty-day period for the filing of plaintiffs appeal began running thirty days after the filing of the motion and expired January 12, 1984. Plaintiffs appeal filed June 20, 1984 was not timely. Wagner Land & Investment Co. v. Halderman, 83 N.M. 628, 495 P.2d 1075 (1972).
The motions filed by plaintiff after January 12, 1984, did not extend the time for the taking of an appeal .nor invest the trial court with further jurisdiction. Upon the expiration of the time for taking of an appeal from the order of dismissal, the trial court’s jurisdiction was terminated. Luna v. Homestake Mining Co., 100 N.M. 265, 669 P.2d 741 (Ct.App.1983); NMSA 1978, Civ.P.R. 59(a) & (e) (Repl.Pamp.1980). See also Zarges v. Zarges, 79 N.M. 494, 445 P.2d 97 (1968) (upon entry of final order or decree and passage of the time allowed for an appeal or reopening of the case, jurisdiction of the court is exhausted unless a specific right of continuing jurisdiction exists). Noncompliance with the requirement of filing a timely notice of appeal deprives an appellate court of jurisdiction over the appeal. Chavez-Rey v. Miller; Seaboard Fire & Marine Insurance Co. v. Kurth, 96 N.M. 631, 633 P.2d 1229 (Ct.App.1980).
The order of dismissal entered by the trial court is affirmed. Each party shall bear their own costs on appeal.
IT IS SO ORDERED.
WOOD and BIVINS, JJ., concur. | [
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] |
OPINION
BIVINS, Judge.
These cases are before us because the trial courts held the defendants without bail prior to trial. In Stale v. David bail was revoked because defendant had threatened to kill witnesses. In State v. Munoz the trial court denied bail under the 1980 amendment to N.M. Const, article II, section 13 (Cum.Supp.1984), which permits the district court to deny bail for sixty days when the defendant is accused of a felony and has previously been convicted of two or more felonies within the state which are unrelated to the crime for which the defendant is currently being charged.
David challenges the trial court’s authority to revoke his bail and the sufficiency of the evidence to do so assuming the authority existed. Munoz challenges the constitutionality of article II, section 13. Because both cases present a common issue as to the proper method of appealing denials or revocations of bail, they have been consolidated.
We first discuss the method of appealing this type case. We then review the merits of each defendant’s appeal. As to David, we hold that the trial court had authority to revoke his bail and that sufficient evidence existed to do so. We therefore affirm the trial court's ruling in that case. As to Munoz, we hold that because defendant was denied notice, hearing and right to counsel, due process requires reversal. We therefore do not reach other constitutional challenges to article II, section 13 raised in that appeal.
1. Method of Appeal
The issue is not whether defendants have a right of appeal from an order denying or revoking bail, but rather the proper method of perfecting the appeal. Munoz took a direct appeal pursuant to NMSA 1978, Crim., Child.Ct., Dom Rel. & W/C App. Rule 202 (Repl.Pamp.1983). David moved to appeal pursuant to NMSA 1978, Crim.P. Rule 26 (Repl.Pamp.1980) and NMSA 1978, Crim., Child.Ct., Dom.Rel. & W/C App.Rule 204 (Repl.Pamp.1983). Because of the apparent confusion as to the method of perfecting appeals from orders denying or revoking bail, we asked the parties in State v. Munoz to brief the question.
The problem arises because Crim.App. Rule 204 is tailored to NMSA 1978, Section 39-3-3 A(2) and Crim.P.Rule 26, both of which provide for review of conditions of release. No “conditions” were set in the cases before us, see State v. Flores, 99 N.M. 44, 653 P.2d 875 (1982) (there are no conditions of release if there is no bond), See also State v. Romero, 101 N.M. 661, 687 P.2d 96 (Ct.App.1984), nor was there an order requiring return to custody after specified hours.
We hold, nevertheless, that Crim. App.Rule 204 provides the most appropriate means for appeal in the type of cases before us. Article II, section 13 required that appeals from orders denying bail shall be given preference over all other matters, and Crim.App.Rule 204 provides the most expeditious method for doing that. We treat Munoz’s docketing statement as a motion for appeal under Crim.App.Rule 204; the motion for appeal is granted.
The state argues that no appeal should lie until there has been a review hearing as required by NMSA 1978, Crim. P.Rule 22(e) (Repl.Pamp.1980). We reject this argument. Crim.P.Rule 22(e) provides for a hearing to review conditions of release or to review an order requiring return to custody after specified hours. Such a hearing would be unnecessary when, as here, bail is entirely revoked or denied.
Having determined that the appeals were properly brought, we turn to the merits of each case.
2. David’s Appeal
A criminal complaint charges this defendant with the felony crimes of two counts of conspiracy, arson, two counts of aggravated burglary, possession of explosives and dangerous use of explosives. Bond was originally set at $1,000,000 but later reduced to $200,000. Because he was unable to post bond in either amount, defendant remained incarcerated from August 1983 until May 1984. When defendant moved for a review of his conditions of release, the state responded with its own motion for review of conditions for release. The state’s motion alleged: (1) the existence of a letter written by or at the insistence of defendant to a Tommy Reed Rice, a material witness in the case, threatening Rice if he testified; (2) that defendant had previously been charged with three counts of escape from custody, one count of flight to avoid prosecution, and convicted of escape from custody; (3) that defendant and a co-defendant had made threats to bomb the Hobbs police department; and (4) that if released, defendant planned to travel to Arkansas to murder a Tommy Dobbs and then return to New Mexico to arrange for the deaths of Rice and a Gary Lynn Draper. The state claimed that these matters, which had not been previously made available to the court, represented a danger to the community and to witnesses for the state. The trial court reduced bond to $100,000 and ordered as additional conditions that defendant not leave the county and that he report to the sheriff’s department on a daily basis.
After defendant’s release the state filed another motion for review of the conditions, alleging that defendant, while an inmate in the Lea County jail, had attempted to hire a Pete Torres to murder Rice, a key witness for the state. The motion alleged that the police had taken a statement from an inmate (Chaves) who had overheard defendant contract with Torres for the murder of Rice. Chaves did not testify at the May 1984 hearing but did testify at the August hearing. Defendant’s bond was revoked.
Defendant challenges the trial court’s authority to revoke bail. He contends that the trial court could have revoked bail only under NMSA 1978, Crim.P. Rule 24(a)(3) (Repl.Pamp.1980), which defendant says does not apply because he has not been charged, arrested, indicted or bound over for any crime allegedly committed while he was released. Tijerina v. Baker, 78 N.M. 770, 438 P.2d 514 (1968) authorizes revocation of bail under circumstances when necessary to prevent interference with the proper administration of justice. We do not understand that the Rules of Criminal Procedure were intended to overrule Tijerina v. Baker.
The state argues that the trial court could have accomplished the same result by imposing such onerous conditions defendant would not have been able to meet them. Thus, substance should govern over form so that the trial court could, as was done here, deny bail in a straightforward manner. We hold the trial court had authority to revoke defendant’s bail.
Defendant also argues that the state should be estopped from relying on any matters relating to threats on the life of the witness Rice because that had been heard at the earlier hearing in May 1984 and did not result in revocation of bail. Without citing any authority to support his argument, defendant analogizes the situation to the doctrines of estoppel, collateral estoppel and res judicata. He also contends it is similar to child custody cases where a material change in circumstances must be shown in order to effect a change in custody. We reject these arguments. See Tijerina v. Baker. The finality of judgments in civil actions do not apply to interlocutory orders in criminal cases having to do with the release or non-release from custody when the administration of justice is threatened. An interlocutory bail determination is not a final judgment and bail decisions may be reviewed at any time and for a variety of reasons under Crim.P. Rules 22 and 24.
Finally, defendant claims there was insufficient evidence to support the revocation of bail. He advances several reasons why Chaves's testimony should be looked on with suspicion. He was an incarcerated informer; he did not come forward for several months; and the layout of the jail made it unlikely that he could have heard any conversation between defendant and Torres. This court does not pass judgment on the credibility of witnesses; that is for the trial court. State v. Lankford, 92 N.M. 1, 582 P.2d 378 (1978). Chaves’s testimony constituted substantial evidence.
We affirm the trial court’s order revoking bail.
3. Munoz’s Appeal
This defendant is also currently incarcerated, awaiting trial. On September 14, 1984 Munoz was arrested and charged with two counts of distribution of a controlled substance, to wit, marijuana, each a fourth degree felony. On September 17 the district attorney moved to deny bail pursuant to article II, section 13 on the grounds that defendant was charged with a felony and had previously been convicted of two felonies within the state. The motion does not allege that the two previous felonies did not arise out of the same transaction or a common transaction as the present charge, but we gather no contention is being made that they did.
On September 17 or 18, Munoz appeared before the trial court for arraignment. He had not been served with a copy of the state’s motion and did not at that time have counsel. After advising Munoz of the motion to deny bail and without hearing either evidence or argument, the trial court granted the motion. Appointment of counsel was then made, and counsel learned of his appointment on September 19.
In his brief Munoz challenges the constitutionality of article II, section 13, both on its face and as applied to him, as violative of the eighth and fourteenth amendments to the United States Constitution. Because we dispose of this appeal on the basis of denial of liberty without due process, we do not reach the remaining constitutional arguments. For a thorough review of the problem, see Norwood and Novins, The Constitutionality of Pretrial Detention Without Bail In New Mexico, 12 U.N.M.L. Rev. 685 (1982) and Comment, The Constitution Is Constitutional — A Reply to “The Constitutionality of Pretrial Detention Without Bail In New Mexico”, 13 U.N.M.L.Rev. 145 (1983).
Munoz’s due process argument is premised on article II, section 13 creating “an irrebuttable presumption that any accused who has been convicted of two prior felonies is a flight risk, or should be denied bond for some other legitimate state purpose.” In Hunt v. Roth, 648 F.2d 1148 (8th Cir.1981), vacated as moot sub. nom. Murphy v. Hunt, 455 U.S. 478, 102 S.Ct. 1181, 71 L.Ed.2d 353 (1982), the court held unconstitutional a portion of the Nebraska constitution. That court said, “The fatal flaw in the Nebraska constitutional amendment is that the state has created an irrebuttable presumption that every individual charged with this particular offense [sexual] is incapable of assuring his appearance by conditioning it upon reasonable bail or is too dangerous to be granted release.” 648 F.2d at 1164. See also Huihui v. Shimoda, 64 Haw. 527, 644 P.2d 968 (1982) (no bail where offense punishable by life imprisonment).
Article II, section 13 provides:
All persons shall be bailable by sufficient sureties, except for capital offenses when the proof is evident or the presumption great and in situations in which bail is specifically prohibited by this section. Excessive bail shall not be required, nor excessive fines imposed, nor cruel and unusual punishment inflicted.
Bail may be denied by the district court for a period of sixty days after the incarceration of the defendant by an order entered within seven days after the incarceration, in the following instances:
A. the defendant is accused of a felony and has previously been convicted of two or more felonies, within the state, which felonies did not arise from the same transaction or a common transaction with the case at bar;
B. the defendant is accused of a felony involving the use of a deadly weapon and has a prior felony conviction, within the state. The period for incarceration without bail may be extended by any period of time by which trial is delayed by a motion for a continuance made by or on behalf of the defendant. An appeal from an order denying bail shall be given preference over all other matters. (As amended November 4, 1980.) [Emphasis added.]
The difference between the New Mexico amendment and the statutes in Nebraska and Hawaii is that discretion has been given to the trial court. Article II, section 13 states, “Bail may be denied * * This court is to indulge all reasonable presumptions that a constitutional amendment is constitutional. City of Raton v. Sproule, 78 N.M. 138, 429 P.2d 336 (1967). Only if the illegality of the enactment appears beyond a reasonable doubt is it to be declared unconstitutional. Id. Further, it is well settled that if an act can be applied so as to avoid a conflict with the constitution, such construction should be adopted by the court. State ex rel. Sedillo v. Sargent, 24 N.M. 333, 171 P. 790 (1918). This same rule applies equally to constitutional enactments as it does to legislation. See State ex rel. Witt v. State Canvassing Board, 78 N.M. 682, 437 P.2d 143 (1968).
We therefore hold that article II, section 13 contemplates judicial discretion and that evidence of two or more previous felonies creates no more than a presumption which may be rebutted. It also contemplates a hearing for such purpose. See Tijerina v. Baker.
But in this case Munoz was not given notice that the state wished to deny him bail, nor was he afforded a hearing where he could offer evidence to rebut the presumption, and he was not afforded counsel to advise and represent him. We hold that due process requires that an accused be given notice and an opportunity to be heard with right of counsel before bail can be denied under article II, section 13. See Tijerina v. Baker.
Because Munoz was denied due process, we hold that the trial court erred in denying him bail without notice, a hearing and right to counsel.
4. Conclusion
In State v. David the order revoking bail is affirmed. In State v. Munoz, the order denying bail is reversed.
IT IS SO ORDERED.
WOOD and NEAL, JJ., concur. | [
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OPINION
FROST, Justice.
In applying for a life insurance policy from Capitol Bankers Life Insurance Company (Capitol), Edward and Kathy Crow made misrepresentations about Kathy’s health history. As required by New Mexico law, the policy contained an incontestability’ clause, stating that, after two years from the date the policy was issued, the coverage could not be challenged. Kathy died of ovarian cancer less than two years after the policy was issued. Upon learning of the misrepresentations, Capitol denied payment of death benefits to Edward. Edward filed suit claiming that the incontestability clause prevented Capitol from challenging the policy.
We conclude that the incontestability clause should not be enforced because the language of the insurance contract required that the insured be alive for the entire two-year period. We also conclude that, because there is strong evidence in the record of fraud and misrepresentation on the part of the Crows, Capitol properly refused to award the death benefits to Edward.
I. FACTS
Kathy Crow, a registered nurse, was diagnosed with ovarian cancer in October 1985. From the date of the diagnosis through the time of her death in 1990, she was under almost continuous care for cancer. She first met with Dr. George Ritcher, a specialist in gynecologic oncology, on October 2, 1985. Upon discovery of the cancer, she soon thereafter underwent a hysterectomy and an oophorectomy. Kathy then began a series of chemotherapy treatments that ended in July 1986.
A month after concluding the chemotherapy, on August 6,1986, Dr. Richter performed a “second look” operation. Biopsies taken from various locations in her abdominal cavity revealed the continued presence of cancer. Dr. Richter suggested at trial that historically a large percentage of patients who have a positive second look will succumb to the disease. Kathy then underwent another year of chemotherapy which ended in August 1987. During the same year Kathy also had minor surgery to remove a kidney stone.
About the same time her chemotherapy treatments ended, in August 1987, Kathy married Edward Crow. The couple purchased a home the following month. In the mortgage paperwork they indicated they would like to be contacted by a life insurance agent. Shortly thereafter, Jean Cooley, an agent for Capitol, contacted the Crows offering to sell them a policy. They told Cooley to call back after the first of the year in 1988.
In December 1987 Kathy complained of lower abdominal pain. New tests revealed evidence of a possible recurrence of cancer including a suspicious soft tissue mass in her pelvis.
Cooley called in mid-January 1988 and scheduled an appointment for February 25, 1988, to sell life insurance to the Crows. She came to their house on the appointed day and personally prepared two life insurance applications, one for Kathy and one for Edward.
Kathy’s “HEALTH STATEMENT,” as completed by Cooley, was in “PART C” of the application. Question 2(f) asked, “To the best of your knowledge and belief has the proposed insured within the last 10 years been treated for or had any known indication of ... [a] stone or other disorder of kidney, bladder, prostate, or reproductive organs?” Cooley marked “Yes” to this question with the explanation that Kathy had suffered from a kidney infection and had a kidney stone removed. No problem with Kathy’s reproductive organs was noted.
Most significantly, question 2(j) asked about any treatments or indications of “[c]ancer, cyst, or any tumor disorder of skin or lymph glands?” To this, Cooley marked Kathy’s response: “No.” Question 9(a) asked, “Has the Proposed Insured ever had any disorder of menstruation, pregnancy, or of the reproductive organs or breasts?” and Kathy’s answer was “No.” Cooley submitted the completed application documents to Capitol.
On March 23, 1988, Capitol issued the Crow’s life insurance contract. Under the terms of the contract, this was the “Issue Date.” Cooley delivered the documents to the Crows the same day. As required by New Mexico law, NMSA 1978, Section 59A-20-5 (Repl.Pamp.1992), the portion of the contract insuring Edward’s life contained an incontestability clause. This clause provided that, “during the lifetime of the Insured,” Capitol could not contest statements made in the application after two years from the issue date. Appended to Edward’s insurance policy was the “OTHER INSURED RIDER” (Rider), which was a policy insuring Kathy’s life. The Rider also contained an incontestability clause. It differed from the one in Edward’s policy in that it lacked any reference to “the lifetime of the Insured.” Husband and wife were each covered for $77,-900.00.
On March 25, 1988, two days after Cooley delivered the insurance policies, Kathy was informed by Dr. Richter that her cancer had recurred. Biopsies taken March 31, 1988, confirmed this diagnosis. Dr. Ritcher met with both Kathy and Edward on April 15, 1988, to discuss the alternatives for treatment. Five days later Kathy called Dr. Ritcher to tell him she wanted to continue aggressively fighting the disease with chemotherapy.
Apparently she continued with the chemotherapy until she went to Corpus Christi, Texas almost two years later in February 1990, to be with her family. She died on February 26, 1990. Her death certificate listed the immediate cause of death as “Aspiration Pneumonia” with “Papillary Adeno Carcinoma” as the significant condition that contributed to her death.
In March 1990 Edward called Cooley and told her Kathy had died. Cooley was “flabbergasted” when she learned that cancer was the cause of death and that Kathy “had it before.” When Cooley asked Edward why the disease was not disclosed on the insurance application, he answered, “We thought she was all right.”
Within a day or two Edward again called Cooley to ask if Capitol would pay the claim since the death certificate listed the immediate cause of death as aspiration pneumonia rather than cancer. Cooley replied that she did not know and indicated that her authority was limited to sending in the claim. She asked Edward again why he and Kathy had not disclosed the cancer. This time he asserted that Cooley had never asked them about it.
On March 6, 1990, Capitol opened its “Death Claim Checklist.” Capitol mailed to Edward the “PROOFS OF DEATH — BENEFICIARY’S STATEMENT,” which he completed and returned to the insurance company on March 14, 1990. Edward listed the “Cause of Death” as “Aspiration Pneumonia.” In response to the question, “When did deceased first complain of or give other indications of his/her last illness?” he answered “1-27-89” though Kathy’s cancer was diagnosed in 1985. When asked, “When did deceased first consult a physician for his/her last illness?” he responded “2-2-90” though she had been treated by Dr. Richter as early as 1985. One question asked for the names of all physicians who attended Kathy during the final three years of her last illness, as well as the dates of attendance, and the condition treated. Edward listed a physician from the hospital in Corpus Christi where Kathy died as treating her from “2-2-90” to “2-26-90” for “Pneumonia Aspiration.” With remarkable understatement, Edward also listed Dr. Ritcher, with no dates of attendance, as treating her for an “OBGYN Condition.” ‘
On April 28, 1990, Capitol wrote to Edward notifying him that, because Kathy’s statements on Part C of the application constituted “a material misrepresentation of her health history,” payment of the death benefits was being denied. Thus, despite, the language of the incontestability clause, Capitol contested the policy after it had been in-force for more than two years.
Edward filed a civil complaint on February, 21,1991, against Capitol and Cooley claiming breach of insurance contract, breach of cove1nant of good faith and fair dealing, and violation of the New Mexico Insurance Practices Act, NMSA 1978, §§ 59A-16-1 to -30 (Repl. Pamp.1992 & Cum.Supp.1994). Edward included an allegation that, because Capitol denied the benefits more than two years after the issue date, it was forbidden by the incontestability clause from challenging any statements made in the original application.
Capitol and Cooley responded with the affirmative defense of fraud and misrepresentation on the part of the Crows. Capitol also claimed that because Kathy died within two years of the Issue Date, the incontestability provision contained in her Rider became inapplicable, and the validity of the policy could therefore be challenged.
After a trial on the merits, a jury determined that Capitol did not breach the terms of the life insurance contract. The jury also found that Kathy made false statements to Cooley. The court awarded judgment for Capitol and Cooley.
On appeal, Edward asserts that the trial court erred by not enforcing, as a matter of law, the incontestability clause. We believe the trial court acted properly. The dispositive issues in this case are whether the incontestability clause was unenforceable and whether Kathy’s misrepresentations on the insurance application released Capitol from its obligations under the contract. No other matters need be addressed.
II. THE INCONTESTABILITY CLAUSE
New Mexico law requires that each life insurance policy contain “a provision that the policy ... shall be incontestable, except for nonpayment of premiums, after it has been in force during the lifetime of the insured for a period of two (2) years from its date of issue.” Section 59A-20-5. Accordingly, Edward’s policy contained a clause that “[w]ith respect to the initial Specified Amount, we will not contest this policy after it has been in force during the lifetime of the Insured for the contestable period shown on the Schedule Page.” The Schedule Page stated, “THE CONTESTABLE PERIOD IS 2 YEARS.” The Rider that insured Kathy’s life also provided that, “[ajfter two years from its Issue Date, this Rider shall be incontestable as to statements made in the application.”
We base our decision in this case on a single narrow issue: whether this particular clause requires that the insured be alive for the entire two-year contestable period. We conclude, under traditional theories of contract interpretation, that the policy issued by Capitol required Kathy to be alive for two years from the issue date for the incontestability clause to be enforceable. We reach this conclusion even though Kathy’s Rider lacked the “during the lifetime of the insured” language.
Edward wishes us to address whether Capitol properly contested the policy within the period specified by the clause. See, e.g., Franklin Life Ins. Co. v. Bieniek, 312 F.2d 365, 371 (3d Cir.1962) (discussing time period within which act of contesting policy must take place). Because the incontestability clause in this case was voided by Kathy’s death, we need not address this matter. For the same reason we need not address Capitol’s allegation that, the incontestability clause notwithstanding, when fraud is alleged, the validity of an insurance policy can be contested at any time. See, e.g., Maxwell v. Cumberland Life Ins. Co., 113 Idaho 808, 811, 748 P.2d 392, 395 (1987) (“Since the [two-year] period has run in the instant case, all defenses premised on false statements in the application are precluded.”).
III. STANDARD OF REVIEW
Though certain elements of construction are unique to insurance contracts, generally they are construed by the same principles governing the interpretation of all contracts. Vargas v. Pacific Nat’l Life Assurance Co., 79 N.M. 152, 155, 441 P.2d 50, 53 (1968). Incontestability clauses are no exception to this generality. 18 George J. Couch, Couch Cyclopedia of Insurance Law 2d § 72:10 (Ronald A. Anderson ed., Mark S. Rhodes rev., 1983).
The clauses in question will be interpreted by their own terms and conditions. Ansvar Am. Ins. Co. v. Hallberg, 209 Ill. App.3d 206, 154 Ill.Dec. 77, 80, 568 N.E.2d 77, 80 (1991) (“[C]ourts should construe and enforce the contract as made.”). To the extent that the insurance company in drafting the insurance form is responsible for the language of the policy, any ambiguity will be resolved in favor of the beneficiary. See Crawford Chevrolet, Inc. v. National Hole-In-One Ass’n, 113 N.M. 519, 521, 828 P.2d 952, 954 (1992). However, to the extent the wording of the incontestability clause is prescribed by statute, and not controlled by the insurance company, the language will not be strictly construed against the insurer. See 18 Couch, supra, § 72:10. Rather, the language will be interpreted so as to fulfill the statutory intent behind the required language.
IV. INCONTESTABILITY CLAUSE IS VOIDED BY THE DEATH OF THE INSURED
The phrase, “during the lifetime of the Insured” in the incontestability clause of Edward’s policy has consistently been interpreted by other jurisdictions to mean that the insured must remain alive for the entire two-year period before the policy becomes incontestable. 18 Couch, supra, § 72:48; see, e.g., Friedman v. Prudential Life Ins. Co., 589 F.Supp. 1017, 1020 (S.D.N.Y.1984) (stating insured must remain alive for the entire contestability period); Downs v. Prudential Ins. Co., 130 N.J.Super. 558, 328 A.2d 20, 25-26 (Law Div.1974) (stating the same).
Since this phrase is derived from the statute, we will, under the standard of review just discussed, not construe it strictly against Capitol. The two-year limitation was not intended by the legislature to be an absolute bar to contestability. The “during the lifetime of the insured” language of Section 59A-20-5, was meant specifically to condition contestability on the survival of the insured for two years after policy was issued. See Spilker v. William Penn Life Ins. Co., 251 N.J.Super. 480, 598 A.2d 929, 932-33 (App.Div.1991) (discussing similar New Jersey statute).
Edward asserts that the Rider should be read separately from his own life insurance policy. He emphasizes that the Rider’s incontestability clause flatly requires the expiration of two years before the policy becomes incontestable. Unlike his policy, it makes no requirement that the policy be in force for two years “during the lifetime of the Insured.” Thus he claims, under the clear and unambiguous language of the Rider, Kathy’s death would not preclude the clause from being enforced.
It is a basic tenet of contract construction that a “memorandum may consist of several writings.” Restatement (Second) of Contracts § 132 (1979). If two or more writings are part of a single transaction and concern the same subject matter, then they are a single contract. Massey v. Galvan, 822 S.W.2d 309, 315 (Tex.Ct.App.1992). Whether multiple documents consist of a single con tract is determined by considering the intentions of the parties and the surrounding circumstances. Master Builders, Inc. v. Cabbell, 95 N.M. 371, 374, 622 P.2d 276, 279 (Ct.App.), cert. denied, 95 N.M. 426, 622 P.2d 1046 (1981). Edward’s insurance contract and the Rider are to be read as a single contract as long as the circumstances establish that they relate to the same transaction. See Restatement (Second) of Contracts § 132 (1979).
The language of the policy shows that the two writings were intended by the parties to be a single contract. The “SCHEDULE PAGE,” which is the first sheet after the cover page, contains the statement that “THE CHARGE FOR ANY ADDITIONAL BENEFITS WHICH ARE PROVIDED BY RIDER IS SHOWN BELOW,” suggesting that, while the Rider may have certain additional provisions, it actually incorporates the terms of Edward’s policy. The Rider, contained entirely on the tenth sheet of the policy, begins with the statement, “Based on the application for this rider and the payment of the premium, this rider is made part of this policy.” (Emphasis added.) The last paragraph of the Rider, entitled “RIDER PART OF POLICY” provides:
This rider is attached to and made a part of this policy as of the Issue Date of this rider in return for the application and payment of premiums. The Issue Date of this rider is the Issue Date of the policy to which it is attached, unless a different date is shown below.
The same paragraph also states that “[a]ll the provisions of the policy apply to this rider, except those that are inconsistent with this rider.” Under the contract doctrine discussed herein, any inconsistency between the two incontestability clauses in question is immaterial. The policy and the Rider are unquestionably to be construed as parts of a single transaction within a single memorandum.
Another basic principle of contract construction is that “[a] writing is interpreted as a whole, and all writings that are part of the same transaction are interpreted together.” Restatement (Second) of Contracts § 202(2) (1979); Crawford Chevrolet, 113 N.M. at 520-21, 828 P.2d at 953-54. Edward urges that, because the Rider lacks the “lifetime of the Insured” language, we should isolate its incontestability clause from the rest of the contract. This approach would violate the principle that no part of the contract can be isolated and interpreted distinctly from the rest of the contract. Madawick Contracting Co. v. Travelers Ins. Co., 307 N.Y. 111, 120 N.E.2d 520, 523 (1954) (“Each portion of an agreement is qualified by other portions that are relevant thereto, and has no separate existence apart from them.”). Moreover, the entire contract is to be considered in the interpretation of any individual part. Each word, phrase, and section of a contract should be analyzed in its context within the contract as a whole so as to realize the intentions of the parties. Brown v. American Bank of Commerce, 79 N.M. 222, 226, 441 P.2d 751, 755 (1968); see Restatement (Second) of Contracts § 202 cmt. d (1979) (“Meaning is inevitably dependent on context.”).
Our conclusion that the Rider’s incontestability clause cannot rationally be isolated and distinguished from the clause in Edward’s policy is supported by several arguments. First, the “during the lifetime of the insured” language is required by New Mexico statute. See § 59A-20-5. Under traditional contract theory, state laws are incorporated into and form a part of every contract whether or not they are specifically mentioned in the instrument. State ex rel. Udall v. Colonial Penn Ins. Co., 112 N.M. 123, 130, 812 P.2d 777, 784 (1991). Edward does not claim there is a fault in the language of the statute. The language of Section 59A-20-5, is thus a part of the entire contract and cannot be isolated from any individual section. Though not specifically mentioned, the “lifetime of the insured” language of the statute was implicitly incorporated into the incontestability clause of the Rider.
A second important reason for refusing to distinguish the Rider’s incontestability clause is that the interpretation urged by Edward violates public policy. A contract is unenforceable if it violates public policy, especially public policies that engender the writing of statutes. See Udall, 112 N.M. at 130, 812 P.2d at 784 (state contract with investment broker who provided illegal investment advice was not enforceable). The incontestability clause promotes two important public policies. First, it protects the insurance company by giving it an adequate window of time in which to investigate an application for life insurance so as to discover any material misrepresentations on the part of the applicant. Second, it protects the insured from having to defend against a possibly specious challenge long after acquisition of the policy. See Maxwell, 113 Idaho at 811, 748 P.2d at 395 (stating that the incontestability clause “prevents the insurer from lulling the insured into a sense of security, only to litigate the issue later, possibly after the death of the insured”); 18 Couch, supra, § 72:2 (stating a similar idea). Thus, by requiring prompt investigation of statements made in an insurance application, the clause furthers the public policy of denying protection to those who make fraudulent claims. The “during the lifetime” wording is part of that public policy. If the insured dies of a serious illness a short time after obtaining a life insurance policy, the insurance company should be permitted to investigate in contemplation of a challenge. It would be against public policy for the Rider in the instant ease to prevent Capitol from investigating the fact that Kathy died of cancer a short time after representing to the insurance company that she had no such disease. The public policy behind the “during the lifetime” language of Edward’s policy is equally a part of the Rider though not expressly articulated.
Finally, no rational reason has been offered for making the incontestability clause of the Rider different from that of Edward’s policy. It is possible to imagine some provisions of an insurance contract that would be different for husband and wife such as the premium cost or the amount of benefits received. However, there is no logical reason why the incontestability clause should apply differently to two parties who are covered by the same contract. Furthermore, there is no logical reason why one clause should incorporate relevant state law and public policy, and the other should not. The law will always seek to effectuate a reasonable over an unreasonable interpretation of a contract. Brown, 79 N.M. at 226, 441 P.2d at 755 (“[I]n construing the contract, reasonable rather than unreasonable interpretations are favored by the law.”).
Thus, Kathy’s death within the contestable period fixed the rights of the parties; the incontestability clause became a nullity even though the contestable period had expired. See 18 Couch, supra, § 72:47; Spilker, 598 A.2d at 933 (“If an insured dies before the policy has been in force two years, the incontestability clause is a nullity and the insurer is not bound by the two year limitation.”). The policy could thus be contested by Capitol.
V. MISREPRESENTATIONS BAR RECOVERY
Since, by the terms of the insurance contract, the incontestability clause became unenforceable upon Kathy’s death, Capitol was not bound by that time constraint in contesting the policy. A question in an insurance application propounded for the purpose of determining the existence of a significant bodily disorder allows the insurer to evaluate whether the disorder makes the insured an unacceptable risk. A material misrepresentation in answering such a question will render the policy void. 7 Couch, supra, § 37:96 (1985).
A misrepresentation on an insurance application is material if the insurer would not have entered into the contract but for the misrepresentation. By concealing the true nature of her health, Kathy induced Capitol to enter a contract it otherwise would have rejected. See Modisette v. Foundation Reserve Ins. Co., 77 N.M. 661, 667-68, 427 P.2d 21, 26 (1967). Capitol relied upon the misrepresentation and, as a result, was deprived of the opportunity to estimate its risk under the contract. See Prudential Ins. Co. v. Anaya, 78 N.M. 101, 105, 428 P.2d 640, 644 (1967).
Capitol bears the burden of proving that the Crows’ fraudulent misrepresentations are sufficient to avoid its liability on the contract. Tsosie v. Foundation Reserve Ins. Co., 77 N.M. 671, 675, 427 P.2d 29, 31 (1967). The insurer can prove misrepresentation in several ways. For example, misrepresentation is indicated when the insurer relies upon statements that were certainly known by the insured to be untrue, or when these statements “are of such a character as clearly to prove a conscious misrepresentation.” See 7 Couch, supra, § 37:106; Powell v. Time Ins. Co., 181 W.Va. 289, 297, 382 S.E.2d 342, 350 (1989). Kathy’s claim on the application that she had never been treated for “[c]ancer, cyst, or any tumor disorder of skin or lymph glands,” was of such a character.
Also, misrepresentation is suggested by the brevity of time between the applicant’s representation about her health and the occurrence of the disease. Though entirely dependent upon the specific facts of each case, this brevity of time can indicate to the company that the insured knew she was afflicted with the disease at the time she applied for insurance. 7 Couch, supra, § 37:106; Metropolitan Life Ins. Co. v. Erdwins, 229 Mo.App. 437, 83 S.W.2d 597, 604 (1935) (“elapse of only a few months” between application for insurance and commencement of total and permanent disability as evidence of misrepresentation on insurance application). In this case, two days after the issue date of the insurance policy, Kathy was told her cancer had reappeared. This circumstance implies misrepresentation on the part of the Crows.
Evidence of misrepresentation can also be found if the insured does not disclose that she knows she suffers from a serious disease which is statistically likely to shorten her life. See 7 Couch, supra, § 37:106; Ford Life Ins. Co. v. Samples, 277 Ark. 351, 641 S.W.2d 708, 709 (1982) (“There is no question but that ‘good health’ statement is incorrect as a matter of law when the insured is aware of an affliction which would seriously affect the risk.”). Kathy suffered from a form of cancer that Dr. Richter described as “the worst disease we deal with,” because it is difficult to detect early and almost impossible to completely eradicate. Kathy’s physicians recounted several discussions in which they informed Kathy of the nature of her disease. As a registered nurse she was at least as competent as most people to understand its consequences. There can be little doubt that both she and Edward were aware that ovarian cancer was likely to shorten her life. See Saunders v. National Old Line Ins. Co., 266 Ark. 247, 583 S.W.2d 58, 59-60 (1979) (life insurance policy voided where insured knew he had cancer but claimed to be in good health).
In the Crows’ policy, Capitol explicitly noted that “[i]n issuing this policy, we have relied on statements made in the application.” Kathy made statements about her health in the application, the statements were incorporated into the policy, and in reliance upon the truth of those statements Capitol issued the policy. Because a jury found that the representations were .false and were material to the risk being assumed by the insurance company, the policy was properly voided. Modisette, 77 N.M. at 669, 427 P.2d at 27.
VI. CONCLUSION
For the foregoing reasons we find that Kathy’s death rendered the incontestability clause of her life insurance policy unenforceable, and that because of Kathy’s misrepresentations about her health on the application form, Capitol properly refused to pay death benefits to Edward, her beneficiary. We therefore affirm the judgment of the trial court.
IT IS SO ORDERED.
FRANCHINI and MINZNER, JJ„ concur. | [
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OPINION
MINZNER, Judge.
Defendants-Appellants Roy and Skip Foreman appeal from a jury verdict of $350,000 in a wrongful death suit arising out of an automobile accident which occurred in Las Cruces, New Mexico, on September 27, 1981. On appeal, defendants claim that the trial court erred in admitting certain evidence and that the error requires reversal. Defendants also claim errors in the jury instructions require reversal. We affirm the trial court’s rulings.
FACTS
Roy Foreman is the principal owner of Foreman Oil Company. Skip, Roy’s son, was employed as a general manager of the marketing branch of the family business. Because Skip’s job required extensive travelling, he had unrestricted use of a company vehicle, a one-ton, short-bed truck. Roy was responsible for the company policy permitting Skip’s unrestricted use of the vehicle.
Skip attended a barbeque on the evening of the accident. The record contains evidence that he had been drinking at the party. Shortly after Skip left the party, the company truck in which he was travel-ling crossed the median on New Mexico State Highway 28 and collided with Ruel W. McCarson’s vehicle. Ruel suffered extensive injuries, which resulted in his death.
Plaintiff Ronald McCarson’s suit alleged negligent driving as to Skip and negligent entrustment as to Roy. Skip defended on the ground that he was not driving at the time of the accident. He testified that he picked up two hitchhikers, one of whom he recognized but could not name, shortly after leaving the party. Skip testified that he let one hitchhiker drive, fell asleep, and awoke after the collision to find that both hitchhikers had departed the scene of the accident. Skip also suffered injuries in the accident. Roy defended on the ground that he had no actual knowledge, or any reason to know, that Skip was a reckless or incompetent driver and that, consequently, the entrustment was not negligent.
Defendants raise four arguments on appeal: (1) admission of a cocaine charge against and plea agreement by Skip was improper on the issue of negligent entrustment against Roy and fatally prejudicial on the negligence claim against Skip; (2) absent evidence of the cocaine charge, there was insufficient evidence to support a verdict against Roy for negligent entrustment; (3) the trial judge gave an improper burden of proof instruction that is reversible error; and (4) the trial judge erred in instructing on damages, because he modified the Uniform Jury Instruction in a way that allowed the jury to award duplicate damages. Because the first and second issues are closely related, we consider them together.
I. ADMISSIBILITY OF COCAINE CHARGE AND PLEA AGREEMENT
The trial court admitted over defendants’ objection evidence that Skip was arrested for trafficking in cocaine in January 1981, some eight months prior to the accident. After two trials, the first of which resulted in a hung jury, in October 1982 Skip pled guilty to a reduced charge of possession of cocaine. The cocaine was seized from the company truck. The trial court also admitted over objection evidence of a September 1980 DWI citation, which resulted in conviction prior to the accident. Roy had knowledge of these incidents prior to the accident.
The trial judge cautioned the jury that it might consider the plea agreement only on the negligent entrustment claim and not in relation to the claim of negligence against Skip. In response to defendants’ renewal of a continuing objection, the trial judge also periodically cautioned the jury that evidence of prior acts was admissible only on the negligent entrustment claim.
Defendants contend first that evidence of the cocaine charge was irrelevant under NMSA 1978, Evid.Rules 401 and 402 (Repl. Pamp.1983), and that, even if relevant, admission of such evidence constituted error because its prejudicial effect outweighed its probative value. NMSA 1978, Evid.R. 403 (Repl.Pamp.1983). On the basis of their argument that evidence of the cocaine charge was inadmissible, defendants reason that Skip was prejudiced on the trial of his negligence and that Roy was prejudiced because the remaining evidence was insufficient to support the negligent entrustment verdict.
There is a risk of prejudice where drug charge testimony is introduced. See United States v. Kizer, 569 F.2d 504 (9th Cir.1978), cert. denied, 435 U.S. 976, 98 S.Ct. 1626, 56 L.Ed.2d 71 (1978). However, the risk of prejudice must be weighed against the probative value of the evidence in light of the plaintiff’s theory. See Evid.R. 403. The trial judge has a great deal of discretion in making the balance required by the Rule. Mac Tyres, Inc. v. Vigil, 92 N.M. 446, 589 P.2d 1037 (1979). His ruling is reversible error only in case of abuse. Id. Given the trial judge’s continued admonitions regarding the restricted use of the evidence, we hold that he did not abuse his discretion in admitting evidence of the cocaine charge. He was entitled to conclude that, given McCarson’s theory, the relevance outweighed potential prejudice. ,
Our prior decisions have recognized negligent entrustment claims, but we have not had occasion in prior cases to identify the elements of the tort. See Bryant v. Gilmer, 97 N.M. 358, 639 P.2d 1212 (Ct.App.1982); McKee v. United Salt Corp., 96 N.M. 382, 385, n. 1, 630 P.2d 1237, 1240 (Ct.App.1980). Courts in other jurisdictions have identified various elements of a negligent entrustment theory in an automobile context. See Woods, Negligent Entrustment: Evaluation of a Frequently Overlooked Source of Additional Liability, 20 Ark.L.Rev. 101 (1966). See also Hines v. Nelson, 547 S.W.2d 378 (Tex.Civ.App.1977).
In this case, the court instructed the jury on the essential elements of the tort. Defendants have not challenged the instruction on appeal. Thus, the evidentiary question we must answer is whether the evidence was relevant to the elements as set forth in the instruction. The relevant portions of the instruction were that, in order to recover on the theory of negligent entrustment, McCarson had the burden of proving “(1) [tjhat [Roy] Foreman ... knew or should have known that Skip Foreman was an incompetent or unfit driver; (2) [tjhat [Roy] Foreman permitted the unrestricted use of [the company] truck by Skip Foreman.”
As a general rule, evidence of character or reputation of a party to a civil action is inadmissible, as is evidence of prior acts indicating incompetence. See Note, Torts: Negligent Entrustment in Oklahoma, 24 Okla.L.Rev. 392 (1971). In an entrustment case, however, the competence and fitness of the driver are issues of fact. Id. As a result, evidence of prior specific acts indicating incompetence or unfitness are admissible on the separate questions of the entrustee’s competence or fitness and the entruster’s knowledge. We hold that the evidence is relevant on the issue of Skip’s fitness or competency to drive and on Roy’s knowledge or reason to know of his son’s fitness or competency to drive.
General principles of negligence are relevant to the determination of negligent entrustment. See Hartford Accident & Indemnity Co. v. Abdullah, 94 Cal. App.3d 81, 156 Cal.Rptr. 254 (1979). The theory of negligent entrustment has been described as follows:
It is negligence to permit a third person to use a thing or to engage in an activity which is under the control of the actor, if the actor knows or should know that such person intends or is likely to use the thing or to conduct himself in the activity in such a manner as to create an unreasonable risk of harm to others.
Restatement (Second) of Torts § 308, at 100 (1965). In other words, it is negligent to make an entrustment that creates an appreciable risk of harm.
McCarson’s theory at trial was consistent with the general theory of negligent entrustment and with the elements on which the jury was instructed. McCarson introduced evidence at trial in an effort to prove that Roy was negligent in entrusting a company vehicle without restriction to Skip, given evidence of Skip’s habits in connection with the truck. The prior DWI citation and conviction have probative value as to this theory, because that conviction stemmed from an incident during which Skip was stopped while driving the company truck. It was relevant evidence on the issue of Skip’s competence or recklessness as a driver.' Further, Roy knew about the conviction.
The cocaine charge is also relevant to McCarson’s theory that Skip’s habits, including the use of drugs, generally made him an unfit driver. Defendants have argued that the plea agreement is irrelevant, because it came after the accident, but the record indicates the plea is related to a charge that occurred prior to the accident.
The charge and the plea agreement are facts from which the jury might infer the use of drugs. Even though the charge was trafficking, Skip ultimately pled to a charge of possession. Drug use during or close to the time the truck was driven would be relevant to a charge of reckless driving. See State v. Sandoval, 88 N.M. 267, 539 P.2d 1029 (Ct.App.1975) (any evidence of drinking is relevant as a circumstance for the jury to consider on the issue of reckless driving). Cf. State v. Lopez, 99 N.M. 791, 664 P.2d 989 (Ct.App.1982) (fact of possession was not probative of plaintiffs’ negligence on facts of case). Under the circumstances of this case, we hold the evidence tended to prove facts relevant to McCarson’s theory.
Contrary to defendants’ contention on appeal, McCarson’s theory of negligent entrustment did not require evidence that Roy knew Skip was intoxicated on a specific occasion and subsequently Roy entrusted the truck to Skip on that occasion. Rather, unfitness to drive might exist as a result of habits of which the entruster is actually aware or of which he should know. See Powell v. Langford, 58 Ariz. 281, 119 P.2d 230 (1941); Chaney v. Duncan, 194 Ark. 1076, 110 S.W.2d 21 (1937); Slaughter v. Holsomback, 166 Miss. 643, 147 So. 318 (1933). Cf. Crowell v. Duncan, 145 Va. 489, 134 S.E. 576 (1926) (where owner of a taxi permitted his son to drive it for personal use, knowing that he was given to drinking and likely to drive while intoxicated, owner was liable for injuries caused by son when he had been drinking).
The fact that the cocaine charge did not involve driving while intoxicated or under the influence of drugs does not make it irrelevant. See V.L. Nicholson Const. Co. v. Lane, 177 Tenn. 440, 150 S.W.2d 1069 (1941). Evidence of the charge of trafficking in cocaine, given the fact that the cocaine was seized from the truck, provides a second instance from which the jury might infer Roy should have known that Skip’s habits made him an unfit driver. It is undisputed that Roy knew about the charge.
Defendants contend that one incident in the past is insufficient to establish that the entruster had reason to know of the driver’s lack of fitness to drive. Defendants make this argument on the assumption that the prior DWI is the only relevant evidence on the issue presented to the jury. We have considered, however, whether there was other evidence to support a claim of negligent entrustment, so that the intro duction of the cocaine charge was not prejudicial.
We agree with the view expressed in Guedon v. Rooney, 160 Or. 621, 87 P.2d 209 (1939), that one or two specific acts of negligence are generally insufficient to establish incompetence since even a perfectly competent driver occasionally will act negligently. However, we conclude, as have other courts, that the entrustee’s habits may be such that the owner should know that the driver is likely to become drunk or otherwise unfit at any time. See Powell v. Langford; Chaney v. Duncan. In such circumstances, it would be negligent to let the entrustee drive at any time. See Petermann v. Gary, 210 Miss. 438, 49 So.2d 828 (1951).
We hold that potential prejudice was outweighed by the probative value of the evidence, because of the other evidence related to that theory. See Arkansas-Louisiana Lumber Co. v. Causey, 228 Ark. 1130, 312 S.W.2d 909 (1958). Evidence of Skip’s social drinking habits, as well as evidence of several speeding tickets and warnings, was introduced. In addition, Skip took Tagamet, medication for ulcers, which enhances the physical effects of alcohol. Although the record does not support a finding that Roy knew all of the facts, there is evidence from which a jury could find that he should have known.
Roy testified that he was the person at the company who was responsible for checking on the drivers from time to time but he also testified that he did not make an effort to acquaint himself with Skip’s social habits. No action was taken to inquire into Skip’s habits after the DWI and cocaine charges surfaced. Roy attended the trial of the trafficking charge, at which Skip’s doctor testified about the effects of Tagamet. There was evidence that, although another employee driver was terminated as a result of a prior DWI charge, Skip’s use of the truck was not affected. Under these circumstances, a jury was entitled to find that lack of knowledge of some of the relevant facts was an aspect of Roy’s negligence in entrusting the vehicle on an unrestricted basis. See Levy v. McMullen, 169 Miss. 659, 152 So. 899 (1934).
Defendants have not raised the issue of sufficiency of the evidence of negligent entrustment. Accordingly, the issue is not decided. Defendants have argued instead that if the cocaine charge and plea agreement were inadmissible, there was insufficient evidence of negligent entrustment.
Skip further complains that introduction of evidence of a cocaine charge and nolo contendere plea entered subsequent to the accident at issue was so prejudicial as to deny him a fair trial on the negligent driving claim. There was more than sufficient evidence in this record to justify the negligence verdict against Skip, and the trial judge gave sufficient limiting instructions to the jury at the time he admitted the testimony. The trial judge also generally instructed the jury to consider the two claims as independent actions. There was no reversible error as to Skip in permitting the introduction of this evidence. See Mascarenas v. Gonzales, 83 N.M. 749, 497 P.2d 751 (Ct.App.1972).
II. INSTRUCTIONS ON BURDEN OF PROOF
Defendants complain that the court erred in submitting erroneous burden of proof instructions. They contend that the trial court required defendants to establish Skip’s defense that he was not driving.
Instruction 1 sets out McCarson’s claims, including the claim of negligent driving by Skip. Each contention in the instruction involves either Skip’s operation of the truck or his failure to control the truck. This instruction does not refer to any defenses raised by defendants. The instruction describes McCarson as having the burden of proof on Skip’s negligence, although the reference is not repeated as each specific claim of negligence is outlined.
Instruction 2 states, in relevant part, “It is a general rule, applicable in all civil cases, that a party seeking a recovery or a party relying upon a defense has the burden of proving every essential element of his claim or defense by the greater weight of the evidence.” (Emphasis added.) Cf NMSA 1978, UJI Civ. 3.6 (Repl.Pamp.1980) (the use instructions indicate that the underlined material should be deleted when the defendant makes no affirmative defense). Defendants claim that the underlined language in Instruction 2, and the failure to specify in Instruction 1 that McCarson must prove that Skip was driving the truck at the time of the accident, combined to mislead the jury.
Where the instructions, considered as a whole, fairly present the issues and the law applicable thereto, they are sufficient. Flanary v. Transport Trucking Stop, 78 N.M. 797, 438 P.2d 637 (Ct.App.1968). These instructions fairly present the issues and the relevant law, but for the fact that the underlined portion of Instruction 2 should have been excised. We conclude, however, that defendants failed to preserve the error.
Defendants offered a correct form of UJI Civ. 3.6, but they did not raise the claim made on appeal until after the jury had retired. Under these circumstances, defendants failed to preserve error. See City of Albuquerque v. Ackerman, 82 N.M. 360, 482 P.2d 63 (1971). Defendants should have called the problem to the trial judge’s attention, so that he could correct the error, before the jury retired. Id. See also Hamel v. Winkworth, 102 N.M. 133, 692 P.2d 58 (Ct.App.1984).
Defendants have argued that, in objecting to Instruction 1 because it failed to specify that McCarson was required to prove Skip was driving, they sufficiently alerted the trial judge to the problem with Instruction 2. We disagree. Absent the comparison with Instruction 2, the trial judge was entitled to conclude that the instruction fairly presented the issues and the relevant law on the burden of proof.
Further, there has been no showing that the jury was misled by the tendered instructions. Absent evidence of prejudice, we would find no error. See Jewell v. Seidenberg, 82 N.M. 120, 477 P.2d 296 (1970).
III. PROPRIETY OF DAMAGE INSTRUCTION
Defendants finally claim that the trial court impermissibly altered the appropriate damages instruction by elaborating on the type of damages which could be awarded. The trial court gave an instruction that generally tracked NMSA 1978, UJI Civ. 18.30 (Cum.Supp.1984). However, the trial court prefaced the instruction with the following language: “Plaintiff brings this lawsuit as personal representative of Ruel McCarson, the deceased. A statute of this state allows damages, compensatory and exemplary, to be awarded for surviving beneficiaries should death be proximately caused by the wrongful act, neglect or default of another.” (Emphasis added.)
Defendants complain that the instruction, by referring to exemplary damages but failing to define the term, see NMSA 1978, UJI Civ. 18.27 (Repl.Pamp.1980), required the jury to speculate as to the damages to be awarded and allowed the jury to duplicate the noncompensatory damages it awarded. Defendants note that the instruction also informed the jurors they might, having determined liability, consider the mitigating or aggravating circumstances attending the wrongful act, neglect, or default, in fixing damages.
Defendants recognized during trial that both compensatory and exemplary damages are recoverable in a wrongful death action. Indeed, the court’s prefatory language tracked the language of NMSA 1978, Section 41-2-3 (Repl.Pamp.1982), referenced in the Committee Comment of UJI Civ. 18.30, in instructing on the availability of both types of damages. Another instruction defined “aggravating circumstances.” Under these circumstances, we hold the additional language represented a minor deviation.
Minor deviations from the appropriate Uniform Jury Instructions are not reversible error in the absence of a showing of prejudice. Anderson v. Welsh, 86 N.M. 767, 527 P.2d 1079 (Ct.App.1974). There has been no showing of prejudice. There is no indication in the record, or in the size of the jury verdict, that the jury was in any way misled or confused by the instruction. There is similarly no evidence of prejudice to defendants in the giving of this instruction.
The jury verdict against defendants is affirmed.
IT IS SO ORDERED.
HENDLEY and NEAL, JJ., concur. | [
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OPINION
BOSSON, Judge.
This case addresses whether claimant Anna Fasso (Worker), having received the benefits of a recommended resolution of her workers’ compensation claim under NMSA 1978, Section 52-5-5 (Repl.Pamp.1987), may thereafter petition to increase those benefits on the basis of an alleged change in condition under NMSA 1978, Section 52-5-9(B)(l) (Repl.Pamp.1987). The Workers’ Compensation Judge (WCJ) held as a matter of law that Worker could not request such a modification, and on that issue we reverse. Worker also requests that we apply Section 52-5-9 directly to her claim and agree to her requested modifications. We decline to do so and instead remand to the WCJ for further consideration.
FACTS
Worker injured her back in 1988 while moving a patient on the premises of Sierra Health Center (Employer). A mediation conference was held on December 5, 1990, and a recommended resolution issued on December 7, 1990. The resolution suggested that Worker receive the following: (1) a lump sum settlement of approximately $13,000; (2) $1,000 in vocational rehabilitation benefits; (3) eighteen months of open medical benefits; and (4) $1,800 in attorney fees. Employer filed an acceptance of resolution, and Worker filed no response. Thus, the recommended resolution became a binding compensation order on January 7, 1991. See NMSA 1978, § 52-5-5(C) (Repl.Pamp.1991). The lump sum settlement embodied in the order was paid to Worker in February 1991.
Worker had spinal fusion surgery on March 26, 1991, due to a herniated disc. Employer paid for this surgery. Worker’s recovery from surgery was unsuccessful, and she decided to have corrective surgery which did not take place until October 26, 1992. Employer refused to pay for the expenses related to her corrective surgery because the eighteen months of open medical coverage provided for in the order had expired.
Prior to the October 22, 1992 surgery, Worker filed a petition under Section 52-5-9 to modify the January 1991 compensation order. After a hearing, the WCJ entered an order concluding that the compensation order could not be reopened because Worker had not rejected the recommended resolution, nor had Worker filed a request within thirty days to have the recommended resolution set aside as allowed by Section 52-5-5.
DISCUSSION
On appeal, Worker contends that the two-year limitation period of Section 52-5-9(B), rather than the thirty-day period of Section 52-5-5(C), applies to the modification of a compensation order on the grounds of a change in condition. In Norman v. Lockheed Engineering & Science Co., 112 N.M. 618, 817 P.2d 1260 (Ct.App.1991), this Court discussed the relationship between Section 52-5-5 and Section 52-5-9. Specifically, Norman held that a party who fails to file a response to a recommended resolution is governed by the time limits of Section 52-5-5(C) when seeking to modify the compensation order based on mistake or excusable neglect. Norman, 112 N.M. at 622, 817 P.2d at 1264. However, this Court also indicated that when considering other grounds for modification under Section 52-5-9, excluding mistake or excusable neglect, the two-year limitation period of Section 52-5-9 applies as with any other compensation order. “[A] conclusively binding recommended resolution is tantamount to a compensation order for purposes of administrative review under Section 52-5-9.” Id. In reliance on Norman, we hold that since Worker seeks to modify the recommended resolution on the basis of her change in condition, that the two-year provision in Section 52-5-9(B) applies and not the shorter limitation period in Section 52-5-5(C).
Worker seeks to modify her recommended resolution by demonstrating a change in condition. Section 52-5-9(A) permits a WCJ to “terminate, continue, rein state, increase, decrease or otherwise properly affect compensation benefits ... or in any other respect ... modify any previous decision, award or action” upon any of the grounds set forth in Section 52-5-9(B). Section 52-5-9(B)(l) authorizes such review and modification of a compensation order on the grounds of “change in condition.” The term “change in condition” refers to a change in a worker’s medical or physical condition. See 3 Arthur Larson, The Law of Workmen’s Compensation § 81.31(a), at 15-988 (1994).
Employer disputes this authority to modify for a change in condition, citing this Court’s decision in Armijo v. Save ’N Gain, 108 N.M. 281, 771 P.2d 989 (Ct.App.1989), and Quintana v. Motel 6, Inc., 102 N.M. 229, 693 P.2d 597 (Ct.App.1984). We are not persuaded. Neither Armijo nor Quintana consider modification of a compensation order under Section 52-5-9. In Armijo, the worker sought reconsideration under Section 52-5-5(C), which, unlike Section 52-5-9, limits review of a binding recommended resolution to mistake or excusable neglect. Armijo, 108 N.M. at 286, 771 P.2d at 994. Quintana predates entirely the 1986 enactment of Section 52-5-9, and is also based upon an alleged mutual mistake of fact, namely the unknown consequences of a known injury, which did not justify setting aside a settlement. Quintana, 102 N.M. at 230-31, 693 P.2d at 598-99.
We note that the compensation order in this case was not preceded by an actual settlement agreement of the parties, approved by the WCJ, and entered on the record. Cf. Durham v. Gulf Interstate Eng’g Co., 74 N.M. 277, 282-83, 393 P.2d 15, 19 (1964) (under former law, prior settlement agreement approved by court and followed by execution of full release could not be reopened under Rule 60(B)). But see Glover v. Sherman Power Tongs, 94 N.M. 587, 589, 613 P.2d 729, 731 (Ct.App.) (Durham limited to “rare circumstances”), cert. denied, 94 N.M. 675, 615 P.2d 992 (1980). There were no releases executed by the parties. We express no opinion on the outcome under those circumstances.
In the present ease, Worker did not even formally accept the recommended resolution; she simply declined to reject it, which makes it a compensation order by operation of law. See Section 52-5-5(0; Norman, 112 N.M. at 622, 817 P.2d at 1264. Recent decisions of this Court indicate that a compensation order is modifiable under Section 52-5-9 even when premised on a lump sum settlement agreement. See Curliss v. B & C Auto Parts, 116 N.M. 668, 670, 866 P.2d 396, 398 (Ct.App.1993) (lump sum settlement agreement could be modified under grounds set forth in Section 52-5-9); Bustamante v. City of Las Cruces, 114 N.M. 179, 181, 836 P.2d 98, 100 (Ct.App.) (lump sum settlement agreement approved by WCJ could be modified under grounds set forth in Section 52-5-9), cert. denied, 114 N.M. 82, 835 P.2d 80 (1992). Although no case has yet expressly approved modification of a compensation order resulting from a settlement conference on the specific grounds of a “change in condition,” we think this follows from the policy considerations articulated in these cases. As this Court has previously stated: “‘[Compensation cases balance the need for finality and judicial efficiency against the need for continuing jurisdiction to effectuate the purposes of the act and to accommodate changes in earning capacity.’ ” Bustamante, 114 N.M. at 181, 836 P.2d at 100 (quoting St. Clair v. County of Grant, 110 N.M. 543, 549-50, 797 P.2d 993, 999-1000 (Ct.App.1990) (citation omitted)). Therefore, we hold that a compensation order may be modified under the change in condition criteria of Section 52-5-9(B)(l), even where the compensation order is the result of a recommended resolution following a settlement conference.
CHANGE IN CONDITION
Worker also asserts that we should decide whether the deterioration in her condition, requiring multiple surgeries, constitutes a “change in condition” pursuant to Section 52-5-9. We will not determine whether there was in fact a change in condition; we leave that for the WCJ on remand. See Walker v. L.G. Everist, Inc., 102 N.M. 783, 791, 701 P.2d 382, 390 (Ct.App.), cert. denied, 105 N.M. 94, 728 P.2d 845 (1985).
CONCLUSION
We reverse the WCJ’s Order of Dismissal and Order Granting Summary Judgment and remand to the Workers’ Compensation Administration on the issue of whether Worker can demonstrate a change in condition under Section 52-5-9(B)(l).
jrp jg gQ ORDERED,
APODACA, C.J., and BLACK, J., concur, | [
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] |
OPINION
WOOD, Judge.
Convicted of burglary and larceny under $100.00, defendant appeals, contending his trial was delayed so long that he was entitled to dismissal of the charges. We discuss (1) speedy trial, and (2) NMSA 1978, Crim.P. Rule 37.
Speedy Trial
The indictment was filed October 13, 1982; the trial began January 4, 1984. The speedy trial claim is not based on the time lapse between these dates. Rather, the claim is based on the time lapse between arraignment on October 25, 1982 and October 5, 1983. The October 5, 1983 date is the termination date of the speedy trial claim because that was an available trial date which defendant declined. In addition, a substantial portion of the trial delay after October 5, 1983 is attributable to defendant’s non-cooperation in connection with an examination by a psychiatrist. See State v. Mascarenas, 84 N.M. 153, 500 P.2d 438 (Ct.App.1972).
The eleven and one-half months involved in the speedy trial claim was presumptively prejudicial and this triggered an inquiry into the four factors which must be balanced in deciding a speedy trial issue. State v. Johnston, 98 N.M. 92, 645 P.2d 448 (Ct.App.1982); State v. Tafoya, 91 N.M. 121, 570 P.2d 1148 (Ct.App.1977). Those four factors are length of delay, reason for the delay, defendant’s assertion of the right and prejudice to the defendant. State v. Tafoya.
As we explain in discussing the issue under Crim.P. Rule 37, the delay and the reason for the delay are the state’s responsibility. Defendant, however, raised no speedy trial issue until his motion to dismiss, filed September 6,1983, one month before the expiration of the time period on which defendant relies. Barker v. Wingo, 407 U.S. 514, 531-32, 92 S.Ct. 2182, 2192-93, 33 L.Ed.2d 101 (1972) states:
Whether and how a defendant asserts his right is closely related to the other factors we have mentioned. The strength of his efforts will be affected by the length of the delay, to some extent by the reason for the delay, and most particularly by the personal prejudice, which is not always readily identifiable, that he experiences. The more serious the deprivation, the more likely a defendant is to complain. The defendant’s assertion of his speedy trial right, then, is entitled to strong evidentiary weight in determining whether the defendant is being deprived of the right. We emphasize that failure to assert the right will make it difficult for a defendant to prove that he was denied a speedy trial.
The claim of prejudice stated in defendant’s brief is: “[A] Dr. Litman, who examined the Appellant on January 4, 1983 * * would have been able to offer information regarding the Appellant’s mental state, which was placed at issue by Appellant’s Trial counsel.” The contention is that Dr. Litman saw and examined defendant on January 4 and March 4, 1983 at the penitentiary; that counsel learned, on September 1, 1983, that defendant might be a schizophrenic; that counsel attempted to telephone Dr. Litman on September 22, 1983 and was informed that Dr. Litman no longer worked at the penitentiary; that Dr. Litman was working in Washington, D.C. and that the penitentiary did not have Dr. Litman’s address or telephone number in Washington, D.C. Counsel’s affidavit asserts “Dr. Litman could have testified as to Mr. Romero’s mental state immediately after the arrest of Mr. Romero on the above-styled Indictment.”
The claim of prejudice goes to the defense of insanity at the time of commission of the offenses and inability of defendant to form a specific intent. These defenses were first asserted by pleadings filed September 12, 1983. See NMSA 1978, Crim. P.R. 35(a) and (e) (Cum.Supp.1984). We assume (the record is silent) that Dr. Lit-man was a person qualified to testify as to defendant’s mental condition. There is nothing indicating to what Dr. Litman would testify; there is nothing indicating that Dr. Litman’s notes could not be obtained from penitentiary officials; there is nothing indicating that Dr. Litman (who we assume is a mental health professional) could not be located in Washington, D.C., or that counsel made any effort to locate him; and no more than a suggestion that similar information could not be obtained from other mental health professionals. The entire claim is based on no more than the possibility of prejudice. See State v. Powers, 97 N.M. 32, 636 P.2d 303 (Ct.App.1981).
Balancing defendant’s delay in asserting his right to a speedy trial and his speculative showing that the absence of Dr. Lit-man might prejudice the defense against the state’s responsibility for the delay of eleven and one-half months, the trial court did not err in denying the motion to dismiss for lack of a speedy trial.
Criminal Procedure Rule 37
The indictment was filed on October 13, 1982. The applicable provisions of Crim.P. Rule 37 are the provisions of the rule as amended by the supreme court by order dated December 31, 1981 for cases filed on or after February 1, 1982. (See Judicial Pamphlet 6, Special Supplement for Amendments from July 1,1981 through January 1, 1982.) The applicable provisions state:
(b) Time limits for commencement of trial. The trial of a criminal case or an habitual criminal proceeding shall be commenced six months after whichever of the following events occurs latest:
(1) the date of arraignment, or waiver of arraignment, in the district court of any defendant;
* * * * * *
(5) the date of arrest of the defendant after conditions of release have been revoked for failure to appear as required[.]
The applicable rule provided for extensions of time (Crim.P.R. 37(c)), but there were no extensions in this case. The rule (Crim.P.R. 37(d)) provided for dismissal with prejudice if there had been no extensions of time and the trial did “not commence within the time specified in Paragraph (b) * *
The trial, which began January 4, 1984, did not commence within six months of the arraignment on October 25, 1982. The violation of Crim.P. Rule 37(b)(1) is not disputed. The trial court denied defendant’s pretrial motion to dismiss on the basis of Crim.P. Rule 37(b)(5).
On the date of arraignment, October 25, 1982, the trial court signed a release order. This order provided that “defendant * * * be released” upon compliance “with the conditions checked”. The checked conditions provided for defendant’s release upon execution of a bond, either cash or security, in the amount of $10,000.00. Defendant never posted this bond; he was never released. Defendant was continuously incarcerated on the charges in this case, and also incarcerated because of other matters, from the time of his arrest on the charges in this case.
The indictment charged that burglary and larceny offenses were committed on or about September 29,1982. The record indicates that defendant was arrested on either September 28 or 29, 1982. Prom the date of arrest, defendant’s incarceration record was:
(a) Bernalillo County Detention Center from September 28 or 29 to December 3, 1982.
(b) Reception and Diagnostic Center, Los Lunas, from December 3, 1982 to January 4, 1983. Defendant's parole, on another matter, was revoked on December 28,1982.
(c) Penitentiary of New Mexico, Santa Fe, from January 4, 1983 to June 17, 1983.
(d) Forensic Treatment Center, Las Vegas, from June 17, 1983.
On December 17, 1982, at a time when defendant was at the Los Lunas facility, the state moved that the trial court reconsider defendant’s conditions of release, alleging that defendant’s whereabouts were “presently unknown to the State and the Defense” and that defendant had “made himself unavailable to his attorney * * *.” The motion was heard on January 3, 1983; defendant was not present. The conditions of release were revoked “for failure to appear as required.” A bench warrant was issued on January 5, 1983; it ordered defendant’s arrest for failure to appear for the motion hearing of January 3, 1983.
Defendant was arrested in Albuquerque, while in the custody of the Forensic Treatment Center, on August 3, 1983. Thereafter he remained in the custody of the Bernalillo County Detention Center.
The trial court denied defendant’s motion to dismiss on the basis that his failure to appear on January 3, 1983 tolled the running of time under Crim.P. Rule 37, and that the time did not begin to run until defendant’s arrest on August 3, 1983. The trial court’s view was that defendant should have kept his attorney advised of his whereabouts, and that defendant could not get himself into the custody of the state and then claim that custody excused defendant from being present in court.
The state seeks to uphold the trial court’s ruling, but cites State v. Franklin, 78 N.M. 127, 428 P.2d 982 (1967); thus the state defends the trial court’s ruling whether or not the state feels that the ruling is defensible. We have reviewed the various contentions pursuant to State v. Maes, 100 N.M. 78, 665 P.2d 1169 (Ct.App.1983). We identify and answer the contentions in the following numbered paragraphs.
(1) State v. Flores, 99 N.M. 44, 653 P.2d 875 (1982), is not applicable. Flores dealt with the release of an accused in violation of the trial court’s order that the accused be detained on the pending charges until further order of the court. Flores was released on October 22, 1981; his failure to appear in court for a pretrial conference occurred on November 16, 1981 when he was not in custody. The state’s prior error in releasing Flores did not excuse Flores’ “failure to appear” when not in custody. Defendant has been in the state’s custody at all pertinent times.
(2) The trial court’s release order provided that defendant was not to leave Bernalillo County without permission of the trial court and provided that defendant was to keep his attorney informed of his whereabouts. These provisions were conditions of release. “The whole purpose for ‘conditions of release’ is to place limitations on a person not in custody.” State v. Flores, 99 N.M. at 46, 653 P.2d 875 (emphasis in original). Inasmuch as defendant was in custody at all pertinent times, the conditions of release are not applicable.
(3) Crim.P. Rule 37(b)(5) is concerned with arrest after conditions of release have been revoked for failure to appear as required. Here, conditions of release were revoked, but those conditions were not applicable because defendant was never released from custody. Utilization of non-applicable conditions of release to extend the time period for commencing trial is the type of technicality condemned in State v. Flores, which stated: “[N]o warrant could have been issued for the violation of nonexistent conditions of release.” Id., 99 N.M. at 46, 653 P.2d 875. Crim.P. Rule 37(b)(5) is not applicable because defendant never failed to appear as required by any operative condition of release.
■ (4) The prosecutor did not know the whereabouts of defendant. However, defendant was available to the state because defendant was in the state’s custody. See State v. Lucero, 91 N.M. 26, 569 P.2d 952 (Ct.App.1977). There is nothing indicating the prosecutor made any effort to learn of defendant’s whereabouts and there is nothing indicating the prosecutor could not have learned of defendant’s whereabouts if the prosecutor had proceeded with reasonable diligence. State v. Hernandez, 97 N.M. 28, 636 P.2d 299 (Ct.App.1981).
Crim.P. Rule 37(b)(5) being inapplicable and the violation of Crim.P. Rule 37(b)(1) being undisputed, defendant’s convictions in this case are reversed. The cause is remanded to the trial court to dismiss the indictment with prejudice. State v. Lucero.
IT IS SO ORDERED.
HENDLEY and ALARID, JJ., concur. | [
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OPINION
WECHSLER, Judge.
Helen Fuentes (Worker) filed for workers’ compensation benefits against the Santa Fe Public Schools (Employer) in connection with an injury she sustained in the course and scope of her employment. The Workers’ Compensation Administration (WCA) ruled against her claim, and she appeals.
The issues on appeal are: (1) whether Employer’s failure to pay Worker temporary disability benefits triggered the running of the statute of limitations for a permanent disability claim; and (2) whether Worker preserved the limitations issue. We hold that the statute of limitations was not triggered and that Worker adequately preserved the limitations issue. Accordingly, we reverse.
FACTS
Worker was injured on January 3,1991, in an accident arising out of her employment with Employer. She took four and one-half days of sick leave from January 4 to January 11, 1991. Employer failed or refused to pay Worker compensation benefits for this period. Between January 14 and August 13, 1991, Employer and its insurer paid workers’ compensation benefits. Worker worked part-time for Employer, from February 28, 1991 through August 12, 1991. On August 13, 1991, Worker returned to full-time employment with Employer at her pre-injury wage and was able to perform all her previous duties. Since then, she has continued to be able to perform all her duties, both with Employer and with a subsequent employer in a similar position, except for one day in March 1992 and three days in March 1993. Employer failed or refused to pay compensation benefits for those four days. On July 26, 1993, Worker reached maximum medical improvement (MMI). Since that time (and even since August 13, 1991), she has been earning at least as much as her pre-injury wage.
On May 27, 1993, Worker filed a claim for both temporary total disability and permanent partial disability benefits. The Workers’ Compensation Judge (WCJ) found that Worker had been temporarily totally disabled from January 3, 1991 to August 13, 1991, and during the periods in March 1992 and March 1993 when she could not perform her duties. The WCJ further found that, as of July 26, 1993, Worker had a permanent partial disability with an impairment of 11%. However, the WCJ denied Worker’s permanent disability claim because Worker had failed to timely claim the temporary disability benefits to which she was entitled.
Worker appeals only the denial of her permanent disability claim. Therefore, we will not consider the merits of her claim for temporary total disability.
DISCUSSION
I. Statute of Limitations
The limitations provision of the Workers’ Compensation Act (the Act) states in pertinent part:
A. If an employer or his insurer fails or refuses to pay a worker any installment of compensation to which the worker is entitled under the Workers’ Compensation Act ... it is the duty of the worker insisting on the payment of compensation to file a claim ... not later than one year after the failure or refusal of the employer or insurer to pay compensation. This one-year period of limitations shall be tolled during the time a worker remains employed by the employer by whom he was employed at the time of such accidental injury, not to exceed a period of one year. If the worker fails ... to file a claim for compensation within the time required by this section, his claim for compensation, all his right to the recovery of compensation and the bringing of any proceeding for the recovery of compensation are forever barred.
NMSA 1978, § 52-1-31 (A) (Repl.Pamp.1991). Employer asks us to construe this provision in accordance with the ordinary meaning of its language. According to Employer’s argument, because Employer failed or refused to pay compensation benefits in January 1991 and March 1992, which benefits can be considered installments within the meaning of the Act, the statute of limitations on Worker’s claim for permanent partial disability benefits began to run in January 1991. If that were the case, the statute of limitations would have expired no later than November 1992 (one year after Worker left her employment with Employer).
Worker asks that we apply Zengerle v. City of Socorro, 105 N.M. 797, 737 P.2d 1174 (Ct.App.1986), cert. quashed, 105 N.M. 781, 737 P.2d 893 (1987), overruled by Whittenberg v. Graves Oil & Butane Co., 113 N.M. 450, 827 P.2d 838 (Ct.App.1991), cert. denied, 113 N.M. 352, 826 P.2d 573 (1992), to the facts of this ease. She also asks that we either find Whittenberg inapplicable or overrule Whittenberg. Zengerle held that the statute of limitations for a compensation claim for permanent total disability benefits is not triggered by a temporary disability after which the worker is able to return to work without a measurable reduction in his or her capacity to perform pre-injury duties. Zengerle, 105 N.M. at 802, 737 P.2d at 1179. Whittenberg overruled Zengerle, rejecting the notion that temporary and permanent disability are meaningfully distinguishable for purposes of the statute of limitations. Whittenberg, 113 N.M. at 454, 827 P.2d at 842. Both Zengerle and Whittenberg were based on statutes that were in effect prior to 1991.
A 1990 amendment to the Act revised the definition of permanent partial disability. The earlier version of the Act defined both temporary and permanent disability in terms of a worker’s capacity to perform his or her duties. NMSA 1978, § 52-l-26(B), (C) (Repl.Pamp.1991) (effective until January 1, 1991). Under the new version, temporary disability is still defined in terms of capacity. NMSA 1978, § 52-1-25.KA) (Repl.Pamp.1991) (effective January 1, 1991). On the other hand, the definition of permanent partial disability depends on whether the worker is earning more or less than the preinjury wage at the time he or she reaches MMI. If the worker is earning less, permanent partial disability is calculated as a percentage based on impairment as well as a number of factors which relate to the worker’s ability to perform work. NMSA 1978, § 52-l-26(C) (Repl.Pamp.1991) (effective January 1,1991); see also Leo v. Cornucopia Restaurant, 118 N.M. 354, 357-58, 881 P.2d 714, 717-18 (Ct.App.), cert. denied, 118 N.M. 430, 882 P.2d 21 (1994). However, if the worker is earning as much or more than the pre-injury wage, permanent partial disability is defined solely in terms of impairment, which is determined using medical standards. NMSA 1978, § 52-l-24(A) (Repl.Pamp.1991) (effective January 1, 1991); Section 52-1-26(D).
Although Worker was earning at least as much as her pre-injury wage after reaching MMI, we do not think that the circumstances of this case require us to revisit Whittenberg. Instead, we decide this case in favor of Worker based on our belief that the installments of compensation that Employer failed or refused to pay were de minimis.
The doctrine of de minimis is used to avoid unjust results in cases where an error, violation of a law or regulation, or failure to comply with certain requirements is so minor as to not justify drastic legal consequences of the error, violation, or failure. See, e.g., Wisconsin Dep’t of Revenue v. William Wrigley, Jr., Co., 505 U.S. 214, 231-233, 112 S.Ct. 2447, 2457-58, 120 L.Ed.2d 174 (1992) (“[T]he venerable maxim de minimis non curat lex (‘the law cares not for trifles’) is part of the established background of legal principles against which all enactments are adopted, and which all enactments (absent contrary indication) are deemed to accept.”); K.L. Conwell Corp. v. City of Albuquerque, 111 N.M. 125, 130, 802 P.2d 634, 639 (1990) (de minimis defective compliance with a contractual requirement should not defeat the entire contract); Hardware Mut. Casualty Co. v. Industrial Comm’n, 19 Ariz.App. 524, 527, 508 P.2d 1168, 1171 (1973) (overpayment by fifteen cents in worker’s compensation monthly benefits because of hearing officer’s miscalculations deemed de minimis); Gardner v. Van Buren Pub. Sch., 445 Mich. 23, 517 N.W.2d 1, 7 (1994) (claimant in a workers’ compensation case must show more than a de minimis connection between disability and injury); Viera v. Level Line, Inc., 276 N.J.Super. 646, 648 A.2d 748, 753 (Ct.App.Div.1994) (same); Patitucci v. Boise Cascade Corp., 8 Or.App. 503, 495 P.2d 36, 38 (1972) (same).
In Stolworthy v. Morrison-Kaiser F & S, 72 N.M. 1, 3, 380 P.2d 13, 14 (1963), our Supreme Court suggested that the employer’s failure to pay two days of compensation benefits was de minimis, although the Court ruled that the worker was entitled to those payments. In that case, the employer was not severely prejudiced by having to pay the small amount of money in question. In contrast, Worker in this case stands to lose permanent disability benefits because of a failure to sue Employer for five and one-half days of temporary disability benefits.
In situations such as the one at bar, it might simply not be worthwhile to a worker to file a minor claim, and legal counsel may not be available to handle such a claim. In the present ease, Worker chose to take sick leave for four and one-half days in January 1991 rather than claim compensation benefits for that period, which would have amounted to only two-thirds her normal salary. She also missed one day of work in March 1992 and was refused compensation benefits for that day.
In interpreting the limitations provision, we are guided by the intent of the legislature. We agree with Worker that the legislature could not have intended to require a worker to make every possible claim for temporary disability benefits, no matter how minor, to preserve a possible claim for future benefits. We note that the legislature decided to disallow compensation benefits in cases in which a disability lasts for seven days or less. NMSA 1978, § 52-1-40 (Repl. Pamp.1991). We view this statutory provision as an indication that the legislature considers seven days of compensation benefits to be de minimis. In this case, Worker failed to file a claim for five and one-half days of benefits within the period of limitations for filing such claims. Under the de minimis principle, the statute of limitations does not bar Worker from claiming subsequent disability benefits despite her failure to file the temporary disability claims.
II. Preservation
Employer contends that Worker waived the right to challenge the WCJ’s finding regarding the expiration of the statute of limitations because Worker actually requested that finding. Worker never filed requested findings of fact and conclusions of law, but rather submitted a compensation order that reflected the decision the WCJ had already made in his dismissal order. As Employer points out, SCRA 1986, 1 — 052(B)(1)(f) (Repl. 1992), provides that specific findings and conclusions not requested by a party will be waived. While this rule is a district court rule applicable to non-jury trials, it applies equally to workers’ compensation hearings. NMSA 1978, § 52-5-8(B) (Repl.Pamp.1991); Pennington v. Chino Mines, 109 N.M. 676, 678, 789 P.2d 624, 626 (Ct.App.1990). However, the rule does not prevent this Court from reviewing the WCJ’s “findings of fact and conclusions of law to determine whether the conclusions appropriately flowed from the findings of fact made.” Thomas v. City of Santa Fe, 112 N.M. 456, 459, 816 P.2d 525, 528 (Ct.App.), cert. denied, 112 N.M. 308, 815 P.2d 161 (1991); see also Blea v. Sandoval, 107 N.M. 554, 556-57, 761 P.2d 432, 434-35 (Ct.App.), cert. denied, 107 N.M. 413, 759 P.2d 200 (1988).
The parties in this case do not contest the findings of fact that bear on the question of the running of the statute of limitations. The question itself is a purely legal one. Worker adequately preserved the question below during closing argument. Therefore, we have properly considered the limitations issue.
CONCLUSION
The WCA’s decision against Worker’s claim for permanent partial disability is hereby reversed and remanded for a determination of Worker’s benefits.
IT IS SO ORDERED.
A. JOSEPH ALARID, and BRUCE D. BLACK, JJ., concur. | [
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] |
OPINION
DONNELLY, Chief Judge.
On rehearing, the previous opinion is withdrawn and the following is substituted.
Defendant, convicted after a jury trial of two counts of resisting, evading or obstructing an officer contrary to NMSA 1978, Section 30-22-1 (Repl.Pamp.1984), appeals Count I of his convictions. Defendant contends this conviction is in violation of the double jeopardy clause of the federal and state constitutions. Defendant has not appealed his conviction under Count II of the criminal information. We affirm.
This is the second time defendant’s case has come before us. Following defendant’s first trial, the jury returned a verdict acquitting him of one count of aggravated assault on a peace officer, and convicting him on one count of battery upon a peace officer. On appeal, this court reversed the battery conviction, determining' that defendant was denied his right to counsel at the preliminary hearing. This denial of counsel resulted in this court’s determination that the magistrate court lacked jurisdiction to conduct the preliminary hearing; thus, it was as though no preliminary hearing had been held and defendant’s conviction under Count II was void. See State v. Hamilton, 104 N.M. 614, 725 P.2d 590 (Ct.App.1986) (Hamilton I).
On remand, defendant was recharged by a new criminal information with the identical offenses which had been asserted against him at his first trial: Count I, aggravated assault on a peace officer, contrary to NMSA 1978, Section 30-22-22(A)(1), and Count II, battery upon a peace officer, contrary to NMSA 1978, Section 30-22-24. Defendant objected to being retried on the first count, arguing that his reprosecution was subject to dismissal based upon double jeopardy grounds. The trial court denied defendant’s motion to dismiss.
At the conclusion of defendant’s second trial, defendant requested the trial court instruct the jury that resisting, evading or obstructing an officer was a lesser included offense of aggravated assault upon a peace officer. The trial court granted the request and the jury returned verdicts finding defendant guilty on each of the reduced counts of resisting, evading or obstructing an officer.
I. ISSUE OF DOUBLE JEOPARDY
Defendant argues that the second indictment and his retrial under Count I, for aggravated assault upon a peace officer, following a prior acquittal for the same offense, placed him in double jeopardy in violation of the federal and state constitutions. Defendant maintains that resisting, evading or obstructing an officer is a lesser included offense of aggravated assault upon a peace officer. Defendant also contends that because he was acquitted of the greater offense at his first jury trial, he may not be reprosecuted for the same or any lesser charge arising out of the same incident. The state, however, asserts that defendant’s conviction for resisting, evading or obstructing an officer under Count I does not violate the double jeopardy clause because it is neither the same nor a lesser included offense of aggravated assault on a peace officer. Alternatively, the state argues that because Hamilton I held that the district and magistrate courts lacked jurisdiction over the defendant, this ruling had the concomitant effect of also voiding the verdict of acquittal. Thus, the state contends that defendant was subject to retrial on Count I at a subsequent retrial.
The fifth amendment to the United States Constitution states that no person shall “be subject for the same offense to be twice put in jeopardy of life or limb.” U.S. Const., amend. V. See N.M. Const, art. II, § 15. The fifth amendment is applicable to the states through the fourteenth amendment. State v. Manzanares, 100 N.M. 621, 674 P.2d 511 (1983), cert. denied, 471 U.S. 1057, 105 S.Ct. 2123, 85 L.Ed.2d 487, reh’g denied, 472 U.S. 1013, 105 S.Ct. 2715, 86 L.Ed.2d 729 (1985). The double jeopardy clause affords a defendant protection against a second prosecution for the same offense after acquittal, protection against a second prosecution for the same offense after conviction, and protection against multiple punishments for the same offense. See Ohio v. Johnson, 467 U.S. 493, 104 S.Ct. 2536, 81 L.Ed.2d 425, reh’g denied, 468 U.S. 1224, 105 S.Ct. 20, 82 L.Ed.2d 915 (1984); United States v. Nichols, 741 F.2d 767, reh’g & reh’g en banc denied, 746 F.2d 812 (5th Cir.1984), cert. denied, 469 U.S. 1214, 105 S.Ct. 1186, 84 L.Ed.2d 333 (1985).
Both the history of the double jeopardy clause and its terms demonstrate, however, that it is not applicable until a proceeding begins before a trier “having jurisdiction to try the question of the guilt or innocence of the accused.” Serfass v. United States, 420 U.S. 377, 391, 95 S.Ct. 1055, 1064, 43 L.Ed.2d 265 (1975) (quoting Kepner v. United States, 195 U.S. 100, 133, 24 S.Ct. 797, 806, 49 L.Ed. 114 (1904)). See Daniel v. Warden, State Correction Institution, 794 F.2d 880 (3rd Cir.1986). The United States Supreme Court held in United States v. Ball, 163 U.S. 662, 669,16 S.Ct. 1192, 1194, 41 L.Ed. 300 (1896), “[a]n acquittal before a court having no jurisdiction is, of course, like all the proceedings in the case, absolutely void, and therefore no bar to subsequent indictment and trial in a court which has jurisdiction of the of-fence.” See United States v. Sabella, 272 F.2d 206 (2nd Cir.1959); Application of Alexander, 80 Nev. 354, 393 P.2d 615 (1964). See generally 16 Rutgers L.Rev. 597 (1962); Annotation, Conviction or Acquittal of One Offense, in Court Having No Jurisdiction to Try Offense Arising Out of Same Set of Facts, Later Charged in Another Court, as Putting Accused in Jeopardy of Latter Offense, 4 A.L.R.3d 874 (1965).
In sum, jurisdiction is essential before jeopardy attaches. State v. Mahlandt, 231 Kan. 665, 647 P.2d 1307 (1982). See State v. Peavler, 88 N.M. 125, 537 P.2d 1387 (1975); State v. Paris, 76 N.M. 291, 414 P.2d 512 (1966). Cf. Trujillo v. State, 79 N.M. 618, 447 P.2d 279 (1968).
Under the facts before us, defendant’s acquittal in a court lacking proper jurisdiction did not violate the constitutional prohibitions against double jeopardy and, therefore, did not bar retrial.
II. PROPRIETY OF DEFENDANT’S CONVICTION
Defendant argues that even if his retrial was not barred by the double jeopardy clause, nevertheless, his conviction for resisting, evading or obstructing an officer was improper because he was not charged in the criminal information with such charge and the charge is not a lesser included offense of aggravated assault on a peace officer. See NMSA 1978, § 30-22-22. Cf. SCRA 1986, 14-2202 & -2215.
An “included offense” is one which has some, but not all, of the elements of the greater offense and does not have any elements not included in the greater offense, so that it is impossible to commit the greater offense without necessarily also committing the included offense. State v. Ross, 104 N.M. 23, 715 P.2d 471 (Ct.App.1986); State v. Muise, 103 N.M. 382, 707 P.2d 1192 (Ct.App.1985). See State v. Simonson, 100 N.M. 297, 669 P.2d 1092 (1983); State v. Patterson, 90 N.M. 735, 568 P.2d 261 (Ct.App.1977). To determine whether an offense is a lesser included offense, it is necessary to look to the nature of the offense charged to the indictment or information. State v. Alderete, 91 N.M. 373, 574 P.2d 592 (Ct.App.1977); State v. Medina, 87 N.M. 394, 534 P.2d 486 (Ct.App.1975).
The trial court’s jury instruction No. 5, on resisting, evading or obstructing an officer, followed UJI 14-2215, stating:
For you to find the defendant guilty of resisting, evading or obstructing an officer, the [sjtate must prove to your satisfaction beyond a reasonable doubt each of the following elements of the crime:
1. Gary Graves was a peace officer in the lawful discharge of his duties; and
2. The defendant, with the knowledge that Gary Graves was attempting to apprehend or arrest him, fled, attempted to evade, or evaded the officer;
3. This happened in New Mexico, on or about the 5th day of October, 1984. [Emphasis supplied.]
The crime of resisting, evading or obstructing an officer as set forth in Section 30-22-1, contains several alternative means by which the offense may be committed. A defendant’s act of fleeing, attempting to evade or evading an officer constitutes one of the alternative methods of committing the offense proscribed under Section 30-22-1. See § 30-22-l(B). When an accused is charged, however, with this method of resisting, evading or obstructing an officer, it is not a lesser included offense of aggravated assault upon a peace officer. Aggravated assault on a peace officer, as charged herein, does not require proof that defendant fled, attempted to evade or evaded the officer, or that defendant had “knowledge” that the officer was attempting to arrest him. See § 30-22-22; see also SCRA 1986, 14-2202. Compare Reese v. State, 106 N.M. 498, 745 P.2d 1146 (1987). It is improper to instruct the jury as to a crime not formally charged if the offense is not a lesser included offense of the crime which is charged. See State v. Trivitt, 89 N.M. 162, 548 P.2d 442 (1976); State v. Patterson. But see State v. Ross, 100 N.M. 48, 665 P.2d 310 (Ct.App.1983).
Defendant, however, overlooks the fact that he requested that the trial court instruct upon the offense of resisting, evading or obstructing an officer. New Mexico courts have repeatedly held that the defendant cannot be heard to complain if the trial court instructed the jury as he desired. See State v. Boeglin, 105 N.M. 247, 731 P.2d 943 (1987) (defendant knowingly, intelligently, and voluntarily waived his right to have the jury instructed on a lesser included offense where he requested the court not give the instruction); State v. Padilla, 104 N.M. 446, 722 P.2d 697 (Ct.App.1986) (defendant’s conviction of voluntary manslaughter, under instruction of voluntary manslaughter as a lesser included offense of murder, which instruction was given at defendant’s request, did not amount to fundamental error even though the evidence did not support such an instruction); State v. Ross (defendant who urged court to adopt an instruction on the basis that such offense was a lesser included offense on the crime charged may not claim on appeal that his conviction of the lesser offense, based on substantial evidence, was error). An instruction not objected to and which was requested by defendant becomes the law of the case. State v. Ross. As observed in Ross the defendant having urged the trial court to adopt an instruction which he successfully contended in the court below constituted a lesser included offense, will not be heard on appeal to complain that the trial court erred in granting his request. Id.
Moreover, defendant has not argued that the giving of the instruction sought by him on resisting, evading or obstructing an officer prejudiced him in the defense of his case, or that he did not have proper notice concerning this charge. A variance between the crime charged and the offense for which defendant was convicted will not be deemed to be fatal unless the defendant could not reasonably have anticipated from the indictment or information, the nature of the charges and proof against him. SCRA 1986, 5-204(C); State v. Ross.
Therefore, we determine that the defendant was properly convicted of resisting, evading or obstructing an officer, because the evidence supported the verdict of the jury to that charge, and his opportunity to prepare and defend against the charge was not impaired by the fact that such offense varied from the crime charged in the criminal information.
Defendant’s conviction of resisting, evading or obstructing an officer is affirmed.
IT IS SO ORDERED.
ALARID and FRUMAN, JJ., concur. | [
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OPINION
ALARID, Judge.
The State appeals from orders dismissing supplemental informations which charge defendant with being an habitual offender. The appeals were consolidated because they involve the same issue, namely, whether a proceeding in another state in which the defendant pleads guilty, but where no adjudication of guilt is entered, may be considered a “conviction” for purposes of New Mexico’s Habitual Offender Act. NMSA 1978, Sections 31-18-17 through 31-18-20 (Cum.Supp.1983). We affirm.
In cause No. 7391 defendant pled guilty in Curry County (No. 83-CR-9071) to residential burglary and was sentenced to a term of six years, which was to run concurrently with an eighteen month sentence imposed in Roosevelt County (No. 83-CR-11), where defendant pled guilty to unlawfully taking a motor vehicle (No. 7446). In both causes, the district attorney filed supplemental informations, charging defendant as an habitual offender based on his guilty pleas in the respective cases and on a previous Texas “conviction.” Defendant moved to dismiss both supplemental informations on the ground that the prior Texas proceedings did not result in a conviction upon which an enhanced sentence could be based. In both cases (Nos. 7391 and 7446), the trial judge dismissed the supplemental informations, finding that under Texas law defendant’s previous plea did not result in an adjudication of guilt, and, therefore, no conviction was had. It is from the court’s dismissals of the supplemental informations that the State appeals.
New Mexico provides for increasing the basic sentence for those who have been determined to be habitual offenders. § 31-18-17. Section 31-18-17(A) of the Act provides that a “prior felony conviction” means:
(2) any prior felony for which the person was convicted other than an offense triable by court-martial if:
(a)the conviction was rendered by a court of another state, the United States, a territory of the United States or the commonwealth of Puerto Rico;
(b) the offense was punishable, at the time of conviction, by death, or a maximum term of imprisonment of more than one year; or
(c) the offense would have been classified as a felony in this state at the time of conviction.
(Emphasis added.) See State v. Harris, 101 N.M. 12, 677 P.2d 625 (Ct.App.1984) for an interpretation of Section 31-18-17(A)(2). If the Texas offense in this case constitutes a conviction, the matter would clearly fall within either Section 31-18-17(A)(2)(b) or (c). The sole issue we consider is whether the Texas matter may be properly classified as a “conviction” for purposes of the Act.
Tex.Code Crim.Proc.Ann. art. 42.12, § 3d(a) (Vernon 1979), provides:
Sec. 3d. (a) When in its opinion the best interest of society and the defendant will be served, the court may, after receiving a plea of guilty or plea of nolo contendere, hearing the evidence, and finding that it substantiates the defendant’s guilt, defer further proceedings without entering an adjudication of guilt, and place the defendant on probation on reasonable terms and conditions as the court may require and for a period as the court may precribe [sic] not to exceed 10 years. However, upon written motion of the defendant requesting final adjudication filed within 30 days after entering such plea and the deferment of adjudication, the court shall proceed to final adjudication as in all other cases.
Under the provisions of this statute, adjudication of guilt is deferred until after probation is revoked. Texas courts hold that because no adjudication of guilt is entered, the trial court’s action in deferring proceedings is not deemed a “conviction.” Ex Parte Shillings, 641 S.W.2d 538 (Tex.Cr.App.1982); McNew v. State, 608 S.W.2d 166 (Tex.Cr.App.1978). Proceedings under Article 42.12, Section 3d(a) have been characterized as “informal administrative pro ceedings,” and as such, the order of deferral is not considered to reflect a finding of guilt beyond a reasonable doubt. Baehr v. State, 615 S.W.2d 713 (Tex.Cr.App.1981).
The State points out that even when no judgment has been entered, or no sentence has been imposed, sentences for subsequent crimes may be enhanced by virtue of the guilty pleas entered. State v. Tipton, 77 N.M. 1, 419 P.2d 216 (1966); French v. Cox, 74 N.M. 593, 396 P.2d 423 (1964). Likewise, under federal law, a guilty plea constitutes a conviction. See Dickerson v. New Banner Institute, Inc., 460 U.S. 103, 103 S.Ct. 986, 74 L.Ed.2d 845 (1983). However, such is not the situation under Texas law. There was no conviction.
Section 31-18-17(A)(2)(a) requires that a conviction be rendered by a court of another state. The record in this ease is clear that Texas deferred not only the sentence here but also the adjudication of guilt. There is no indication in the record of any conviction rendered by the court of any other state. We find no “conviction rendered” and, therefore, the proceeding in Texas cannot be used in New Mexico to enhance the defendant's sentence. The trial court acted properly in dismissing the supplemental informations.
We have considered the State’s other arguments and find them to be without merit. The judgment is affirmed.
IT IS SO ORDERED.
DONNELLY, C.J., and HENDLEY, J„ concur. | [
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] |
OPINION
FEDERICI, Chief Justice.
Plaintiffs-Appellants (plaintiffs) filed suit in the Bernalillo County District Court seeking a declaratory judgment that the operation and enforcement of the joint Albuquerque/Bernalillo County Motor Vehicle Emission Inspection Program (Program) was unlawful. The district court dismissed the complaint and upheld the Program. Plaintiffs appealed the dismissal to this Court which, in Chapman v. Luna, 101 N.M. 59, 678 P.2d 687 (1984) (Chapman v. Luna 1), affirmed in part and reversed in part. The mandate issued on March 28, 1984, remanding the cause to the district court. On April 4, 1984, plaintiffs filed in the district court a motion for attorney fees, pursuant to 42 U.S.C. Sections 1983 and 1988 (1982). Plaintiffs now appeal from the district court’s denial of the motion. We affirm the district court.
In Chapman v. Luna I, plaintiffs were successful in having two aspects of the Program invalidated by this Court. The inspection fee was invalidated on state statutory grounds and the $75.00 repair provision was held to violate “equal protection standards.” Plaintiffs now argue that the equal protection allegation was a 42 U.S.C. Section 1983 cause of action and that because they prevailed on this issue, they are entitled to Section 1988 attorney fees. Count six of plaintiffs’ complaint contained the equal protection claim. It did not specifically refer to the New Mexico Constitution, the United States Constitution, Section 1983, or Section 1988.
Section 1988 provides in part: “[i]n any action or proceeding to enforce a provision of sections 1981, 1982, 1983 * * * the court, in its discretion, may allow the prevailing party a reasonable attorney's fee as part of the costs.” Plaintiffs’ entitlement to Section 1988 attorney fees depends upon whether their original suit was an action under Section 1983.
The statutory prerequisites for a Section 1983 cause of action are “that the defendants must have acted under color of law, regulation, custom or usage of the State of New Mexico, and that the plaintiff must have been deprived of federal constitutional rights, privileges and immunities.” Gomez v. Board of Education, 85 N.M. 708, 711, 516 P.2d 679, 682 (1973); Stringer v. Dilger, 313 F.2d 536 (10th Cir.1963). Plaintiffs’ contention that their original lawsuit was a Section 1983 cause of action fails due to their inability to show that deprivation of a federal constitutional right was raised and decided in their favor in Chapman v. Luna I.
In Chapman v. Luna I, this Court did not specifically refer to either the New Mexico Constitution or the United States Constitution in holding that the $75.00 repair provision violated “equal protection standards.” We referred solely to New Mexico case law. Although the equal protection clauses of the United States Constitution and the New Mexico Constitution have been interpreted similarly, Anaconda Co. v. Property Tax Department, 94 N.M. 202, 608 P.2d 514 (Ct.App.1979), cert. denied, 94 N.M. 628, 614 P.2d 545 (1980), they nevertheless constitute independent rights and protections.
In an analogous case, the California Supreme Court invalidated a state statute as violating “the basic constitutional guaranty of equal protection of the law * * *.” Department of Mental Hygiene v. Kirchner, 60 Cal.2d 716, 717, 36 Cal.Rptr. 488, 388 P.2d 720 (1964). The United States Supreme Court granted certiorari, but then vacated and remanded the case to the California Supreme Court to clarify “whether that court relied on the State Constitution alone, the Federal Constitution alone, or both.” Department of Mental Hygiene v. Kirchner, 380 U.S. 194, 198, 85 S.Ct. 871, 874, 13 L.Ed.2d 753 (1965). On remand the California Supreme Court held that the statute had been invalidated on state constitutional grounds and not by compulsion of the Federal Constitution. Department of Mental Hygiene v. Kirchner, 62 Cal.2d 586, 43 Cal.Rptr. 329, 400 P.2d 321 (1965). The Supreme Court of California determined that the state and federal equal protection clauses “provide generally equivalent but independent protections in their respective jurisdictions.” 62 Cal.2d at 588, 43 Cal.Rptr. at 330, 400 P.2d at 322.
Similarly, we determine that the $75.00 repair provision was invalidated in Chapman v. Luna I solely on New Mexico constitutional grounds. Appellants did not specifically plead a federal equal protection claim or a claim under 42 U.S.C. Section 1983, and this Court did not decide that issue under compulsion of the Federal Constitution.
Chapman v. Luna I, therefore, did not present or decide a federal question. Appellants did not prevail in proving a deprivation of a federal constitutional right, privilege, or immunity. Their cause of action was not a Section 1983 action. The case was brought under the New Mexico Declaratory Judgment Act, NMSA 1978, Sections 44-6-1 to -15, and was decided solely on state statutory and state constitutional grounds. Having failed to prevail in an action to enforce Section 1983, plaintiffs are not entitled to any attorney fees under Section 1988.
On cross-appeal, defendants contend that the district court erred in awarding plaintiffs their appellate costs. We find this question to be moot. The contested costs were paid by Hamilton Test Systems, Inc., who is not a party to this appeal. Furthermore, plaintiffs assert no claim against the City and County for the costs.
The judgment of the district court is affirmed. The cause is remanded for entry of judgment on mandate in conformity with this opinion.
IT IS SO ORDERED.
SOSA, Senior J., and STOWERS, J., concur. | [
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OPINION
HENDLEY, Judge.
Intervenors, Alfred Pino (father) and the Pueblo of Laguna (Pueblo), appeal the children’s court’s failure to grant their motion to reopen the court’s judgment and order (1) determining that father had waived his consent to the baby’s adoption, and (2) decreeing that the prospective parents may adopt the child. Finding that the trial court lacked jurisdiction, we reverse.
On May 13, 1983, prospective parents petitioned the court to decree that they might adopt the child. The child was born two days earlier on May 11. The child was born out of wedlock to a Pueblo mother and father. The mother signed a consent to adoption, acknowledging the father’s paternity by affidavit.
Subsequently, the Pueblo and father moved to intervene in the adoption proceedings, and moved to dismiss them on the ground that the children’s court lacked jurisdiction under the Indian Child Welfare Act (the Act), 25 U.S.C. §§ 1901-1923 (1982). The court denied their motions to dismiss but granted their motions to intervene.
The Pueblo’s and father’s application for a writ of prohibition from the New Mexico Supreme Court on the jurisdictional issue was denied. The Pueblo and father sought review of the denial of the writ in the United States Supreme Court. During the pendency of this appeal, the United States Supreme Court noted probable jurisdiction. However, we are led to believe that a decision is not likely until next term.
On May 9, 1984, the prospective parents moved the court to waive the consent of the father to the adoption. A hearing on the motion was originally set for May 25, 1984, but that date was vacated. The hearing was reset for July 31, 1984. Attorneys for the Pueblo and father received notice of the July 31 setting by letter from opposing counsel, but never received notice from the court. At the July 31st hearing, neither the father nor the Pueblo appeared; the court ordered that the motion to waive father’s consent be granted. On the same day, the court entered a final decree of adoption.
Counsel for the father and Pueblo did not learn of the entry of the final decree of adoption and waiver until August 9 or 10, 1984, when they received a “courtesy copy” of the order from opposing counsel. They subsequently moved the court for an extension of time in which to file an appeal and, alternatively, for relief from the judgment under NMSA 1978, Civ.P. Rule 60(b) (Repl. Pamp.1980). The children’s court denied both motions. Only the Rule 60(b) issues and an issue concerning notice of entry of a default judgment are presented for decision in the briefs on appeal; other issues are abandoned. State v. Vogenthaler, 89 N.M. 150, 548 P.2d 112 (Ct.App.1976).
The dispositive issue is whether the children’s court erred in not granting appellants’ motion under Rule 60(b)(4) to vacate the judgment because it was void for lack of jurisdiction. Before discussing the jurisdictional issue, we discuss the Supreme Court’s denial of appellants’ earlier request for a writ of prohibition against the children’s court.
In State v. Sisneros, 98 N.M. 201, 647 P.2d 403 (1982), defendant pled guilty pursuant to a plea agreement. The trial court initially placed him on probation, but agreed to reconsider the sentence upon motion by the state. Defendant sought a writ of prohibition from the Supreme Court to prevent the trial court from reconsidering the sentence. The court granted the writ, later quashed it, and remanded the case for proper sentencing. Defendant appealed, after the court sentenced him to a term of years, to this Court, which held that the second sentence violated the plea agreement. We reinstated the first sentence of probation. The Supreme Court noted that, when it sent the case back to the trial court for proper sentencing, it implicitly determined that the probation was illegal. The decision on the writ of prohibition — that is, the implicit determination that the probation was illegal — became law of the case and could not be reexamined by the Court of Appeals on appeal.
Sisneros does not preclude this Court from finding a lack of jurisdiction in the trial court after the Supreme Court denied a writ of prohibition when lack of jurisdiction was argued in support of the writ. Denial of the writ does not constitute law of the case in this case. Sisneros is distinguished because there the Supreme Court affirmatively ordered the trial court to hold a hearing on sentencing. If the Supreme Court meant for the probation sentence to be legal, it would have granted the writ instead of quashing it. By denying the writ and ordering the sentencing hearing, it impliedly held that the probation sentence was unacceptable.
In this case, the writ was denied with no direction to the trial court. Denial of a petition for a writ does not necessarily mean that the Supreme Court reached the merits of the issue argued in support of the writ. State v. Reese, 91 N.M. 76, 570 P.2d 614 (Ct.App.1977). We recognize that State v. Zinn, 80 N.M. 710, 460 P.2d 240 (1969), holds that, when the trial court is totally lacking in jurisdiction, the writ is issued “almost” as a matter of right. However, such language implies that there will be some jurisdictional cases in which the writ will not issue. An application for a writ can be denied when there exists an adequate remedy at law. Reese; NMSA 1978, § 44-2-5. The denial of the writ is not a decision on the merits, and the issue can be reviewed on appeal. Reese. In this case, as in Reese, an adequate remedy at law — an appeal to this Court of the jurisdictional issue — was available to appellants. However, in Sisneros, the illegality of the probation sentence was clearly implied by the court’s order to the trial court to hold a sentencing hearing. The present case is governed by Reese, not by Sisneros; we are not prohibited from deciding whether the children’s court had jurisdiction.
Appellants argue that the Act vests exclusive jurisdiction in matters such as this in the tribal court. Appellees argue that the jurisdiction issue is not properly before the court in an appeal of denial of a Rule 60(b) motion. Appellees imply that appellants’ failure to appeal the court’s earlier denial of appellants’ motion to dismiss on jurisdictional grounds forecloses appellants from raising the issue now. We disagree.
Subject-matter jurisdiction can be raised any time in the proceedings, even for the first time on appeal. Chavez v. County of Valencia, 86 N.M. 205, 521 P.2d 1154 (1974). See also New Mexico Livestock Board v. Dose, 94 N.M. 68, 607 P.2d 606 (1980). Rule 60(b)(4) is a proper means of attacking the subject-matter jurisdiction of the trial court. Chavez. See 7 J. Moore & J. Lucas, Moore’s Federal Practice ¶ 60.25[2] (2d ed. 1985). The trial court has no discretion in granting a Rule 60(b)(4) motion. Either the judgment is void or it is valid. Chavez. Did the children’s court have jurisdiction to hear the adoption matter in order to decide whether the trial court erred in not granting appellants' Rule 60(b) motion? Our answer is in the negative.
We hold that jurisdiction over the proceedings was exclusive in the tribal court and, therefore, that the children’s court lacked jurisdiction. The relevant portion of the Act states: “An Indian tribe shall have jurisdiction exclusive as to any State over any child custody proceeding involving an Indian child who resides or is domiciled within the reservation of such tribe * * * ” 25 U.S.C. § 1911. “ ‘[Cjhild custody proceeding’ ” means foster care placement, termination of parental rights, preadoptive placement, and adoptive placement. 25 U.S.C. § 1903. Although the Act contains no definition of “domicile,” New Mexico holds that an illegitimate child takes the domicile of its mother at the time of its birth. Gomez v. Snyder Ranch, 101 N.M. 44, 678 P.2d 219 (Ct.App.1983). The facts necessary for a conclusion of domicile are physical presence plus a concurrent intention to make a place one’s home. Worland v. Worland, 89 N.M. 291, 551 P.2d 981 (1976). In this case, the mother gives her residence as the Pueblo of Laguna. There is no evidence in the record to indicate that the mother is not a resident and domiciliary of the Pueblo. The baby child then assumes the mother’s domicile and becomes a domiciliary of the Pueblo. Therefore, jurisdiction is exclusively in tribal courts.
The children’s court’s order denying the Rule 60(b)(4) motion is reversed and remanded with directions to vacate its judgment.
IT IS SO ORDERED.
NEAL and ALARID, JJ., concur. | [
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OPINION
NEAL, Judge.
The parties in this consolidated appeal were involved in a foreclosure proceeding. The plaintiff-appellee, Bank of Santa Fe, filed suit to foreclose its judgment lien against Boston E. Witt and Kathleen A. Witt (the Witts), who are not parties to the appeal. The principal amount of the judgment lien was $32,356.42, plus interest and attorney’s fees. Many creditors, including defendant-appellee Western Bank, also had judgment liens against the Witts which were inferior to that of the Bank of Santa Fe. Default judgment was entered against the Witts and others. Plaintiff moved for summary judgment on issues involving only plaintiff. Western Bank moved for summary judgment on its cross claim seeking foreclosure and a determination of the lien priority of the parties. Summary judgment was granted on all issues based on the pleadings and affidavits, including an affidavit showing the priorities and amounts of the judgment liens on the property. The court determined the priority of the various liens and the amounts secured by the liens. The court ordered the property sold by special master and granted deficiency judgments to those lien creditors not fully satisfied from the proceeds.
The property subject to the judgment lien was real estate which was in the possession of the Witts in 1975, at the time the lien was created. They were purchasing the property under a real estate contract with the Smiths. During the proceedings the Smiths assigned their interest as vendors in the property to Western Bank. In 1979, the Witts deeded the property to Reginaldo Espinoza. There were numerous judgment liens outstanding against him as well. In June 1981, Espinoza deeded his interest to his mother, Trinnie B. Espinoza, who accepted the deed with actual knowledge of the existence of outstanding judgment liens against the property. She made improvements on the property.
The Espinozas (hereinafter “defendants”) appealed the trial court’s final judgment and decree of foreclosure. They also appealed the trial court’s subsequent order approving the special master’s sale and awarding deficiency judgments, and the order disbursing the proceeds of foreclosure. We affirm the judgment and orders, except as to deficiency judgments granted three creditors who did not appear, that must be omitted for lack of jurisdiction.
I. Foreclosure.
Defendants contend on appeal that summary judgment was improper because there was a genuine issue of material fact as to the extent to which the proceeds of the foreclosure sale should have been distributed to creditors. Defendants’ brief takes the position that this court should adopt a rule that only funds representing the value of the judgment debtor’s equitable interest in the property are available to satisfy the debtor’s judgment liens and, therefore, the court below should have determined the value of that equitable interest. Under their theory, the value of the equitable interest raises an issue of material fact. The Bank of Santa Fe and Western Bank argue that defendants, as transferees of an equitable interest in real estate, took the property with knowledge of the outstanding liens against the property and contributed to the equity in the property at their peril. Under this theory, the full value of the debtor’s estate in the property is subject to disbursement to creditors following foreclosure sale.
The judgment lien on real estate is a right created by statute. Curtis Manufacturing Co. v. Barela, 76 N.M. 392, 415 P.2d 361 (1966). NMSA 1978, Section 39-1-6 (Cum.Supp.1984) states, in applicable part, that “[t]he judgment shall be a lien on the real estate of the judgment debtor from the date of the filing of the transcript of the judgment in the office of the county clerk of the county in which the real estate is situate.” Once the statutory terms have been complied with, i.e., the transcript of the judgment is recorded, a transferee of the debtor takes the property with constructive notice of the amount of the judgment and the life of the lien. Kinney v. Vallentyne, 15 Cal.3d 475, 124 Cal. Rptr. 897, 541 P.2d 537 (1975).
Defendants do not deny that valid judgment liens have attached to the Witts’ interest in the real estate. Relying on Romero v. State, 97 N.M. 569, 573, 642 P.2d 172, 176 (1982), however, defendants contend that the liens do not attach to the full value of the property at the time of foreclosure. Romero states that “a judgment lien can attach only to whatever interest the debtor has in the property.” Defendants urge us to limit a “debtor’s interest” under these circumstances to the value of payments and improvements made by that debtor, or the amount commonly referred to as his or her “equity.” Under defendants’ definition of a debtor’s “interest,” the trial court should have determined the amount of the Witts’ equity and precluded their judgment lien creditors from reaching any of the proceeds in excess of that amount. While the issue has not been specifically addressed in New Mexico, the answer depends upon the terms and construction of the statute’s provisions. 3 R. Powell, Powell on Real Property 11479 (1984). See generally Note, Rights of a Judgment Creditor Against a Vendor or Vendee Following an Executory Contract for the Sale of Land, 43 Iowa L.Rev. 366 (1958). The case law regarding the relationship between judgment liens and real estate contracts, together with the plain statutory language, indicates that defendants’ position is incorrect.
Under a real estate contract, the purchaser holds equitable title, while the seller retains legal title in trust until the contract is paid. A judgment lien against the purchaser attaches to the equitable interest under the contract. Mutual Building & Loan Association of Las Cruces v. Collins, 85 N.M. 706, 516 P.2d 677 (1973), overruled on other grounds, Marks v. City of Tucumcari, 93 N.M. 4, 595 P.2d 1199 (1979). In Marks the supreme court ruled that a judgment lien cannot attach to the legal title held by the seller because the purchaser is treated as the owner of the land and the seller merely holds legal title as trustee. The seller’s interest is considered personalty. Marks. During the life of a real estate contract any risk of loss or enhancement of value accrues to the purchaser. MGIC Mortgage Corp. v. Bowen, 91 N.M. 200, 572 P.2d 547 (1977). In short, when the vendor has not exercised his contractual rights to declare a forfeiture, our cases support recognizing that the debtor’s estate in the property is an equitable fee simple, subject to the vendor’s lien for the unpaid purchase price. See generally III A. Casner, American Law of Property ¶! 11.29 (1952). Therefore, because a judgment lien is a lien on the real estate of the debtor from the date of filing of the transcript of judgment, Section 39-1-6, and a purchaser under a real estate contract is treated as the owner of the property, the debtor’s interest in the property to which the lien attaches, when he holds equitable title under a real estate contract, is the full value of his estate in the property, not just the amount of his payments and the value of improvements as defendants here contend.
The same result has been reached elsewhere in comparable situations; courts in other jurisdictions have not restricted judgment lien creditors of a mortgagor to the amount of his or her payments and improvements at the date of foreclosure. Belnap v. Blain, 575 P.2d 696 (Utah 1978); Kinney v. Vallentyne, 124 Cal.Rptr. at 899, 541 P.2d at 539; Gray v. Stevens, 5 Utah 2d 361, 302 P.2d 273 (1956). The rule is consistent with the strong public policy in favor of satisfaction of judgments. See Mutual Building & Loan Association of Las Cruces v. Collins. The language of Cochran v. Cutler, 39 Ill.App.3d 602, 350 N.E.2d 59 (1976), in an analogous situation, is applicable to the Espinozas here. “By failing to make arrangements for the satisfaction of the lien at the time of the conveyance, they took the risk that the property might increase in value and that such increase might be reached by the judgment creditors should they choose to enforce the lien.” 39 Ill.App.3d at 609, 350 N.E.2d at 64. Knowing that risk, they contributed to the equity in the property at their peril. Kinney v. Vallentyne. As stated in Belnap v. Blain, 575 P.2d at 699-700 (quoting Gray v. Stevens, 5 Utah 2d at 364, 302 P.2d at 274) to rule otherwise
could lead to absurd and illogical results. If the aggregate sum of encumbrances exceeded by ten cents the court-found property value, the judgment creditor forever would be foreclosed in a quiet title suit from asserting his lien. The next day the debtor safely could convey the property free from the judgment lien. If the aggregate amount fell ten cents short of the adjudged value of the property the judgment creditor’s lien would be preserved during the judgment’s life and could result in an execution against the property when and if the encumbrances were paid off, voluntarily discharged, judicially declared to be inferi- or, foreclosed (in which event the judgment creditor could assert his valuable right of redemption), or otherwise disaffiliated with the ownership, — and the magic sum of ten cents would make all the difference in the world. So long as the judgment is extant * * * the judgment does not lack virility in futuro, when, as pointed out above, the property may become disencumbered.
II. Value of Improvements.
Defendants contend that the court erred in refusing to allow Mrs. Espinoza to recover the reasonable value of the improvements she made on the property. This contention is answered by the discussion under Point I. Mrs. Espinoza made the improvements with actual and constructive knowledge of the prior liens on the property and, therefore, contributed to the equity at her peril. See Kinney v. Vallentyne.
III. Deficiency Judgments.
(1) Defendants contend that the court erred by granting deficiency judgments to three creditors who were served with process, but did not answer or appear in the case because the court lacked jurisdiction over them. The creditors, La Tienda de Santa Fe, U.S. Life Credit Corp., and Venture Capitol Corp., possessed judgment liens not satisfied out of the proceeds of the foreclosure sale. The issue of the jurisdiction of the district court may be raised for the first time on appeal. Perea v. Baca, 94 N.M. 624, 614 P.2d 541 (1980). The basis for the contention is that the court lacked jurisdiction to grant relief to parties which had not appeared to ask for the relief granted. We agree and, therefore, modify the judgment to omit the deficiency judgments granted the three creditors and affirm as so modified. See Haden v. Eaves, 55 N.M. 40, 226 P.2d 457 (1950).
The second amended complaint named the three creditors as additional defendants, alleging that they claimed interest in the property by virtue of judgment liens. The counterclaim and cross claim of Western Bank also alleged that the three creditors claimed an interest in the property, which was inferior to that of Western Bank, and asked the court to determine the priority of the liens. The three creditors did not answer or otherwise appear. Western Bank then filed its motion for summary judgment, supported by affidavits which summarized the abstract of title on the property and particularized the amounts of the recorded judgment liens of each party. The provision for deficiency judgments in the final judgment and decree of foreclosure accounted for the recorded claims of the creditors who could not be satisfied out of the proceeds of the foreclosure sale. However, the creditors did not appear to invoke the court’s aid and, therefore, the court was without jurisdiction to grant relief on their behalf. See City of Natchez v. Craig, 191 Miss. 567, 3 So.2d 837 (1941); 21 C.J.S. Courts § 83 (1940). The underlying judgments upon which the deficiency judgments were based are not affected by our ruling, of course, and remain viable.
(2) Defendants also contest deficiency judgments against Mr. Espinoza in favor of Lewis Thompson and Charolyn R. Espinoza, alleging that Mr. Espinoza acquired the property subject to the lien after the liens arose. We do not address this issue because the issue is moot. The judgment liens complained of were discharged in the foreclosure. The underlying judgments remain in effect, of course, because the proceeds of the foreclosure sale were insufficient to satisfy them. Therefore, the issue can have no effect on the result below. This court does not decide moot questions. State v. Vogel, 39 N.M. 122, 41 P.2d 1107 (1935).
Affirmed as modified.
IT IS SO ORDERED.
BIVINS and MINZNER, JJ., concur. | [
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OPINION
MINZNER, Chief Judge.
Worker appeals from a compensation order denying her benefits. Employer successfully relied upon the false representation defense discussed in a number of cases and recently analyzed by this Court in Lamay v. Roswell Independent School District, 118 N.M. 518, 882 P.2d 559 (Ct.App.1994). In Lamay, we fashioned a test to be applied in false representation cases to assist in determining whether all of the elements of the false representation defense have been adequately proved by the employer. Since the worker in Lamay had expressly declined to argue the issue of the sufficiency of the evidence supporting the workers’ compensation judge’s (judge) decision, we did not apply the new test to the facts of that case, but instead remanded it to the workers’ compensation judge for further proceedings. In this case, however, Worker does argue that there was insufficient evidence supporting the judge’s findings. Therefore, the question presented by this appeal is whether, under the test set out in Lamay and considering the standard of review, Employer has adduced sufficient evidence to prove the false representation defense.
When Worker applied for a cashier job with Employer, she filled out an employment application containing the following question and answer:
List any physical limitations or chronic illnesses. None.
The judge found that this answer was false, that Worker knew it was false when she wrote it, and that Employer relied on the answer in hiring Worker. We must determine whether, given the language of the question asked by Employer and the facts of this case, there was substantial evidence to support the judge’s findings. See Lamay, 118 N.M. at 525-26, 882 P.2d at 566-67. We hold there was not.
FACTS
Worker filled out her employment application on January 11, 1990. Therefore, it is Worker’s knowledge and state of mind at that time that is crucial to the determination in this case. Lamay, 118 N.M. at 525-26, 882 P.2d at 566-67 (employer must prove a knowing misrepresentation by a worker to prevail on false representation defense). Important factual issues to be considered are what Worker’s physical condition was at the time she filled out the employment application, what Worker knew about that physical condition, what Worker might have known about Employer’s purpose in asking the specific question at issue here, how a reasonable person would have interpreted the question asked by Employer, and what Worker knew about the tasks of the job for which she was applying. Id.
At the time Worker applied for her position with Employer, she had a degenerative disc condition in her back. There is no evidence, however, that she knew of that diagnosis at the time of the application. It appears that it was first diagnosed in x-rays taken in April 1991, after Worker was injured when an automobile crashed into the cashier’s office at Employer’s place of business. Worker did know that she had problems with her back episodically over the fifteen-year period preceding the application. She had been off work once for approximately two weeks due to a back strain when she was in her late teens or early twenties. Later, in 1985, she was hospitalized for a few days with another back strain. Dr. Caldwell, an orthopaedic surgeon, testified that the hospital records describe Worker as suffering mostly a backache, caused by muscle spasms. The hospital records reveal a final diagnosis of thoracolumbar muscle spasm and lumbosacral strain. There is nothing to indicate that Worker was told at this time that she had degenerative disc disease, or should avoid certain activities, or was at risk for further injury to her back.
Worker’s family physician, Dr. Maley, testified that Worker suffered no more recorded episodes of back difficulties following the 1985 hospitalization until over a year after she began working for Employer. No physician ever restricted her activities in any way. In addition, there is no evidence that Worker herself limited her activities due to back pain or for any other reason. She testified that after starting the job in January 1990 she had no back problems until April 1991; she was “doing great.”
Dr. Maley and Dr. Caldwell agreed that Worker had a long-term back condition caused by her degenerative disc disease. Dr. Maley did not believe that the condition was severe enough to warrant an impairment rating prior to the 1991 accident. Dr. Caldwell, on the other hand, thought that Worker did have a permanent partial impairment prior to that accident. However, she was unaware of this “impairment,” and never sought any workers’ compensation benefits for it.
Worker testified that when she applied for the cashier position, she thought the job entailed only cashier work. She did not realize that it included janitorial side work. Her supervisor, however, testified that the duties of a cashier included light cleaning, sweeping the lot, cleaning up oil or gasoline spills, stocking shelves with oil, and occasionally lifting cases of soda. He also testified that he explained these duties to Worker when she applied for the job. Employer had a form listing the duties, and the manager testified that he went over the form with Worker, and that she seemed to understand it. All employees read and sign such a form, and Worker read and signed it. There is no evidence that Employer specifically discussed the “physical limitations or chronic illnesses” question with Worker at the time she filled out the application.
APPLICATION OF LAMAY TEST
Applying the Lamay test to this case, we must first determine whether the question “List any physical limitations or chronic illnesses” is so overly broad that, as a matter of law, a prospective employee could not be expected to provide an accurate answer. Lamay, 118 N.M. at 525-26, 882 P.2d at 566-67. We hold that this question is not so vague. Under certain circumstances, this question could call for completely factual information. For example, where an applicant has suffered a prior injury and has been assigned a permanent partial impairment rating, or has been precluded by a doctor’s order from performing certain types of work, this information would appear to fall under the category of a “physical limitation.” Similarly, debilitating conditions caused by disease would seem to answer the “chronic illnesses” portion of the question. Therefore, since the question is not vague for all applicants under all circumstances, we cannot hold as a matter of law that a prospective employee could not be expected to provide an accurate answer, and thus that the question could never be the basis for a false application defense.
The next step in the Lamay analysis is to determine whether, given the language of the question, a reasonable person applying for the same job as Worker, knowing the same information about that job, having the same medical history as Worker, and the same knowledge as Worker about that history, would have understood that the question posed in the application called for a disclosure of that medical history. Id In making this determination, we look to the whole record below and resolve all conflicts in the evidence in favor of the judge’s findings. See Tallman v. ABF (Arkansas Best Freight), 108 N.M. 124, 127, 767 P.2d 363, 366 (Ct.App.) (discussing whole-record standard of review), cert. denied, 109 N.M. 33, 781 P.2d 305 (1988).
One factual inquiry is the extent of Worker’s knowledge concerning the duties of the position at the time she applied for it. This issue could be important in some cases because the worker’s knowledge of the amount of strenuous work required in a position might have an effect on the way the worker or a reasonable person applying for the same job would view the questions asked on the application. In this case, Worker testified that she thought the duties were restricted to acting as a cashier. However, Employer’s witness testified that he explained to Worker that the position included some light cleaning and stocking. Resolving this conflict in favor of Employer, as we must, we conclude that Worker knew or should have known that the position would require more strenuous physical effort than simply making change.
The next factual issue is the actual condition of Worker’s back at the time she applied. If there were no evidence of an actual physical impairment or of a currently existing condition at the time of the application, Worker’s negative answer to the question could have been true and our inquiry would cease. Dr. Maley’s opinion was that the condition was not serious enough to warrant a partial impairment rating at that time, and she had never restricted Worker’s activities. Dr. Caldwell, however, testified that Worker had an 8% impairment due to her degenerative disc disease, and that, if asked, he would have restricted her work activities due to that preexisting condition. Although he had never examined Worker before her 1991 accident, and he did not specify the date upon which the 8% impairment began, his testimony taken as a whole is probably sufficient to support a finding that, in January 1990, Worker actually had a “physical limitation” due to her back condition, and that her answer to the question was inaccurate.
But this is not to say that Worker either knew or should have known that her answer was inaccurate. As of January 1990, Worker knew only that she had a history of back problems. She had been hospitalized in 1985 for a back strain, and a number of years prior to that she had been off work for two weeks due to another back strain. In addition, she told Dr. Caldwell on her first visit that she had suffered episodic back problems since she was twenty years old. There is no evidence, however, that she suffered from any of these problems between 1985, when she was hospitalized, and January 1990. There is also no evidence that Worker was told to limit her activities, or was placed under any physical restrictions, by any physician prior to 1990. In addition, there is no evidence that Worker was ever told about her degenerative disc condition prior to the time of her application. Finally, there is no evidence either that Worker limited her activities on her own initiative, due to pain or discomfort caused by her back condition, or that she knew that certain activities could cause injury to her back. While the evidence in this record would support a finding that Worker knew her back was susceptible to injury at times, that evidence does not support a finding that she knew about her degenerative disc condition, or about the impairment that condition had caused, or that she should limit her activities in order to avoid re-injuring her back.
The question we must answer, then, is whether a reasonable person who has had episodic problems with back strains, but knows of no resulting restrictions on her activities or lifestyle, would understand the phrase “physical limitations or chronic illnesses” to refer to her back problems. We hold that a reasonable person could not be expected to make that connection.
The normal, everyday understanding of the term “chronic illness” is a lingering or frequently recurring disease such as cancer, tuberculosis, malaria, or other similar afflictions. The phrase is not normally understood to refer to an episodic condition such as Worker’s, which flared up only occasionally and at widely separated time intervals. See Webster’s Third New International Dictionary of the English Language, Unabridged 402 (1976) (defining “chronic” as referring to frequent recurrences over a long period of time, or something that is unending, or of long duration). We therefore hold that a reasonable person in her position would not have understood the “chronic illnesses” portion of the question to call for disclosure of the back condition, especially since the condition was asymptomatic at the time of the application.
Similarly, we do not believe a reasonable person with Worker’s knowledge would understand the term “physical limitation” to refer to her back condition. That term is commonly understood as some sort of restriction on the person’s ability to perform certain activities. See Webster’s, swpra, at 1312 (defining a “limitation” as a restriction, restraint, restrictive weakness, or lack of capacity). The general understanding of a physical limitation is not just a physical condition; that understanding includes the idea that the condition causes an inability, to some extent, to fully perform normal physical activities. There is evidence in this case that Worker knew she had a back condition. However, there is no evidence that she knew her condition limited her in any significant way at the time she applied for the cashier position. Therefore, Employer failed to establish that a reasonable person in Worker’s position would have understood her back condition as within the term “physical limitations.”
It may very well be true that by using the phrase “physical limitations or chronic illnesses” Employer intended to cover all significant physical and mental problems, including those not currently causing difficulties or restrictions. We will not, however, expand the meaning of those phrases beyond their ordinary, commonly understood meanings. Employer drafted the questions on the application and knew what type of information would be useful to obtain. If Employer desired more specific factual information, it would have been easy to ask clearly for that information. For example, Employer could have asked whether Worker had ever been hospitalized, or had received an impairment rating, or had her lifting capacity restricted. Any number of similar questions could be devised to require disclosure of specific factual information that would reveal the existence of conditions such as Worker’s.
We see no unfairness in construing Employer’s question narrowly to call for disclosure of exactly the types of problems signified by the plain meaning of the words used in the question. Cf. Smith v. Tinley, 100 N.M. 663, 665, 674 P.2d 1123, 1125 (1984) (ambiguities in a contract are to be construed against party that drafted document); Restatement (Second) of Contracts §§ 168, 169 (1981). This is especially so in light of the grave consequences possibly attending a wrong answer to the question — namely, a finding that the wrong answer was given deliberately, and the consequential forfeiture of all workers’ compensation benefits. The false application defense is not a litigation tactic to be used, in retrospect, to attempt to avoid responsibility for an employer’s obligations. Instead,, it is designed to redress the unfairness that results when a worker deliberately responds falsely to a question that asks for information the employer genu inely wants to know. Therefore, the questions asked by an employer should be construed to mean exactly what the words say, instead of allowing an employer to argue later for a broader interpretation in an effort to avoid due compensation.
We have held that a reasonable person in Worker’s position would not have understood the question to refer to her back condition. ■ That is not the end of the Lcimay inquiry. - We must also determine whether thére is any evidence that Worker actually' loiew, ■ from any source, that the question wás refer-, ring to that condition. Lamay, 118 N.M. at 526, 882 P.2d at 567 (discussing the “subjective test”). For example,'it is possible that during an interview, an employer might discuss the tasks of the position and let toe applicant know that it is important to disclose any prior injury resulting in hospitalization or other medical treatment. See also Gray v. J.P. (Bum) Gibbins, Inc:, 75 N.M. 584, 587, 408 P.2d 506, 507 (1965). In this case, however, there is no' evidence indicating" that Worker was told anything during the application process about the questions on the application. There is also no evidence showing that Worker was informed' that Employer wanted to know about-her episodic, back troubles, her prior hospitalization, or about any medical conditions other than the physical limitations, or chronic illnésses asked about in-toe application. For .-this reason; application of the subjective test'does .not-lead to a denial of benefits'. . •
CONCLUSION
Denial of benefits on the basis of Worker’s job application was error. • We reverse the judge’s decision,, and we remand this case for consideration of the .merits of Wori claim.
IT IS SO ORDERED.
PICKARD and BOSSON, JJ., concur | [
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OPINION
PER CURIAM.
This matter came before the Court following disciplinary proceedings conducted pursuant to the Rules Governing Discipline, SCRA 1986, 17-101 to 17-316 (Repl.Pamp.1991 & Cum.Supp.1994), in which attorney Joseph A Roberts, in conjunction with an agreement for discipline by consent, admitted to various violations of the Rules of Professional Conduct, SCRA 1986, 16-101 to 16-805 (Repl.Pamp.1991 & Cum.Supp.1994). We adopt the disciplinary board’s recommendation and approve the agreement admitting allegations and consenting to discipline. Accordingly, pursuant to Rule 17-211(B)(l)(a), it is hereby ordered that Joseph A Roberts be indefinitely suspended from the practice of law pursuant to Rule 17-206(A)(3).
In the early 1980’s, Roberts undertook the representation of Michael D. Salazar, an individual who was injured at his place of employment. On June 9, 1983, Roberts filed a products liability action on his client’s behalf. On February 21,1985, the trial court granted a directed verdict against Salazar in the products liability suit, and, thereafter, Roberts filed a notice of appeal from the directed verdict in the United States District Court for the District of New Mexico.
Roberts failed to adhere to the scheduling requirements of the United States Court of Appeals for the Tenth Circuit and failed to file a docketing statement within the prescribed time. The clerk of the Tenth Circuit Court of Appeals sent Roberts a letter warning him of his failure to file the docketing statement, granting an extension in which to file the required documents, and alerting Roberts that his client’s appeal would be dismissed unless he filed the required documents within the extended time period. Roberts filed nothing further in the appeal. On August 6, 1985, Salazar’s appeal was dismissed for lack of prosecution.
In June 1992, Roberts’ client discovered for the first time from the Tenth Circuit clerk’s office that his appeal had been dismissed in 1985. During the previous seven years, Salazar regularly had requested from Roberts status reports on his appeal and Roberts repeatedly informed Salazar that his appeal was pending. Although the statute of limitations for a disciplinary matter is four years, the limitations period begins from the time the complainant “knew or should have known” about the misconduct, SCRA 1986, 17-303 (Repl.Pamp.1991 & Cum.Supp.1994), in this ease, in 1992 when Salazar called the Clerk’s office and realized that Roberts had been misleading him as to the status of his ease.
While malpractice and ethical matters are not synonymous and one may be filed without the other, in this instance a malpractice action was filed against Roberts and a judgment of the verdict was entered for $1,009,-979.40. In his answer to the malpractice action, Roberts admitted that he failed to docket the appeal in Salazar’s products liability case. Although Roberts was able to reach a settlement with Salazar, Roberts’ conduct hurt not only his client but also public perception of the legal profession.
In the disciplinary matter, Roberts also admitted that he failed to docket the appeal in Salazar’s case. This Court disagrees with Roberts’ characterization that his conduct was a “momentary transgression.” By lying to his client for seven years about the status of the appeal, Roberts exacerbated what might have been a momentary transgression into a knowing and willful sustained period of misconduct and deceit. Roberts, therefore, violated Rules 16-101, 16-103, 16-104(A), 16-302, 16-304(0, 16-804(C), 16-804(D), and 16-804(H) of the Rules of Professional Conduct.
Despite Roberts’ appeal to this Court to consider a lesser sanction than that agreed upon in the consent agreement, this Court notes that Roberts initially concurred to the consent agreement, and that the terms of the consent agreement were approved and recommended by the hearing committee to a panel of the disciplinary board, who, in turn, recommended approval by this Court. Roberts’ plea to this Court for mercy rather than justice is misplaced for such an inexplicable grievous breach of his client’s faith.
NOW, THEREFORE, IT IS ORDERED that, pursuant to Rule 17-206(A)(3), Joseph A. Roberts hereby is indefinitely suspended from the practice of law effective April 26, 1995.
IT IS FURTHER ORDERED that Roberts shall be eligible to apply for reinstatement in accordance with Rule 17-214(B)(2) on or after April 26, 1996, but only upon a showing of the following:
(1) Roberts shall successfully complete the Multistate Professional Responsibility Exam within the first year of suspension;
(2) Roberts shall pay all costs of the investigation and prosecution of this matter in the amount of $313.17 on or before May 19,1995;
(3) Roberts shall observe all Rules of Professional Conduct and Rules Governing Discipline during his suspension; and
(4) Roberts shall demonstrate, through a licensed psychologist or psychiatrist, a meaningful and sustained period of successful rehabilitation of his psychological condition.
IT IS FURTHER ORDERED that this opinion be published in the New Mexico Reports and Bar Bulletin.
Costs of these disciplinary proceedings in the amount of $313.17 are assessed against Roberts and shall be paid to the disciplinary board on or before May 19, 1995. Any amounts not paid by that date shall bear interest at the rate of fifteen percent (15%) per annum until paid, and a transcript of judgment will be issued by this Court for any amounts not paid by May 19, 1995.
IT IS SO ORDERED. | [
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OPINION
DONNELLY, Chief Judge.
Plaintiff, Arturo Candelaria, filed suit against the Middle Rio Grande Conservancy District (District) for property damages arising out of a flood which occurred when the District’s irrigation ditches broke. The District filed a motion for judgment on the pleadings, alleging immunity under the Tort Claims Act. The trial court denied the motion and certified for interlocutory appeal the question of governmental immunity and a question regarding the jurisdiction of the district court over the subject matter involved in the action.
This case poses the question of whether this court may properly accept jurisdiction over an application for interlocutory appeal which is untimely filed, or whether this court may enlarge the time for filing such an application. The interlocutory order which is the subject of this appeal was filed on May 16, 1988. On June 1, 1988, the District filed an application for interlocutory appeal with this court, sixteen days after the interlocutory order was entered and in excess of the time provided by law for filing such appeal.
The law clearly contemplates that an application for interlocutory appeal shall be filed within ten days of the date of filing the interlocutory order sought to be reviewed. SCRA 1986, 12-203; NMSA 1978, § 39-3-4(B). The law is also clear that acceptance of an interlocutory appeal is discretionary with the appellate court. See State v. Hernandez, 95 N.M. 125, 619 P.2d 570 (Ct.App.1980).
Under Section 39-3-4(B), the application was deemed denied on June 21 by operation of law. Because the issue has arisen in the past and may arise again, we take this opportunity to explain why we have denied the application.
Interlocutory appeals are an exception to the rule that appeals may only be taken from final judgments and are designed to avoid unnecessary litigation and promote judicial economy. Attempts to reach an early and speedy disposition of a cause are favored, while at the same time piecemeal appeals are not favored. See Springer Transfer Co. v. Board of Comm’rs, 43 N.M. 444, 94 P.2d 977 (1939). Cf. Montoya v. Anaconda Mining Co., 97 N.M. 1, 635 P.2d 1323 (Ct.App.1981). Application for appellate review of non-final orders is allowed only in limited circumstances when the district court certifies: (1) the order involves a controlling question of law on which there is substantial ground for difference of opinion; and (2) resolution of the question will materially advance the ultimate termination of the litigation. See § 39-3-4. The statute requires that the application be filed within ten days of the interlocutory order. District court certification, timely filing of the application and appellate court discretion in accepting the application all operate to ensure that the underlying purpose of interlocutory appeals is served. See Nuclear Engineering Co. v. Scott, 660 F.2d 241 (7th Cir.1981), cert. denied, 455 U.S. 993, 102 S.Ct. 1622, 71 L.Ed.2d 855 (1982); see also Note, New Mexico’s Analogue to 28 U.S.C. § 1292(b): Interlocutory Appeals Come to the State Courts, 2 N.M.L.Rev. 113 (1972); Note, Interlocutory Appeals in the Federal Courts Under 28 U.S.C. § 1292(b), 88 Harv.L.Rev. 607 (1974-1975).
Appeals from interlocutory orders are subject to allowance only upon compliance with the provisions of Section 39-3-4. See Miller v. City of Albuquerque, 88 N.M. 324, 540 P.2d 254 (Ct.App.1975). Neither the statute nor rules authorize this court to entertain late applications for interlocutory appeals or extensions of time for filing late applications. Absent statutory authority or supreme court rule, appellate courts may not extend the time for appeal, even to relieve against mistake, inadvertence or accident. See Hollister Convalescent Hosp., Inc. v. Rico, 15 Cal.3d 660, 125 Cal.Rptr. 757, 542 P.2d 1349 (1975) (In Bank); see also General Television Arts, Inc. v. Southern Ry. Co., 725 F.2d 1327 (11th Cir.1984).
The district courts, however, maintain jurisdiction over matters in which this court denies an application for interlocutory appeal. State v. Hernandez. Therefore, in appropriate circumstances, the district court may reconsider the issue and enter a second interlocutory order from which application for a timely interlocutory appeal may be made. In considering whether to recertify an order, the district courts should consider the purpose of Section 39-3-4, the delay caused by the late filing of the application and the circumstances which have transpired since the initial interlocutory order was entered, including any potential prejudice to the opposing party. See In re Benny, 812 F.2d 1133 (9th Cir.1987); Nuclear Engineering Co. v. Scott. Requests for recertification should not be granted routinely and are discretionary with the district court.
For the reasons stated above the application for interlocutory appeal is denied.
IT IS SO ORDERED.
ALARID and MINZNER, JJ., concur. | [
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OPINION
BIVINS, Judge.
Pursuant to NMSA 1978, § 39-3-3(B)(l) the State appeals from a district court order dismissing a charge of burglary against defendant. The sole issue on appeal is whether reaching into the bed of a pickup truck with the intent to commit a felony may constitute a burglary within the meaning of NMSA 1978, § 30-16-3.
The record indicates that the State charged defendant with burglary and larceny after the victim saw him taking a tool box from the bed of her pickup truck. The parties appear to agree that the tool box was lying in an open and uncovered area of the truck.
Burglary as defined by our New Mexico statute makes a radical departure from its common law predecessor. The crime of common law burglary consisted of six specific elements: (1) breaking and (2) entering (3) a dwelling house (4) of another (5) in the nighttime (6) with the intent to commit a felony therein. W. LaFave & A. Scott, Handbook on Criminal Law § 96 (1972). In contrast, the current New Mexico statute defines burglary as “the unauthorized entry of any vehicle; watercraft, aircraft, dwelling or other structure, movable or immovable, with the intent to commit any felony or theft therein.” Section 30-16-3. Thus, only the common law requirements of entry and intent (with the modification to include non-felony theft) have survived in our statutory proscription.
At common law, burglary was “an offense against the security of habitation or occupancy.” C. Torcia, 3 Wharton’s Criminal Law § 326 (14th ed. 1980). This Court has described the statutory offense as one against “the security of the proper ty which is entered.” State v. Ortiz, 92 N.M. 166, 584 P.2d 1306 (Ct.App.1978). This change in definition reflects the legislature’s expansion of the dwelling house requirement to include various movable and immovable structures. The rationale underlying the expansion, however, remains somewhat unclear. See generally Note, Statutory Burglary—The Magic of Four Walls and a Roof, 100 U.Pa.L.Rev. 411 (1951).
As defendant has pointed out, this Court construes penal statutes strictly in favor of the accused. See Bokum Resources v. N.M. Water Quality Control Com’n, 93 N.M. 546, 603 P.2d 285 (1979). In doing so, we follow established rules of statutory construction.
A statute should be construed in light of the purpose for which it was enacted. State v. Trujillo, 85 N.M. 208, 510 P.2d 1079 (Ct.App.1973). The general purpose of burglary statutes is to protect possessory rights with respect to structures and conveyances, State v. Hankins, 376 So.2d 285 (Fla.App.1979), and to define “prohibited space”. See People v. Davis, 54 Ill.App.3d 517, 12 Ill.Dec. 362, 369 N.E.2d 1376 (1977).
Section 30-16-3 expressly includes “vehicles” as a prohibited space. Since this Court must give words used in a statute their ordinary meaning unless the legislature indicates a different intent, State v. Tapia, 89 N.M. 221, 549 P.2d 636 (Ct.App.1976), we hold that the bed of a pickup truck, as a part of a vehicle, falls within the statutorily protected area.
Defendant argues that this Court should follow the rationale set forth in Smith v. First Judicial District Court, 75 Nev. 526, 347 P.2d 526 (1959). There the Supreme Court of Nevada rejected the State’s contention that “to hold one’s hand over the platform body of a truck with intent to commit larceny is the entry of a vehicle” within the meaning of the Nevada burglary statute. Id. at 529, 347 P.2d 526. The Nevada court relied upon the case of State v. Petit, 32 Wash. 129, 72 P. 1021 (1903), in making its decision. Petit involved a Washington burglary statute which required breaking as well as entering to prove the crime. The Washington court, understandably, found it difficult to accept the idea that an individual could break and enter an open railroad flat car of wheat. Thus, the present case is distinguishable, and we decline to follow the precedent set by Petit, notwithstanding Smith, on the basis that our statute does not require a breaking.
We note that other jurisdictions have also concluded that the open portion of a pickup falls within the protected areas targeted by a state burglary statute, see, e.g., State v. Cloud, 324 N.W.2d 287 (S.D.1982); People v. Romero, 179 Colo. 159, 499 P.2d 604 (1972).
The district court’s order dismissing the burglary charge in this case is reversed and the case remanded.
IT IS SO ORDERED.
DONNELLY, C.J., and ALARID, J., concur. | [
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OPINION
APODACA, Judge.
The State of New Mexico Taxation and Revenue Department (Department) appeals from the trial court's judgment and order granting plaintiffs’ (taxpayers) application for a tax refund. Two issues are raised by the Department: (1) whether basic real estate contracts constitute loan transactions, such that receipts from charges for handling payments made under the contracts may be deducted from taxpayers’ gross receipts; and (2) whether the trial court erred in granting summary judgment in favor of taxpayers and denying the Department’s own motion for summary judgment. We hold that such real estate contracts do not constitute loan transactions under the specific statutory provision allowing deductions from gross receipts. We reverse the trial court and remand the case with directions that an order be entered granting the Department’s summary judgment motion.
Taxpayers filed an application for tax refund for the alleged overpayment of gross receipts taxes, pursuant to NMSA 1978, Section 7-l-26(A) (Repl.1986). They, as escrow agents, processed installment payments paid on various real estate contracts held in escrow by taxpayers. It is the charges collected by them for handling these payments that are the subject matter of this appeal. The Department denied the refund, and taxpayers filed a complaint in the trial court pursuant to Section 7-1-26(A)(2). The trial court found that no genuine issues of material fact existed and that taxpayers were entitled to judgment as a matter of law. Judgment was thus entered in favor of taxpayers in the amount of $91,727.00, plus interest. The Department appeals from that judgment.
Taxpayers base their claim for refund on the language of NMSA 1978, Section 7-9-61.1 (Repl.1986), which allows the deduction of receipts from charges made in connection with a loan or made for handling loan payments when computing the gross receipts tax. The Department denied taxpayers’ claim, contending that an estimated ninety percent of their receipts were for charges made in connection with payments on the subject contracts and that such transactions did not qualify as “loans” for gross receipts tax purposes. The Department, however, did refund gross receipts taxes paid on receipts from charges for handling payments on mortgages, notes, and deeds of trust. Thus, the amount of tax at issue is based upon gross receipts derived solely from the handling of the real estate contract payments.
The parties apparently do not differentiate between the specific contracts; instead, they desire that we determine whether real estate contracts, in general, constitute loan transactions. However, although standard real estate contract “forms” are available to the public, the real estate contract is a flexible legal instrument and may contain any pertinent provisions the contracting parties consider necessary or desirable. See L. Buchmiller, Real Estate Contracts in New Mexico §§ 1.02 & 1.14 (1985). None of the real estate contracts were introduced into evidence and thus are not included in the record on appeal.
Section 7-9-61.1 provides: “Receipts from charges made in connection with the origination, making or assumption of a loan or from charges made for handling loan payments may be deducted from gross receipts.” It is necessary to define the term “loan.” The Department contends that the plain language of the statute indicates its purpose is to provide a deduction for handling loan payments under loan transactions involving borrowers and lenders in which a sum of money is delivered under a contract to return an equivalent amount at some future time. The Department further asserts that real estate contracts do not constitute loan transactions involving borrowers and lenders but are installment sales agreements involving buyers and sellers in a credit sale.
In construing the meaning of a particular statute, a reviewing court’s central concern is to determine and give effect to the intention of the legislature. State ex rel. Klineline v. Blackhurst, 106 N.M. 732, 749 P.2d 1111 (1988). In determining this intent, we look primarily to the language of the act and the meaning of the words, and when they are free from ambiguity, we will not resort to any other means of interpretation. See State v. Pitts, 103 N.M. 778, 714 P.2d 582 (1986); New Mexico Beverage Co. v. Blything, 102 N.M. 533, 697 P.2d 952. (1985).
When a term is not defined by the statute, a court may interpret the word in accordance with its ordinary meaning. United States v. State of New Mexico, 536 F.2d 1324 (10th Cir.1976). Unless the legislature indicates a different intent, we must give statutory words their ordinary meaning. State ex rel. Klineline v. Blackhurst. Although we cannot add a requirement that is not provided for in the statute or read into it language that is not there, we do read the act in its entirety and construe each part in connection with every other part to produce a harmonious whole. Id.
Where an exemption or deduction from tax is claimed, the statute must be construed strictly in favor of the taxing authority, the right to the exemption or deduction must be clearly and unambiguously expressed in the statute, and the right must be clearly established by the taxpayer. Chavez v. Commissioner of Revenue, 82 N.M. 97, 476 P.2d 67 (Ct.App. 1970); see also Pittsburgh & Midway Coal Mining Co. v. Revenue Div., Taxation & Revenue Dep’t, 99 N.M. 545, 660 P.2d 1027 (Ct.App.), appeal dismissed, 464 U.S. 923, 104 S.Ct. 323, 78 L.Ed.2d 296 (1983); Stohr v. New Mexico Bureau of Revenue, 90 N.M. 43, 559 P.2d 420 (Ct.App.1976); Reed v. Jones, 81 N.M. 481, 468 P.2d 882 (Ct. App.1970).
Once it is determined that a tax is applicable, after allowing for any statutory deduction, the statute permitting the deduction must be narrowly, yet reasonably construed. Chavez v. Commissioner of Revenue. “A tax statute must also be given a fair, unbiased, and reasonable construction, without favor or prejudice to either the taxpayer or the State, to the end that the legislative intent is effectuated and the public interests to be subserved thereby are furthered.” Id. 82 N.M. at 99, 476 P.2d at 69.
Thus, taxation is the rule and the claimant for an exemption must show that his demand is within the letter as well as the spirit of the law. Jones v. Iowa State Tax Comm’n, 247 Iowa 530, 74 N.W.2d 563 (1956). See generally 3A N. Singer, Sutherland Statutory Construction § 66.09 (Sands 4th ed. 1986).
Although some of the cases cited, see, e.g., Chavez v. Commissioner of Revenue, refer to “construction” when ordinarily we speak of rules of construction in connection with ambiguity, we believe there is a difference between interpretation and construction that is relevant in this case. In “interpreting” a document or statute, courts are trying to decide what the words chosen by the author or legislature mean. In “construing” a document or statute, courts are applying principles of preferred meaning, because the meaning cannot otherwise be ascertained. Cf. T. Atkinson, Law of Wills § 146 at 809 (2d ed. 1953) (“construction is necessary only when interpretation fails”).
With these principles in mind, our analysis involves the following steps: (1) because the statute does not include a definition of the relevant terms, this court may interpret the words in accordance with their ordinary meaning; (2) in interpreting the words in accordance with their ordinary meaning, and in the absence of cases from this state, we can look to cases from other jurisdictions and from model statutes for guidance; (3) the definition found in these authorities supports the Department’s position that a loan is distinguishable from a credit sale; (4) in applying the statute, we observe the rules that the taxpayer must establish a right to an exemption or deduction and that a statute establishing an exemption or deduction is to be narrowly construed; and (5) we must then decide whether the phrase “charges made for handling loan payments” as used in Section 7-9-61.1 encompasses the charges made by taxpayers in connection with installment payments on real estate contracts held in escrow.
The legislature, in enacting Section 7-9-61.1, did not expressly define the terms “loan” or “loan payments,” and the disposition of this appeal consequently turns on the ordinary meaning of those terms.
In interpreting the statute, “loan” is the critical term. We believe this term has a well-accepted meaning. Webster’s Third New International Dictionary 1326 (1966) defines “loan” as “something lent for the borrower's temporary use on condition that it or its equivalent be returned.” Case law has defined a loan as a delivery of a sum of money to another under a contract to return at some future time an equivalent amount with or without an additional amount agreed upon for its use. Boerner v. Colwell Co., 21 Cal.3d 37, 145 Cal.Rptr. 380, 577 P.2d 200 (1978) (in bank); Kline v. Robinson, 83 Nev. 244, 428 P.2d 190 (1967), overruled on other grounds, Pease v. Taylor, 88 Nev. 287, 496 P.2d 757 (1972). See generally Verbeck v. Clymer, 202 Cal. 557, 261 P. 1017 (1927) (contract for sale of land, providing for monthly payments covering a period of fifteen years, being a bona fide sale and purchase of real property where vendor retained title, held not a “loan” within the meaning of usury law); Petersen v. Philco Fin. Corp., 91 Idaho 644, 428 P.2d 961 (1967) (bona fide sale of property under a contract providing for payment of the purchase price, in whole or in part, in the future, in one or more installments, is in no sense a “loan,” and usury statute has no application to such sales).
The four elements of a loan are: (1) a principal sum; (2) a placing of the sum with a borrower; (3) an agreement that interest is to be paid; and (4) a recognition by the receiver of money of his liability for return of the principal amount with accrued interest. McLendon v. Johnson, 71 Ga.App. 424, 31 S.E.2d 89 (1944). In a loan, the initial transaction creates a debit and credit relationship that is not terminated until replacement of the sum borrowed with agreed interest. Kline v. Robinson. A sale, on the other hand, is the transfer of the property or a thing for a price in money. Id.
In L. Buchmiller, supra, at § 1.01, a real estate contract is defined as a “legally enforceable agreement by which an owner of real property agrees to sell, and a purchaser agrees to buy the property on a deferred payment arrangement.” (Emphasis added.) Moreover, Black’s Law Dictionary 717 (5th ed. 1979) defines “installment land contract” as a “[t]ype of contract by which [the] buyer is required to make periodic payments towards purchase price of land and only on the last payment is the seller required to deliver a deed.” These definitions do not define a real estate contract in terms of a loan or a lending transaction.
Additionally, the Uniform Consumer Credit Code, 1974 Act, Section 1.301(25), 7A U.L.A. 46 (1985) states that a loan includes:
(i) the creation of debt by the lender’s payment of or agreement to pay money to the debtor or to a third person for the account of the debtor;
(ii) the creation of debt pursuant to a lender credit card * * *;
(iii) the creation of debt by a cash advance to a debtor pursuant to a seller credit card;
(iv) the creation of debt by a credit to an account with the lender upon which the debtor is entitled to draw immediately; and
(v) the forbearance of debt arising from a loan.
The Code further states that a loan does not include the “forbearance of debt arising from a sale or lease.”
These authorities support the Department’s position that the phrase “charges made for handling loan payments,” as used in Section 7-9-61.1, does not encompass the charges made by taxpayers for their escrow services in connection with installment payments on real estate contracts. When the key terms are interpreted according to their ordinary meaning, we then apply the statute in accordance with the rules that the taxpayers must establish their right to an exemption or deduction and that the relevant statute is to be narrowly and reasonably construed.
We conclude that the legislature intended to allow the deduction from gross receipts under the statute only for typical loan transactions involving both a traditional lender and borrower. We necessarily conclude that the real estate contracts at issue in this appeal, or the installment payments made under them, were not intended by the legislature to come within the meaning of the terms “loan” or “loan payments,” respectively. Under our reading of the statute, any processing or collection charges typieally made by either independent escrow agents, or banks acting as escrow agents, are not properly deductible from gross receipts under the pertinent statute.
We believe that this interpretation and construction of Section 7-9-61.1 is both narrow and reasonable, see Chavez v. Commissioner of Revenue, and that as such, we are applying the statute in light of its purpose. See Claridge v. New Mexico State Racing Comm’n, 107 N.M. 632, 763 P.2d 66, (App.1988). Our interpretation also follows the principles stated in Chavez, that when a deduction is claimed by a taxpayer, the statute is to be strictly construed in favor of the taxing authority, and the right to the deduction must be clearly and unambiguously expressed. Further, taxpayers did not clearly establish their right to the deduction. See Chavez v. Commissioner of Revenue.
To hold otherwise would in effect unfairly eliminate payment of gross receipts tax by escrow businesses throughout New Mexico for gross receipts derived from charges similar to those at issue in this case. We do not believe that result was the intent of the legislature. Additionally, if we were to construe the statute as urged by taxpayers, we would in essence be deferring substance to form, thus encouraging escrow agents or the parties under any real estate contract to adopt certain contractual language making the transaction appear as a loan when in substance it is not. The sole purpose of such manipulative wording would be to improperly permit a deduction from gross receipts under the statute. Likewise, we believe this circumvention would open a floodgate to needless and possibly endless litigation with respect to whether a real estate contract was, in addition to being a sale, also a loan transaction.
In summary, we conclude that the subject real estate contracts do not constitute loan transactions qualifying taxpayers for deductions under Section 7-9-61.1. We hold that the trial court erred in granting summary judgment to taxpayers and denying the Department’s motion for summary judgment.
We reverse and remand the case with directions that the trial court enter an order granting the Department’s summary judgment motion and revoking its previous order granting taxpayers’ own motion. The Department is awarded its costs on appeal.
IT IS SO ORDERED.
BIVINS and MINZNER, JJ., concur. | [
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] |
OPINION
BIVINS, Judge.
Plaintiff Clara Pena filed suit against defendant Westland Development Co., Inc. (Westland) following a shareholder election selecting Westland’s board of directors. The trial court appointed a special master to tabulate the results and categorize challenges to a number of shareholder proxies. Following the special master proceedings, Barbara Page and Polecarpio Anaya were joined as plaintiffs on the trial court’s own motion. After a nonjury trial, the trial court entered a judgment establishing the results of the election. Plaintiffs appeal from that judgment and Westland cross-appeals. Plaintiffs raise three claims of error and Westland four. We identity and discuss each issue after reciting the factual background. We affirm in part and reverse in part.
FACTS
Plaintiffs ran as a nonmanagement slate in the election that is the subject of this suit. The election was held on November 16,1985, at a shareholders’ meeting. Some shareholders cast ballots at the meeting, and others voted by 'proxy. The election was extremely close and both sides actively solicited votes. During the process of counting the ballots and proxies, disputes arose between the management faction and the nonmanagement faction. On December 4, 1985, Pena filed a complaint requesting a temporary restraining order to halt the counting of the votes, and the appointment of a special master to count the votes and deal with challenges to the ballots and proxies. The temporary restraining order was granted and a hearing held on December 5. Following the hearing, the trial court ordered the counting to continue, subject to certain conditions. More disputes arose and Pena asked for additional intervention by the trial court.
The trial court granted another temporary restraining order imposing additional conditions. Then, on January 3, 1986, the trial court appointed a special master to supervise the proceedings, tabulate the votes, and determine the existence of challenges to proxies or ballots. The special master held meetings on January 8, 13, 15, and 16. At these meetings, Pena and Westland raised a variety of challenges to the proxies. Neither side challenged any of the proxies on the basis that the signatures on the proxies were forgeries. By the end of the special master meetings, Pena and Westland had agreed that 966 nonmanagement proxies and 918 management proxies would not be challenged, and these proxies were segregated into a separate box.
On January 31, after the special master proceedings concluded, the trial court held a hearing to rule on the parties’ objections to the various proxies. Following the January 31 hearing, the proxies and ballots were submitted to a private accounting firm to be counted. The parties were allowed to challenge the accounting firm’s procedures and final'tally.
Later in February, Westland asked the trial court to order Pena to pay the costs of the special master proceedings, including the accountant’s fees. Westland maintained that since Pena had asked for the appointment of the special master, she should bear the cost. The trial court ordered Westland to pay the costs, but reserved ruling on who would ultimately be responsible for them.
In March, Westland moved to join Page and Anaya as plaintiffs. Westland wanted them to be available to help pay the costs if the trial court ordered Pena to pay them. The trial court denied the motion, but joined Page and Anaya as plaintiffs on its own motion, ruling that they would not be responsible for any costs incurred prior to the time of their joinder.
On April 29, Pena moved to allow a renewal of objections to proxies that had been uncontested. The basis of the motion was plaintiff’s claim that since the conclusion of the special master proceedings, she had discovered that a number of the uncontested proxies contained forged signatures. The trial court denied Pena’s motion, stating that there would be no reopening of the special master proceedings. Later, at trial, plaintiffs submitted offer-of-proof testimony that they had discovered the first forgery by accident, in early February; that they did not obtain copies of the proxies until early March, and only then were able to begin to investigate the signatures; and that they had uncovered enough forgeries to change the result of the election.
On May 15, Page and Anaya made their own motion to renew objections to the uncontested proxies on the same grounds as Pena’s motion. This motion was also denied. The trial court ruled that Page’s and Anaya’s rights had been protected by Pena, and noted that Page had been present at many of the trial court proceedings and at the special master proceedings.
The trial was held on July 15, 1986. Most of the trial time was consumed with plaintiffs’ offer of proof concerning the forged proxies. Plaintiffs presented witnesses who testified that the signatures on management ballots were not theirs. Plaintiffs also offered depositions of unavailable witnesses who said the same thing. Finally, plaintiffs offered Page’s testimony regarding her lack of access to the proxies and the lack of knowledge that forgery might be a problem until after the special master proceedings ended.
The trial court entered judgment establishing the management slate as the winners of the election. The margin of victory between the management candidate with the least votes and the nonmanagement candidate with the most votes was less than 400 out of a total of almost 300,000 votes. A change of only 500 votes from management candidates to nonmanagement candidates would have elected two of the nonmanagement candidates. In addition to determining the results of the election, the trial court also held Westland responsible for the costs of the special master proceedings.
DISCUSSION
Trial Court’s Refusal to Allow Plaintiffs to Challenge Allegedly Forged Proxies
Plaintiffs’ initial contention is that they should have been allowed to challenge proxies that they had agreed, in the special master proceedings, not to challenge. They liken the situation to one in which a party enters into a stipulation that proves to be contrary to the facts, and argue that the trial court should have granted them relief from that stipulation. Page and Ana-ya argue, in addition, that they were not joined as parties until after the special master proceedings were concluded, and that they should not be bound by any stipulations entered into before they became parties. We need not address that issue because of our disposition of the first contention.
It is true that a court may set aside a stipulation if a mistake of fact is clearly shown, the mistake is material to the case, and the mistake could not have been avoided through the exercise of due care. See Ballard v. Miller, 87 N.M. 86, 529 P.2d 752 (1974); Marrujo v. Chavez, 77 N.M. 595, 426 P.2d 199 (1967). The decision as to whether a stipulation should be set aside is within the discretion of the trial court. Id. Thus, under plaintiffs’ argument, the trial court’s refusal to set aside the stipulation and allow them to challenge the “uncontested” proxies is reviewable only for an abuse of discretion.
While the argument regarding setting aside stipulations does seem to have some applicability to the situation at hand, we believe that a more apt analogy is a motion for a new trial based on newly-discovered evidence, or a Rule 60(B) motion (SCRA 1986, 1-060(B)) to set aside a judgment based on such evidence. A special master proceeding is a quasi-independent proceeding from the rest of the trial; for example, the trial court may only review the special master’s findings of fact to determine whether they are supported by substantial evidence. State ex rel. Reynolds v. Niccum, 102 N.M. 330, 695 P.2d 480 (1985). The trial court may not set aside the special master’s findings just to reweigh the evidence. Lopez v. Singh, 53 N.M. 245, 205 P.2d 492 (1949). This case involves evidence discovered after the conclusion of the proceeding, and plaintiffs are in effect asking to reopen that proceeding to change the result. The trial court acknowledged this when it denied their motion, by stating that it would not go back in and reopen the special master hearing. We will, therefore, apply the principles of review applicable to the denial of a motion for a new trial to the situation at hand. The result we reach would be the same regardless of which approach we utilize.
A motion for a new trial based on newly-discovered evidence is addressed to the trial court’s discretion. Hill v. Burnworth, 85 N.M. 615, 514 P.2d 1312 (Ct.App. 1973). Therefore, our review is limited to determining whether the trial court abused its discretion in refusing to allow plaintiffs to raise the forgery issue with respect to the unchallenged proxies.
The prerequisites for granting a motion for a new trial based on newly-discovered evidence are as follows: (1) the new evidence would probably change the result; (2) it has been discovered since the trial; (3) it could not have been discovered before trial through the exercise of due diligence; (4) it is material to the issues in the case; (5) it is not merely cumulative; and (6) it is not merely impeaching or contradictory. Mitchell v. Forster, 59 N.M. 226, 282 P.2d 708 (1955); Hill v. Burnworth.
It appears that the new evidence in this case would probably change the result, if it is accepted by the trial court. Plaintiffs presented testimony of the owners of over 3500 shares of Westland’s stock, who claimed that they did not sign the management proxies that were counted as management votes. Some of this testimony was somewhat equivocal; for example, Frank Candelaria, the owner of 2570 shares, changed his mind about whether he did not sign the management proxy at all or was “backed into” signing it. Even without Candelaria’s votes, however, the election was close enough that the other witnesses’ votes would probably have changed the result.
The new evidence was clearly discovered after the last special master meeting. It is also material to the issue in the case, which is, who legitimately won the election? It is not merely cumulative, because it is the only testimony concerning forged proxies in the case. It is not merely contradictory or impeaching.
There is room for contention, however, over whether the forged proxies could have been discovered before the end of the special master proceedings if plaintiffs had exercised due diligence. The only evidence on this issue is Page’s testimony at trial and what we can glean from the record proper. Page’s testimony indicates that during the special master proceedings plaintiffs did not have an opportunity to closely examine the original proxies and did not have copies of the proxies to examine at their leisure. Plaintiffs had no reason to suspect that some of the signatures were forged until, by accident, they discovered an apparent forgery in early February. The last special master meeting was held on January 16.
In March, the trial court gave plaintiffs permission to obtain copies of the proxies, and they contacted a few hundred people to ask about their signatures and, allegedly, discovered that approximately one of every twenty-five management proxies was a forgery. They then made their motions to allow renewal of objections, which were denied.
The timetable revealed by the record shows that the election was held on November 16, and the process of counting the votes began soon after. December was filled with litigation, such as plaintiffs’ requests for temporary restraining orders and an attempt by Westland to remove the case to federal court. The special master proceedings started in January and ended on the 16th of that month. Plaintiffs, therefore, had two months from the date of the election to the end of the special master proceedings to uncover the alleged forgeries. During that time, however, plaintiffs had no reason to suspect that the forgeries had occurred. Given the short period of time in which plaintiffs had to act, and the lack of any knowledge that forgery of proxies might be a problem, we believe that plaintiffs did exercise due diligence in making their challenges to proxies.
Based on the foregoing, it appears that plaintiffs have met the requirements for the grant of a new trial. See Mitchell v. Forster; Hill v. Burnworth. The trial court denied plaintiffs the opportunity to raise their objections to the formerly unchallenged proxies. The trial court’s denial was based on considerations of the amount of time it would take to try to verify over 1800 signatures on proxies that had not been challenged in the special master proceedings, and. on the fact that plaintiffs had been urging the trial court to expedite the litigation so that the election dispute could be resolved. While concerns over the necessity for an expeditious resolution of a lawsuit of this type are valid, we believe they cannot overcome the requirement that each side be allowed a full and fair opportunity to litigate all material issues.
The present case involves a battle over control of a corporation and a debate over the direction that corporation should take in the future. The vote was extremely close, and frequent solicitations for votes were made in person, as well as through the mail. In such an atmosphere, it is likely that overreaching could occur by partisans of either side. To ensure a fair result in the election and to deter future misconduct of this sort, plaintiffs should have been allowed the opportunity to raise the issue of the asserted forgeries and have the trial court rule on their challenges to those proxies. We, therefore, reverse the trial court on this issue. On remand, both sides should be allowed to conduct discovery regarding the authenticity of proxy signatures and to cross-examine all witnesses presented by the other party.
Manner of Signing Proxies
Plaintiffs challenge a number of proxies because of asserted deficiencies in the manner in which they were signed. They argue, first, that where shares are jointly owned, all owners must sign a proxy to make it valid. The trial court ruled that proxies signed by only one of two or more joint owners were presumptively valid, but that plaintiffs could overcome the presumption by presenting evidence to show that the missing joint owners did not agree with the vote evidenced on the proxies.
This approach seems fair and reasonable, and in accord with the reasoning adopted by other courts. See Sellers v. Joseph Bancroft & Sons Co., 25 Del.Ch. 268, 17 A.2d 831 (1941) (where shares of stock are jointly owned, they may be voted at a shareholder’s meeting by one of the joint owners, in the absence of apparent objection by any other owner). Cf. Standard Power & Light Corp. v. Investment Assocs., Inc., 29 Del.Ch. 593, 51 A.2d 572 (1947) (where husband signed his wife’s name to a proxy, the proxy would be prima facie valid in the absence of a showing that husband was not authorized to sign for wife).
The trial court’s approach comports with the policy that stockholders should not be disenfranchised unless their purported vote is meaningless. See Levin v. Metro-Goldwyn-Mayer, Inc., 43 Del.Ch. 168, 221 A.2d 499 (1966). We also agree that proxies of small shareholders in large companies should be scrutinized and evaluated so that the shareholders’ wishes are not frustrated. Cupo v. Community Nat’l Bank & Trust Co. of N.Y., 324 F.Supp. 1390 (E.D.N.Y.1971), rev’d on other grounds, 438 F.2d 108 (2d Cir.1971). The trial court’s approach to these challenges was eminently reasonable, especially since plaintiffs were allowed the opportunity to produce evidence showing that the non-signing joint owner did not intend that the shares be voted in the way they were voted. Plaintiffs produced no such evidence.
A number of the proxies contained “signatures” that were printed instead of signed. Plaintiffs contend that these proxies are void as a matter of law. This contention is answered by Costilla Estates Development Co. v. Mascarenas, 33 N.M. 356, 267 P. 74 (1928). In Costilla, the supreme court interpreted a statute that directed the court clerk to sign filed papers. The clerk had stamped the papers with a rubber stamp instead of physically signing them. The supreme court concluded: “Generally a signature, if adopted as such, may be printed, lithographed, or typewritten, as well as written.” Id. at 364, 267 P. at 77 (emphasis added). While this statement may have referred to a machine-printed signature as opposed to a hand-printed one, the principle is clear: if a party intends that the purported signature be a signature, it will be treated as such.
Costilla is in line with cases from other jurisdictions. See, e.g., Schott v. Climax Molybdenum Co., 38 Del.Ch. 450, 154 A.2d 221 (1959) (use of a stamped facsimile sig nature is sufficient to cloak proxy with presumption of authenticity); Board of County Comm’rs of Johnson County v. Kearney, 8 Kan.App.2d 534, 661 P.2d 823 (1983) (signature may be by mark, initials, printed, stamped or typewritten). The trial court did not rule that the proxies were valid as a matter of law, but only that they were presumptively valid. Plaintiffs were allowed the opportunity to rebut that presumption with testimony from the shareholders whose names were printed. The trial court’s ruling was correct.
Counting Class B Shareholders’ Votes
Plaintiffs argue that the votes reflecting Class B shares of stock should not have been counted in the candidates’ totals. As the basis for this contention, plaintiffs rely on the fact that the voting list, prepared by Westland before the election, did not list the Class B shares and their owners. Plaintiffs argue that the list is prima facie evidence of those entitled to vote, and Westland’s failure to include Class B shares and their owners in the list bars the validity of their votes. We disagree.
Plaintiffs’ position would disenfranchise record owners of stock, who are entitled to vote, because Westland did not prepare a proper list of shareholders. The Class B shareholders are entitled to vote by law. NMSA 1978, § 53-ll-33(A) (Repl.Pamp. 1983). They should not be disenfranchised by another’s misfeasance or malfeasance. In addition, NMSA 1978, Section 53-11-31 (Repl.Pamp.1983), which specifies voting list requirements, provides in part: “Failure to comply with the requirements of this section does not affect the validity of any action taken at the [shareholders’] meeting.” Combining the Class B owners’ right to vote with this statement in the statute and the policy that shareholders should not be disenfranchised, we reach the conclusion that the trial court’s ruling on this issue was correct. This is especially so because, as Westland contends and plaintiffs do not contest, all the Class B owners also held common stock, and so were included in the list of voters. The list simply did not reveal the extent of their Class B stock holdings. It appears, therefore, that plaintiffs had an opportunity to solicit votes from all of the owners of Class B stock and were not prejudiced by the omission of the Class B shares from the list of voters and shares entitled to vote.
Double Proxies Issue
This is the first issue raised by Westland in its cross-appeal. Twenty-three shareholders executed nonmanagement proxies, then submitted later management proxies on which they checked the “No” box, indicating that they did not want their votes cast for the management candidates. One shareholder executed a nonmanagement proxy, then submitted a management proxy on which neither the “Yes” nor the “No” box was checked. The management proxy form specifically stated that “THIS PROXY REVOKES ALL PROXIES PREVIOUSLY GRANTED BY ME FOR ANY PURPOSE.” Westland relies on this statement to argue that the later management proxies revoked the earlier nonmanagement proxies, so that the shareholders’ votes should not have been counted for the nonmanagement candidates. Westland in effect argues that by submitting later-dated management proxies, with no box checked or the “No” box checked, the shareholders intended to abstain from the voting. The trial court ruled that the earlier nonmanagement “Yes” votes indicated a preference for the nonmanagement slate, and the subsequent “No” and blank management proxies indicated “No” votes for that slate and were not abstentions. The trial court stated that these rulings only established presumptions that the votes were intended to be nonmanagement votes and that Westland could rebut that presumption. Westland did not attempt to do so with respect to any of the proxies.
Westland relies on the explicit language of the management proxies and on the principle that a later proxy revokes an earlier one. See, e.g., Burleson v. Hayutin, 130 Colo. 58, 273 P.2d 124 (1954) (En Banc) (proxy may be revoked by giving later proxy to another). However, under the circumstances surrounding these proxies and considering that the offer-of-proof testimony shows that many of these share holders are not sophisticated and are not large shareholders, we believe the trial court’s approach was correct. Establishing a presumption that the shareholders intended to vote for the nonmanagement candidates appears to have carried out the shareholders’ intentions in submitting the proxies as they did. This equitable result is in accordance with our earlier discussion of the rationale that proxies of small shareholders of a corporation should be scrutinized and evaluated so that the shareholders’ wishes are not frustrated. Cupo v. Community Nat’l Bank & Trust Co. of N.Y. We affirm the trial court’s holding on this issue.
Sotero Salazar’s Proxy
Westland argues that the trial court erred by ruling that Sotero Salazar’s votes would be counted for the nonmanagement slate. Westland contends that Salazar’s deposition showed that he intended to vote for the management candidates, that the trial court had earlier ruled that Salazar’s intent would determine how his votes would be counted, and that the trial court thus erred in its determination that the votes should be added to plaintiffs’ total. Westland maintains that since the trial court looked to shareholder intent in deciding that later-submitted “No” votes for management candidates should not supersede earlier “Yes” votes for nonmanagement candidates, the trial court should have effectuated Salazar’s intent also. We agree.
The first proxy signed by Salazar voted in favor of the management candidates; the second voted for the nonmanagement candidates. It appears from the findings the trial court counted Salazar’s shares in favor of nonmanagement on the basis that the later-signed proxy controlled. While Salazar’s later-submitted proxy was not blank, or a “No” vote for the slate on the proxy, as was the case of the proxies discussed in the previous section, we believe that consistency requires that Salazar’s intent controls.
Ordinarily, the trial court is the proper arbiter of the credibility of witnesses and the testimony. See Farmers & Stockmens Bank of Clayton v. Morrow, 81 N.M. 678, 472 P.2d 643 (1970). However, where, as here, the testimony is by deposition, this court is in just as good a position as the trial court to evaluate Salazar’s testimony. In any event, it is not clear that the trial court considered Salazar’s intent in making its ruling. See Cupo v. Community Nat’l Bank & Trust Co. of N. Y. Since we hold that intent should control, we have examined Salazar’s deposition and determine that it evinces a clear intent to vote for the management candidates. Moreover, Salazar’s deposition indicates that the later-signed proxy may have been obtained through misrepresentation. Therefore, on remand, Salazar’s votes are to be counted in favor of management.
Edmund Chavez’s Proxy
Edmund Chavez attempted to split his votes among the three nonmanagement candidates and one of the management candidates. He sent in two proxies and marked the number of shares that he wanted voted on each one. The trial court refused to give effect to his attempt to vote for one of the management candidates, instead ruling that all of his shares would be counted as votes for the nonmanagement slate. The trial court’s decision was apparently based only on the fact that the non-management proxy was dated later than the management proxy.
The trial court’s refusal to give effect to the shareholder’s intent is inconsistent with the trial court’s rulings on other issues raised by the parties. Chavez clearly marked on his proxies the number of shares he wished voted for the various candidates. The parties have not directed us to any authority preventing him from doing so, as long as his votes were not cumulated. Therefore, he should have been able to split his shares among the candidates for whom he wanted to vote. The trial court’s refusal to allow him to do so is reversed, and the trial court is directed to determine Chavez’s intent in casting his votes and enter a decision in accordance with that intent.
Expenses of Special Master Proceedings
Westland argues that the expenses of the special master proceedings should have been assessed to plaintiffs and not to West-land. Westland’s argument is based on the fact that Pena, and not Westland, asked for the appointment of the special master, and on the contention that there is no evidence supporting the trial court’s finding that judicial intervention was necessary to obtain a fair and accurate vote count.
SCRA 1986, 1-053(A) (Supp.1987) states that “[t]he compensation to be allowed to a master shall be fixed by the court, and shall be charged upon such of the parties * * * as the court may direct.” This rule gives a trial court the discretion to decide who should bear the burden of paying the special master’s fees and other expenses of the special master proceedings. In addition, as Westland acknowledges, the matter of assessing costs lies within the discretion of the trial court and will not be reversed on appeal except for abuse of that discretion. Baca v. Marquez, 105 N.M. 762, 737 P.2d 543 (Ct.App.1987); see SCRA 1986, 1-054(E) (“[Cjosts shall be allowed as a matter of course to the prevailing party unless the court otherwise directs * * *.”).
This case involved a bitterly contested and extremely close proxy fight between rival shareholder factions. The trial court was asked to intervene in the proceedings twice in one month. Appointment of a special master to control the matter and conserve the trial court’s resources was a proper way to deal with the situation. The proceedings involved a number of challenges to many proxies, based on a number of different grounds. Under these circumstances, we do not believe the trial court abused its discretion by determining that the special master proceedings were necessary to ensure a well-regulated vote count and that Westland should bear the costs of those proceedings. In so ruling, we do not intend to restrict the trial court in allocating costs on remand.
CONCLUSION
For the foregoing reasons, we reverse the trial court’s judgment in part and affirm in part. The matter is remanded to the trial court for further proceedings consistent with this opinion. Plaintiffs’ motion requesting oral argument is denied because we deem oral argument unnecessary. Garcia v. Genuine Parts Co., 90 N.M. 124, 560 P.2d 545 (Ct.App.1977).
IT IS SO ORDERED.
GARCIA and FRUMAN, JJ., concur. | [
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] |
OPINION
RANSOM, Justice.
Diversified Development & Investment, Inc., sued the estate of Anne Pickard and its personal representatives, Helga Heil and Dorothy Holmberg, (collectively, “the Estate") for breach of contract, misrepresentation, and prima facie tort in connection with a contractual option to purchase real estate. After the Estate filed a third-party claim for indemnification and legal malpractice against its attorney, Patrick Hurley, Diversified Development filed a claim against Hurley for breach of contract, misrepresentation, and prima facie tort, and asked for punitive damages. Before ruling on a motion filed by Diversified Development to compel discovery, the district court granted summary judgments in favor of the Estate and Hurley.
Diversified Development appeals pursuant to SCRA 1986, 12-102(A)(1) (Repl. Pamp.1992) (count sounding in contract). We find that the court erred in granting summary judgment before ruling on the motion to compel discovery. We therefore reverse the judgment in favor of the Estate on Diversified Development’s claim that Hurley had actual authority to grant an extension of the purchase option. Further, we hold that the trial court should compel discovery of certain communications between the Estate and Hurley. Finally, we find that Diversified Development raised a genuine issue as to Hurley’s actual or apparent authority to communicate whether the Estate agreed to an extension of the option deadline. We therefore hold that, on remand, Diversified Development may pursue its theory that Hurley’s statements thus could bind the Estate.
Facts. In March 1990 Diversified Development executed an agreement with New Jersey residents Heil and Holmberg in which Diversified Development was given a six-month option to purchase approximately sixteen acres of unimproved Albuquerque real estate for $575,000. The agreement empowered Diversified Development to extend the purchase option for an additional six months upon written notification to the Estate. Diversified Development exercised this right to an extension in a letter delivered to Hurley from Diversified Development’s attorney, Ray Baehr. This extension gave Diversified Development until March 31, 1991, to exercise the purchase option.
In February 1991 Diversified Development asked Lee Welsh, a real estate agent for the Estate, to determine whether the Estate would consider modifications to the agreement’s financing terms. Diversified Development’s president, Chester Hearn, testified that Welsh assured him he had talked to Heil and Holmberg and that they were receptive to “some modifications of the financing arrangements.” Diversified Development emphasized to Welsh that it wished to retain the right to exercise the original purchase option if financing modifications could not be worked out.
In a letter sent to Welsh, Heil, Hurley, and Baehr dated March 22, 1991, Diversified Development put its financing modification request in writing. In this letter Hearn reaffirmed Diversified Development’s intent to purchase the parcel of land and requested a ninety-day extension of the existing option pending execution of the modified agreement. Baehr testified that during the week of March 25 he telephoned Hurley to inquire about the status of the March 22 extension request and to set up a meeting before the March 31 option deadline to discuss whether the Estate would accept the alternative financing proposal. He testified that Hurley was not able to meet with him but assured him that “a few days one way or another [will] not make any difference” and “these ladies are not going to hold [Diversified Development] to the [option deadline.]”
Hurley conceded only that on March 29 he told Baehr he had talked to Heil and that the Estate “probably [would] agree to an extension — possibly more.” He stated that Heil told him it would be after the March 31 deadline before she could say whether the Estate was amenable to accepting an alteration of the option. Heil insisted that Hurley had no authority to tell Baehr that the Estate “probably [would] agree to an extension” but acknowledged that Hurley did have authority to discuss an extension.
Baehr and Hurley agreed to meet on April 4. At this meeting Diversified Development and Baehr discussed the March 22 financing proposal with Hurley and Welsh and inquired whether the option would have to be exercised as written. Hearn testified that at the conclusion of the meeting he asked for a written extension but Hurley insisted that one was not necessary because Diversified Development would get an answer on the financing proposal in a few days. Hearn also stated that Hurley assured Diversified Development it could exercise the original purchase option if the Estate did not agree to financing modifications.
Between April 4 and April 25 Hurley had several conversations with Heil about the proposed modifications. Hurley did not know that the Estate would not extend the option, however, until either April 25 or May 2. On May 1 Heil and Holmberg faxed a letter directly to Baehr rejecting the proposed financing modifications and stating that the Estate was “reviewing [its] options” and would attempt to obtain a better price for the land. On May 8 Welsh told Hearn that the Estate considered the purchase option to have expired.
On May 9 Diversified Development deposited earnest money in the amount called for by the option agreement into escrow and notified Hurley, Welsh, and Heil that it was exercising the original purchase option. On May 11 the Estate instructed the escrow agent to return the earnest money to Diversified Development and to record a termination statement. Approximately three months later the Estate accepted a purchase offer for $800,000 from another buyer.
Proceedings. On February 25, 1993, following minimal pretrial discovery, Diversified Development filed a motion to compel production of memos written by Hurley detailing his conversations with Heil about the March 22 extension request. Hurley refused to produce these memos, claiming attorney-client privilege. The motion to compel also sought production of withheld portions of Heil’s telephone diary detailing conversations with Welsh and Hurley. Hurley joined in Diversified Development’s motion, arguing that Heil had waived the attorney-client privilege by bringing an action against him and by offering evidence of some of the communications. The court held a motion hearing on March 11 but did not rule.
The Estate and Hurley filed motions for summary judgment on February 15 and 19 respectively. On March 26 and 29 those motions were heard and on April 6 the court issued a letter decision ruling in favor of the Estate and Hurley. .The court stated that it assumed Diversified Development’s motion to compel discovery to be moot as a result of its ruling. The trial court found it undisputed that Hurley lacked actual or apparent authority either to make final decisions for the Estate or to grant an extension. Based on this finding, the court determined that there was no support for the contract claim. The court also determined that “Hurley made no misrepresentations for which his principals could be held liable.” Finally, the court found as a matter of law that the facts of the case did not support the prima facie tort claim.
With regard to Diversified Development’s claims against Hurley, the court determined that Diversified Development could not state a contract claim because Hurley was not a principal and commented that the nature of the extension was too nebulous to represent a “meeting of the minds as to what the duties and obligations of the parties were.” The. court also determined that recovery against Hurley for prima facie tort was not supported by the facts, and that Hurley’s representations were unactionable opinions upon which Diversified Development could not rea sonably have relied. Finally, the court found that Hurley had no duty to disclose to Diversified Development his lack of authority to grant an extension.
The motion to compel discovery. The major issue in this case is whether Hurley had actual or apparent authority to bind the Estate to an extension of time within which Diversified Development could exercise the purchase option. Diversified Development argues that because it was denied the opportunity to discover facts defining the nature and scope of Hurley’s authority, it did not have the ability to defeat summary judgment motions by the Estate and Hurley. The Estate counters that Diversified Development waived any objection to the court’s decision by failing to object to the court’s mootness ruling when summary judgment was granted. On the merits, the Estate claims an attorney-client privilege against discovery.
—Diversified Development preserved the issue. To preserve an issue for appeal, “it must appear that a ruling or decision by the district court was fairly invoked.” SCRA 1986, 12-216(A) (Repl.Pamp.1992); see also SCRA 1986, 1-046 (Repl.Pamp.1992). The purpose of requiring a party to invoke a ruling or decision by the district court is to alert the trial judge to a claim of error and give the judge an opportunity to correct any mistake. Madrid v. Roybal, 112 N.M. 354, 356, 815 P.2d 650, 652 (Ct.App.), cert. denied, 112 N.M. 308, 815 P.2d 161 (1991); see also Cockrell v. Cockrell, 117 N.M. 321, 323-24, 871 P.2d 977, 979-80 (1994) (holding that challenge to sufficiency of evidence was not brought to the attention of trial court and thus was not preserved).
In its response to the Estate’s motion for summary judgment Diversified Development requested “that the Court’s decision on Summary Judgment be continued pursuant to SCRA 1986, 1-056(F) [ (Repl.Pamp.1992) (allowing a trial judge to deny a motion for summary judgment when it appears that the party opposing the motion needs more discovery to obtain facts supporting his position) ], until such time as the Motion to Compel Discovery is decided.” Diversified Development further argued, as it had done previously and more extensively in a memorandum in support of the motion to compel, that its “ability to fully demonstrate the extent of the dispute as to Hurley’s authority [had] been hampered” by the Estate’s claim of attorney-client privilege. Thus Diversified Development argued that a decision on summary judgment should be delayed until the motion to compel was decided.
By requesting the trial judge to stay his ruling on the motions for summary judgment until he had ruled on the motion to compel, by citing Rule 1-056(F), and by incorporating its prior argument that further discovery was essential to support its claims that Hurley had authority to bind the Estate, Diversified Development presented the judge with all the information necessary to make an informed decision whether the motion to compel should be decided prior to the motions for summary judgment. Diversified Development thus preserved the discovery issue.
—Attorney-client privilege does not extend to a client’s grant of actual authority. Although appellate courts generally do not address the merits of a discovery motion before the trial court has had an opportunity to do so, see Garrett v. City of San Francisco, 818 F.2d 1515, 1519 n. 4 (9th Cir.1987), for purposes of judicial economy and because the parties have briefed the issue, we will address the merits of the Estate’s claim of privilege. Diversified Development and Hurley urge that no privilege existed between Hurley and the Estate. Alternatively, they urge that the Estate waived any privilege by bringing a third-party claim against Hurley. The Estate counters that communications between itself and Hurley should be exempt from discovery under the attorney-client privilege set out in SCRA 1986, 11-503(B) (Repl.Pamp.1994).
Rule 11-503(B) states that “[a] client has a privilege to refuse to disclose and to prevent any other person from disclosing confidential communications made for the purpose of facilitating the rendition of professional legal services to the client.” Rule 11-503(A)(4) defines a “confidential communication” as one “not intended to be disclosed to third persons.” It follows from the unambiguous definition of confidential communications and from Rule 11-503 that the Estate may refuse to disclose only those communications made for the purpose of facilitating legal services and not intended to be disclosed to others.
Diversified Development seeks to discover the instructions given to Hurley by the Estate and the nature and scope of his authority in regard to the purchase option deadline. “[C]ourts have held that the [attorney-client] privilege does not protect the instructions or authority given by the client to his attorney____” Paul R. Rice et al., Attorney-Client Privilege in the United States § 6:22, at 467-68 (1993); see id. § 6:22, at 468 n. 35 (citing cases that have held that a client’s instructions to his or her attorney and the scope of the authority granted are not protected by attorney-client privilege). Explaining the reason for this rule, one federal court has stated that “the client’s grant of authority to the attorney to settle [is not protected by the attorney-client privilege] since this must be communicated to the other party to the settlement.” Willard C. Beach Air Brush Co. v. General Motors Corp., 118 F.Supp. 242, 244 (D.N.J.1953), aff'd 214 F.2d 664 (3d Cir.1954). Thus the attorney-client privilege does not prohibit Hurley from disclosing what the Estate authorized him to agree upon with or communicate to Diversified Development.
—Incomplete discovery precluded summary judgment on actual authority claim. Generally, “a court should not grant summary judgment before a party has completed discovery, ... particularly when further factual resolution is essential to determine the central legal issues.” Sun Country Sav. Bank of N.M. v. McDowell, 108 N.M. 528, 534, 775 P.2d 730, 736 (1989) (citations omitted). Diversified Development may have been able to discover material facts in Hurley’s memos and in the withheld portions of Heil’s telephone diary defining the nature and scope of Hurley’s authority. The court should have examined those documents and allowed Diversified Development to discover those portions detailing the Estate’s instructions to Hurley and the scope of his authority in connection with the extension of the option deadline. See Garrett, 818 F.2d at 1519 (“It was error for the trial court to have granted defendants’ motion for summary judgment without first having determined the merits of plaintiffs pending [motion to compel discovery].”); Snook v. Trust Co. of Georgia Bank of Savannah, 859 F.2d 865, 871 (11th Cir.1988) (“By failing to rule on the motion to compel, the district court deprived the plaintiffs’ of their right to utilize the discovery process to discover the facts neeessary to justify their opposition to the [summary judgment] motion.”). Summary judgment was therefore improper on Diversified Development’s claim that Hurley had actual authority to grant an extension of the option deadline.
Hurley did not have apparent authority to agree upon an extension. In Romero v. Mervyn’s, 109 N.M. 249, 253, 784 P.2d 992, 996 (1989), we stated that “a principal ... is responsible for the acts of the agent when the principal has clothed the agent with the appearance of authority.” Apparent authority arises from manifestations by the principal to the third party “and can be created by appointing a person to a position that carries with it generally recognized duties.” Id. Because the facts necessary to prove apparent authority would be known by Diversified Development without further discovery, we decide whether summary judgment was appropriate on the issue of Hurley’s apparent authority to grant an extension of the option deadline.
The record establishes that the purchase agreement could be modified only in writing. The record further establishes that the Estate did not communicate directly with Diversified Development or its attorney prior to the May 1 letter rejecting the proposed financing modifications. As an attorney himself, Baehr knew or should have known that an attorney does not have implied authority to approve the modification of an agreement. See Augustus v. John Williams & Assoc., Inc., 92 N.M. 437, 438-39, 589 P.2d 1028, 1029-30 (1979) (stating rule that attorney does not have implied authority to compromise client’s cause of action (quoting Nehleber v. Anzalone, 345 So.2d 822, 822-23 (Fla. Dist.Ct.App.1977))); see, e.g., Torrao v. Cox, 26 Mass.App.Ct. 247, 525 N.E.2d 1349, 1353 (1988) (stating that attorney has no power, absent express authority, to bind principal by his assent to modification of principal’s contract). Hurley’s assertion that “these ladies are not going to hold [Diversified Development] to [the purchase option deadline],” without more, did not indicate Hurley was authorized to make the decision and did not absolve Baehr and Diversified Development of the duty to make further inquiry as to the extent of Hurley’s authority. See Warren A. Seavey, Handbook of the Law of Agency § 22(B), at 44 (1964) (“Persons dealing with an agent ... cannot hold the principal liable for unauthorized acts of an agent which are not normally permitted to an agent in such a position.”); Comstock v. Mitchell, 110 N.M. 131, 132, 793 P.2d 261, 262 (1990) (stating that third party has duty to “use reasonable diligence and prudence to ascertain whether the agent is acting within the scope of his powers” (quoting 3 Am.Jur.2d Agency § 82 (1986))). Therefore summary judgment on the issue of apparent authority to agree to an extension was appropriate.
For similar reasons, it was unreasonable for Diversified Development to infer from Hurley’s above-quoted assertion that it could place any reliance on an implied representation by Hurley that he was binding the-Estate. Thus summary judgment was appropriate on Diversified Development’s misrepresentation claim ¿gainst Hurley.
Diversified Development may pursue whether Hurley’s statements bound the Estate to an extension. Diversified Development argues that the facts it has adduced raise a question whether Hurley could bind the Estate by representing to Diversified Development that the Estate itself agreed to an extension. As we understand the facts, Hurley’s authority to bind the Estate may spring from two sources. First, it may be argued that Hurley could bind the Estate because he had actual or apparent authority to perform discretionary acts on behalf of the Estate such as granting an extension of the option deadline. We have held that summary judgment on the issue of Hurley’s actual authority to grant an extension was premature in light of the pending motion to compel discovery. Further, we have held that the Estate did not place Hurley in such a position that he had apparent authority to grant an extension.
Second, it may be argued that Hurley had actual or apparent authority to make binding statements representing the position of the Estate. It is unclear whether Diversified Development actually argued this issue below, and consequently it is also unclear whether the trial court, as part of its grant of summary judgment, ruled that Hurley did not have speaking authority. In response to questions from this Court, the parties have supplied us with briefs on this issue. Because we have ruled that summary judgment was premature and are remanding this case for further discovery, and because we find that the trial court could not rule against Diversified Development as a matter of law on the issue of speaking authority under the facts presented here, Diversified Development would not be prohibited from claiming on remand that Hurley had speaking authority. We therefore take this opportunity to clarify the law on this issue for purposes of aiding the trial court.
An agent’s statements may bind the principal if the agent is authorized to speak. When a principal gives a person authority (either actual or apparent) to do certain acts, those acts become binding on the principal because they are treated as the acts of the principal. Cf. Albuquerque Concrete Coring Co. v. Pan Am World Servs., Inc., 118 N.M. 140, 146, 879 P.2d 772, 778 (1994) (holding corporation liable for act of managing agent because acts of agent are acts of corporation). In the case of speaking authority, an agent who actually has been authorized to speak, or has been cloaked with the authority to speak, may bind his or her principal to perform the acts about which he or she speaks. Speaking authority differs from authority to do acts within one’s discretion such as entering into a binding modification of the principal’s contract with a third party. Thus an agent with speaking authority may not agree to a modification of the principal’s contract but may represent the principal’s position on the modification of the contract and thereby bind the principal to that modification.
For the statements, representations, or admissions of a purported agent to be binding on the principal, the fact of agency must first be established. 2 Floyd R. Me-chem, A Treatise on the Law of Agency § 1774, at 1348 (2d ed. 1914). “[T]he unauthorized statements of an agent to the third party concerning the existence or extent of his authority cannot be relied upon to establish apparent authority.” Comstock v. Mitchell, 110 N.M. 131, 134, 793 P.2d 261, 264 (1990) (Ransom, J., specially concurring). Once the principal has manifested to a third party that another individual is his or her agent, however, statements by that agent regarding the extent of authority may bear upon whether, without further inquiry of the principal, the third party reasonably relied upon a belief about the extent of the agent’s authority. Even then, before the agent’s extrajudicial statements concerning the extent of authority may be relied upon to excuse further inquiry, the principal first must have placed the agent in a position that would give rise to a belief in a reasonably prudent third party that the authority of the agent would extend as far as represented by the agent. Thus once agency has been established, the statements, representations, or admissions made by the agent to a third party will bind the principal only if the agent was actually or apparently authorized to make the particular statements or was actually or apparently authorized to make statements on the particular subject. See Restatement (Second) of Agency § 286 (1957).
In this case Hurley's agency is not disputed. Hence the only question remaining is whether the facts presented an issue regarding the existence of actual or apparent speaking authority. Even if the trial court was to be the finder of fact, it could not have used the summary judgment procedure to resolve a disputed issue of fact. See Bergerson Plumbing & Heating, Inc. v. Poole, 111 N.M. 525, 528, 807 P.2d 223, 226 (1991) (holding that “[a] trial court should not summarily cut to a dispositive issue without trial on the merits, even when the trial court believes the ultimate disposition is foreseeable”). If Diversified Development raised facts that, if proven, might have been interpreted in such a way as to entitle it to judgment, the court must have conducted a trial on the merits. See id.
—Actual authority to speak. Actual speaking authority may be express or implied. See Restatement (Second) of Agency § 7 cmt. c (1957). Express speaking authority will exist when the principal has told the agent that he or she may make certain statements, representations, or admissions. Id. Implied speaking authority will exist when the principal appoints the agent to a position that normally carries with it the authority to make certain statements and from which position the agent reasonably believes that he is authorized to make such statements. Similarly, implied speaking authority will exist when the principal expressly authorizes the agent to do an act that necessarily requires the making of statements. See Warren A. Seavey, Handbook of the Law of Agency § 105(C), at 190 (1964) (“To the extent that statements are made as part of an authorized transaction, ... a statement is authorized if the agent has reason to believe that the principal desires him to make it.”).
Heil testified that Hurley had actual authority to discuss an extension of the purchase option deadline. By informing Hurley that it would not make the decision whether to agree to the financing modifications until after the March 31 purchase option deadline, the Estate gave Hurley reason to believe that it was authorizing a “grace period” during which the original option could be exercised. On remand the factfinder thus should determine whether Hurley reasonably believed Heil and Holmberg desired him to communicate to Diversified Development a temporary extension of the option agreement. If Hurley had such a reasonable belief, the Estate would be bound by Hurley’s statement that “these ladies are not going to hold [Diversified Development] to the [option deadline]” regardless of whether the Estate intended Hurley to grant an extension. See Restatement (Second) of Agency § 26 cmt. a (1957) (“[T]he manifestation and not the intention of the principal is important; hence, whenever the principal manifests to the agent that the agent is to act on his account, [actual] authority exists although the principal is not in fact willing that he should do so.”).
—Apparent authority to speak. Whether an agent has apparent speaking authority is a question that must be determined by the trier of fact in light of the agent’s duties and responsibilities. See Hartman v. Port of Seattle, 63 Wash.2d 879, 389 P.2d 669, 673-74 (1964); cf. Kasper v. Buffalo Bills, 42 A.D.2d 87, 345 N.Y.S.2d 244, 250-51 (1973) (adopting rule that statements made by agent will bind principal if agent had authority to speak and remanding for determination of agent’s authority and responsibilities). Further, evidence of the appearance of authority as created by the actions and words of the principal is always admissible to show that the agent has authority to speak. See Restatement (Second) of Agency § 286 cmt. b (1957); see also Sigel v. Boston & M.R.R., 107 N.H. 8, 216 A.2d 794, 806-07 (1966) (finding sufficient evidence of speaking authority to create a jury question when negotiations over proposed railroad crossing repair were initiated by defendant, defendant’s representatives were vice presidents in charge of purchasing, and duties of defendant’s representatives included resolving matters in relation to the company negotiated with).
As an attorney and negotiator for the Estate, Hurley had apparent authority to communicate the position of the Estate in terms of offer and acceptance. Further, pri- or to the negotiations over the extension of the option deadline, the Estate always had communicated its wishes to Diversified Development through Hurley, and, prior to the May 1 letter faxed directly to Baehr, the Estate never had communicated directly with Diversified Development. Finally, the Estate did not reject Diversified Development’s proposed financing modifications or respond to Diversified Development’s extension request, other than through Hurley, prior to the expiration of the option. Thus because of Hurley’s position, and because of the Estate’s behavior toward Diversified Development in relation to the option deadline, we conclude that there was an issue of fact whether Hurley had apparent authority to speak.
Even if the evidence discloses that Hurley’s representations that the Estate would not hold Diversified Development to the option deadline were not correct, his misrepresentations could still be binding on the Estate. Seavey, Handbook of the Law of Agency § 60, at 109; cf. Wallo v. Rosenberg, 331 S.W.2d 8, 13-14 (Mo.Ct.App.1960) (holding that agent’s fraudulent representations about the occupancy rates and expenses of a hotel were binding on the principal in an action to rescind a real estate contract). The question is whether Hurley’s statements reasonably could be understood as representations of the Estate’s position. When a speaking agent makes a statement that is susceptible to more than one reasonable interpretation, the principal cannot complain that a third party relied on one reasonable interpretation over another. Thus, if the Estate placed Hurley in a position from which Diversified Development could reasonably conclude that he had authority to communicate the Estate’s position on the proposed extension request, the Estate cannot complain to the third party that its agent acted contrary to its wishes.
Reasonableness of interpretation is a question of fact. We have discussed the binding nature of a representation by an agent with speaking authority. We hasten to distinguish that issue from the issue whether Diversified Development reasonably interpreted Hurley’s statements as representations of the Estate’s extension of a grace period for exercise of this purchase option. From statements such as “a few days one way or another would not make any difference” and “[t]hese ladies are not going to hold you to the line” there is raised a genuine issue of material fact whether Diversified Development did reasonably rely on Hurley’s statements as a representation of the Estate’s position.
Statute of frauds not a bar. As a contract for the sale of land, the contract between Diversified Development and the Estate is governed by the statute of frauds and must be in writing. See Robinson v. Black, 73 N.M. 116, 118-19, 385 P.2d 971, 973 (1963). The Estate argues that because the contract falls within the statute of frauds, the oral modification of the option agreement, to be enforceable, had to be in writing. We disagree and conclude that Hurley could bind the Estate to an extension of the option deadline by orally conveying the Estate’s agreement to an extension.
Relying on this Court’s prior decisions in Dave Zerwas Co. v. James Hamilton Construction Co., 117 N.M. 724, 876 P.2d 653 (1994), and Yrisarri v. Wallis, 76 N.M. 776, 418 P.2d 852 (1966), the Estate argues that an oral modification of the option deadline is unenforceable because of the statute of frauds. In Yrisarri this Court held that parole evidence was not admissible to “contradict, vary, modify, or add to a written agreement.” 76 N.M. at 779, 418 P.2d at 854 (quoting Maine v. Garvin, 76 N.M. 546, 550-51, 417 P.2d 40, 43 (1966)). In Zerwas we stated that “a modification to an agreement within the Statute of Frauds must be in writing ... because it is, in essence, a new agreement.” 117 N.M. at 726, 876 P.2d at 655.
While we believe Yrisarri and Zerwas correctly stated the general law, we must reconcile those cases with other New Mexico law. In Kingston v. Walters, 16 N.M. 59, 64, 113 P. 594, 595 (1911), we held that “a subsequent verbal modification of the time of performance fixed by a written agreement for the sale of real estate will be regarded ... as valid.” This holding recognized that parties to a written contract controlled by the statute of frauds may orally modify the contract and the modification will be enforced if one of the parties materially changes its position in reasonable reliance on the subsequent oral agreement. Id. at 64-65, 113 P. at 595; see Restatement (Second) of Contracts § 150 (1979) (stating that statute of frauds does not bar enforcement of subsequent oral modification if enforcement of original terms would be unjust in view of one party’s material change in position). We believe these holdings may be reconciled insofar as the extension of the option agreement in Kingston did not so alter the real estate sale agreement as to create, in effect, a new agreement. As in Kingston, the oral modification between Di-' versified Development and the Estate, if authorized, would be enforceable notwithstanding the statute of frauds.
The court erred in dismissing Diversified Development’s prima facie tort claim against the Estate. In recognizing prima facie tort as a cause of action in Schmitz v. Smentowski 109 N.M. 386, 394, 785 P.2d 726, 734 (1990), we stated that the cause of action was intended to provide “a remedy for plaintiffs who have been harmed by a defendant’s intentional and malicious acts” and who have no other legal remedy. For liability under this cause of action to attach, a defendant’s conduct must be both wrongful and unjustifiable. Id. at 394-95, 785 P.2d at 734-35. Because the court entered judgment before ruling on the motion to compel, the evidence of intent was not fully developed. The withheld portions of Heil’s telephone diary may have established the Estate’s knowledge and intent; therefore dismissal of the cause of action before ruling on the motion to compel was premature. There being no genuine issue of material fact in this regard on the part of Hurley, however, summary judgment was properly granted in his favor on this issue.
Conclusion. We reverse the judgments in favor of the Estate except the judgment based on Hurley’s lack of apparent authority to grant an extension. We affirm the judgments in favor of Hurley. The case is remanded to the trial court for further proceedings consistent with this opinion.
IT IS SO ORDERED.
BACA, C.J., and FROST, J., concur. | [
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] |
OPINION
WOOD, Judge.
The trial court granted summary judgment. That judgment provides
that a permanent injunction is hereby issued restraining Mr. George G. Welsh directly or indirectly, personally or by any agent, from filing any civil or criminal action in any of the courts of the State of New Mexico or any political subdivision of New Mexico unless he is represented by an attorney at law[.]
The judgment provides an exception; the injunction does not apply if a district judge outside the Second Judicial District is aware of the injunction and issues an order allowing Welsh to file an action in a specific judicial district other than the Second Judicial District. Welsh appealed. We (1) state the background; (2) summarily dispose of certain issues; (3) decide the propriety of the injunction; and (4) decide whether the trial judge was disqualified from sitting in this case.
BACKGROUND
The complaint filed June 29, 1983, states: 1[.] This action is brought to protect the citizens and judicial officers of New Mexico from being sued in repeated unnecessary and vexatious lawsuits; to protect the citizens of New Mexico from having their courts unduly occupied by frivolous lawsuits to the exclusion of valid matters; to protect the courts from being burdened with frivolous lawsuits which impede the functioning of the courts; to protect the citizens, the courts and the State from the unnecessary expense of dealing with frivolous lawsuits.
2. The nature of this action is for injunctive relief against the Defendant to preclude him from filing additional lawsuits in any court of the State of New Mexico unless he is represented by a licensed member of the New Mexico Bar Association.
The complaint identifies a series of cases filed by Welsh, pro se, in the District Court of the Second Judicial District,, between September 12, 1974, and May 31, 1983. The complaint then alleges:
30. Mr. Welsh has never been successful in prosecuting any of his pro se actions in New Mexico.
31. Mr. Welsh files numerous motions in his more recent lawsuits. These motions rarely have any discernible legal merit and serve only as a means for Mr. Welsh to complain about opposing counsel and the courts.
32. Mr. Welsh regularly files affidavits in his actions which are unrelated to any motion and serve no legal purpose. These affidavits frequently attack opposing counsel, opposing parties and the courts.
34. State court judges, court employees, attorneys and public employees are the most common targets of Mr. Welsh’s pro se complaints. Defendants in the pro se lawsuits filed by Mr. Welsh thus far include: state district court judges, state magistrate court judges, assistant district attorneys, private attorneys, court clerks, court reporters, municipal police officers, animal control officers and the Executive Director of the New Mexico State Bar Association.
35. The fact that judges previously sued by Mr. Welsh and other judges recuse themselves, combined with the fact that Mr. Welsh often files motions to disqualify remaining judges, makes it necessary to appoint district court judges from other judicial districts to hear Mr. Welsh’s cases.
37. Mr. Welsh’s pro se lawsuits serve only to harass the individual defendants against whom they are filed.
38. Mr. Welsh’s pro se lawsuits interfere with the functioning of the state court system and place a serious strain on the judicial resources of the State.
40. Mr. Welsh’s misuse of the judicial system has wasted court time making it more difficult for the courts to deal with legitimate legal actions in a timely manner.
41. If Mr. Welsh is not enjoined from filing further pro se civil actions in the courts of the State of New Mexico the people of the State, and the courts of the State will be irreparably injured by the further waste of court time, the time of parties, waste of other judicial resources and loss of access to the courts for legitimate legal actions.
The complaint was accompanied by a motion for a temporary restraining order. The motion was supported by the affidavits of the Bernalillo County District Court Clerk and the attorney for plaintiff.
The clerk’s affidavit states that she is personally acquainted with Welsh. “Mr. Welsh as a matter of course files lawsuits against anyone who files a suit against Mr. Welsh.” The attorney’s affidavit states:
If a restraining order is not immediately issued * * * the Defendant will in all likelihood file additional lawsuits. If the Defendant is given notice of this [motion for a] Restraining Order before it is issued he will in all likelihood file lawsuits before the matter can be heard. Such lawsuits will further burden the courts of this state and the parties sued.
Judge Brennan issued a temporary restraining order on June 29, 1983, which expired by its own terms prior to any hearing. See NMSA 1978, Civ.P.R. 66(b) (Repl. Pamp.1980).
On July 1, 1983, Welsh filed an affidavit disqualifying Judge Brennan. The affidavit was honored. Thereafter, various judges were assigned to the case. Each assignment was followed by the recusal of the judge assigned, until the case was assigned to Judge Love on December 2, 1983. Eleven district judges recused. Only one judge stated a reason. There being no evidence to the contrary, we presume that each of the recusing judges did so in conformity with his or her duty to perform his or her judicial role except where the judges’ impartiality might be reasonably questioned. Gerety v. Demers, 92 N.M. 396, 589 P.2d 180 (1978).
Welsh filed several motions. We refer to these motions in discussing the propriety of the injunction. On July 7, 1983, Welsh filed a petition for removal of the case to federal court. Upon plaintiff’s motion, the United States District Court remanded the matter to the Second Judicial District Court on August 12, 1983. We also refer to the petition, and accompanying affidavit, in discussing the propriety of the injunction.
Judge Love, who was assigned the case on December 2, 1983, denied Welsh’s various motions without hearing on December 6, 1983, on the basis that no hearing was needed. See Birdo v. Rodriguez, 84 N.M. 207, 501 P.2d 195 (1972). Judge Love set a hearing for December 12, 1983, on the application in the complaint for a preliminary injunction. The hearing was held as scheduled and a preliminary injunction was filed December 21, 1983. This injunction is worded similarly to the permanent injunction quoted at the beginning of this opinion. The preliminary injunction provided that it was to continue in effect until further order of the court or final adjudication of the matter.
On February 14, 1984, plaintiff moved for summary judgment on the issue of a permanent injunction, relying on the record in the case and the exhibits admitted as evidence at the December 12, 1983, hearing. The motion sought a summary judgment to prevent “George Welsh’s vexatious, harassing and oppressive lawsuits.” This was the motion that was subsequently granted.
On February 24, 1984, an attorney entered an appearance for Welsh. The attorney represented Welsh through the filing of the skeleton transcript in this court, at which point this court permitted the attorney to withdraw. The attorney filed a response to the motion for summary judgment. Two of the allegations in the response raised the substantive issues to be decided in the appeal — the propriety of the summary judgment and whether Judge Love was disqualified from sitting in the case. The response was supported by an affidavit of Welsh which contained various comments as to why Judge Love should not sit. The attorney also moved to quash the preliminary injunction and moved to disqualify Judge Love for cause. Both motions were denied and the motion for summary judgment was granted.
SUMMARY DISPOSITION
Welsh’s appellate brief makes assertions concerning laches, tampering with evidence, secret court sessions, lack of access to the record, and criminal conspiracy. At a minimum, it alleges collusion between District Judge Jack Love and Metropolitan Court Judge Elizabeth Love. It attacks the attorney who represented Welsh in connection with the summary judgment proceedings. To the extent that these comments seek to raise appellate issues, they are not proper. They were either not raised in the trial court or lack support in the appellate record. NMSA 1978, Civ. App.R. 11 (Repl.Pamp.1984); State v. Duran, 91 N.M. 756, 581 P.2d 19 (1978).
PROPRIETY OF THE INJUNCTION
The attack on the propriety of the injunction has two parts: (1) the authority of a district court to grant the injunction; and (2) the sufficiency of the showing to grant an injunction by summary judgment.
1. Authority To Grant the Injunction
The injunction was to prevent “George Welsh’s vexatious, harassing and oppressive lawsuits.” The question is the district court’s jurisdictional authority to issue the injunction. See Heckathorn v. Heckathorn, 77 N.M. 369, 423 P.2d 410 (1967).
In General Atomic Co. v. Felter, 90 N.M. 120, 560 P.2d 541 (1977), the district court had enjoined General Atomic Company from filing or prosecuting additional lawsuits against United Nuclear Corporation excepting lawsuits named in the injunction. General Atomic Co. states:
[Ojnce a court has acquired jurisdiction over the parties and the subject matter, it may enjoin either party from instituting or proceeding with another action in the same state or in a sister state based upon the same facts and issues.
* * * * * *
The underlying issue before us is whether the district court may restrict the future acts of a party who is bringing vexatious and oppressive litigation in multiple jurisdictions for the purpose of harassment. Clearly, the party may be restrained from instituting future state actions * * *.
Id. at 122, 124, 560 P.2d 541 (citations omitted). This holding was reversed insofar as it enjoined federal litigation. “[I]t is not within the power of state courts to bar litigants from filing and prosecuting in personam actions in the federal courts.” General Atomic Co. v. Felter, 434 U.S. 12, 12, 98 S.Ct. 76, 76, 54 L.Ed.2d 199 (1977).
Under General Atomic Co. the district court had authority to enjoin future vexatious and oppressive litigation. The aspect of the issue not answered by General Atomic Co. is whether that authority extends to future vexatious and oppressive litigation when the plaintiff is the same but the defendants are different. We hold that the district court has such authority, that a permanent injunction does not unconstitutionally deprive Welsh of access to the courts, and that a less restrictive method of regulating access is not required when the facts show a pattern of conduct which is either vexatious, oppressive or for the purpose of harassment.
People v. Spencer, 185 Colo. 377, 524 P.2d 1084, 1086 (1974) states:
When such a multiplicity of suits is brought, of course, it is not only the individual litigants who suffer. The taxpayers, bound as they are to pay the costs of court administration, have an interest in insuring that meritless suits are not filed. This petitioner, in suing the district judge personally and then filing petitions to disqualify the judge, has caused other judges to be transferred into the county to determine the validity of his limitless claims. This is not only a waste of money and judicial time, but also interferes with the dockets in the jurisdiction from which the transferred judges must come. Finally, and perhaps most importantly, the efficiency of the judicial system in the county and the rights of other litigants who seek their day in court suffer when the courts are crowded and beclouded with the matters of one party. In a proper case, then, the right of free access to our courts must yield to the rights of others and the efficient administration of justice.
Eismann v. Miller, 101 Idaho 692, 619 P.2d 1145 (1980), characterized Miller’s conduct as a burden on the judicial machinery with repetitive lawsuits, hampering and discrediting personal and professional lives of many, and expense to the taxpayers for substitute judges. “At both state and county levels valuable time and resources have been spent to defend public officials against the vast litigation spawned by this one individual.” Id. 619 P.2d at 1150. Eismann states:
We do not fail to recognize that every individual in our society has a right of access to the courts. See, e.g., Board of County Comm’rs v. Barday, [197 Colo. 519], 594 P.2d 1057, 1059 (1979); People v. Spencer, supra 524 P.2d at 1086. However, the exercise of that right cannot be allowed to rise to the level of abuse, impeding the normal and essential functioning of the judicial process. To allow one individual ... to incessantly seek a forum for his views both legal and secular by means of pro se litigation against virtually every public official or private citizen who disagrees with him only serves to debilitate the entire system of justice.
We emphasize that our order does not * * * deprive the respondent of access to the courts of this state. What is restricted is the respondent’s ability to hamstring the judicial system of this state with unapproved pro se filings and related matter, and with attempted “en forcement” of those efforts through certain unacceptable means.
Id. at 1150 (emphasis in original) (footnotes omitted). See also Gordon v. United States Department of Justice, 558 F.2d 618 (1st Cir.1977); Roy v. Manchester Gas Co., 113 N.H. 140, 302 A.2d 825 (1973); Muka v. Hancock, Estabrook, Ryan, Shove & Hust, 120 Misc.2d 146, 465 N.Y.S.2d 416 (1983).
Muka recognized the difficulty of imposing sanctions on a nonlawyer and approved a permanent injunction, stating that an injunction is warranted when the courts are being used as a vehicle of harassment. In People v. Dunlap, 623 P.2d 408 (Colo. 1981), it was contended that counterclaims and suits seeking damages were “available alternatives and would be a less restrictive method of regulating the fundamental right of citizens to litigate their claims in the courts.” Id. at 410. Dunlap states:
[I]f the respondents’ abuse of the courts had been limited to matters of private and individual concern, then private and individual remedies would seem adequate to protect opposing litigants * * *. However, an injunction issued from this court is appropriate when the procedure followed by private litigants conflicts with important public rights and interests and when it resists other means of control.
Id. at 410 (citations omitted).
2. Sufficiency of the Showing
Some twenty-two exhibits were admitted as evidence. Welsh contends the exhibits were not the best evidence available to the state. Each of the exhibits is a copy of court records, certified to be true, correct and complete by the Bernalillo County District Court Clerk. The exhibits were properly admitted. NMSA 1978, Evid.R. 902(4) and 1005 (Repl.Pamp.1983).
Exhibit 1 was a suit against the chief clerk of the Bernalillo County Magistrate Court seeking damages on the grounds of “the negligence and inefficiency of the Clerks [sic] office” which allegedly resulted in plaintiff and his family being “swamped with barratrous and tumultuous litigation based upon suspicious and unfounded claims * * Defendant moved to dismiss on the basis of no duty to plaintiff and the failure of the complaint to allege any act resulting in any interference with plaintiff’s rights. The complaint was dismissed with prejudice.
Exhibit 2 was a suit against a deputy clerk of the Bernalillo District Magistrate Court and C.D. Hill. The pleadings indicate, that Hill, as agent for Southern Union Gas Co., sued Welsh in magistrate court in a dispute over unauthorized use of a gas meter. The suit alleged that Hill perjured himself in the Southern Union complaint, and that the deputy clerk aided and abetted Hill in collecting a suspicious claim. After a hearing at which there was a tender of evidence, Judge Baca granted the motion of both defendants for a dismissal with prejudice.
Exhibit 3 was a suit against Judge Marshall, then a magistrate, and against the executive director of the State Bar. The complaint indicates that Welsh was a defendant in a criminal libel prosecution, and that the libel involved the deputy clerk in Exhibit 2. Judge Marshall, who sat in the criminal libel action by designation, was sued for sitting as judge. The executive director was sued for alleged negligence in carrying out his duties as executive director. Welsh voluntarily dismissed this suit.
Exhibit 4 was a suit against Bolton Animal Hospital and Dr. Borthwick, a partner, which alleged that defendants permitted a child to observe Welsh’s dog for the purpose of determining if it was Welsh’s dog that had bitten the child. The trial court granted summary judgment for defendants. In Cause No. 3205, this court granted defendants’ motion to affirm because Welsh had not docketed his appeal within the time provided by the appellate rules.
Exhibit 5 was a suit against Judge Baca. The complaint alleged that Welsh was appealing a magistrate court judgment that fined Welsh for violations of the Albuquerque Animal Control Ordinance. The com plaint sought damages from Judge Baca for failing to issue a writ of habeas corpus. The complaint alleged a copy of a petition for the writ of habeas corpus was attached to the complaint. There was nothing attached to the complaint. Judge Franchini dismissed the complaint on the basis that no petition for a writ of habeas corpus had ever been filed in the Bernalillo County District Court. After the dismissal, Welsh filed affidavits accusing the court clerk of fraud by sending notices of hearing by certified mail, return receipt requested; accusing the court clerk of distorting judicial records and tampering with evidence; asserting that Judge Baca has a monomania for persons who appear pro se and “bears watching”; asserting the case was still pending; and asserting that Judge Neal, designated to sit during Judge Franchini’s illness, should be ordered to hear the case. Judge Neal had directed that certain material be sealed by the clerk. Welsh filed a copy of Judge Neal’s letter “to show a propensity on the Clerk’s part to commit deliberate acts of sabotage * * Welsh also filed a motion to “restore” his petition for a writ of habeas corpus, alleging that Justice Payne of the Supreme Court had a pecuniary interest in the case; that a document had been pilfered from Welsh v. Marshall, the Exhibit 3 case; that two named deputy clerks were involved in a cover-up; that he had been “disfranchized [sic]” of his right to vote in the 1976 Presidential Election and had been deprived of his right to serve on a jury.
Exhibit 6 was a suit against a physician for malpractice in treating a dog bite. See discussion of the Exhibit 4 case. The file shows the malpractice claim was without foundation in fact. The complaint is remarkable in that it asserted that Welsh was a third-party beneficiary of the physician’s duty of care owed to the patient, apparently on the basis that plaintiff’s wife administered first aid to the patient. The complaint also asserts that the physician failed to obey a subpoena and attend Welsh’s trial on charges of violating the animal control ordinance. See discussion of Exhibit 5. The file shows the physician was never served with a subpoena. The case was dismissed with prejudice.
Exhibit 7 was a suit against a school teacher for defamation and was dismissed because the complaint was defective in its pleading. The file contains Welsh’s affidavit attacking the Albuquerque postmaster as a “sycophant,” a politician and as being unfit to be a postmaster. Another affidavit alleges the district court clerk to be “an aborter of truth * *
Exhibit 8 was a complaint in “quo warranto” asserting that defendant Mescall was engaged in the private practice of law while serving as a judge. Mescall was an attorney for a party in the cases discussed in Exhibits 1, 2 and 3. Mescall counterclaimed for damages on the basis of harassment, asserting he was a temporary municipal judge and could engage in the private practice of law except in Albuquerque Municipal Court cases. The counterclaim asserted that Welsh’s suit was designed to affect the consideration of Mes-call for a permanent appointment. The complaint was dismissed for nonprosecution; no action has been taken on the counterclaim.
Exhibit 9 was a suit against Magistrate Short for allegedly aiding in the filing of suits and criminal prosecutions against Welsh. Defendant moved for a more definite statement but never obtained one. All we know about the allegations in the complaint comes from Welsh’s attachments to his complaint. The attachments indicate that, in the case discussed under Exhibit 3, a jury had convicted Welsh of four counts of criminal libel, that Judge Marshall had imposed and then suspended sentence, and that the state, through an assistant district attorney, had moved that the remainder of the suspended sentence be revoked and that Welsh be incarcerated. Notice to Welsh to show cause was filed on December 9, 1977; Welsh filed his suit against Short on December 14, 1977. Short moved for disciplinary action against Welsh on June 4, 1978. An attorney entered an appearance for Welsh on June 21, and the trial court dismissed the complaint against Short with prejudice on June 26, 1978.
We note that Welsh voluntarily dismissed the suit against Judge Marshall, discussed under Exhibit 3. Welsh’s affidavit, contained in Exhibit 9, asserts that his dismissal of the Exhibit 3 case was coerced by three men wearing surgeon’s gowns, masks and rubber gloves who threatened castration if he did not dismiss the Exhibit 3 case.
Exhibit 10 is a suit against Butler, Welsh’s attorney in a divorce suit. Complainants are both Welsh and his wife. The suit is pending. This exhibit indicates that the Welshes reconciled on October 20, 1980 and stipulated to a dismissal. The suit against Butler was filed October 24, 1980. The exhibit shows Welsh accused Butler of being a drunkard and of being senile. The exhibit contains pleadings indicating Welsh sued then Magistrate, now Metropolitan Judge, O’Toole, apparently in connection with the Southern Union Gas Co. v. Welsh case, referred to in the discussion of Exhibit 2.
Exhibit 11 sought a writ of mandamus directed to Metropolitan Judge Short commanding Judge Short to reinstate Welsh’s replevin action in the metropolitan court case of Welsh v. Butler. Butler was Welsh’s former attorney, see discussion of Exhibit 10. The exhibit shows the metropolitan court case was tried by Judge Martinez, that Judge Short had recused himself. After trial, Judge Martinez’s judgment dismissed the complaint on the merits. Judge Boucher, designated to try the mandamus action against Judge Short, dismissed the suit on the basis that the remedy of mandamus was not applicable. During the pendency of the mandamus action against Judge Short, Welsh filed affidavits accusing the Second Judicial District Court Administrator of gross insubordination, accusing attorney Butler of “pandering” Welsh’s private papers and health records, and seeking to disqualify Judge Boucher, who had been designated by the supreme court. Welsh also filed motions 1) asserting that Judge Short had intimidated witnesses in the metropolitan court case decided by Judge Martinez; 2) asking that a grand jury be convened to inquire “into the jurisdictional excesses of the * * * Metropolitan Court for condoning, authorizing, and unlawfully permitting the practice of law by itinerant landlords representing foreign corporations”; 3) attacking Assistant District Attorney Henson for representing Judge Short and attacking District Attorney Schiff on the basis that Mr. Schiff was compounding a crime because he knew that members of his staff were engaged in the unauthorized practice of law; 4) asking for an injunction against Judge Short for “heckling, harassing, and distressing [Welsh] in the honest pursuit of justice”; 5) asking for compensation of $15,000 for Welsh’s “numerous acts of public service at grave personal peril to himself” which public service “should have been done by public agents working for the State”; 6) asking for an award of liquidated damages to be paid by Henson and Schiff because “Henson is attempting to obtain hearings on Motions previously set for hearing but subsequently vacated”; and 7) asking for a “public service fee” of $5,000 “for having suffered humiliation and disgrace at the hands of Metropolitan Court officials *
Exhibit 12 was a suit against Williams, an attorney for St. Joseph Hospital, and Huppert, a vice president of the hospital. Welsh and his wife were the plaintiffs. The suit asserted plaintiffs had been libeled by a letter written by Williams in connection with Welsh’s failure to appear for his deposition in the hospital’s suit against Welsh. The letter stated that Williams was filing a motion to impose sanctions against Welsh for his nonappearance. A copy of the letter was sent to Huppert. Upon a showing that Huppert’s only involvement was to receive a copy of Williams’ letter, the trial court granted summary judgment in favor of Huppert. Upon a showing that the complaint, as a matter of law, did not allege libel, the trial court granted a judgment on the pleadings in favor of Williams. We refer to this exhibit in more detail in discussing the propriety of Judge Love sitting in the injunction case.
Exhibit 13 was an appeal based on a metropolitan court suit in which the Welshes sought damages from Sheffield, d/b/a Jiffy Maintenance Co., on the basis that defendant’s agents had damaged the Welshes’ fence. The suit was dismissed because at the time of the appeal there was no metropolitan court judgment to be appealed. We refer to this exhibit in discussing the propriety of Judge Love sitting in the injunction case.
Exhibit 14 was a petition for a writ of mandamus seeking to compel Metropolitan Judge Mandel to rule on a motion for summary judgment allegedly filed by Welsh in the metropolitan court case of Welsh v. Bank of New Mexico. Judge Cosgrove was the metropolitan judge assigned to the case until he recused on August 27, 1981. Judge Mandel was assigned the case on August 27, and recused on August 31, 1981. Judge Love dismissed the petition on the merits on the basis that a ruling on the motion for summary judgment was not subject to control by mandamus. Welsh’s appeal to the supreme court was dismissed under NMSA 1978, Civ.App. Rule 31 (Repl. Pamp.1984).
Exhibit 15 was a declaratory judgment suit filed by the Welshes against the Bernalillo County Metropolitan Court. The original complaint indicates the issue involved the Welshes’ attempted disqualification of a metropolitan court judge. However, subsequent pleadings allege that the metropolitan court refused to accept for filing the Welshes’ complaint against attorney Williams, see discussion of Exhibit 12. The refused complaint sought damages from Williams on the basis that he refused to file an order dismissing the Welshes’ counterclaim against the hospital. The metropolitan court counterclaimed seeking an injunction prohibiting the Welshes from appearing before any court in New Mexico without representation by counsel. The suit is pending. We refer to this exhibit subsequently.
Exhibit 16 shows a suit by the Welshes against the Bank of New Mexico in the metropolitan court. The Welshes claimed the bank had refused to refund insurance premiums. The bank asserted it had refunded the premiums and counterclaimed for “malicious harassment.” The Welshes disqualified Metropolitan Court Judge O’Toole. All other metropolitan court judges recused. The case was then transferred to the district court. All district court judges recused, except Judge Love. Welsh’s affidavit attempting to disqualify Judge Love bears the notation “Not Processed — Not Timely Filed.” The case is pending.
Exhibit 17 was a suit against St. Joseph Hospital based on the hospital’s prior suit against Welsh, see discussion of Exhibit 12. The complaint recognizes that Welsh’s defense of payment was rejected in the prior suit. The complaint alleged that the prior suit was a second collection of Welsh’s account with the hospital, that the account had been satisfied by Welsh’s S.S.I. coverage, and the failure to recognize that the account had been satisfied deprived Welsh of due process. Allegations not pertinent to the due process claim are made against the hospital, and Williams, the hospital’s attorney, is alleged to have committed fraud. All Second Judicial District Judges recused, except Judge Love. Welsh disqualified Judge Love. The supreme court designated Judge Angel. Welsh then objected to the “jurisdiction” of Judge Angel, alleging that the recusing Second Judicial District Judges colluded with Judge Angel to get Judge Angel an expense-paid trip to Albuquerque. Welsh alleged that evidence of the “recusal caper” had been given to the district attorney, and the district attorney was compounding a felony by not heeding Welsh’s information. Judge Angel dismissed the suit for failure to state a claim.
Exhibit 18 was a suit against attorney Kirk, a partner of attorney Williams, based on the deposition taken from Welsh in aid of execution, and appears to pertain to the judgment the hospital obtained against Welsh. See discussion of Exhibits 12 and 17. All Second Judicial District Judges re cused, except Judge Love. Judge Love dismissed Counts II and III of the complaint for failure to state a claim. Defendant’s motion for summary judgment as to Count I is pending.
Exhibit 19 was Welsh’s suit against Judge Love and will be discussed subsequently. Exhibit 22 pertains to the suit enjoining Welsh from filing certain pro se pleadings for a six-month period which ended on March 10, 1983. Exhibit 22 will be discussed subsequently.
Exhibit 20 was a suit against Police Sergeant Tradup filed on March 18,1983, eight days after the six-month injunction expired. The complaint alleged assault and battery, false arrest, false imprisonment and conversion of personal property. The answer alleges that Welsh was in the police station shouting at officers and that, when restrained, concealed weapons were discovered. All Second Judicial District Judges recused. The supreme court assigned the case to Judge DePauli. The case is pending.
Exhibit 21 was a suit against an assistant district attorney, Terry Vincent Yu, who had filed a motion in a metropolitan court case, in which Welsh was the defendant, seeking a determination of Welsh’s competency to stand trial. Welsh’s complaint alleged that Yu was using a man’s name to obscure “her true female identity” to Welsh’s damage. The exhibit shows a scheduled hearing on the motion to determine Welsh’s competency before Judge Flores. Welsh’s complaint asserts “[fjilthy courtroom conditions * * * and judges visiting from other venues are compelled to wade ankle deep through garbage * * On the same day the complaint was filed, Welsh moved for a mental examination of Yu on the basis that she “suffers from delusions of persecution and is masquerading as a man * * Welsh also moved for a preliminary injunction seeking to enjoin Yu from prosecuting the motion for a determination of Welsh’s competency. The action is pending.
Welsh’s motions in this injunction suit and his petition for removal to federal court are consistent with the contents of the exhibits. He complains of the hospital judgment, see discussion of Exhibits 12 and 17, as a medicare “rip-off” set up with the approval of then Attorney General, now United States Senator, Bingaman; that the current Attorney General, Bardacke, is attempting to suppress the fraud and that Bardacke should be required to post a $200,000 surety bond to protect Welsh against financial loss. He sought to join Sheffield, the defendant in Exhibit 13, as an indispensable party to this suit. He claims the district court clerk colluded with Williams, see Exhibit 12 discussion, to prevent an appeal of a false claim on open account. He attacks his former attorney, Butler. See Exhibit 10 discussion. He claims the disposition in the Exhibit 13 case is based on a false transcript. He claims Judge Love’s six-month injunction, see our reference to Exhibit 22, was “double punishment for Petitioner’s outspokenness against the United States for its use of chemical-biological weapons in the macabre extermination of millions of defenseless Chinese Communists by the U.S. Marine Corps in Korea in 1950-51 * * He criticizes Metropolitan Judge Barnhart and District Judge Flores. He states that the New Mexico Supreme Court “hallucinates” and “aggrandizes.” He asserts that competent legal counsel “is a mirage in New Mexico * * *.” He asserts that Attorney General Bardacke should be ordered to submit to a mental examination and that a guardian ad litem should be appointed for Bardacke.
Judges, whether district, metropolitan or magistrate, do not escape Welsh’s venom. Nor do attorneys, court clerks, other judicial personnel, police officers, citizens or supreme court justices. The exhibits and the record in this ease establish a patent pattern of filing vexatious, harassing and oppressive lawsuits. The exhibits and record also show that persons not demonstrably connected with a lawsuit — the postmaster, Senator Bingaman, District Attorney Schiff, for example — will be vilified by Welsh’s pleadings. The uncontradicted showing supports the permanent injunction.
WHETHER JUDGE LOVE WAS DISQUALIFIED FROM SITTING
The exhibits show the recusals and the recusals show that Judge Love was the only Second Judicial District Judge who felt he could sit in this injunction suit. Commendably, Judge Love did sit. Welsh asserts Judge Love was disqualified. This claim is not based on any procedure for disqualifying a judge. See NMSA 1978, § 38-3-9; NMSA 1978, Civ.P.R. 88.1 (Cum. Supp.1984). Nor does this claim involve untimely disqualification on the basis of invoking the court’s discretion before the issue of disqualification was raised. See Smith v. Martinez, 96 N.M. 440, 631 P.2d 1308 (1981).
Welsh contends it makes no difference that he delayed questioning Judge Love’s qualifications to sit in this case until after the preliminary injunction had been issued. According to Welsh, Judge Love was disqualified from taking any action in this case because of “cause,” and was prohibited from sitting on the basis of “cause.” Welsh contends that he timely raised the issue of Judge Love’s qualifications in opposition to the summary judgment motion which resulted in the permanent injunction, and that Judge Love was disqualified from issuing the permanent injunction. The state seems to assert that, by not raising the issue of Judge Love’s qualifications until after the preliminary injunction was issued, Welsh waived any issue of Judge Love’s qualifications to issue the permanent injunction. We decline to apply waiver to a disqualification claim clearly raised before entry of the judgment being appealed. See Midwest Royalties, Inc. v. Simmons, 61 N.M. 399, 301 P.2d 334 (1956); Tharp v. Massengill, 38 N.M. 58, 28 P.2d 502 (1933).
Welsh’s claim involves N.M. Const, art. VI, § 18 which provides that no judge shall sit in any cause in which he has an interest. State v. Scarborough, 75 N.M. 702, 705, 410 P.2d 732 (1966), states: “[Tjhat an ‘interest’ necessary to disqualify a judge must be a present pecuniary interest in the result, or actual bias or prejudice, and not some indirect, remote, speculative, theoretical or possible interest.” Tharp v. Massengill states: “The purpose of this provision in our Constitution is to secure to litigants a fair and impartial trial by an impartial and unbiased tribunal.” 38 N.M. at 70, 28 P.2d 502. To be disqualifying, the alleged bias and prejudice must stem from an extrajudicial source and must result in a decision on a bias other than what the judge learned from sitting in the particular case. “Stated another way, the bias must be personal, and not judicial.” United Nuclear Corp. v. General Atomic Co., 96 N.M. 155, 248, 629 P.2d 231 (1980).
According to Welsh, the extrajudicial source in this case is the exhibits showing cases where Judge Love sat as the judge. The exhibits of cases in which Judge Love sat are extrajudicial sources in this case; however, those exhibits do not show that Judge Love’s rulings in the exhibit cases were based on an extrajudicial source.
Exhibit 22 was a case entitled “In re Pleadings of George G. Welsh, pro se.” On June 16, 1982, Judge Love issued an order directing Welsh to show cause why he should not be barred from filing pleadings in the district court for six months. On June 21, 1982, Welsh moved to quash the show cause order. On June 22, 1982, Welsh filed an affidavit of disqualification which Judge Love refused to honor, relying on Section 38-3-9. The propriety of this ruling is not an issue in this appeal, see United Nuclear Corp. v. General Atomic Co., and Welsh did not appeal the decision in the Exhibit 22 case. On June 25,. 1982, Welsh filed a counterclaim attacking his former counsel, see discussion of Exhibit 10, asserting the show cause order was a conspiracy to boycott Welsh in violation of various federal statutes, and that Welsh was entitled to special damages of $75, general damages of $125,000 for abuse of process, and punitive damages of $125,000. On June 28, 1982, the state moved that the metropolitan court’s counterclaim, see discussion in Exhibit 15, be consolidated with the show cause order. On June 29, 1982, Welsh filed “affirmative” defenses asserting Judge Love’s handwritten orders were “illegible, irresponsible, and unfilable” and the handwritten orders were purposely illegible in order to “defy review by the Supreme Court * *
Continuing with Exhibit 22, on July 2, 1982, Welsh petitioned for removal of the ease to the United States District Court. The petition was denied by a federal judge. The petition for removal alleged that Judge Love’s show cause order was “a silly prejudicial prank aimed at aiding and abetting vexatious litigation against Petitioner and covering up acts of judicial incompetence,” was a political plan to cut off Welsh’s access to the courts, that Judge Love had deliberately refused to be disqualified, that Judge Love was encouraging a boycott by the New Mexico Bar, and that Welsh had “a property right to practice law” in New Mexico courts.. On July 23, 1982, Welsh again filed a statutory affidavit of disqualification which was not processed. On July 26, 1982, Welsh moved for default judgment on his counterclaim.
Continuing with Exhibit 22, on August 27, 1982, notice of hearing was given for September 10, 1982. On August 31, 1982, Welsh sued Judge Love. This suit is Exhibit 19.
Exhibit 22 shows that on September 7, 1982, Welsh moved for an order requiring Judge Love “to be more definite and certain” as to the pleadings relied on in the show cause order. Welsh alleged the show cause order “is silly, sychophantic peacockery, and overacted sham dictated by delusions of grandeur * * On September 10, 1982, Welsh moved to dismiss the complaint on the basis that Judge Love failed to appear at the Law School on September 9 so that Welsh could inspect and copy documents. This motion asked for a $250,-000 judgment against the Second Judicial Districts and “the individual Fifteen Judicial Divisions * * On September 10, 1982, Judge Love judicially noticed files and records and found that the “pro se pleadings of George G. Welsh are impairing, impeding, delaying, and obstructing the orderly administration of justice.” The order provided that pro se pleadings of Welsh were not to be accepted for filing in the Bernalillo County District Court except for cases in which Welsh was a defendant and except in the Exhibit 19 case. The order expired March 10, 1983.
Welsh’s suit against Judge Love, Exhibit 19, specifically complains of a subpoena duces tecum issued to Welsh in connection with the disposition referred to in discussing Exhibit 18. Welsh complains generally about unfair and partial rulings and refers to copies of orders annexed to and incorporated within the complaint. The orders are copies of rulings by Judge Love in the cases identified as Exhibits 12, 13 and 15, and in St. Joseph Hospital, Inc. v. Welsh, which is referred to in the discussion of Exhibit 12. Sampling of the rulings follow. Motions by Welsh to compel Judge Love to recuse, to vacate a judgment, for imposition of sanctions, to dismiss, to quash service were denied. One ruling advised Welsh to file and serve affidavits in support of his motion for summary judgment. Another explained denial of a motion to strike an answer on the basis that inconsistent pleadings are permitted. Another explained denial of a motion for a default judgment on the basis that the particular defendant had never been served, and the court did not have jurisdiction over that defendant until that defendant filed an answer.
In Exhibit 19, Welsh moved that Judge Love be required to submit to a mental examination, at the state’s expense, because Judge Love was “intellectually impaired and emotionally unfit to read and understand Plaintiff’s Pro Se pleadings.” Welsh’s affidavit asserted that Judge Love was an incapacitated person who should have a guardian ad litem appointed during the pendency of the case. Judge Love’s answer to the complaint asserted judicial immunity. Welsh moved to strike this de fense on the basis that it has no application in modern law, and asserted that Judge Love’s raising of this defense supported his claim that a guardian ad litem should be appointed for Judge Love. In a separate reply, Welsh asserted that “mental insanity” restricts the immunity defense.
There is nothing in the exhibits which show an actual bias or prejudice against Welsh on the part of Judge Love.
Welsh also relies on a newspaper article in claiming that Judge Love was disqualified. The newspaper quotes Judge Love as saying, “ ‘there's a natural bias against a pro se pleading * * * so the inclination of the judge is to put more time and effort into it in order to be fair to that person.’ ” The article states, concerning the six-month prohibition of Exhibit 22, “The judge said Welsh was simply taking too much of his time, forcing him to read eases that not only were meritless, but ‘scandalous.’ ” This article does not show bias or prejudice against Welsh on the part of Judge Love.
Welsh’s claim that Judge Love was disqualified from hearing the motion seeking a permanent injunction, on the ground of “cause,” is without merit. Welsh’s reliance on NMSA 1978, Code of Judicial Conduct, Canon 3 (Repl.Pamp.1983), raises a separate issue. Canon 3(C)(1) states when a judge should disqualify himself. Canon 3(C)(2) states when a judge shall disqualify himself. The issue is the “should” disqualify provision. It is a narrow issue. If Judge Love should have disqualified himself, the cause would be remanded for a hearing before another judge on the issue of a permanent injunction. The preliminary injunction would continue in effect pending such a hearing.
Canon 3(C)(1) states: “A judge should disqualify himself in a proceeding in which his impartiality might reasonably be questioned * * *.” United Nuclear Corp. v. General Atomic Co., after quoting the “should disqualify” provision, states: “This provision sets up an objective standard geared to the appearance of justice, and thus expands the instances in which a judge should disqualify himself beyond those set out in [N.M. Const.] Article VI, § 18.” 96 N.M. at 250, 629 P.2d 231. Tharp v. Massengill, which involved a judge sitting in a case in which the judge’s son was an attorney in the case and the son had a contingent fee contract, was also concerned with the appearance of impropriety.
The state asserts the “should disqualify” provision should not be considered because of the “rule of necessity.” Eismann v. Miller explains the rule: “[W]here disqualification results in an absence of judicial machinery capable of dealing with a matter, disqualification must yield to necessity.” 619 P.2d at 1149. See also United States v. Will, 449 U.S. 200, 101 S.Ct. 471, 66 L.Ed.2d 392 (1980). Eismann applied the rule, stating: “Application of the ‘rule of necessity’ is clearly called for here, where the respondent has stated that no judge in the state is capable of hearing his case and has manifested an intent to sue all those who try.” 619 P.2d at 1149 (citations omitted). That is not the situation in this case.
Judicial machinery existed to deal with the matter. See NMSA 1978, Civ.P.R. 88 (Cum.Supp.1984). This record does not show that the machinery would not function. The exhibits show that several out of district judges sat, by designation, in the Second Judicial District suits—Neal, Marshall, Flores, Musgrove, Boucher—and disposed of the matter assigned. The rule of necessity does not apply in this case.
Returning to the “should disqualify” issue, what is the appearance of impropriety in this case? It is that Judge Love sat in this (permanent injunction) case when he was a defendant in a pending case. United Nuclear Corp. v. General Atomic Co. indicates the “should disqualify” issue, as does the “actual prejudice” issue, requires extrajudicial bias. The extrajudicial source for this claim is Exhibit 19.
United Nuclear Corp. v. General Atomic Co. also indicates the basis for judging the claim. Canon 3(C)(1) applies when a judge's impartiality might reasonably be questioned. This means there must be a reasonable factual basis for doubting the judge’s impartiality. The following cases are pertinent to our holding.
State v. Stout, 100 N.M. 472, 672 P.2d 645 (1983), involved a judge citing an attorney for indirect contempt and then deciding the indirect contempt charge. Certainly an appearance of impropriety is involved when a judge brings the charge and then decides it on the merits. However, Stout held that the judge was precluded from hearing the case only “when a judge has become so embroiled in the controversy that he cannot fairly and objectively hear the case, or when he or one of his staff will necessarily be a witness in the proceeding * * Id. at 475, 672 P.2d 645 (citations omitted).
Aguilar v. Penasco Independent School District No. 6, 100 N.M. 625, 674 P.2d 515 (1984), involved the question of the judge sitting to determine attorney fees in a worker’s compensation case after being reversed on that issue on appeal. Aguilar noted that the trial judge did not indicate any “possible embroilment” until the end of the hearing on attorney fees, that there “was no suggestion that the judge had an unfavorable personal attitude toward [the defendant] School District,” that the trial court’s strong denunciation of the defendant for its trial tactics “merely underscores facts.” Id. at 626-27, 674 P.2d 515. Although the appearance of impropriety was involved in authorizing a trial judge to set the attorney’s fee for plaintiff after a strong denunciation of defendant, Aguilar relied on the facts.
In State v. Mata, 88 N.M. 560, 543 P.2d 1188 (Ct.App.1975), defendant claimed he was entitled to a new trial “because when defendant was tried, his former defense attorney was an employee of the district attorney’s office which prosecuted the case.” Id. at 560, 543 P.2d 1188. The issue was the appearance of impropriety. We held that the concern for an appearance of unfairness had been met because the trial court conducted an evidentiary hearing and found facts which were not challenged. After outlining the facts found by the trial court, we stated: “The appearance of unfairness is dissipated by the above facts.” Id. at 561, 543 P.2d 1188.
In this case, the uncontradicted facts shown by the exhibits and the record, are that Welsh’s suit against Judge Love is frivolous and vexatious. To the extent any credibility can be given to a Welsh affidavit, he stated that after Judge Love refused to honor his attempted disqualification of Judge Love in the Exhibit 22 case, “In order to enforce and protect my rights, or what I thought to be my rights, I filed a lawsuit naming Judge Love as the defendant [the Exhibit 19 case].”
The Exhibit 19 case does not provide a reasonable factual basis for doubting the judge’s impartiality; rather, the Exhibit 19 case is of the same ilk as the cases supporting the permanent injunction.
The permanent injunction is affirmed. No costs are awarded.
IT IS SO ORDERED.
DONNELLY, C.J., and NEAL, J., concur. | [
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OPINION
REBECCA SITTERLY, District Judge.
On the court’s own motion, the prior opinion of this court is withdrawn and the following opinion substituted therefor.
This appeal arises from a decision of the district court of Rio Arriba County reversing an order of the state engineer which had granted the Modified Application (the Application) of Sleeper and Gaylors (Applicants) to change the purpose and place of use and point of diversion of surface water rights appurtenant to the Ensenada Ditch near Ensenada, New Mexico. The Ensenada Land and Water Association, et al. (Protestants) appealed to the district court. After trial de novo, the district court reversed the state engineer’s decision and denied the Application on the grounds that the requested transfer would impair existing water rights on the Rio Brazos stream system and would be contrary to the public interest. The Applicants and the state engineer appeal. We reverse the district court.
The issues are:
(1) Whether the state engineer’s appeal is timely;
(2) Whether the applicable statutes allow consideration of the “public interest” in ruling on an application for change of purpose and place of use or point of diversion of surface water rights; and, if so,
(a) Whether that grant of authority is an unconstitutional delegation of legislative function; and
(b) Whether substantial evidence supports the trial court’s determination that the requested changes would be contrary to the public interest; and
(3) Whether substantial evidence supports the trial court’s finding that the transfer would impair existing rights, and that the protective conditions imposed in the state engineer’s order are insufficient to obviate the impairment.
Tierra Grande, Inc. and Peñasco Ski Corporation began a recreational development and subdivision in Ensenada. A gravel pit was dug to supply gravel for construction of various roads in the subdivision. Primarily for recreational and aesthetic purposes, Tierra Grande decided to create a lake over the unsightly gravel pit. For this purpose, Tierra Grande contracted with Applicants to purchase lands and the appurtenant water rights, conditioned upon the state engineer’s approval of an application for change of purpose and place of use and point of diversion of those water rights.
Applicants have water rights for irrigation purposes from the Ensenada Ditch. A sketch of the area, based on one of Applicants’ exhibits, is reproduced below.
The Ensenada, Porvenir, and Park View Ditches divert from the Rio Brazos. The Nutritas Creek is a tributary of the Rio Brazos, is part of the Rio Brazos stream system, and empties into the Ensenada and Park View Ditches after they divert from the Rio Brazos. The Nutritas is fed by spring snow melt and occasional summer rain. It begins to run in March and is usually dry by May or early June. Water from the Nutritas, when it is flowing, is used by members of the Ensenada and Park View Ditches to water stock in the spring, to fill irrigation reservoirs for use in summer, and to “fertilize” the soil with its historically high silt content. The Nutritas produces between 800 and 4500 acre feet of water annually.
The declaration of water rights for the entire Ensenada Ditch, filed in the state engineer’s office, shows an entitlement to irrigate 982.1 acres of land from the Rio Brazos with a duty of 1.3 acre feet of water per acre per year. The Application seeks to change point of diversion from Applicants’ farms off the Ensenada Ditch to the proposed lake site on the Nutritas Creek, and to change the purpose of use from irrigation to construction and maintenance of a lake. This would be accomplished by a one-time diversion of 61.32 acre feet from the first year to fill the lake, and 13.32 acre feet annually thereafter to maintain the lake. Based on a consumptive use of 0.95 acre feet per acre per annum, Applicants proposed to temporarily retire 64.55 acres of irrigated land the first year and to permanently retire 14.02 acres of land from irrigation thereafter, which would offset the amount required for filling and maintenance of the lake.
I. TIMELINESS OF STATE ENGINEER’S APPEAL.
We grant Protestant’s motion to dismiss the state engineer’s appeal as untimely. The judgment appealed from was entered on July 2, 1985. Applicants filed a notice of appeal on July 29,1985, in Ct.App. No. 8782. The state engineer filed a notice of appeal on August 30, 1985, in Ct.App. No. 8830. No request for an extension of time to file the state engineer’s notice of appeal was made. Although the state engineer’s notice of appeal was filed within the time provided in NMSA 1978, Section 72-7-3 (Repl.1985), it was not filed within the time provided by the rules of appellate procedure. See NMSA 1978, Civ.App.R. 3 (Repl.Pamp.1984) and Civ.App.R. 4(c) (Supp.1985). The state engineer’s appeal is untimely and this court is without jurisdiction to hear it. American Auto. Ass’n v. State Corp. Comm’n, 102 N.M. 527, 697 P.2d 946 (1985).
However, the state engineer was served with and is a named party in the notice of appeal filed by Applicants. Having jurisdiction of Applicants’ appeal, and there being no prejudice to the parties, we grant the state engineer’s motion to be added as a party appellant. See generally SCRA 1986, 12-301(A) (which provides for the addition of parties on motion of the appellate court on essentially the same terms as did NMSA 1978, Civ.App.R. 21(a) (Repl.Pamp.1984)); see also Morris v. Fitzgerald, 73 N.M. 56, 385 P.2d 574 (1963); Home Fire & Marine Ins. Co. v. Pan American Petroleum Corp., 72 N.M. 163, 381 P.2d 675 (1963).
II. THE PUBLIC INTEREST.
The district court concluded that, as a public official charged with supervising an important resource belonging to the public, the state engineer must consider the public interest in ruling on applications for transfer or change of water rights, whether or not articulated in the statutes, and that Applicants’ requested transfer was contrary to the public interest and should be denied on that ground. In so concluding, the district court erred as a matter of law.
The jurisdiction of the state engineer to regulate use of water is “no broader than as expressed in or necessarily to be inferred from the statute.” State ex rel. Reynolds v. W.S. Ranch Co., 69 N.M. 169, 172, 364 P.2d 1036, 1038 (1961) (quoting El Paso & R.I. Ry. Co. v. District Court, 36 N.M. 94, 101, 8 P.2d 1064, 1068 (1931)). Thus, we must look to the statutes in force at the time of the Application to determine if public interest is a proper consideration in transfer applications.
Appropriation and use of surface water was governed, at the time of the Application, by NMSA 1978, Sections 72-5-1 et seq. Applicants contend that pursuant to the plain language of NMSA 1978, Sections 72-5-23 and -24, once there has been proper application to the state engineer, detriment to existing water rights is the only basis on which their application can lawfully be denied. Section 72-5-23 provided: “All water used in this state for irrigation purposes, * * * may be transferred for other purposes, without losing priority of right theretofore established, if such changes can be made without detriment to existing rights * * * .” and Section 72-5-24 provided:
An appropriator of water may, * *■ * use the same for other than the purpose for which it was appropriated, or may change the place of diversion, storage or use, * * * provided that no such change shall be allowed to the detriment of the rights of others having valid and existing rights to the use of the waters of said stream system.
Protestants argue that language in other sections of Chapter 72, Article 5 of the statutes allows the state engineer to deny an application for transfer of surface water rights if the transfer would be detrimental to the public interest. They rely principally on NMSA 1978, Section 72-5-7, which provided: “If, in the opinion of the state engineer, there is no unappropriated water available, he shall reject such application * * *. He may also refuse to consider or approve any application or notice of intention to make application * * * if, in his opinion, approval thereof would be contrary to public interest.”
It is apparent that the first sentence refers to applications to acquire rights to unappropriated waters. Protestants argue that the second sentence quoted allows the state engineer to deny any application, including transfer of existing water rights, if it would be contrary to the public interest. Applicants contend that Section 72-5-7 applied only to applications to appropriate previously unappropriated surface water, and not to transfers of rights to waters already appropriated. We find Applicants’ argument persuasive.
It is conceded that the state engineer has traditionally and consistently construed Section 72-5-7 to apply only to applications for unappropriated water, and that Sections 72-5-23 and -24 apply to transfers of existing rights, and allow him to deny a proper application for transfer only if it would be detrimental to other existing water rights. Long-standing administrative constructions of statutes by the agency charged with administering them are to be given persuasive weight, and should not be lightly overturned. Molycorp., Inc. v. State Corp. Comm’n, 95 N.M. 613, 624 P.2d 1010 (1981); Perea v. Baca, 94 N.M. 624, 614 P.2d 541 (1980). The logic of those rules is clear. First, the state engineer’s orders are presumed to be proper implementations of the water laws. NMSA 1978, Section 72-2-8. Second, the more long-standing the state engineer’s interpretation of construction of the statutes without amendment by the legislature, the more likely that the state engineer’s interpretation reflects the legislature’s intent.
Case law also supports the state engineer’s interpretation of the statute. “Inherent in a water right is the right to change the place of diversion, subject only to the requirement that the rights of other water users not be injured or impaired thereby.” Langenegger v. Carlsbad Irrigation Dist., 82 N.M. 416, 421, 483 P.2d 297, 302 (1971) (emphasis added) (citing Durand v. Reynolds, 75 N.M. 497, 406 P.2d 817 (1965)); Clodfelter v. Reynolds, 68 N.M. 61, 358 P.2d 626 (1961); Application of Brown, 65 N.M. 74, 332 P.2d 475 (1958).
Although dealing with our groundwater rather than surface water statutes, two recent cases and the legislative reaction to them further support the Applicants’ position. City of El Paso v. Reynolds, 563 F.Supp. 379 (D.N.M.1983)*(£7 Paso I) held that New Mexico could not constitutionally embargo the export of water out-of-state. Our legislature immediately passed Laws 1983, Ch. 2, amending the groundwater statutes to allow new appropriations and transfers of groundwater for out-of-state use, if not contrary to the conservation of water or otherwise detrimental to the public welfare. City of El Paso v. Reynolds, 597 F.Supp. 694 (D.N.M.1984) (El Paso II) then ruled the amendments unconstitutional because the conservation and public welfare criteria were applicable to transfers out-of-state, but not to in-state transfers. “In-state, no permit to transfer a water right * * * can be denied on the ground that it would be contrary to the conservation of water or detrimental to the public welfare. These factors are irrelevant with regard to in-state transfers and domestic wells.” El Paso II, 597 F.Supp. at 704. Although the El Paso cases dealt with the groundwater statutes, the transfer provisions are similar to those applicable to surface waters. The legislature again responded by enacting Laws 1985, Ch. 201, amending the water laws. But this time, both groundwater and surface water statutes were amended, adding for the first time the conservation and public welfare criteria to Sections 72-5-23 and -24, applicable to transfers of surface water rights. We will not distort the plain geography of a statutory scheme to find Protestants’ construction. The statutes in force at the time of the Application did not allow denial of the requested transfer on the basis of general “public interest” considerations.
In view of our disposition, we need not reach the other public interest issues listed. As the state engineer acknowledged at oral argument, the public interest is relevant in considering certain aspects of an application to transfer existing surface water rights, such as whether the transfer is to a beneficial use. However, in this case the trial court’s decision incorporates a broader view of the public interest than in our judgment the legislature contemplated in enacting the controlling statute. Further, neither the record on appeal nor the oral arguments indicate that the issue of whether the proposed transfer was to a beneficial use was raised at trial.
III. IMPAIRMENT OF EXISTING RIGHTS.
The district court found that the requested transfer would be detrimental to existing rights because:
[30.] a. Rio Brazos stream system water users would be deprived of water * * * (for) livestock in the early spring with water derived principally from the Nutritas Creek; and
b. Rio Brazos stream system water users would be deprived of their first watering in the spring which benefits the land in two ways:
i. the watering moistens the soil in preparation for sowing; and
ii. the watering “fertilizes” the soil by providing rich silt carried by the waters of the Nutritas Creek.
Applicants argue that, as a matter of law, water rights do not include a right to receive a traditional or historical amount of silt carried in the water. We agree.
Protestants argue that the reduction in silt content is a reduction in the quality of the water, citing Heine v. Reynolds, 69 N.M. 398, 367 P.2d 708 (1962) and Stokes v. Morgan, 101 N.M. 195, 680 P.2d 335 (1984). Both of those cases involved claims of diminished water quality from increased salt content in the water. Salt becomes chemically associated with water in a solution, while silt is physically associated with water in a suspension. Even salt has been held not to be part of the water in which it is dissolved, where the proposed appropriation sought water with a particular salt content so that the salt could be extracted for sale. Deseret Livestock Co. v. State, 110 Utah 239, 171 P.2d 401 (1946).
Apparently the only case directly on point is A-B Cattle Co. v. United States, 196 Colo. 539, 589 P.2d 57 (1978). The Colorado Supreme Court interpreted Colo. Const., art. XVI, Section 5, to define water, “not silt and water,” as subject to appropriation. 196 Colo, at 545, 589 P.2d at 61. That part of the Colorado constitution is remarkably similar to N.M. Const., art. XVI, Section 2. We agree with the Colorado Supreme Court. We hold that an owner of surface water rights does not have a right to receive a particular silt content that has existed historically. To hold otherwise could prevent all upstream users from controlling erosion on their lands for fear that silt would be reduced downstream.
Applicants met their burden of showing no impairment by introducing evidence supporting an inference that the Rio Brazos has historically produced a sufficient supply for irrigation needs on the Ensenada Ditch, except during the late summer months when the Nutritas is dry, by proving they will be retiring enough land from irrigation along the Ensenada Ditch to offset the water being used at the new location along the Nutritas, and by proof that the State Engineer had found no impairment. See Stokes v. Morgan. Thereafter, the burden of going forward with additional evidence shifted to Protestants.
Protestants’ evidence of impairment included testimony that the users of the Rio Brazos stream system “need all the water they can get.” This is not a sufficient showing. Protestants are entitled only to the amount of water allocated to them by declared right.
The remaining evidence does not support the trial court’s findings as to the impact of the transfer on early spring watering. Applicants proposed to fill the lake by diversion of two days’ flow in early March, and thereafter divert annually a much smaller amount of water to offset evaporation losses. In good years, when the flow of the Nutritas is high, the record indicates there would be no net effect on other users. In dry years, when the snow melt is low, Applicants may not be able to receive their full entitlement from the Nutritas. However, because their point of diversion at the move-to location lies above the confluence of the Ensenada Ditch and the Nutritas, Applicants cannot make up the difference from the flow of the Rio Brazos. Therefore, if the transfer is granted, in all years the downstream users would have additional water available from the Rio Brazos that would otherwise have been subject to Applicants’ claims at the move-from location. Finally, there was uncontroverted evidence that some amount of water from the Nutritas passes unused through the ditches and back to the Rio Brazos at various times in the spring.
In addition, the state engineer’s order specified that no water shall be diverted from the Nutritas at any time that the combined flow of the Nutritas and the Rio Brazos are insufficient to meet the needs of the users along the Ensenada Ditch. Further, the order required that all water diverted for filling and maintaining the lake be measured in a manner acceptable to the state engineer.
Protestants have argued that the conditions imposed in the state engineer’s order are inadequate to insure that their rights will not be impaired. The record indicates that a requirement for monthly metering was omitted by inadvertence. That omission shall be corrected on remand, including, if necessary, provision for monitoring to make metering effective. Once so corrected, the conditions imposed by the state engineer’s order will adequately protect against any possible impairment of existing rights.
CONCLUSION.
The trial court’s judgment is reversed, and the case is remanded for further proceedings not inconsistent with this opinion. No costs are awarded.
IT IS SO ORDERED.
ALARID and MINZNER, JJ., concur. | [
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OPINION
SOSA, Senior Justice.
On January 29, 1986 the New Mexico Board of Medical Examiners (Board), pursuant to the authority granted it in NMSA 1978, §§ 61-1-1 through -33 (1986 Repl.) (“Uniform Licensing Act”) revoked the license to practice medicine of Dr. Jacinto Lopez (Lopez). Lopez attempted through his attorney to file a petition for review pursuant to Section 61-1-17 of the Act, but failed in several particulars to conform his pleadings to the requirements of that section. The Board moved to dismiss the petition. Lopez, meanwhile, alleged that the Board had failed to observe the time requirement of Section 61-1-13(B) whereby the Board was to render its decision against Lopez within ninety days after the hearing. On July 10, 1987 the trial court ruled against the Board as to the issue of the time limit, but granted the Board’s motion to dismiss as to Lopez’s failure to conform his pleadings to Section 61-1-17. The matter proceeded to a bench trial, and the trial court essentially repeated in its judgment its earlier ruling on the motion to dismiss, restoring Lopez’s license to practice medicine. The Board appeals, and we affirm.
FACTS
There is no dispute as to the substantive nature of Lopez’s misfeasance in performing the act which led to the revocation of his license. On July 7, 1983 Lopez amputated his patient’s leg in an office that did not meet proper licensing standards, with no assistance from a trained health professional, and without being certified in the use of anesthesia. There is little doubt that Lopez’s conduct constituted gross negligence as alleged by the Board. However, the patient suffered no unexpected or damaging medical result, and voiced no complaint. Further, this was Lopez’s first disciplinary appearance since his licensure in 1968.
The issue before us, however, concerns not Lopez’s medical conduct, but the post-operative conduct of both Lopez and the Board in proceeding with the investigation and findings under the Uniform Licensing Act. First, we agree with the trial court that Lopez’s petition under Section 61-1-17 was defective. It was not filed within twenty days, did not bear the proper heading, and failed to state all exceptions to the Board’s ruling as required by law.
The more important issue, however, is not Lopez’s failure to comply with Section 61-1-17, but the Board’s failure to comply with Section 61-1-13. Whereas Lopez’s negligence in regard to filing his pleading goes to the issue of his response to the Board’s complaint, the Board’s negligence in not having rendered its decision within ninety days relates to the more important issues of jurisdiction, due process of law and equal protection of the law. Thus, whatever errors Lopez may have made are secondary to the more basic issues raised by the Board’s delay in rendering its decision. If the Board possessed no jurisdiction ab initio to render its decision, everything which the Board did following that decision is void and of no effect. Therefore, it does the Board little good to argue that Lopez filed faulty pleadings if the Board itself never possessed the requisite jurisdiction to proceed with its decision. Lopez’s error is derivative in nature, while that of the Board is foundational.
Yet, the Board argues that Lopez waived the Board’s requirement to render its decision in ninety days, and thereby conferred jurisdiction on the Board in spite of its delay of nearly a year and a half in making a decision. It is true that Lopez made certain waivers in this respect. The time limit was first extended from the original date of September 22, 1984 to November 19, 1984. The second waiver date was sometime in May, 1985. Lopez contends that he made no further waivers. The Board made no decision in May, 1985, but instead considered Lopez’s case at a meeting in November, 1985, and eventually revoked Lopez’s license on January 29, 1986. Whereas the Board in essence argues, “once waived always waived,” the trial court in its finding of facts (# 33) concluded, “Neither Lopez or his counsel assented in any way expressly or implicitly, to a continuance of this matter beyond the May, 1985 regularly scheduled Board meeting, nor to a delay until the November, 1985 regularly scheduled Board meeting.”
LEGAL ISSUES INVOLVED
We find that there is adequate substantial evidence in the record to support the trial court’s conclusion. Further, on appeal, the evidence is to be viewed in the aspect most favorable to the action of the court which is being appealed. Jones v. New Mexico State Racing Comm’n, 100 N.M. 434, 671 P.2d 1145 (1983). Every reasonable intendment and presumption will be resolved against appellants in favor of proceedings in the trial court. Romero v. Sanchez, 86 N.M. 55, 519 P.2d 291 (1974). We are thus bound by the trial court’s conclusion that no further waivers on Lopez’s part took place after May, 1985, and we conclude that more than ninety days passed after May, 1985 before the Board reached its decision.
Each party urges us to apply Foster v. Board of Dentistry, 103 N.M. 776, 714 P.2d 580 (1986) to its respective position and to conclude that Foster either does or does not stand for the proposition that the ninety day time limit in Section 61-1-13 is jurisdictional. In deciding this question, it seems to us that the language in Foster could not be clearer:
The Board further argues that under Section 61-1-13(B) the requirement that the decision be signed within ninety days after the completion of the hearing is merely procedural, not jurisdictional, and to argue that the Board lost jurisdiction over Foster merely for failing to sign the decision within ninety days leads to the unintended result of having to start the proceedings against Foster all over again. The Board argues that such unnecessary duplication was not intended by the legislature for the mere failure by the Board to sign its decision within the ninety day time period prescribed by Section 61-1-13(B). We disagree.
103 N.M. at 777, 714 P.2d at 581.
Although it is true that Chief Justice Riordan could have clarified the issue if he had written, “the ninety day time limit is jurisdictional,” his failure to do so does not detract from the obvious conclusion that this is what he intended to say. We therefore hold that the ninety day time limit imposed by Section 61-1-13 is expressly jurisdictional. “Because the Board [in the case before us] failed to take action within the required ninety day period [taking into account Lopez’s two waivers], its decision is void and must be reversed. To rule otherwise would ignore the plain language of Section 61-1-13(B).” Id. at 777, 714 P.2d at 581. We thus conclude that the trial court was correct to rule in its judgment, “the proceedings of the New Mexico Board of Medical Examiners below are void, [and] of no force and effect * * (R.P. 216).
Finally, in addition to the jurisdictional requirements imposed by Section 61-1-13, we hold, as the trial court likewise adjudged, that the Board violated certain constitutional requirements as well. See Logan v. Zimmerman Brush Co., 455 U.S. 422, 102 S.Ct. 1148, 71 L.Ed.2d 265 (1982), where the court held that procedures such as those in effect here constitute a vital property right, the deprivation of which is a deprivation of due process of law under the Fourteenth Amendment to the United States Constitution. 455 U.S. at 430-31, 102 S.Ct. at 1155. In Logan, the factfinding tribunal failed to act within the statutorily required 120 day period. Apparently through inadvertence, the commission’s representative scheduled the conference five days after expiration of the statutory period. Id. at 426, 102 S.Ct. at 1152. The Court held that “[a] system or procedure that deprives persons of their claims in a random manner * * * necessarily presents an unjustifiably high risk that meritorious claims will be terminated.” 455 U.S. at 434-35, 102 S.Ct. at 1157.
Further, in an opinion separate from that of the majority, four members of the Court addressed Logan’s equal protection claim. The Court wrote that to treat persons whose claims are processed within the 120 day period differently than persons whose claims are not processed within that period and finally terminated, amounts to a denial of equal protection under the Fourteenth Amendment.
“So far as the State’s purpose is concerned, every * * * claimant’s charge, when filed with the Commission, stands on the same footing. Yet certain randomly selected claims, because processed too slowly by the State, are irrevocably terminated without review. In other words, the State converts similarly situated claims into dissimilarly situated ones, and then uses this distinction as the basis for its classification. This, I believe, is the very essence of arbitrary state action.”
Logan v. Zimmerman Brush Co., 455 U.S. 422, 442, 102 S.Ct. 1148, 1161, 71 L.Ed.2d 265 (1982) (Blackman, J. separate opinion).
The judgment of the trial court is affirmed in its entirety.
IT IS SO ORDERED.
SCARBOROUGH, C.J., and WALTERS and RANSOM, JJ., concur.
STOWERS, J., Dissents. | [
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OPINION
ALARID, Judge.
Defendant, Jerry Gutierrez, brings this interlocutory appeal from the trial court’s denial of his motion to suppress evidence discovered during searches of defendant’s business and residence in Guadalupe County. The searches involved here were conducted by deputy sheriffs from Curry County in Guadalupe County. Defendant asserts that the Curry County deputies were without authority to obtain and execute search warrants in Guadalupe County. We disagree and affirm the trial court’s finding that statutory authority exists to allow a sheriff to serve process in any county in the state. Determining this issue dispositive, we do not consider the other issues raised.
FACTS
On March 9, 1983 two Curry County deputy sheriffs traveled from Clovis, in Curry County, New Mexico, to Santa Rosa, in Guadalupe County, New Mexico, to execute an arrest warrant and obtain and execute a search warrant. Upon arrival in Santa Rosa, the deputies contacted a state police officer assigned to the area, who assisted them but did not accompany them to defendant’s place of business or to the local magistrate’s office where the search warrant was issued. After obtaining the search warrant, the deputies, still unaccompanied by local law enforcement personnel, proceeded to defendant’s business premises, arrested him, served the search warrant, and commenced a search of the premises. There is a dispute about when the local Chief of Police, Horatio Chavez, arrived at the scene of the search, but the trial judge found that the search had commenced before he arrived. On the same day, Deputy Spear obtained a search warrant from a district judge allowing him to obtain a handwriting exemplar from defendant.
In addition, on March 9, 1983, Curry County Deputy Sheriffs Lyle Stevens and John Mares traveled to Santa Rosa where, unaccompanied by any other law enforcement officer, they obtained a search warrant for defendant’s residence from the local magistrate. State Police Officer Russell Kirkpatrick showed the deputies where the residence was located, and after the search warrant was obtained, accompanied the deputies in their attempt to find defendant’s brother or wife for assistance in entering the locked residence. The wife was not found, and the brother had no keys. The officers then returned to the residence a few minutes before Officer Kirkpatrick. By the time Officer Kirkpatrick arrived, the two deputies were inside the residence, and had already conducted a walk through and noticed certain business papers in a bedroom and an office area.
Defendant, in his motion to suppress, seeks to exclude the evidence seized as a result of the two search warrants. The trial court denied the motion and allowed interlocutory appeal. This court denied the interlocutory appeal, but on certiorari the supreme court ordered us to grant defendant’s interlocutory appeal on the search claim.
DISCUSSION
MAY A DEPUTY SHERIFF FROM ONE COUNTY EXECUTE A SEARCH WARRANT IN ANOTHER COUNTY WHERE NO LOCAL OR STATE LAW ENFORCEMENT OFFICIAL PARTICIPATES OR ACCOMPANIES HIM IN APPLYING FOR THE SEARCH WARRANT, OR PARTICIPATES AT THE TIME THE WARRANT IS SERVED AND THE SEARCH IS COMMENCED?
The question raised in this case is one of first impression in New Mexico. The closest New Mexico case on this issue is State v. Wise, 90 N.M. 659, 567 P.2d 970 (Ct.App.1977). In that case, Albuquerque police officers conducted a search in Lea County. The state contended that Albuquerque police officers did have authority to execute search warrants in Lea County. After reviewing statutes which contain geographical references and references to an officer’s authority within the geographical area, this court held that it was unnecessary to decide whether the statutes authorized Albuquerque officers to conduct searches in Lea County. The transcript revealed that the Albuquerque officers were working with the Lea County Sheriff and the Hobbs Police Department. One of the officers in charge of the search was a Hobbs police officer. A deputy sheriff and two or three Hobbs police officers participated in the search. Accordingly, it was “immaterial whether the Albuquerque police officers had authority to execute the warrant because other officers, present and participating, did have the authority.” 90 N.M. at 661. In this case, we address only the question of authority. Finding that discussion dispositive, it is not necessary to consider whether other authorized officers were “present and participating” in this case.
Defendant relies on the general rule that, at common law, the powers of a sheriff and his deputies are restricted to their counties unless they are given additional jurisdiction by statute. New Mexico appears to have followed this rule. See Geek v. Shepherd, 1 N.M. 346 (1859). Cf. Wise. Thus, the question to be answered is what extraterritorial powers have been given to county sheriffs by statutes.
In Wise, the state contended that police officers were authorized to serve search warrants outside of their jurisdictions because Laws 1967, ch. 245, which directed that search warrants be directed to officers in the county, had been repealed. This court found the argument unpersuasive because there were other statutes which appeared to limit certain officers’ powers to specific geographical boundaries. However, it is significant that Wise was concerned with municipal police officers. The duties of such officers, in serving writs and processes, are circumscribed by county boundary. NMSA 1978, § 3-13-2(A)(2). The same is not true for sheriffs.
A review of applicable statutes indicates that the municipal police officers in Wise were strictly circumscribed by county boundary in what they could do. On the other hand, the sheriff is so circumscribed if he is acting in a general capacity as a conservator of the peace, serving probate court process, or tracing or discovering stolen property. NMSA 1978, §§ 4-41-2 and -13 (Repl.Pamp.1984); NMSA 1978, § 29-1-2 (Repl.Pamp.1984). The comparison between Section 4-41-13 and NMSA 1978, Section 4-41-14 (Repl.Pamp.1984) should be noted. The former only allows sheriffs to serve probate court process if issued by the probate court in their counties. The latter allows sheriffs to serve the process, orders, and writs of magistrate courts without limitation. Section 4-41-14 is part of an act, another portion of which is compiled at NMSA 1978, Section 31-1-4(E) (Repl.Pamp.1984). N.M.Laws 1975 ch. 242. The latter section allows police officers to serve all non-municipal court process in any county of the state. Wise, dealing with municipal police officers, is not controlling in this case. Sections 4-41-14 and 31 — 1— 4(E) allow sheriffs to serve process in any county of the state.
The next question which must be addressed is whether a search warrant is process within the meaning of Section 31-1-4(E). As the state points out, State v. Welch, 37 N.M. 549, 25 P.2d 211 (1933), appeared to refer to a search warrant as process. In Welch, the court initially noted that an investigating party had no search Warrant or arrest warrant, and subsequently stated, “Admittedly the officers were armed with no process entitling them to enter.” 37 N.M. at 551, 556, 25 P.2d 211. Although State ex rel. Dresden v. District Court of Second Judicial Dist., 45 N.M. 119, 112 P.2d 506 (1941), equated process with summons in interpreting the statute there at issue, it also noted that process could include writs, warrants, and orders, depending upon the context of the statutes in which the word appears. Reviewing all of the above statutes, it is clear that process was meant to be the generic term, including summons, writs, warrants, and orders. See particularly Section 4-41-14, directing sheriffs to serve and execute all such processes directed to them by magistrate courts.
Moreover, the state has cited a number of cases standing for the proposition that a search warrant is “process” within the meaning of statutes or constitutional provisions dealing with process. State v. Hennessee, 232 Kan. 807, 658 P.2d 1034 (1983); Smith v. Commonwealth, 504 S.W.2d 708 (Ky.1974); Boring v. State, 253 So.2d 251 (Miss.1971), cert. denied, 405 U.S. 1040, 92 S.Ct. 1310, 31 L.Ed.2d 581 (1972); People v. Beard, 77 Misc.2d 927, 353 N.Y.S.2d 999 (1974); White v. State, 81 Okl.Cr. 399, 165 P.2d 151 (1946). In any event, defendant does not contend that a search warrant is not process within the meaning of either Section 4-41-14 or Section 31-1-4(E). Rather, he contends that a sheriff's only extraterritorial powers are those stated in NMSA 1978, Section 4-41-12 (Repl.Pamp. 1984). He argues that none of the statutes relating to sheriffs, particularly Section 4-41-14 or 31-1-4(E), expressly gives sheriffs the power to execute search warrants outside of their counties. Defendant also argues that Section 31-1-4(E) gives only police officers authorized to serve process outside of a county the power to serve process outside of the county.
With regard to defendant’s argument, it is clear that Sections 4-41-14 and 31-1-4(E) were intended to allow sheriffs to have more extraterritorial jurisdiction than that stated in Section 4-41-12. The courts of at least one state have expressly so ruled based on statutes similar to ours. State v. Lamb, 209 Kan. 453, 497 P.2d 275 (1972), overruled on other grounds, State v. Jacques, 225 Kan. 38, 587 P.2d 861 (1978). It was only when subsequent legislation narrowed the extraterritorial powers of sheriffs that the Kansas courts ruled that sheriffs’ powers were more circumscribed by geographical boundary. See State v. Hennessee.
With regard to defendant’s last argument, defendant would read the words “authorized to serve process issued in any criminal action” out of the statute. Defendant in effect contends the phrase “authorized to serve process issued in any criminal action” includes only those police officers otherwise authorized to serve process outside the county. This interpretation requires us to read words into the statute or ignore words that are present. This we need not do, since the statute makes sense as written. See State ex rel. Barela v. New Mexico State Board of Education, 80 N.M. 220, 453 P.2d 583 (1969).
Therefore, the order of the trial court denying defendant’s motion to suppress is affirmed and the case remanded to the district court for trial.
IT IS SO ORDERED.
NEAL and MINZNER, JJ., concur.
. A list of applicable statutes, together with a synopsis, follows:
Section 3 — 13—2(A)(1): Municipal police officers shall execute and return all writs and processes as directed by the municipal judges.
Section 3-13-2(A)(2): Municipal police officers shall serve writs and processes in any part of the county where the municipality is situated.
Section 3-13-2(A)(3): Municipal police officers shall suppress riots and arrest people within the municipality.
Section 3-13-2(B): In the discharge of his duties, a municipal police officer has the powers of a sheriff.
NMSA 1978, Section 4-41-2 (Repl.Pamp. 1984): A sheriff is the conservator of the peace within his county.
NMSA 1978, Section 4-41-9 (Repl.Pamp. 1984): A deputy may do what a sheriff may do.
NMSA 1978, Section 4-41-12 (Repl.Pamp. 1984): A sheriff may enter other counties to make arrests.
NMSA 1978, Section 4-41-13 (Repl.Pamp. 1984): A sheriff may execute the process of the probate judges in the respective counties.
NMSA 1978, Section 4-41-14 (Repl.Pamp. 1984): A sheriff shall serve and execute all pro cesses, writs, and orders directed to him by the magistrate courts.
NMSA 1978, Section 29-1-1 (Repl.Pamp. 1984): It is the duty of sheriffs, constables, and peace officers to investigate all violations of the law in the state.
NMSA 1978, Section 29-1-2 (Repl.Pamp. 1984): It is the duty of sheriffs and constables in the respective counties to trace and discover stolen property.
NMSA 1978, Section 29-2-18 (Repl.Pamp. 1984): State police are the conservators of the peace throughout the state.
NMSA 1978, Section 31-1-4(E) (Repl.Pamp. 1984): Except for municipal court actions, all police officers authorized to serve process issued in any action have jurisdiction to serve process in any county of the state. | [
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OPINION
DONNELLY, Chief Judge.
Marie Grace Romero appeals from an order of the district court upholding the action of the State Personnel Board which affirmed disciplinary action imposed against her by her employer, the Employment Security Department. The sole issue asserted by appellant on appeal is whether her conduct at a meeting with her supervisors constituted misconduct and just cause for her employer to suspend her from work. We affirm.
FACTS
Appellant is a supervisor employed by the New Mexico Employment Security Department. On November 3, 1980, appellant attended a meeting at the Albuquerque Montgomery area office of the Employment Security Department which had been called by Joseph Garrison, the Regional Bureau Chief and Debbie Gorenz, an Agency Claims Examiner. The purpose of the meeting was to study a number of complaints the state office had received concerning personnel problems at the area office between departmental supervisory personnel. Garrison and Gorenz also wished to determine the reasons for the delays in processing unemployment compensation benefits for claimants.
At the meeting, after reviewing the problems which were determined to exist, Garrison stated that a new plan would be formulated to resolve the problems. Appellant, as a supervisor, was told that she would be the person who would have the responsibility for implementing the new plan. While Gorenz was explaining the changes that should be carried out, appellant became visibly upset and interrupted Gorenz’s explanation. Appellant began crying and yelling at Gorenz and the other supervisory personnel present, stating that they did not know what they were doing and that if she followed their instructions she would be violating federal law.
The area supervisor, Garrison, told appellant to stop interrupting but appellant con tinued yelling until Garrison had repeated his order three times.
After the meeting, appellant’s supervisors determined that she was guilty of misconduct and ordered that she be suspended without pay for five work days. They recommended that she should be put on probation for forty-five days as a result of. her conduct. Appellant appealed the disciplinary action to the State Personnel Board. On May 27, 1981, following a hearing before a hearing officer, the Personnel Board affirmed the disciplinary action, finding that appellant’s conduct at the meeting constituted misconduct and that there was just cause to sustain the disciplinary action imposed by her employer.
Appellant appealed the ruling of the State Personnel Board to the District Court of Bernalillo County. At the court hearing the parties stipulated that the findings of the State Personnel Board were supported by substantial evidence and that the decision of the Board was not arbitrary or capricious.
The findings of the State Personnel Board were adopted by the district court and the court concluded that appellant’s behavior during the meeting of November 3, 1980, constituted misconduct and that the Employment Security Department had just cause for imposing the disciplinary action taken. The trial court affirmed the decision of the State Personnel Board.
DID APPELLANT’S ACTION CONSTITUTE MISCONDUCT?
Appellant challenges on appeal the disciplinary action imposed against her and asserts that her conduct did not, as a matter of law, fall within the definition of misconduct. Appellant contends that by her conduct she was voicing an objection to proposals stated by others at the meeting, and that her failure to promptly heed the verbal order of her superior was the result of being emotionally upset. She asserts that her conduct, while perhaps inappropriate, did not amount to a showing of a wilful or wanton disregard of her employer’s interest or an action which legally amounted to misconduct sufficient to constitute just cause for the imposition of disciplinary action against her. Appellant further contends that she became upset as a result of long-standing tension which had existed in her office between certain individuals and because of her concern that the plan her supervisors proposed would violate federal regulations governing her job activities.
Rule 14.7(C) of the Rules and Regulations of the State Personnel Board in effect at the time of appellant’s hearing, provided in applicable part:
Employees may be dismissed, demoted, or suspended only for just cause, such as inefficiency, incompetency, misconduct, negligence, insubordination, for performance which continues to be inadequate after reasonable efforts have been made to correct it, or conviction of a felony or misdemeanor and the provisions of the Criminal Offender Employment Act, Section 28-2-1, et seq., NMSA 1978, permit such disciplinary action. [Emphasis added.]
The term “misconduct” is not specifically defined in the State Personnel Act, or the Rules and Regulations of the State Personnel Board. “Just cause” is defined in the Personnel Board’s Rules and Regulations as “any conduct, action, or inaction, arising from, or directly connected with the employee’s work, which is inconsistent with the employee’s obligations to the employer and reflects the employee’s disregard of the employer’s interests.” State Personnel Board Rule 1.25 (July 1, 1983). See State ex rel. New Mexico Highway Department v. Silva, 98 N.M. 549, 650 P.2d 833 (Ct.App.1982).
The word “misconduct” within the context of Rule 14.7(C) of the State Personnel Rules should be interpreted in its plain and ordinary meaning in light of the purpose of the rule. See State ex rel. Bingaman v. Valley Savings & Loan Association, 97 N.M. 8, 636 P.2d 279 (1981) (court construed statutorily created attorney general powers to include a suit against Valley Savings Loan Association by determining that this action was within the “public interest” when the statute was read giving the words their ordinary and usual meaning). “Misconduct,” as defined in Webster’s New Collegiate Dictionary 734 (1977), includes conduct of an employee which amounts to “intentional wrongdoing * * * deliberate violation of a law or standard * * * [or] improper behavior.” Similarly, the term “misconduct” has been interpreted to mean a “ ‘wilful, intentional disregard of [an] employer’s interest; a deliberate violation of the employer’s rules; or a disregard of standards of behavior which the employer has a right to expect of his employees.’ ” Weston v. Gritman Memorial Hospital, 99 Idaho 717, 719, 587 P.2d 1252, 1254 (1978). See also Hickenbottom v. District of Columbia Unemployment Compensation Board, 273 A.2d 475 (D.C.App.1971). Mere inefficiency, ordinary negligence, or isolated instances of good-faith errors in judgment do not rise to the level of misconduct although such may be evidence going to the provisions of Rule 14.7(C).
Appellant argues that a “wilful and wanton” standard should be required to be shown when the actions of a public employee are alleged to constitute “misconduct.” We conclude that while “wilful and wanton” conduct may indeed constitute misconduct, the definition of misconduct as embodied in Rule 14.7(C), is not so narrowly proscribed. The term “misconduct” as contemplated by the rule is not limited to circumstances of intentional wrongdoing, but also embraces an employee’s disregard of proper behavior which an employer has a right to expect of an employee. See Weston v. Gritman Hospital.
The question of whether an employee’s action constituted misconduct so as to provide “just cause” for the discipline of a state employee is a question of fact to be determined from all the attendant circumstances in each ease. The employee’s action should be viewed in light of the common and ordinary meaning of “misconduct.” Cf Silva.
Applying this standard to the facts in the present case, the actions of appellant in direct contravention of her superior’s instructions to stop yelling at others at the staff meeting was a sufficient basis upon which appellant’s supervisors, the State Personnel Board, and the district court could reasonably find misconduct by the appellant within the definition of Rule 14.-7(C) of the State Personnel Rules. Appellant had the status of a supervisor and as such, her behavior and conduct while on duty and while serving the public and individuals who have business with the agency, affects the efficiency of the agency. She also serves as an example to her subordinates. The Personnel Board specifically found that the recommendations sought to be carried out by appellant’s supervisors would not in fact violate federal regulations. This finding was stipulated to by the parties before the district court and is not an issue on appeal. Additionally, on appeal to this court, appellant has not challenged the reasonableness of the plan which her superiors directed her to carry out at the November 3, 1980 meeting.
The judgment of the district court is affirmed. Appellees are awarded their costs on appeal.
IT IS SO ORDERED.
WOOD and HENDLEY, JJ., concur. | [
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OPINION
DONNELLY, Chief Judge.
Plaintiff appeals the trial court’s denial of her motion for postjudgment interest on a prior judgment obtained against the New Mexico State Highway Department (State) for the wrongful death of her husband. We discuss whether the trial court properly denied postjudgment interest against the State and affirm.
Plaintiff argues that the trial court erred in denying postjudgment interest on a judgment obtained against a governmental entity under the Tort Claims Act, NMSA 1978, Sections 41-4-1 to -27 (Repl.Pamp.1986). Specifically, plaintiff contends that, because Section 41-4-19 of the Act prohibits punitive damages and prejudgment interest and is silent as to postjudgment interest, the Act permits an award of postjudgment interest.
Section 41-4-19(B) provides: “No judgment against a governmental entity or public employee for any tort for which immunity has been waived under the Tort Claims Act shall include an award for exemplary or punitive damages or for interest prior to judgment.” (Emphasis added.)
The fact that the act is silent as to postjudgment interest does not indicate that the legislature intended to permit recovery of postjudgment interest against the State. In construing statutes, this court will not read into a statute language which does not exist, particularly if the statute makes sense as written. See Perez v. Health & Soc. Servs., 91 N.M. 334, 573 P.2d 689 (Ct.App.1977). Moreover, the Tort Claims Act must be strictly construed. Methola v. County of Eddy, 95 N.M. 329, 622 P.2d 234 (1980). At the time the Tort Claims Act was enacted, statutory provisions for post-judgment interest referred to judgments based on contracts. See NMSA 1953, §§ 50-6-3 & -4. The legislature is presumed to have been aware of existing statutory and common law. See Bettini v. City of Las Cruces, 82 N.M. 633, 485 P.2d 967 (1971).
Plaintiff also argues that NMSA 1978, Section 56-8-4(D) (Repl.Pamp.1986) exempts the State and its political subdivisions from awards of postjudgment interest, except as provided by statute or common law. Section 56-8-4 provides, in part:
A. Interest shall be allowed on judgments and decrees for the payment of money from entry and shall be calculated at the rate of fifteen percent per year____
D. The state and its political subdivisions are exempt from the provisions of this section except as otherwise provided by statute or common law. [Emphasis added.]
Plaintiff contends that because the common law permitted postjudgment interest to accrue against the State, the State is not exempt under this provision. Plaintiff has pointed to no authority for the proposition that the common law permitted post-judgment interest to accrue against the State. In fact, at common law, judgments against any party did not bear interest. See Pierce v. United States, 255 U.S. 398, 41 S.Ct. 365, 65 L.Ed. 697 (1921); Washington & Georgetown R.R. Co. v. Harmon’s Adm’r., 147 U.S. 571, 13 S.Ct. 557, 37 L.Ed. 284 (1893).
Moreover, interest, as a general rule, cannot be recovered in a suit against a state or the federal government. See Library of Congress v. Shaw, 478 U.S. 310, 106 S.Ct. 2957, 92 L.Ed.2d 250 (1986); Hyde v. Wellpinit School Dist. No. 49, 32 Wash. App. 465, 648 P.2d 892 (1982). However, interest may be awarded when the legislature or Congress has, either expressly or by reasonable construction of a statute, consented to such award. See Annotation, Recovery of Interest on Claim Against a Governmental Unit in Absence of Provision in Contract or Express Statutory Provision, 24 A.L.R.2d 928 (1952); see also Bradbury & Stamm Constr. Co. v. Bureau of Revenue, 70 N.M. 226, 372 P.2d 808 (1962).
Because any statute allowing interest against the state is in derogation of common law, it must be strictly construed. See State ex rel. Miera v. Chavez, 70 N.M. 289, 373 P.2d 533, 373 P.2d 533 (1962). There can be no liability for interest of any kind without specific statutory language subjecting the state to liability. See generally City of Springfield v. Allphin, 82 Ill.2d 571, 45 Ill.Dec. 916, 413 N.E.2d 394 (1980); Brown v. State Highway Comm’n, 206 Kan. 49, 476 P.2d 233 (1970); Myers v. Department of Crime Control & Pub. Safety, 67 N.C.App. 553, 313 S.E.2d 276 (1984).
We interpret both the Tort Claims Act and Section 56-8-4(D) to deny an award of postjudgment interest on final judgments entered against the State. The decision of the trial court is affirmed.
IT IS SO ORDERED.
ALARID and APOD AC A, JJ., concur. | [
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] |
OPINION
STOWERS, Justice.
Edward F. and Charlotte A. Jacobs (Jacobses) filed a complaint which sought recission of a real estate contract and return of their down payment from Charles W. and Elizabeth B. Phillippi (Phillippis), and damages for misrepresentation from Howard Wolfley (Wolfley) and Gallery of Homes. After a hearing on the merits, the trial court dismissed the complaint with prejudice. The Jacobses appeal. We affirm.
The Jacobses present the following issues: (1) whether the trial court erred in concluding that the Jacobses suffered no damage as a result of a breach of fiduciary duty by Wolfley; (2) whether the trial court erred in concluding that the retention of down payment by the Phillippis upon default by the Jacobses was not an unwarranted forfeiture; and (3) whether the trial court erred in concluding that the real estate contract was not void for lack of mutual assent.
The following facts are pertinent to this appeal. After their divorce, the Phillippis listed their house (the house) for sale with Gallery of Homes at a price of $184,000. The Jacobses made an offer through Wolfley of Gallery of Homes to purchase the Phillippis' house. The offer included a $35,000 down payment, an assumption of a pre-existing mortgage in the amount of $59,183, and a real estate contract on the balance of $89,817, at an interest rate of ten percent, with a balloon payment due and payable within one year. The Phillip-pis made a counter-offer, through Wolfley, raising the interest on the real estate contract to twelve percent. The Jacobses instructed Wolfley to make a further counter-offer of ten percent for the first six months and twelve percent for the second six months. Wolfley did not inform the Phillippis of the further counter-offer by the Jacobses and the Phillippis believed that their offer of twelve percent interest had been accepted.
The parties signed a real estate contract which provided for an interest rate of twelve percent and for a balloon payment of the balance plus interest within twelve months. Except for information relating to the first mortgage, the terms of the real estate contract were complete and visible for review by the Jacobses. The Phillippis each borrowed money to construct separate new homes in reliance on receipt of the balloon payment. The Jacobses were unable to pay the balloon payment. The Phillippis declared the Jacobses in default under the real estate contract, and withdrew the special warranty deed from escrow and filed it. As a consequence of the default, for a period of ten months the Phillippis had to pay a total of $7,461 on the mortgage, $511 for the utility payments, and $576 for house repairs. The Phillippis also had to pay additional interest of $15,604 on their new home construction loans. Also, after default, the Jacobses failed to pay three months of a $1,200 per month agreed rental. The house was subsequently sold for $180,000, which was $4,000 less than the original sale price.
The Jacobses contend that the trial court erred in concluding no damage was caused by Wolfley’s breach of fiduciary duty. We disagree. The standard for review on appeal is whether substantial evidence supports the findings of the trial court. Toltec International, Inc. v. Village of Ruidoso, 95 N.M. 82, 619 P.2d 186 (1980). Although the trial court determined that Wolfley had breached his duty, substantial evidence exists to support the trial court’s findings that the difference in interest rates was not a material factor in the negotiations between the parties and in the execution of the real estate contract. In his testimony, Mr. Jacobs testified that the difference in the interest rates was immaterial to the negotiations. The Jacobses did not pay the balloon payment, and thus suffered no damage as a consequence of the contract’s higher interest rate. The Jacobses cannot recover damages for the higher interest rate absent proof that damage occurred. See Bank of New Mexico v. Rice, 78 N.M. 170, 429 P.2d 368 (1967).
The Jacobses are not correct in their assertion that there was an unwarranted forfeiture. In New Mexico, the rule is well settled that real estate contracts are enforceable, unless enforcement of the literal terms would result in an unwarranted forfeiture or in unfairness which shocks the conscience of the court. Huckins v. Ritter, 99 N.M. 560, 661 P.2d 52 (1983). However, the Jacobses misplace their reliance on the exceptions to enforcement of default provisions in real estate contracts announced in Huckins, and the cases cited therein. See, e.g., Hale v. Whitlock, 92 N.M. 657, 593 P.2d 754 (1979); Eiferle v. Toppino, 90 N.M. 469, 565 P.2d 340 (1977). In Huckins this Court determined that the seller’s retention of the down payment, in addition to regaining the house after the buyer’s default, was an unwarranted forfeiture in light of the equitable considerations involved in that case. The following equitable considerations were pertinent to the Huckins Court: the down payment was almost one-third of the purchase price, the buyers were in possession of the house for three months at the time of default and for only seven months at termination of the contract, the market value was still equal to the sale price, and the sellers could rent the house. Here, as a consequence of the Jacobses’ default in this case, the Phillippis had to pay approximately $24,000 in post-default mortgage, utility, interest and repair payments, they lost $4,000 on the resale of the house, and they lost $3,600 in rent agreed to but not paid by the Jacobs-es. Equitable considerations do not exist in this case which would require application of an exception to enforcement of the real estate contract. The conclusion of the trial court will not be disturbed.
Finally, the Jacobses assert that the real estate contract was void due to a mutual mistake because there was no meeting of the minds between the parties. We disagree. A contract is void because of a mutual mistake where the minds of the parties have not met on any part of a proposed contract. Lamonica v. Bosenberg, 73 N.M. 452, 389 P.2d 216 (1964). However, in this case, substantial evidence exists to support the trial court’s conclusions that the Jacobses’ belief that the interest rate was ten percent for the first six months was a unilateral mistake. The contract stated and the Phillippis believed that the interest rate of twelve percent was the rate agreed to by the parties. Only the Jacobses believed that the interest rate should have been ten percent for the first six months. This Court will not void a contract for a unilateral mistake except where the mistake is basic and material to the agreement, and the other party knew or reasonably should have known of the mistake. Gardner v. Meiling, 280 Or. 665, 572 P.2d 1012 (1977). See generally 17 Am.Jur.2d Contracts § 146 (1964) (unilateral mistake will not void a contract). Moreover, the record does not show that the contract was different from what each party intended, which is necessary for a mistake to be mutual and common to both parties. See Cargill v. Sherrod, 96 N.M. 431, 631 P.2d 726 (1981).
The trial court properly dismissed the Jacobses’ complaint.
Judgment of the trial court is affirmed.
IT IS SO ORDERED.
FEDERICI, C.J., and SOSA, Senior Justice, concur. | [
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OPINION
FEDERICI, Chief Justice.
A. Daniel Swallows (Swallows) brought this action against Ted and Birka Laney (Laneys) in the District Court of Catron County alleging breach of contract for the sale of land. The district court ruled in favor of the Laneys, and Swallows appeals. This case involves an important question of first impression in New Mexico: whether a fiduciary relationship between a real estate broker or salesperson and his principal may continue to exist under certain circumstances after the expiration of a written listing agreement.
The Laneys entered into two exclusive right-to-sell listing agreements with Western Farm Management Company for the sale of three tracts of land in Catron County. These three tracts consisted of a 7-acre parcel of land with a home and water rights, a 19-acre parcel of vacant land, and a 48.6-acre parcel of land with water rights. The 48.6-acre parcel is the subject matter of this suit. Swallows was the real estate salesman who arranged the listings. He was unable to sell any of the tracts prior to the termination date of the written listing agreements on October 15, 1980.
In early February 1981, Swallows and the Laneys entered into negotiations concerning the possible purchase by Swallows of the 48.6-acre parcel. On April 1, 1981, Swallows prepared, signed and mailed a purchase agreement to the Laneys in Ava, Missouri, where the Laneys resided. On April 13, 1981, the Laneys executed the agreement which provided for a purchase price of $72,500 and a closing date of April 30, 1981. Swallows and the Laneys orally agreed to postpone the closing date until May 26, 1981. The Laneys arrived in Reserve, New Mexico on May 23, 1981, to close the sale, but were unable to meet with Swallows until the evening of May 26, 1981, at which time they learned that Swallows was not prepared to close the transaction. The Laneys advised Swallows that they were unwilling to postpone further the closing date or engage in any more negotiations concerning the transaction. They returned to Swallows his earnest money of $100. The Laneys rejected any attempt by Swallows to perform under the contract after the May 26, 1981 closing date. Consequently, Swallows brought this suit for breach of contract.
The district court found for the Laneys on two separate grounds. First, it held that Swallows had breached his fiduciary duty toward the Laneys and that as a result, the purchase agreement was null and void as a matter of public policy. Second, the district court found that Swallows had failed to close the transaction in a timely manner so that the purchase agreement expired by its own terms. It held, therefore, that Swallows had no right to seek performance from the Laneys after the expiration of the contract. We agree with the district court on both points.
Swallows first contends that the district court erred in finding that a fiduciary relationship existed between him and the Laneys at the time of the negotiation and execution of the land sales contract for the 48.6-acre parcel because the listing on the property had expired at this time. We disagree.
An owner-broker relationship is clearly established during the term of a listing agreement. Talley v. Security Service Corp., 99 N.M. 702, 663 P.2d 361 (1983). It is well-established in New Mexico law that a real estate agent stands in a fiduciary relationship with his principal and must reveal all facts within his knowledge which might affect his principal’s decisions, rights and interests. Poorbaugh v. Mullen, 99 N.M. 11, 653 P.2d 511 (Ct.App.), cert. denied, 99 N.M. 47, 653 P.2d 878 (1982); Master Builders, Inc. v. Cabbell, 95 N.M. 371, 622 P.2d 276 (Ct.App.1980), cert. denied, 95 N.M. 426, 622 P.2d 1046 (1981). As a fiduciary, a broker or salesperson holds a position of great trust and confidence and must act in utmost good faith. Amato v. Rathbun Realty, Inc., 98 N.M. 231, 647 P.2d 433 (Ct.App.1982).
The National Association of Realtors in the Preamble to its Code of Ethics recognizes the trust placed on members of its profession. It states:
The REALTOR, therefore, is zealous to maintain and improve the standards of his calling and shares with his fellow REALTORS a common responsibility for its integrity and honor. The term REALTOR has come to connote competency, fairness, and high integrity resulting from adherence to a lofty ideal of moral conduct in business relations. No inducement of profit and no instruction from clients ever can justify departure from this ideal.
This code is applicable to all members of New Mexico’s regional Boards of Realtors.
Strict adherence to these fiduciary duties and obligations by a real estate broker or salesperson is especially important when the broker or salesperson buys the listed property for himself. The opportunity for overreaching by the broker or salesperson, or for taking advantage of facts and information within his specialized knowledge, is great. For this reason, this Court has previously recognized, when a real estate broker or salesperson buys listed property from his principal before the listing has expired, that:
In addition to the duty to disclose his interest as a purchaser, a real estate broker is under a legal obligation to make a full, fair and prompt disclosure to his employer of all facts within his knowledge which are or may be material, or which might affect his principal’s rights and interest or influence his action relative to the disposition of the property.
Iriart v. Johnson, 75 N.M. 745, 748, 411 P.2d 226, 227-28 (1965). In Mart, we found that the real estate agent had breached his fiduciary duty by failing to disclose his true role in the transaction and facts within his knowledge concerning property values in the area.
New Mexico appellate courts have not previously addressed the question of whether a real estate broker or salesperson should be bound by these same fiduciary duties and legal obligations when he buys listed property after the listing agreement has expired. We believe that the expiration or absence of a listing agreement, by itself, should not absolve the real estate broker or salesperson from these obligations and duties. Additional circumstances concerning the agent-principal relationship should be inquired' into to determine if, in fact, a fiduciary relationship continues to exist.
Other states have found a fiduciary relationship to exist between a real estate agent and a vendor in the absence of a written listing agreement. In Black v. Dahl, 625 P.2d 876 (Alaska 1981), the Supreme Court of Alaska held that a real estate agent was liable for breach of fiduciary duty although no written listing agreement had been entered into and in spite of Alaska’s law requiring all real estate listings to be in writing and Alaska’s statute of frauds. That court rejected the broker’s contention that a lesser fiduciary duty is owed in the absence of a listing. In Starkweather v. Shaffer, 262 Or. 198, 497 P.2d 358 (1972), the Supreme Court of Oregon disagreed with a real estate broker’s assertion that no fiduciary duty is owed merely because there was no written listing agreement. In that case the court stated:
A fiduciary relationship exists in all cases where there has been a special confidence reposed in one who in equity and good conscience is bound to act in good faith and with due regard to the interests of one reposing the confidence.
Id. at 205, 497 P.2d at 361. The court found that the statute requiring a real estate listing to be in writing was to protect the public against fraud, not to relieve a real estate agent from his duties and obligations.
We conclude that the fiduciary relationship between a real estate broker or salesperson and his principal may, under certain circumstances, exist in the absence or after the expiration of a written listing agreement. To determine whether particular circumstances give rise to such a relationship, a court should consider the following factors, among others, to be relevant:
1. The course of conduct between the real estate broker or salesperson and the principal.
2. The extent to which the broker or salesperson holds himself out to the principal as a real estate advisor and confidant.
3. The degree of the principal’s dependence on the broker or salesperson for advice.
4. The sophistication of the principal in real estate matters.
5. The familiarity of the principal with the value of the subject property.
In the case at bar, the district court correctly found that a fiduciary relationship existed between Swallows and the Laneys at the time they negotiated and entered into the purchase agreement for the 48.6-acre tract. The record shows that after the expiration of the listing agreements on October 15, 1980, Swallows continued to attempt to sell the listed properties for the Laneys and thus to act as agent on their behalf. At the same time Swallows was negotiating to buy the 48.6-acre tract, he was also attempting to sell another piece of property for the Laneys that had not previ ously been listed for sale by Swallows. A listing agreement on this property was finally signed on May 26, 1981, the day the Swallows-Laney transaction was to close, but was backdated to May 1, 1981. Swallows was successful in selling this property and received a commission on it. These facts show that Swallows continued to act as the Laneys’ real estate agent, continued to give them advice on real estate matters, and the Laneys continued to rely upon his aid. Under such circumstances, Swallows’ negotiation with the Laneys to purchase for his own account the 48.6-acre tract cannot be considered to have been at arms-length.
We are not suggesting that, once a real estate broker or salesperson has acted as agent for the sale of a property, he may not purchase it himself. What we do hold is that having once acted as agent, the broker or salesperson has the additional • obligation of full and complete disclosure of all pertinent facts within his knowledge concerning the property if the fiduciary relationship between the agent and principal has continued to exist. If this is not done, the negotiations concerning the purchase of the property might be unequal, and the realtors’ ideals of fairness, high integrity, and strict moral conduct could be jeopardized.
These same concerns were expressed in Williams v. Wagers, 117 Colo. 141, 184 P.2d 497 (1947), a case in which a real estate agent, who attempted to buy his principal’s property without disclosing this fact to the principal, sued the principal for specific performance of the contract. Although the record disclosed no listing agreement between the agent and the principal covering the subject property, the Colorado Supreme Court, nevertheless, upheld the trial court’s finding that a fiduciary relationship had been established between the parties by their actions. The Supreme Court of Colorado concluded that the agent’s failure to disclose all the facts concerning the entire transaction was a breach of his fiduciary duty. The court said:
But when the usual fiduciary relationship of principal and agent already exists, it is evident that the agent can not properly deal with his principal as an independent buyer, or as one having a net price contract, unless and until he has made a complete disclosure of all facts concerning his principal’s property which he has had or has acquired during the fiduciary relationship, so that both parties may be put in position where they can deal with each other on equal terms, and with all facts possessed by the agent disclosed to his principal.
Id. at 149, 184 P.2d at 500-01.
After properly ascertaining that a fiduciary relationship existed, the district court was correct in finding that Swallows had breached his fiduciary duty to the Laneys. To determine whether a real estate broker or salesperson has breached his fiduciary duty in such a situation, we believe that a court should consider, among other factors, the fairness of the price paid for the property by the broker, bearing in mind the fair market value of the property at the time of the sale, and the actual disclosures made by the broker or salesperson to the principal.
Although Swallows did disclose to the Laneys that he was purchasing for his own account, the record shows that he did not disclose all facts within his knowledge that were or might have been material to the Laneys’ decision to sell to him. Swallows never fully advised the Laneys of the potential value of their property if sold in segments rather than as a whole. Swallows clearly had extensive knowledge of land values in the area and market prices, yet when the Laneys specifically asked Swallows the value of their water rights, Swallows told them he did not know, despite the fact that he had already been negotiating to sell some of the Laneys’ water rights, which he hoped to purchase.
If a breach in fiduciary duty is found, the transaction is void as against public policy whether the broker has profited thereby or not. Iriart v. Johnson, 75 N.M. 745, 411 P.2d 226 (1965). For this reason alone, Swallows is prevented from specifically enforcing the contract.
There is, however, another reason why Swallows cannot specifically enforce the contract. Swallows also contends that the district court erred in finding that he was not prepared to close the transaction on May 26, 1981. The purchase agreement specified an April 30, 1981 closing date. It provided that time was of the essence. The closing date was postponed by oral agreement of the parties to May 26, 1981. Swallows admits that he did not tender any money to the Laneys on that day. After that time the agreement expired, unless again mutually extended, and was no longer enforceable by Swallows. The district court found that the agreement did not extend beyond May 26, 1981. We agree with the district court.
The findings of a trial court will not be disturbed if supported by substantial evidence. Sandoval v. Department of Employment Security, 96 N.M. 717, 634 P.2d 1269 (1981). This Court may not substitute its judgment of the facts for that of the district court. Only the district court, as trier of the facts, may weigh the evidence and determine a witness’ credibility. Lewis v. Bloom, 96 N.M. 63, 628 P.2d 308 (1981).
We find there to be substantial evidence in the record to support the district court’s finding that Swallows was unprepared to close on May 26th. The record indicates that the Laneys. came to New Mexico in May from- their home in Missouri specifically to close the transaction with Swallows; that they repeatedly tried to contact Swallows; that they finally reached him by telephone in Taos, New Mexico on the night of May 25th; and, that he told them he had not yet completed the survey and did not know if he could meet with them or not. When he did finally meet with them on the night of the 26th, he did not tender any money or otherwise attempt to close the transaction. Nothing in the record indicates that the closing date was again mutually postponed by the parties.
On cross-appeal, the Laneys contend that the district court erred in not awarding them per diem and mileage expenses for appearing as witnesses in this case. The district court was correct in denying these costs. Costs are recoverable only when authorized by statute. Read v. Western Farm Bureau Mutual Insurance Co., 90 N.M. 369, 563 P.2d 1162 (1977), (citing Reck v. Robert E. McKee General Contractors, 59 N.M. 492, 287 P.2d 61 (1955)). There is no statute or court rule that awards a successful party per diem and mileage expenses for appearing as a witness in his own case. It is the general rule that parties are not entitled to be treated as ordinary witnesses for the purposes of fees. Hinton v. Scharoun Industries, 41 N.Y.S.2d 595 (1943); Villanueva v. Rodriguez, 300 S.W.2d 668 (Tex.Civ.App. 1957); Bostrom v. Duffield, 28 S.W.2d 610 (Tex.Civ.App.1930); 20 C.J.S. Costs § 222 (1940).
Finally, the Laneys assert that the district court erred in denying their expenses upon Swallows’ failure to admit to several statements in their requests to admit. The district court stated in its order that the expenses should be denied “inasmuch as Rule 37(C) and Rule 26(B) of the New Mexico Rules of Civil Procedure, primarily direct themselves toward the genuineness of documents as opposed to facts relative to the parties’ respective positions in connection with this action, and therefore costs for failure to admit are not allowable.”
NMSA 1978, Civ.P.R. 37(C) (Repl.Pamp. 1980), provides that expenses shall be allowed on failure to admit,
[Ujnless it finds that (1) the request was held objectionable pursuant to Rule 36(a), or (2) the admission sought was of no substantial importance, or (3) the party failing to admit had reasonable grounds to believe that he might prevail on the matter, or (4) there was another good reason for the failure to admit.
Compliance with an earlier version of this same subdivision was mandatory upon the trial court. Schrib v. Seidenberg, 80 N.M. 573, 458 P.2d 825 (Ct.App.1969). If the trial court denied the expenses, it had to make findings pursuant to the rule. Id.
The Laneys maintain that the district court, in its order, made none of the four findings specified in the rule and that the case should, therefore, be remanded for compliance with the rule. We disagree.
The district court judge did state a reason, and although he did not use the specific language of Rule 37(C), his reason clearly goes to the third possible finding, that the party “had reasonable grounds to believe he might prevail on the matter.” The district court judge determined that Swallows’ answers reflected his position in the litigation. This expense was properly denied.
The district court is affirmed on all issues.
IT IS SO ORDERED.
RIORDAN and STOWERS, JJ., concur. | [
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OPINION
WOOD, Judge.
Plaintiff’s claim for worker’s compensation is based on injuries received when struck by a motor vehicle, driven by an uninsured motorist, about midnight of March 13, 1981. The appeal does not involve the question of a compensable injury under NMSA 1978, § 52-1-28. The appeal involves summary judgment proceedings concerned with the avoidance of compensation. There are two questions: (1) whether plaintiff was covered under the compensation policy issued by Transamerica Insurance Company; and (2) whether plaintiff’s acceptance of a settlement under uninsured motorist coverage bars compensation under NMSA 1978, § 52-l-56(C).
Whether Plaintiff was Covered
L & G Air Conditioning is a partnership consisting of plaintiff and Ortiz. Plaintiff is a “working partner”. Defendants moved for summary judgment on the basis that “Plaintiff was not an employee within the meaning of the Workman’s Compensation Act.” This motion was denied; defendants’ cross-appeal challenges the propriety of the ruling. Four arguments are presented on this issue.
(a) The deposition testimony of plaintiff raises factual issues as to whether the worker’s compensation policy was intended to cover plaintiff as a working partner. If, in fact, the policy failed to provide compensation coverage for a working partner, plaintiff may have a claim against the insurance agent for failure to obtain the intended coverage. Jernigan v. New Amsterdam Casualty Company, 69 N.M. 336, 367 P.2d 519 (1961); Topmiller v. Cain, 99 N.M. 311, 657 P.2d 638 (Ct.App.1983). This argument cannot sustain the denial of summary judgment because no such claim is made in this lawsuit, and the insurance agent is not a party to this lawsuit.
(b) Defendants assert that summary judgment should have been granted because a working partner is not eligible for compensation as an employee. Jernigan v. Clark and Day Exploration Company, 65 N.M. 355, 337 P.2d 614 (1959); see NMSA 1978, § 52-1-16 (Cum.Supp.1982). While this statement is correct, it is not true, as defendants assert, that “[t]he only issue is whether Plaintiff was an employee”. The compensation policy may have been issued to cover working partners. Jernigan v. New Amsterdam Casualty Company, supra. The fact that plaintiff, as a working partner, was not an employee was not a sufficient showing entitling defendants to summary judgment.
(c) Defendants recognize that our compensation statute provides, in NMSA 1978 § 52-l-6(B) (Cum.Supp.1982): “An election to be subject to the Workmen’s Compensa-, tion Act * * * by a partner * * * may be made by filing in the office of the superintendent of insurance * * * an insurance * * * undertaking as required by Section 52-1-4 NMSA 1978.”
Defendants assert that once it showed that plaintiff was a working partner it was entitled to summary judgment unless plaintiff raised a factual issue as to filing of an insurance undertaking covering a partner. We do not agree. Defendants, as the movant, had the burden of making a prima facie showing that no genuine issue of fact existed in the case, and that they were entitled to judgment as a matter of law. This “burden cannot be discharged unless the record upon which * * * [defendants] moved reflected the lack of a genuine issue of material fact.” (Emphasis added.) Fidelity Nat. Bank v. Tommy L. Goff, Inc., 92 N.M. 106, 583 P.2d 470 (1978). Defendants made no showing of an absence of the filing of an insurance undertaking covering a working partner.
Defendants’ brief points out: “There was no evidence before the Court * * * that any policy * * * was ever filed with the superintendent of insurance as required by the Act.” It is undisputed that a compensation policy was in fact issued. Whatever the coverage under the policy, if defendants moved for summary judgment on the basis of no coverage for lack of filing, it was defendants’ burden to show an absence of filing. They did not meet this burden. Thus we need not consider what consequences, if any, there may have been to plaintiff’s claim due to lack of filing and need not consider plaintiff’s improper attempt to raise a factual issue as to filing by attaching a document to his brief. Baca v. Swift & Company, 74 N.M. 211, 392 P.2d 407 (1964).
(d) Defendants assert the compensation policy issued by Transameriea excluded coverage for a partner. They rely on an exhibit to plaintiff’s deposition entitled “Worker’s Compensation Application”. Although the name of the applicant is the same as the name of the insured in the policy that was issued, the application indicates that the applicant was a corporation; the policy identifies the insured as a partnership. Neither plaintiff nor Ortiz, his partner, signed the application; the agent signed as “producer”.
There is an inference that the agent wrote the phrase “exclude partners” on the application. The showing is that the number of “employees” listed in the application, whether 3 or 4, included the plaintiff. We do not know whether this application was the basis of the policy that was in fact' issued, but we do know that if the “corporate” application is the basis for the premium charged, the premium included plaintiff’s work as an “employee”. See Jernigan v. New Amsterdam Casualty Company, supra.
The showing that an insurance agent, in filling in the answers on an application for a corporation, excluded partners, is insufficient to show that defendants were entitled to summary judgment on the question of coverage. In so holding, we have not considered the following “condition” in the policy that was issued: “If the insured is a partnership * * * such insurance as is afforded by this policy applies to each partner * * * as an insured only while he is acting within the scope of his duties as such partner * * *.” This condition insures a partner as well as the partnership, however, there is nothing indicating the meaning of “such insurance as is afforded by this policy applies to each partner * *.”
Defendants did not make a showing entitling them to summary judgment on the coverage issue. There being factual issues as to coverage, the motion for summary judgment was properly denied.
Uninsured Motorist Settlement as a Bar to Compensation
After plaintiff got out of the hospital, the insurance agent provided plaintiff with a compensation claim form which, when executed, was submitted to Transamerica by the agent. Subsequently, the agent informed plaintiff that Transamerica’s position was that there was no compensation coverage.
The partnership had other insurance with Transamerica. One policy provided liability coverage for certain of the partnership’s vehicles. It is undisputed that this policy also provided uninsured motorist coverage. The showing is that the operator of the vehicle that struck plaintiff was uninsured. Transamerica paid plaintiff $33,000.00 under the uninsured motorist coverage. The trial court granted summary judgment on the basis that plaintiff’s acceptance of this settlement barred plaintiff from recovering compensation under the provisions of § 52-1—56(C). Plaintiff appealed.
Our decision as to the propriety of this summary judgment does not consider the actual wording of the uninsured motorist coverage. The portion of the policy providing such coverage is not in the appellate record and there is no claim that it was before the trial court. At oral argument the parties stated that there is no statutory form of uninsured motorist coverage. No contention is made that the wording of such coverage makes any difference in this case. However, see A. Larson, The Law of Workmen’s Compensation § 71.23(b) (1982). Our decision is based on the contentions presented by the parties.
Section 52-l-56(C) provides:
The right of any workman * * * to receive payment or damages for injuries occasioned to him by the negligence or wrong of any person other than the employer or any other employee of the employer * * * shall not be affected by the Workmen’s Compensation Act, but he * * * shall not be allowed to receive payment or recover damages therefor and also claim compensation from the employer, and in such case the receipt of compensation from the employer shall operate as an assignment to the employer, his or its insurer * * * of any cause of action, to the extent of payment * * * for compensation * * *.
The purpose of § 52-l-56(C) is to prevent a double recovery by a worker and to provide reimbursement to an employer or insurer. Garcia v. Middle Rio Grande Conservancy District, 99 N.M. 802, 664 P.2d 1000 (Ct.App.1983); Britz v. Joy Mfg. Co., 97 N.M. 595, 642 P.2d 198 (Ct.App. 1982). However, this purpose is not pertinent unless the statute applies to the facts of the case.
Section 52-l-56(C) applies only if the worker has received payment or recovered damages for injuries occasioned by the negligence or wrong of the third party. Thus, if the worker obtains a judgment against a third-party tortfeasor or settles the claim either with the third party or the third party’s insurer, the worker at that point is barred from obtaining compensation thereafter. Castro v. Bass, 74 N.M. 254, 392 P.2d 668 (1964); Brown v. Arapahoe Drilling Company, 70 N.M. 99, 370 P.2d 816 (1962); White v. New Mexico Highway Commission, 42 N.M. 626, 83 P.2d 457 (1938). The reason is that the recovery from or payment on behalf of a third party is for the full loss and detriment suffered by the worker and makes the worker financially whole. Castro v. Bass, supra; Strickland v. Roosevelt Cty. Rural Elec., 99 N.M. 335, 657 P.2d 1184 (Ct.App.1982).
There has been no recovery from or settlement on behalf of the uninsured motorist in this case. The settlement agreement, signed by plaintiff, releases only Transamerica and its agents and representatives. The “Release and Trust Agreement” which plaintiff appears to have signed on the line for a notary’s signature, releases Transamerica from claims by plaintiff under the uninsured motorist coverage, and also provides:
(a) Transamerica is entitled to $33,000.00 “from the proceeds of any settlement or judgment that may result from the exercise of any rights of recovery against any person or organization legally responsible for the bodily injury” of plaintiff.
(b) Plaintiff holds in trust, for the benefit of Transamerica, all rights of recovery plaintiff has against “such other person or organization” and plaintiff shall do nothing to prejudice such rights.
(c) If requested in writing by Transamer-' ica, plaintiff shall take action to recover the $33,000.00 “as damages from such other person or organization * *
Defendants contend that it makes no difference that plaintiff still has a claim against the uninsured motorist. They assert that the $33,000.00 is a payment which made the plaintiff financially whole, that to allow plaintiff to collect under an uninsured motorist clause and also collect compensation would be a double recovery. Defendants remind us that § 52-l-56(C) refers to payment for injuries and assert that decisions concerning our uninsured motorist statute support the summary judgment.
The applicable uninsured motorist statute is the first of two sections appearing in NMSA 1978, as § 66-5-301 (Cum. Supp.1982). The coverage is mandatory “for the protection of persons insured thereunder who are legally entitled to recover damages from owners or operators of uninsured motor vehicles because of * * injury * * The legislative purpose was to place the insured in the same position as to the recovery of damages that he would have been in if the tortfeasor had possessed liability insurance. Wood v. Millers Nat. Ins. Co., 96 N.M. 525, 632 P.2d 1163 (1981). Defendants emphasize this purpose stating “recovery under the uninsured motorist provisions of a policy is analagous [sic] to recovery from a third party tortfeasor’s liability insurance carrier. In effect, the insurance carrier steps into the shoes of the uninsured third party tortfeasor in compensating the injured party.” Defendants assert that no legal distinction should be made on the basis of who makes the payment or on what basis the payment is made.
The purported analogy is inapt for several reasons. Uninsured motorist coverage is a contract between the insured and the insurance company. See Wood v. Millers Nat. Ins. Co., supra. The legislative purpose is to protect the insured agaiiist the financially unresponsible motorist, not to protect the insurance company. See Sandoval v. Valdez, 91 N.M. 705, 580 P.2d 131 (Ct.App.1978). Although § 66-5-301 mandates such protection, the insured pays for it. A condition of that protection is that the injured person must be legally entitled to recover damages from the uninsured motorist, but once the condition is met, the payment received under the coverage is what is provided in the contract. In no sense is this analogous to recovery from a third-party tortfeasor; a closer analogy would be the receipt of payments, by the insured, under the medical payments portion of the insured’s motor vehicle liability insurance or health insurance.
Nor does the insurer step into the shoes of the third-party tortfeasor; the wording of the “Release and Trust Agreement” shows that any stepping is into the shoes of the insured.
This issue is not resolved by the purported relationship between Transamerica and the third-party tortfeasor or by § 65-5-301. Resolution depends upon the applicability of § 52-l-56(C).
Section 52-l-56(C) is not a bar to plaintiffs pursuit of compensation because it does not apply. Section 52-l-56(C) “is intended to deny an injured workman both compensation from his employer and a recovery from the third party * * Castro v. Bass, supra; Seminara v. Frank Seminara Pontiac-Buick, 95 N.M. 22, 618 P.2d 366 (Ct.App.1980). Payments pursuant to uninsured motorist coverage are not a recovery from a third party.
Section 52-l-56(C) does not apply to benefits received under insurance policies, such as uninsured motorist coverage, which have been purchased by the worker or for the worker’s benefit. Such “private” insurance contracts benefit neither the compensation carrier nor the third-party tortfeasor. Benefits paid under such insurance contracts are not payments within the meaning of § 52-l-56(C) because “payment” in that statute means payments on behalf of the tortfeasor. Such benefits are not a “double recovery”; they are additional benefits provided by the contract purchased by the insured; specifically, the benefits are “contract” benefits determined by the injury but not payments for the injury itself. Compare Segura v. Molycorp, 97 N.M. 13, 636 P.2d 284 (1981).
Our decision is based on New Mexico law. We have not discussed decisions from other jurisdictions because of variations in statutory language and the different meaning given to provisions similar to § 52-1-56(C). For a general discussion on the relation of an uninsured motorist clause to provisions similar to § 52-l-56(C), see Larson, supra, § 71.
The trial court erred in ruling that plaintiff was barred from asserting a compensation claim on the basis that “collection of benefits under uninsured motorist coverage constitutes an election of remedies under” § 52-l-56(C). That statute does not apply, under the record in this appeal, to the payment plaintiff received under the uninsured motorist coverage.
The summary judgment in favor of defendants is reversed. Within 15 days after this decision becomes final, defendants are to pay the appellate filing fee of $20.00 to the Clerk of the Court of Appeals, and pay costs of $48.56 plus $11.60, certified by the Clerk of the District Court, to that Clerk. Romero v. J.W. Jones Const. Co., 98 N.M. 658, 651 P.2d 1302 (Ct.App.1982).
IT IS SO ORDERED.
DONNELLY and BIVINS, JJ., concur. | [
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OPINION
DONNELLY, Chief Judge.
This interlocutory appeal presents the issue of when an employer is time-barred from asserting its claim for reimbursement against the Subsequent Injury Fund (Fund). The Fund appeals from the denial of its motion for summary judgment against the employer, Levi Strauss, Inc., based on the statute of limitations. We affirm.
In April 1982, the plaintiff, Pilar Hernandez, suffered an accidental injury while on the job. Thereafter, on October 17, 1983, plaintiff sustained a subsequent job-related accidental injury. Plaintiff filed a workmen’s compensation action against the employer in December 1983. The claim was settled on April 11, 1984.
On March 2, 1987, the employer filed a third-party complaint against the Fund seeking an apportionment and reimbursement of compensation paid to plaintiff. Employer filed a second complaint against the Fund in September 1987. The Fund filed a motion for summary judgment, alleging in part, that employer’s claim was barred by the statute of limitations. Following denial of the motion, the Fund filed this interlocutory appeal, contending that the trial court erred in denying its motion for summary judgment and in determining that employer’s claim was not barred by the statute of limitations. In resolving this issue, we determine what limitations period is applicable and when the period began to accrue.
In 1988, the legislature enacted a two-year statute of limitations on claims against the Fund, commencing at the time the employer receives notice of a compensation claim or has actual knowledge of the claim. See 1988 N.M.Laws, ch. 109, § 7. Because plaintiff was injured and the employer filed its claim against the Fund prior to the adoption of this legislation, we apply the previous law. See N.M. Const, art. IV, § 23.
The Fund argues that the one-year period of limitations in the Workers’ Compensation Act, NMSA 1978, Section 52-l~31(A) (Repl.Pamp.1987), or the three-year period of limitations for personal injuries contained in NMSA 1978, Section 37-1-8 should govern. Employer argues that no limitations period applies, or alternatively, that the four-year period of limitations for unwritten contracts or unspecified actions contained in NMSA 1978, Section 37-1-4 is applicable.
We disagree that the one-year period of limitations of Section 52-l-31(A) applies by operation of NMSA 1978, Sections 52-2-12 or -13 (Repl.Pamp.1987). In Duran v. Xerox Corp., 105 N.M. 277, 731 P.2d 973 (Ct.App.1986), this court rejected a similar contention by the Fund that Section 52-2-13 of the Subsequent Injury Act adopted the one-year statute of limitations of the Workmens’ Compensation Act for actions a worker, employer, or insurance carrier brought against the Fund. Section 52-2-13 provides that “[t]he determination of the rights of an employee * * * under the provisions of the Subsequent Injury Act shall be made in the same manner as in cases arising under the Workmen’s Compensation Act.” The court stated in Duran:
We understand this section to mean at least that procedures involved in claiming benefits under the [Subsequent Injury Act] shall be followed as they are in workmen’s compensation claims; however, this does not mean that every provision that applies to a claim against an employer for workmen’s compensation is also applicable to subsequent injury claims.
Id. at 279-280, 731 P.2d at 975-976. Duran rejected the Fund’s argument that Section 52-2-13, dealing with the rights of the worker, was intended to impose a condition precedent on the rights of an employer against the Fund.
Similarly, we determine that Section 52-2-12 does not impose the one-year statute of limitations contained in Section 52-1-31(A) on an employer’s claim against the Fund. Section 52-2-12 states that “[t]he payments prescribed by the Subsequent Injury Act shall be subject to the same limitations in time and in amount as those under the Workmen’s compensation Act * * (Emphasis added.) The latter section relates to the amount and duration of payments. See, e.g., Fierro v. Stanley’s Hardware, 104 N.M. 411, 722 P.2d 662 (Ct.App.1986) (“limitations” refers to the limitations regarding average weekly wage and maximum period of recovery rather than scheduled injury provisions). We reaffirm the reasoning in Duran.
Duran also stated that “there is no specific period of limitations on an employer’s rights against the Fund under the [Subsequent Injury Act].” Id. at 280, 731 P.2d at 976. This language indicated that the Subsequent Injury Act did not expressly specify a period of limitations for an employer to file a claim against the Fund under the Subsequent Injury Act. See NMSA 1978, §§ 37-1-1 to -28. The only period of limitations at issue in Duran was the one-year period specified in the Workmen’s Compensation Act. Duran did not, however, exclude application of a period of limitations other than that contained in the Workmen’s Compensation Act.
Employer argues that no statute of limitations should apply, urging that the court adopt a rule similar to that involving a worker’s claim for medical benefits. See Nasci v. Frank Paxton Lumber Co., 69 N.M. 412, 367 P.2d 913 (1961); see also Pena v. New Mexico Highway Dep’t, 100 N.M. 408, 671 P.2d 656 (Ct.App.1983). We disagree. Employer’s claim of reimbursement against the Fund is more closely analogous to the payment of compensation benefits rather than the payment of medical benefits. See Nasci v. Frank Paxton Lumber Co. (right to claim installment payments barred by statute, though claim for medical benefits is not); see also Pena v. New Mexico Highway Dep’t.
Employer also argues that even in the absence of a statute of limitations, the doctrines of laches or estoppel would protect the Fund from stale claims. This argument, relying on equitable doctrines, disregards the provisions of Section 37-1-1. This section provides: “[t]he following suits or actions may be brought within the time hereinafter limited, respectively, after their causes accrue, and not afterwards, except when otherwise specifically provided.”
Because at the time of the filing of plaintiff’s claim the Subsequent Injury Act did not specifically provide for a period of limitations on actions brought by an employer against the Fund for reimbursement, we look to the limitation periods contained in Sections 37-1-1 to -28. Cf. Ortega v. Shube, 93 N.M. 584, 603 P.2d 323 (Ct.App. 1979). The Fund contends the nature of employer’s claim against it is most closely analogous to a cause of action for personal injuries and, therefore, Section 37-1-8 should apply. Employer argues that because its cause of action is based on an unwritten contract for indemnification, or alternatively, because its cause of action is unspecified, Section 37-1-4 should apply. We agree that Section 37-1-4 is applicable because the cause of action is one not “otherwise provided for and specified [by law].” § 37-1-4.
Although a worker’s claim for compensation is based on a personal injury, and an employer’s claim for apportionment and reimbursement is contingent on the worker’s entitlement to compensation, the two claims differ significantly. The employer’s right to apportionment and reimbursement requires conditions beyond those required to establish the employer’s liability for payment of compensation to the worker. Compare NMSA 1978, § 52-1-28 (Repl. Pamp.1987) with NMSA 1978, § 52-2-9(A) (Repl.Pamp.1987). These conditions include a preexisting physical impairment and a subsequent compensable disability which is materially and substantially greater than that which would have resulted from the subsequent injury alone. See Ballard v. Southwest Potash Corp., 80 N.M. 10, 450 P.2d 448 (Ct.App.1969). Additionally, there must be proof that a certificate of preexisting impairment was filed or that the employer had actual knowledge of the preexisting impairment before the worker suffered the subsequent injury. See Padilla v. Chavez, 105 N.M. 349, 732 P.2d 876 (Ct.App.1987).
The Fund argues the worker’s personal injury was the significant factor that triggered the underlying litigation. We disagree. The Fund’s liability is not based on a tortious act or omission. See § 52-2-9; cf. American Gen. Fire & Cas. Co. v. J.T. Constr. Co., 106 N.M. 195, 740 P.2d 1179 (Ct.App.1987) (court permitted suit against third-party tortfeasor by insurance carrier for contribution for compensation paid to injured employee where employee assigned his claim to insurance carrier). Nor is it based on a voluntary or contractual relationship of indemnification. Instead, it is based on a mandatory statutory scheme. See NMSA 1978, §§ 52-2-4 and -5 (Repl.Pamp.1987). The primary purpose of the Subsequent Injury Act is to encourage employers to hire workers with physical handicaps by adjusting the employer’s liability under the Workmen’s Compensation Act, rather than to compensate workers for personal injuries. NMSA 1978, § 52-2-2 (Repl.Pamp.1987); see also Vaughn v. United Nuclear Corp., 98 N.M. 481, 650 P.2d 3 (Ct.App.1982), limited by Padilla v. Chavez.
Claims against the Fund are based on statutory rights. Prior to 1988, there was no specific period of limitations for actions against the Fund contained in the Subsequent Injury Act and an employer’s claim for reimbursement from the Fund is not sufficiently analogous to either a claim for personal injuries or an unwritten contract so as to justify invocation of the statute of limitations on these theories. Therefore, we determine that the four-year limitations period in Section 37-1-4 for “all other actions not * * * otherwise provided for and specified” is the applicable statute to the present action.
We next address the issue of when the statute of limitations begins to run in an action brought by an employer against the Fund, and which action is not controlled by the limitation period specified in the 1988 amendment. 1988 N.M. Laws, ch. 109, § 7. We adopt a similar rule to that which applies to the filing of claims by an injured worker. ABF Freight System v. Montano, 99 N.M. 259, 657 P.2d 115 (1982) (statutory period for the filing of a complaint for worker’s compensation begins to run when it either became or should have become reasonably apparent to worker that he had an injury entitling him to worker’s compensation benefits and employer failed or refused to make payment) (citing Noland v. Young Drilling Co., 79 N.M. 444, 444 P.2d 771 (Ct.App.1968)).
We conclude that where an employer seeks to file a suit against the Fund for reimbursement, and where the 1988 statute of limitations is not applicable, the period of limitations on such claim begins to run from the time the employer knew or should have known it had a claim against the Fund. This approach is consistent with NMSA 1978, Section 52-2-11(C) (Repl. Pamp.1987), which provides that “all payments of compensation benefits shall be initially paid to the employee or his dependents * * * by the employer or his insurance carrier and the sums paid for which the subsequent injury fund is liable shall be repaid to the employer or his insurance carrier making payments from the fund.” In such case, the determinative event is the date an employer is notified of the subsequent injury or, when the injury is latent, the date the employer is notified of the disability arising out of the subsequent injury. Cf. Smith v. Dowell Corp., 102 N.M. 102, 692 P.2d 27 (1984).
The determination of whether a claim is timely filed or whether good cause exists for any delay in filing is, however, a question of fact. See Pena v. New Mexico Highway Dep’t; see also Rybus v. Kruetzer Motor Express, 298 Minn. 435, 437, 215 N.W.2d 611, 613 (1974) (court interpreted compensation commission’s regulation providing for extension of time “upon proper showing” to mean a showing that: (1) the delay was not the fault of the employer; (2) the employer gave notice with reasonable promptness after it knew or should have known a claim was to be filed; and (3) the delay did not cause material prejudice to the fund) (citing Beson v. Carleton College, 271 Minn. 268, 136 N.W.2d 82 (1965)).
In the present case, the employer’s cause of action against the Fund did not accrue prior to the date of the subsequent injury in October 1983. Thus, under the facts herein, the statute of limitations could not have run before October 1987. Since the employer filed third-party complaints against the Fund in March and September 1987, its claims were timely filed.
The Fund also alleges that several procedural defects existed in the complaint filed against it in March 1987, and that these defects preclude recovery by employer. The record, however, does not reflect that these matters were raised in or considered by the trial court. Thus, they are not cognizable on appeal. See SCRA 1986, 12-216.
The order denying the Fund’s motion for summary judgment is affirmed.
IT IS SO ORDERED.
FRUMAN and APODACA, JJ., concur. | [
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OPINION
WOOD, Judge.
Plaintiff was injured in an automobile accident. She sued defendants for both compensatory and punitive damages. Defendant, Ken E. Rutherford, the son, was driving a car with the permission of George C. Rutherford, the father, within the family purpose doctrine. See Peters v. LeDoux, 83 N.M. 307, 491 P.2d 524 (1971). Prior to trial, the claim of punitive damages against George C. Rutherford was disposed of by a partial summary judgment. The punitive damage claim against Ken remained in the case. The trial court dismissed this punitive damage claim at the close of the evidence. The jury awarded plaintiff compensatory damages of $47,500.00. Defendants appeal. We discuss: (1) handling of the punitive damage claim; (2) the propriety of admitting certain compensatory damage testimony; and (3) asserted judicial misconduct.
Handling of the Punitive Damage Claim
Having admitted liability for compensatory damages, defendants assert that the admission of testimony concerning the “aggravated circumstances” of the accident was error because no punitive damage claim was submitted to the jury. Defendants argue: “This evidence of the aggravated circumstances of the accident was introduced solely to arouse the jury and lead to an excessive verdict on the compensatory damage claim which could be collected from the defendant, George Rutherford.”
Defendants do not assert, as a separate point relied on in the appeal, see NMSA 1978, Civ.App.R. 9(h) and (k) (Cum.Supp. 1983), that the compensatory damage award was excessive. However, a suggestion of excessiveness is presented as a synthesis of all defendants’ arguments. Accordingly, we answer the suggestion of excessiveness in our discussion of the compensatory damage testimony.
The argument as to the handling of the punitive damage claim is based on a distortion of what occurred in the trial court.
Defendants admitted liability for compensatory damages at a conference between the trial court and counsel immediately prior to the start of the jury trial. This resulted in a discussion of the punitive damage claim against Ken. In this discussion, plaintiff’s counsel recognized that he might have difficulty collecting any punitive damages that might be awarded. Plaintiff’s counsel also recognized that, at the conclusion of the evidence, the trial court might consider the evidence was insufficient for punitive damages to be submitted to the jury. This is the basis for the defendants’ claim that evidence of aggravating circumstances was introduced solely to arouse the jury.
The distortion is in the defendants’ disregard of what happened thereafter. Plaintiff reaffirmed that punitive damages were sought from Ken on the basis of willful, malicious conduct. The jury was informed, without objection from defendants, that the defendants had admitted liability for the negligent driving of Ken, that the case would proceed on the issue of damages sustained by the plaintiff, “and the complaint for punitive damages for the alleged willful and malicious conduct of Ken Rutherford.”
Plaintiff introduced evidence of the aggravated circumstances of the accident. This evidence went to Ken’s drinking, his speeding and his turning off the lights of his car before entering the intersection where the accident occurred. This evidence was relevant to plaintiff’s claim that Ken’s conduct was willful and malicious. At the close of the evidence, the trial court ruled that this evidence was insufficient for submission of the punitive damage claim to the jury. The transcript does not show that the testimony was introduced “solely to arouse the jury”; rather, it was submitted in support of a claim that was an issue in the case at the time the testimony was presented.
Defendants argue that all of the punitive damage testimony was included in depositions that were before the trial court at the time of the conference. On this basis, defendants infer that plaintiff knew that the punitive damage claim would never get to the jury. This is presented in support of the argument that testimony as to the circumstances of the accident was presented solely to arouse the jury.
In the appeal, defendants sought unsuccessfully, in both'the trial court and in this Court, to have the depositions included as a part of the appellate record. The appellate record contains all portions of the depositions that were used at the trial. Defendants never sought dismissal of the punitive damage claim against Ken at the conference. Defendants never informed the trial court that the depositions included all the punitive damage testimony and that the deposition testimony was insufficient to raise a jury issue. Defendants are attempting to raise an issue never raised in the trial court; that issue is whether the punitive damage claim should have been dismissed prior to trial. They are attempting to support that issue on the basis of material never brought to the trial court’s attention. They may not do so. NMSA 1978, Civ.App.R. 11.
There was no error in the admission of evidence on the issue of punitive damages. The question is the appropriate procedure when a claim that was tried is dismissed by the trial court before the case was submitted to the jury. In this case, defendants’ counsel asked if the trial court was going to advise the jury that the punitive damages claim had been dismissed. The trial court said that it would. The jury was informed: “I want to advise the jury that the Court has dismissed the claim for punitive damages against Ken Rutherford. So this case will go to the jury only on the claim of general or compensatory damages for plaintiff’s injuries.”
Defendants may have been entitled to have the jury instructed that the evidence going to punitive damages was not to be considered on the issue of compensatory damages. This need not be decided because defendants did not ask for a limiting instruction. McCauley v. Ray, 80 N.M. 171, 453 P.2d 192 (1968); see NMSA 1978, Civ.P.R. 51(1) (Cum.Supp.1983) on failure to instruct. Defendants assert that such an instruction would have been ineffective “since the jury has already heard the prejudicial testimony.” This argument disregards the approval of limiting instructions in NMSA 1978, Evid.R. 105 (Repl.Pamp. 1983). See State v. Ortiz, 88 N.M. 370, 540 P.2d 850 (Ct.App.1975).
The trial court did not err in its handling of the punitive damage claim.
Compensatory Damage Testimony
(a) Suggestion of excessiveness.
The accident occurred in June 1978. The trial was in May 1983. Plaintiff suffered a compression fracture of the L3 vertebrae; the broken portion of the vertebrae had not healed (a non-union) by the time of trial and will not heal in the future. The disc space at L2-L3 had narrowed and there was a bulging annulus. Plaintiffs back condition will degenerate in the future. There was evidence that plaintiff had had continuing low back pain since the injury; that the back pain was due to chronic back strain caused by the accident. Plaintiff is not a malingerer. She was characterized as not exaggerating and maybe understating. She had a life expect ancy at the time of the accident of over 60 years.
An award of $47,500.00 for a broken vertebrae that will not heal and will degenerate in the future, for pain that has continued for over four years and will continue and worsen as future degeneration occurs is not excessive. See the test for excessiveness stated in Gonzales v. General Motors Corporation, 89 N.M. 474, 553 P.2d 1281 (Ct. App.1976).
Defendants’ suggestion of excessiveness is not based on the injury or the pain. Defendants assert that the compensatory damage award is excessive because testimony was improperly admitted as to future medical care and loss of earning capacity. This contention does not involve excessiveness but the propriety of admitting testimony.
(b) Future surgery.
There was testimony as to how frequently plaintiff should be seen by a physician so that the progress of the degeneration could be checked, and the cost thereof. Defendants’ objection to all future medical expense, including these future trips to the doctor, is discussed in (c). Here, we consider defendants’ complaint about testimony that plaintiff may need a spinal fusion in the future and that the cost in connection with the fusion would be approximately $10,000.00. Defendants assert the cost figure, see Baros v. Kazmierczwk, 68 N.M. 421, 362 P.2d 798 (1961), should not have been admitted because of the absence of evidence that as a medical probability the spinal fusion would be required. Michael v. West, 76 N.M. 118, 121, 412 P.2d 549 (1966), held that testimony that “ ‘plaintiff may require an operation’ is insufficient to support the judgment for the cost [of the operation].” Michael v. West indicates that cost of future surgery must be based on evidence “that such a future operation will be required as a medical probability.” Id. at 121, 412 P.2d 549. See Annot., 75 A.L.R.3d 9 at 17 (1977). Defendants assert such evidence is lacking. We disagree.
The worker’s compensation statute involved in Gammon v. Ebasco Corporation, 74 N.M. 789, 399 P.2d 279 (1965), required that the causal connection between the accident and the injury be established as a medical probability. NMSA 1978, § 52-l-28(B). Gammon states: “[T]he medical expert need not state his opinion in positive, dogmatic language or in the exact language of the statute. But he must testify in language the sense of which reasonably connotes precisely what the statute categorically requires.” 74 N.M. at 794.
Saide v. Stanton, 135 Ariz. 76, 659 P.2d 35, 37 (1983), states: “The use or refusal of an expert to use a ‘magic word’ or phrase such as ‘probability’ is not determinative. The trier of fact is allowed to determine probability or lack thereof if the evidence, taken as a whole, is sufficient to warrant such a conclusion.” See also Nunez v. Wilson, 211 Kan. 443, 507 P.2d 329 (1973).
Defendants assert that the physician did use a “magic word” in that he refused to state that a future spinal fusion was reasonably probable. This contention overlooks how the physician defined his terms. The physician stated he could not use the word “ ‘possible’ ” meaning that it “just might happen”; he stated he could not use “ ‘probable’ ” “because that means it will happen.” The requirement of evidence to a medical probability uses “probable” in the sense of “that can reasonably and fairly convincingly be accepted as true * * * without being undeniably so * * *. Probable applies to that which is so supported by evidence that is adequate although not conclusive or by reason that it is worthy of belief or acceptance * * See “probable” in Webster’s Third New International Dictionary (1966).
Approved civil damage instructions use “reasonably certain” rather than “reasonably probable”, see NMSA 1978, UJI Civ. 18.3, 18.4, 18.5, 18.7, 18.9, 18.10. The use of “reasonably certain” in these instructions to state the legal test of “reasonably probable” indicates no distinction is to be made in these terms. See Nunez v. Wilson.
The fact that the physician declined to use the word “probable”, because of the physician’s meaning of probable, does not show that a future spinal fusion was not a reasonable- probability. We look to the physician’s testimony “as a whole”, Saide v. Stanton, to determine whether the testimony “reasonably connotes”, Gammon v. Ebasco Corporation, a probability.
Plaintiff was sixteen years old when the accident occurred, and twenty years old at the time of trial. The physician testified:
But what does concern me is not so much the unhealed piece of bone, but evidence that this damage occurred at this disc and is not healing. I can’t say, though, that it is narrowing rapidly. I would expect in years, though, that that pad, having been damaged, will narrow and become more of a problem for Sherry.
After explaining his concern with the disc and the bulging annulus, the physician continued:
The obvious solution would be a matter of moving the vertebra back up to the normal height, making this space equal to what it’s supposed to be, getting it backward so these nerves aren’t all distorted, and placing bone graft in here (indicating). And that’s called a spine fusion. She would need a fusion between here to stop that pain in that one particular segment.
* * * And if you start out at the age of 19 or 20 with this, it’s fairly likely that there will be significant problems when the patient or the person is 40 years of age. [Emphasis added.]
******
* * * [W]e think that once the disc is damaged, it progresses toward deterioration much more so than a normal disc would. Say, in ten years. We know that a normal disc will be ten years older and somewhat worn. If you take a damaged disc and add ten years, we know it’s going to be a lot worse off than this one would be, the normal one.
* * * The problem is that this is a young person who has this injury that has not manifested itself fully yet * * *.
******
* * * You know, what’s interesting in this particular fracture, from a teaching point of view, that as time has gone along, the fracture, instead of looking better, has looked worse. * * *
******
* * * I can’t say for sure that Sherry is going to end up with this operation. It is somewhere in the area of likely, or approaching 50-50.
* * * I don’t know if it really will come to pass, but I think it’s going to be close.
Saide v. Stanton states:
The fact that the dentist refused to foretell the future and would not state positively that Stanton would require these procedures goes to the weight of his testimony and does not deprive the jury of the right to consider it. [Citations omitted.] Furthermore, it is well within the province of the jury to reach their own conclusion on the issue as long as the evidence as a whole will support a finding that the future treatments are reasonably probable. [Citation omitted.]
Nunez v. Wilson points out that the words “liable”, “likely” and “probable” have been accepted as words connoting reasonable probability. The physician said the future fusion was “fairly likely” and explained why. See NMSA 1978, Evid.R. 705 (Repl.Pamp.1983). His testimony on the future spinal fusion was properly admitted; his testimony would support a finding that this future treatment was medically probable; it was for the jury to reach its own conclusion on this issue. Saide v. Stanton.
(c) Intervening accident.
Defendants contend that all testimony as to the cost of future medical expenses was improperly admitted because the physician “was not aware of an intervening accident in which the plaintiff was involved.” Defendants rely on Niederstadt v. Ancho Rico Consolidated Mines, 88 N.M. 48, 536 P.2d 1104 (Ct.App.1975). Niederstadt involved a suit for a second injury; there was evidence of a pre-existing low back injury and evidence that after the second injury there was no additional disability or injury. Dr. Palafox testified as to causal connection as a medical probability but had no knowledge of the pre-existing low back condition. Niederstadt held that in these circumstances Dr. Palafox’s testimony was insufficient to show causal connection to a medical probability.
Niederstadt is not applicable for two reasons. First, the physician testified as to the causal connection between the accident and plaintiffs low back condition. There was no contrary medical testimony and nothing suggesting a pre-existing low back condition. See Fryar v. Johnsen, 93 N.M. 485, 601 P.2d 718 (1979). Second, the testimony in this ease does not support defendants’ argument concerning injury in an intervening accident. See Martinez v. Fluor Utah, Inc., 90 N.M. 782, 568 P.2d 618 (Ct.App.1977).
On cross-examination the physician testified that he was unaware of any trauma intervening between the accident and the time of trial. Asked if plaintiff’s injury was the type that was susceptible to aggravation by subsequent trauma, the physician answered that it would have to be trauma of “significant magnitude * * *. If there is no record of major trauma, I would say that it is all one continuous process.” Asked if he would want to reconsider his opinion if there was evidence of “some other trauma,” the physician stated: “Yes, I think it would be significant if it was a significant injury.”
The cross-examination referred to above avoided identifying or asking about injury to a particular area of the body. The physician’s testimony was about plaintiff’s low back condition. Such evidence as there was of intervening trauma was elicited from plaintiff when defendants called her as a defense witness.
Plaintiff testified that she was involved in an automobile accident in 1980 when a car drove from a parking lot into her lane of travel and she ran into it. Plaintiff testified that she went to see a doctor the day after the accident but made no claim for any injury in the accident, and was not injured in this accident. Plaintiff was not asked if she had any new complaints about her low back after the 1980 accident; she was not asked if she had complaints of any kind after the 1980 accident.
Defendants’ intervening accident argument is frivolous in that there is no factual basis for the argument.
(d) Earning capacity.
An economist testified as to plaintiff’s potential loss of earning capacity. See Strickland v. Roosevelt County Rural Electric Cooperative, 99 N.M. 335, 657 P.2d 1184 (Ct.App.1982). Loss of earning capacity was included in the instructions as a damage item to be considered by - the jury. See UJI Civ. 18.3.
Defendants contend the instruction should not have been given because it was based on the erroneous admission of the economist’s testimony. They claim the economist’s testimony was improperly admitted because it was “based on a summarization of the medical testimony ... and thus suffered from the same defect as did [the physician’s] testimony.” This argument fails because the physician’s testimony was properly admitted.
Asserted Judicial Misconduct
Defendants complain of “misconduct” of the trial court “during the course of the trial which ultimately affected the outcome of the trial.” This argument goes to rulings and comments of the trial court during the direct examination of plaintiff as a defense witness. “Throughout counsel’s questioning, Judge Traub repeatedly interrupted counsel, made objections to the questions, and finally admonished the plaintiff’s attorney to speak up.” Defendants assert that the trial court’s conduct “illustrated” a bias in favor of the plaintiff and “influenced the outcome of the jury trial, as reflected by the excessive verdict * * ” We have previously held that the evidence of injury and pain, without considering oth er damage items, supports the damage award, and the award is not excessive. The remainder of the defendants’ argument is exaggeration, not supported by the record.
The trial court did make some evidentiary rulings before plaintiff’s counsel objected but the rulings must be considered in context. Defendants’ counsel attempted to read from the police report of the 1980 accident; plaintiff’s counsel objected and the objection was sustained. After plaintiff testified that she had never seen what purported to be a police report, defendants’ counsel asked plaintiff if the exhibit appeared to be a police report. The trial court remarked “[y]ou can’t do that” before plaintiff’s objection was sustained. Defendants' counsel then tendered the police report as evidence in violation of NMSA 1978, Section 66-7-213. The trial court refused the tender. Defendants’ counsel asked plaintiff if she made a claim against anybody for injuries or property damage. The trial court ruled that it was a compound question; “[a]sk it singly.” The trial court also ruled that property damage would be irrelevant. Disregarding the trial court’s ruling, defendants’ counsel asked about property damage. At this point, the trial court remarked that it was going to quit making objections for plaintiff’s counsel.
The foregoing shows neither undue interference nor conduct by the trial court which prevented a proper presentation of defendants’ case. Rather, it shows proper intervention because of the attempts of defendants’ counsel to question plaintiff on matters not properly involved in the case. See In re Will of Callaway, 84 N.M. 125, 500 P.2d 410 (1972); NMSA 1978, Evid.R. 611(a) (Repl.Pamp.1983).
Instead of complaining about the trial court’s conduct, it would be appropriate for defendants’ counsel to apologize to the trial court for counsel’s conduct. See Grammer v. Kohlhaas Tank & Equipment Co., 93 N.M. 685, 604 P.2d 823 (Ct.App.1979).
The judgment is affirmed. Defendants shall bear the appellate costs.
IT IS SO ORDERED.
HENDLEY and ALARID, JJ., concur. | [
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OPINION
HENDLEY, Judge.
The children appeal from orders of the children’s court which transferred their cases to district court for prosecution. Their appeals have been consolidated. The sole issue concerns the jurisdictional problem of the validity of the transfer order. Other issues raised in the docketing statement but not briefed are deemed abandoned. State v. Gonzales, 96 N.M. 556, 632 P.2d 1194 (Ct.App.1981).
The petitions in children’s court charged the children with armed robbery, false imprisonment, and aggravated assault. The State filed a motion for transfer to district court, pursuant to NMSA 1978, § 32-1-30 (Repl.Pamp.1981). After a hearing on the motion, the court ordered the children transferred to district court.
The single issue briefed by the parties is raised as jurisdictional error pursuant to NMSA 1978, Crim., Child.Ct., Dom. Rel. & W/C App.R. 308 (Repl.Pamp.1983). This issue can properly be raised for the first time in the brief-in-chief only if it is in fact jurisdictional error. State v. Rael, 100 N.M. 193, 668 P.2d 309 (Ct.App.1983); State v. Jacobs, 91 N.M. 445, 575 P.2d 954 (Ct.App.1978). We hold that there was jurisdictional error in transferring the children.
Notice to the children’s parents is required under the applicable transfer statute, Section 32-1-30. Under Section 32-1-30, the children’s court may transfer a child to district court if five findings are made. The third of those findings, Section 32-1-30(A)(3), states: “notice in writing of the time, place and purpose of the hearing is given the child, his attorney, parents, guardian or custodian at least five days before the hearing[.]” The transfer orders entered by the court as to these children did not find that notice of the hearing was given to the parents of the children. Neither was there actual notice to the parents.
The record indicates the parents of both children were not notified of the detention hearing. At the transfer hearing, the trial judge concluded that the parents of both children were not notified of the transfer hearing. There is no indication that the parents of either child have ever been notified of the children’s court proceedings.
At the transfer hearing, one of the children moved to dismiss the proceedings on the basis of the failure to notify his parents as required under Section 32-l-30(A)(3). The children’s court, orally finding that the children’s parents were not notified, denied the motion because the court did not believe the notice requirement to be a jurisdictional requisite to transfer the children. A review of the transfer hearing reveals that the parents of both children were not notified.
The State claims that the provisions of Section 32-l-30(A)(3) were complied with because the parents could not be located. The testimony was not conclusive on whether sufficient effort was made to locate the parents. The effort to locate and notify parents should continue for a reasonable period. See, e.g., Committee commentary, NMSA 1978, Child.Ct.R. 25 (Repl. Pamp.1982). In this case, affidavits were not filed, pursuant to NMSA 1978, Child. Ct.R. 5(g) (Repl.Pamp.1982), stating that the parents could not be located.
There are three jurisdictional essentials necessary to the validity of every judgment: jurisdiction of parties, jurisdiction of subject matter, and power or authority to decide the particular matter presented. Heckathorn v. Heckathorn, 77 N.M. 369, 423 P.2d 410 (1967). The jurisdictional question presented here involves the power or authority of the children’s court to transfer the children.
Under Section 32-1-30, a child is not to be transferred to district court unless his parents, guardian, or custodian have been notified. Since the statute requires a specific finding, and none was made, the transfer order is invalid because it was not entered in compliance with the statute. Heckathorn v. Heckathorn; State v. Doe, 93 N.M. 481, 601 P.2d 451 (Ct.App.1979); State v. Doe, 90 N.M. 249, 561 P.2d 948 (Ct.App.1977).
Our holding in this case also accords with the stated legislative purpose of the Children’s Code, NMSA 1978, § 32-l-2(A), (C), (G) (Repl.Pamp.1981). The Children’s Code must be read in its entirety and each section must be interpreted so as to correlate with all other sections, in order that the ends sought to be accomplished by the Legislature shall not be thwarted. State v. Doe, 95 N.M. 88, 619 P.2d 192 (Ct.App.1980). The requirement in Section 32-1-30(A)(3), that parents receive notification of children’s court transfer proceedings involving their child, is not a mere procedural formality. Notification serves the purpose of effectuating the stated purposes of the Legislature in drafting the Children’s Code.
The order transferring the children to district court is reversed.
IT IS SO ORDERED.
NEAL and BIVINS, JJ., concur. | [
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OPINION
BLACK, Judge.
Richard Chavez (Worker) was injured on April 13,1989, when the truck he was driving rolled over. As a result of the accident, Worker sustained a laceration to his head and a torn rotator cuff. The injury to his rotator cuff left Worker with a permanent physical impairment of thirty percent of the right upper extremity at or above the shoulder. Based on this physical impairment, the Workers’ Compensation Judge (WCJ) determined that Worker was forty-eight percent permanently partially disabled. The WCJ also found that Worker suffered from a psychological condition known as Ganser’s Syndrome. The WCJ found the mental condition causally related to the same motor vehicle accident that caused the shoulder injury, but not within the statutory definitions of either primary or secondary mental impairment, contained in NMSA 1978, Sections 52-1-24(B) and (C) (Repl.Pamp.1991). Based on the plain meaning of the statutory language, we affirm.
I. STATUTORY REQUIREMENTS FOR MENTAL IMPAIRMENT
Under the 1987 version of the Workers’ Compensation Act, NMSA 1978, Sections 52-1-1 to -70 (Repl.Pamp.1987), recovery for mental impairment was governed by Section 52-1-24. Subsection B of that statute defined primary mental impairment in the following terms:
B. “primary mental impairment” means a mental illness arising from an accidental injury arising out of and in the course of employment when the accidental injury involves no physical injury and consists of a psychologically traumatic event that is generally outside of a worker’s usual experience and would evoke significant symptoms of distress in a worker in similar circumstances, but is not an event in connection with disciplinary, corrective or job evaluation action or cessation of the worker’s employment.
Secondary mental impairment was defined by Section 52-l-24(C), which provided:
C. “secondary mental impairment” means a mental illness resulting from a physical impairment caused by an accidental injury arising out of and in the course of employment.
II. THE DECISION OF THE WCJ
The WCJ took the somewhat unusual step of filing a memorandum opinion in this case. As we find the factual basis of the WCJ’s opinion significant and the logic compelling, we quote from it liberally. The WCJ set forth the factual foundation of his decision as follows:
Ganser’s Syndrome is a psychological condition by which a person behaves as if there were severe cognitive malfunctions. Ganser’s Syndrome is a psychological condition, and is not related to a physical malady such as dementia or organic brain injury.
In this case it is my determination, based on the evidence presented at trial, that Worker suffers from Ganser’s Syndrome. Worker is rendered totally disabled by reason of Ganser’s Syndrome. The Ganser’s Syndrome is causally related to the work accident of April 13, 1989. In that same accident Worker suffered a laceration to his head, and a torn rotator cuff to his right shoulder.
In this case Worker suffered a head laceration which fully resolved. In addition, Worker suffered a torn rotator cuff to his right shoulder which has left him with a 30% permanent physical impairment to the right upper extremity as determined by his physicians. Worker has been rendered partially disabled by reason of this shoulder injury.
The WCJ also considered the statutory definitions of primary and secondary impairment, as well as their application to a psychological disability caused by the accident but unrelated to any physical injuries resulting from the accident:
The Workers’ Compensation Act defines primary mental impairment as a mental illness arising from an accidental injury arising out of and in the course of employment, where there is no physical injury and the accident consists of a psychologically traumatic event that would evoke significant symptoms of distress in a Worker in similar circumstances. Secondary mental impairment is defined as a mental illness resulting from a physical impairment caused by an accidental injury arising out of and in the course of employment. The Ganser’s Syndrome in this case did not derive from a psychologically traumatic event outside of the Worker’s usual experience. Nor, can it properly claimed [sic] that the accident would evoke significant symptoms of distress in a Worker in similar circumstances. The Ganser’s Syndrome does not derive from a physical impairment caused by an accidental injury, but is rather directly related to the accident of April 13,1989. It can therefore be seen that Ganser’s Syndrome fits neither the definition of primary mental impairment, nor the definition of secondary mental impairment so as to render it a compensable condition under the New Mexico Workers’ Compensation Act. While Worker is disabled as a result of the Ganser’s Syndrome, the fact that the condition is non-eompensable means that the Worker cannot receive compensation as a result of that condition.
The WCJ made several findings of fact relevant to his decision on mental impairment:
16. As a direct and proximate result of the accident of April 13, 1989, to a reasonable medical probability, Worker suffered an injury to the head and right shoulder. The nature of the injury is laceration of the head and torn rotator cuff of the right shoulder. Worker also suffers from Ganser’s Syndrome.
17. Ganser’s Syndrome is causally related to the April 13, 1989 accident, but is not a primary mental impairment within the Act, nor is it secondary to a physical injury.
30. Worker’s disability from Ganser’s Syndrome is causally related to the accident of April 13, 1989.
31. Worker is unable to return to his former job.
32. Worker would not likely benefit from vocational rehabilitation. This is because of the Ganser’s Syndrome.
At least one of the WCJ’s conclusions of law also relates to the nature of the disability caused by the Ganser’s Syndrome:
16. Worker is not entitled to weekly benefits based on Ganser’s Syndrome, as that condition fits neither primary, nor secondary impairment definitions so as to render it compensable.
III. DISCUSSION
Under Section 52-l-24(B), a worker can' recover for primary mental impairment only “when the accidental injury involves no physical injury.” The present ease clearly involved a physical injury, for which compensation benefits were awarded. Worker’s injury therefore does not fall within the definition of primary mental impairment. Moreover, the WCJ expressly recognized that the accidental injury “in this case did not derive from a psychologically traumatic event outside of the Worker’s usual experience.” There is also no evidence in the record to show that Worker was predisposed to such a psychological disorder or that such an accident “would evoke significant symptoms of distress in a worker in similar circumstances.” Section 52-l-24(B). These factors provide a second basis for the WCJ’s conclusion that Worker’s Ganser’s Syndrome is not within the statutory definition of a primary mental impairment.
In order to recover for a secondary mental impairment the mental illness must be the result of a physical impairment. We agree with Worker that it was not necessary for him to prove the Ganser’s Syndrome was caused by a physical injury to the brain. Under the clear language of Section 52-1-24(C), however, Worker was required to prove that the Ganser’s Syndrome resulted from a physical impairment of some nature. After reviewing the evidence, the WCJ concluded, “[t]he Ganser’s Syndrome does not derive from a physical impairment caused by an accidental injury, but is rather directly related to the accident of April 13, 1989.” Worker does not argue that there is not substantial evidence to support the WCJ’s decision but rather that there was evidence from which the WCJ could have concluded that the Ganser’s Syndrome was the result of a physical impairment caused by the accident. However, the fact that there is other evidence upon which a lower court could have reached a different conclusion does not make its decision erroneous. Jay Walton Enters, v. Rio Grande Oil Co., 106 N.M. 55, 60, 738 P.2d 927, 932 (Ct.App.), cert. denied, 106 N.M. 7, 738 P.2d 125 (1987). Here, there is substantial evidence that Worker’s injury was not the result of a physical impairment and thus is not within the definition of a secondary mental impairment under Section 52-l-24(C).
“The chief aim of statutory construction is to give effect to the intent of the legislature.” Roth v. Thompson, 113 N.M. 331, 332, 825 P.2d 1241, 1242 (1992). This standard “ordinarily requires [the court] to determine the legislative intent primarily from the language used in the statute as a whole. When the words of the statute are free from ambiguity and doubt, resort should not be undertaken to any other means of interpretation.” State ex rel. Stratton v. Roswell Indep. Sch., 111 N.M. 495, 500, 806 P.2d 1085, 1090 (Ct.App.1991) (citation omitted). “Section 52-1-24 restricts the rights to recover for work-related ‘mental impairment’ to those types of impairment expressly specified in the statute.” Douglass v. State, Regulation & Licensing Dep’t, 112 N.M. 183, 186, 812 P.2d 1331, 1334 (Ct.App.), cert. denied, 112 N.M. 77, 811 P.2d 575 (1991). In the present case the definitions of mental impairment are clear, so we do not look to any other source to determine legislative intent.
The decision of the WCJ is affirmed.
IT IS SO ORDERED.
FLORES, J., concurs.
DONNELLY, J., files dissenting opinion.
. Effective January 1, 1991, Section 52-l-24(A) was amended. The provisions of subsections B and C remained unchanged.
. We also note that the 1987 Act, which we construe in this case, was the first to explicitly abolish the long held canon of construction that the Workers’ Compensation Act was to be construed liberally in favor of the worker. See Fitzgerald v. Open Hands, 115 N.M. 210, 213, 848 P.2d 1137, 1140 (Ct.App.1993). We recognize that the legislative intent the dissent attributes to Section 52-l-24(B) and (C) may be more consistent with the original goals of workers' compensation, but we do not feel free to ignore the clear dictates of the legislature. | [
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OPINION
WALTERS, Justice.
The trial court granted a summary judgment to plaintiffs in their class action suit for refund, to each member of the class, of city liquor license taxes in excess of $1,000 for the 1981-82 tax year. It denied plaintiffs’ request for prejudgment interest. The City appeals the refund judgment; plaintiffs appeal the denial of interest. We affirm.
I.
In May, 1980, the Albuquerque City Council passed an ordinance, effective July 1, 1980, imposing a liquor license tax of $3700 per year on persons holding dispensers’ licenses, and $1500 per year on those with retailers’ licenses. In January, 1981, the state legislature amended NMSA 1978, Section 7-24-1, to provide, in pertinent part:
Municipalities * * * may, by duly adopted ordinance, impose an annual, nonprohibitive municipal license tax upon the privilege of persons holding state licenses under the provisions of the Liquor Control Act * * *. The amount of such license tax, which shall not exceed one thousand dollars ($1,000), and the dates and manner of payment thereof shall be fixed on or before June 1 of each year by the ordinance imposing the same.
The effective date of this amendment, which limited the amount of the tax which could be imposed, was set at July 1, 1981.
In response to the legislative limitation established in Section 7-24-1, the City amended its 1980 ordinance on May 26, 1981, by adding Subsection D:
D. Effective Date of Tax. The effective date of this tax shall be July 1, 1980 and shall continue through June 30,1982. Effective July 1, 1982, the license tax shall be (one thousand) $1,000 per year on all State issued licenses per authority of Laws 1981, Chapter 39, Section 124. If by ultimate judicial decision it is determined that the limitation on license taxes imposed by Section 124, Laws, 1981, Chapter 39, must be implemented before July 1, 1982, the license tax for such period shall be $1,000 per year for such licenses as authorized by the Section.
The City argues that since its amended ordinance was adopted prior to June 1, 1981, as required by the statute, and since the legislative limitation did not become effective until July 1, 1981, the statute could not have controlled the City’s taxing ordinance adopted earlier than either June 19 (90 days after adjournment of the 1981 legislature) or July 1, 1981.
The City of Albuquerque is a home rule municipality. City of Albuquerque v. Chavez, 91 N.M. 559, 577 P.2d 457 (Ct.App.), cert. denied, 91 N.M. 610, 577 P.2d 1256 (1978). A municipality which has adopted a city charter “may exercise all legislative powers and perform all functions not expressly denied by general law or charter.” N.M. Const, art. X, § 6(D). We have interpreted this language to mean that a “home rule” municipality in New Mexico need look to legislative enactments not for a grant of power to act, but only for express limitations on that power. Apodaca v. Wilson, 86 N.M. 516, 525 P.2d 876 (1974).
Nevertheless, both our constitution and statutes specifically restrict the taxing power of a municipality: “No tax imposed by the governing body of a charter municipality, except a tax authorized by general law, shall become effective until approved by a majority vote in the charter municipality.” N.M. Const, art. X, § 6(D). NMSA 1978, Section 3-18-2 (Cum.Supp.1984) (which in relevant part is identical to the statute that was in force in 1981), denies a municipality the right to impose an excise tax on any incident relating to liquor unless otherwise provided by law. Section 7-24-1, quoted above, does (and its predecessor did) provide the authority for imposition of the City’s liquor tax; at the same time, however, the amended statute limits the amount that may be assessed.
While the general purpose of statutory construction is to give effect to legislative intent,
[t]he rule is well established that where the statute directs in definite terms the manner in which municipal acts are to be exercised, such statutory method must be substantially followed. Fancher v. Board of County Com., 28 N.M. 179, 210 P. 237; Bibo v. Town of Cubero Land Grant, 65 N.M. 103, 332 P.2d 1020; McQuillin, Municipal Corporations, 3d ed., Vol. 2, § 10.27, p. 640. Also, the direction of definite and certain method of procedure in the grant of power to the municipality excludes all other methods by implication of law. McQuillin, § 10.-27, supra. Moreover, the statute making the grant of power to the municipality must be strictly construed, and the municipality must keep closely within its limits. 38 Am.Jur., § 385, p. 74.
City of Clovis v. Crain, 68 N.M. 10, 13, 357 P.2d 667, 669 (1960). A municipality lacks the power to alter, by ordinance, a legislatively-mandated tax limitation. Cf. City of Albuquerque v. Cauwels & Davis, Management Co., 96 N.M. 494, 632 P.2d 729 (1981) (municipality not empowered to change tax collection method established by legislature).
Unless a contrary intent is clear, courts will read and give effect to statutes as written, attributing to the words their plain meaning. Board of County Commissioners v. City of Las Vegas, 95 N.M. 387, 622 P.2d 695 (1980); State v. Elliot, 89 N.M. 756, 557 P.2d 1105 (1977). The City argues that the statute in question is unambiguous, and we agree. The legislative amendment imposed a $1,000 tax limit per license, and the amendment was made effective as of July 1, 1981. The rules of strict construction of taxing statutes and of following plain meaning and clear legislative intent dictate that we enforce the $1,000 limit and its effective date. The City’s attempt to rush through an ordinance amendment in expectation that it would avoid a state statute having a later effective date is simply a misapprehension of the taxing powers of the City. It has no such power aside from state legislation. Ergo, the municipality must comply with the authorizing legislation or it forfeits the granted power to tax. See City of Clovis v. Crain.
It is evident to us that the City knew the shakiness of the May 1981 amendment to the ordinance, because it provided therein that the $1,000 tax would apply for 1981-82 if it were determined “by ultimate judicial decision” that the 1981 statutory limitation had to be implemented before the following 1982-83 year. It is difficult to conceive of clearer statutory language than that found in 1981 N.M. Laws, ch. 39, § 130, making July 1, 1981, the effective date of Section 7-24-1, and thereby making July 1, 1981, the effective date of the $1,000 limitation.
“One of the reasons for strict construction when taxing authority is delegated is that taxpayers should not be subjected to the burden of taxation without clear warrant of law.” Cauwels & Davis, 96 N.M. 494 at 496, 632 P.2d 729 at 731 (citations omitted). The City was without authority to impose or collect any liquor license tax over $1,000 after July 1, 1981. The trial court correctly held that plaintiffs are entitled to a refund of excess liquor taxes paid.
Plaintiffs have argued also that principles of either res judicata or collateral estoppel apply because of an earlier separate district court decision on this issue between the City and a taxpayer not a party to the present action. The application of those doctrines is inappropriate here, where the mutual requirement of party identity or privity is lacking. See Torres v. Village of Capitan, 92 N.M. 64, 582 P.2d 1277 (1978). Collateral estoppel “is not intended to tie the hands of judges nor to * * [force] one judge to accept the conclusions of pure law made by another without benefit of appeal to this Court.” Id. at 68, 582 P.2d 1277, 582 P.2d at 1281. Reliance on either doctrine, however, is unnecessary in view of our disposition of this matter on the statutory basis.
Plaintiffs recognize that under current and earlier versions of NMSA 1978, Section 56-8-4 (Cum.Supp.1984), the award of prejudgment interest is a question of law solely within the sound discretion of the trial court. Navajo Tribe v. Bank of New Mexico, 700 F.2d 1285 (10th Cir.1983). Such interest is not a matter of right under this section. Trujillo v. Beaty Electric Co., 91 N.M. 533, 577 P.2d 431 (Ct.App.1978). We are unable to say there was a clear abuse of discretion here.
For the foregoing reasons, we affirm the trial court’s award of summary judgment, which gives effect to the severability and savings provisions of the amendment to the ordinance. In other words, our affirmance triggers the savings clause, which operates to impose a liquor license tax of $1,000 upon affected taxpayers as of July 1, 1981, and to mandate refunds of their excess payments.
Plaintiffs are awarded all appropriate trial and appeal costs, and interest from the date of entry of judgment below.
IT IS SO ORDERED.
SOSA, Senior Justice, and RIORDAN, J., concur. | [
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OPINION
DONNELLY, Chief Judge.
Claimant appeals from the dismissal of his claim for workers’ compensation pursuant to the hearing officer’s order granting respondents’ motion for summary judgment. Our calendar notice proposed to affirm the hearing officer’s order dismissing the claim as being time barred. Claimant has filed a memorandum in opposition and respondents have filed a memorandum in support. Claimant has also filed a response to respondents’ motion in support of the calendar notice. We do not consider this response since such pleading is not contemplated by the appellate rules. In any event, the response essentially reiterates what claimant stated in his memorandum in opposition previously filed herein. Not convinced by claimant’s memorandum, we now affirm.
Claimant’s claim for compensation benefits was dismissed on motion for summary judgment as being time barred. Claimant suffered a compensable injury on February 6, 1986; received installments of total temporary disability at the rate of $270.90 per week in bi-weekly installments of $541.80; was released on July 3,1986, to return to work the next week by one of his treating physicians; and was issued the final installment of $387.00 on July 14, 1986 (for the period of June 27, 1986, until July 7, 1986). However, the reduced final installment was not mailed to claimant until July 18, 1986. On July 30, 1986, claimant’s attorney confirmed by telephone with the insurer that no further total temporary disability benefits would be paid to claimant. Claimant's petition for compensation benefits was not filed until July 31, 1987. Claimant argues that statements made to his attorney by the insurer that no further total temporary disability benefits would be paid to claimant were not relevant to the issue of whether the statute of limitations had run. We disagree. Neither Stasey v. H.B. Stasey, 77 N.M. 436, 423 P.2d 869 (1967), nor Knippel v. Northern Communications, Inc., 97 N.M. 401, 640 P.2d 507 (Ct.App.1982), relied upon by claimant support his assertion that information or misinformation to a claimant from an insurance agent has any effect on the statute of limitations or that the conversation between claimant’s former attorney and the insurer’s agent was irrelevant. Both cases affirmed dismissals of workers’ compensation claims as time barred even though the insurers had made representations that might have caused the insurers to be es-topped from relying upon the statute of limitations. Here, the conversation between claimant’s former attorney and the insurer to the effect that no further benefits would be paid was relevant, as indicated in the calendar notice, because it supports respondents’ prima facie showing that claimant received the reduced final payment prior to July 30, 1986.
We agree with claimant that the statute of limitations is tolled during any period that the employer is relieved of the obligation to pay compensation. See Zengerle v. City of Socorro, 105 N.M. 797, 737 P.2d 1174 (Ct.App.1986). However, here respondents made a prima facie showing that claimant received the reduced, final payment over one year prior to the filing of the claim for workers’ compensation. On the date of receipt of that payment the statute of limitations began to run on the claim.
Claimant relies upon Jowers v. Corey’s Plumbing & Heating, 74 N.M. 555, 395 P.2d 827 (1964); Martinez v. Wester Brothers Wholesale Produce Co., 69 N.M. 375, 367 P.2d 545 (1961); and State ex rel. Mountain States Mutual Casualty Co. v. Swope, 58 N.M. 553, 273 P.2d 750 (1954), contending that the limitation period did not commence running at the time the insurer made the last full installment. Jowers concerns the failure or refusal to make a full installment payment within sixteen days after the last full installment payment. Martinez concerns a premature filing when no installment had yet become due, and Swope concerns a premature filing where all installment payments were promptly paid. Instead, the instant case concerns the failure of respondents to make a full installment payment. As stated in our calendar notice, when maximum compensation benefits are refused or reduced, a worker can file a claim for maximum compensation benefits to establish total disability. See NMSA 1978, § 52-1-69 (see NMSA 1978, § 52-5-18 (Repl.Pamp. 1987)); Rollins v. Albuquerque Pub. Schools, 92 N.M. 795, 595 P.2d 765 (Ct.App. 1979). This is exactly what occurred in the instant case. Accordingly, claimant had one year from the date of receipt of the final reduced installment payment to file his claim for workers’ compensation. See NMSA 1978, § 52-l-31(A). Claimant’s memorandum in opposition fails to consider the effect of Section 52-1-69 or Rollins when he argues that there is no basis for this court’s distinction between termination and reduction of compensation installment payments.
Claimant asserts that it is not logical to recognize a distinction between payment of a full installment and payment of a reduced installment with respect to the triggering of the statute of limitations. We disagree. The limitation period in a worker’s compensation case begins to run when the employer fails or refuses to make an installment. See § 52-l-31(A). Where the last installment payment is paid in full, the employer cannot fail or refuse to make an installment until the next installment is due and is not paid. See Jowers v. Corey’s Plumbing & Heating. However, where the last installment is for a reduced amount, the employer has failed or refused to make the installment. See Rollins v. Albuquerque Pub. Schools.
Neither ABF Freight System v. Montano, 99 N.M. 259, 657 P.2d 115 (1982), nor Cole v. J.A. Drake Well Service, 106 N.M. 484, 745 P.2d 392 (Ct.App.1987), affect our conclusion that dismissal of the claim here for workers’ compensation was proper. Montano and Cole only clarify that NMSA 1978, Section 52-1-30 requires tacking on of either sixteen or thirty-one days to the one-year statutory limitation period provided for in Section 52-l-31(A). Neither case overruled Rollins nor held that Section 52-1-69 {see § 52-5-18) was without effect. Accordingly, we believe the distinction between a full installment reduced installment payment is logical and not just a distinction without a difference or effect.
Although it is black letter law that the Workers’ Compensation Act is remedial and should be liberally interpreted so as to accomplish its purposes, at the same time the provisions of the Act must be reasonably construed so as not to nullify its provisions. See Geeslin v. Goodno, Inc., 75 N.M. 174,- 402 P.2d 156 (1965). Claimant’s argument that a decrease in the amount of the payment of compensation benefits should not be interpreted so as to trigger the commencement of the statute of limitations, in our opinion, would result in an unreasonable construction of the Act. Accordingly, we do not interpret the Act as claimant urges.
For the reasons stated herein and those set forth in our calendar notice, we determine that claimant has failed to rebut respondents’ prima facie showing that the statute of limitations has run, and therefore, we affirm the hearing officer’s order of dismissal.
IT IS SO ORDERED.
BIVINS and ALARID, JJ., concur. | [
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] |
OPINION
FEDERICI, Justice.
The opinion of this Court heretofore filed on November 23,1983 is withdrawn and the following opinion is substituted therefor.
Duke City Lumber Company, petitioner, applied to the New Mexico Environmental Improvement Board (Board) for a one year variance from Air Quality Control Regulation 402(A). The application was denied, and the denial was reviewed by the Court of Appeals. The court remanded “with instructions to the Board to conduct further proceedings to determine whether the wood smoke, in the volume being emitted from appellant’s wigwam burner is ‘injurious to health or safety.’ ” Duke City Lumber Co. v. New Mexico Environmental Improvement Board, 95 N.M. 401, 407, 622 P.2d 709, 715 (Ct.App.1980), cert. denied, 95 N.M. 426, 622 P.2d 1046 (1981) (emphasis added).
The Board held a second hearing and again denied the application for a variance. Duke City Lumber Company again appealed. The Court of Appeals, affirming the Board’s second denial of the variance, held that a condition injurious to health or safety does not mean actual harm, but “only a condition that tends to cause harm to health or safety.”
The Court of Appeals also upheld, but questioned, the current New Mexico standard of judicial review which is limited to substantial evidence in the record. We granted certiorari.
The questions presented are:
I. Whether judicial review of an Environmental Improvement Board decision should be limited to the current standard of substantial evidence in the record, or whether this Court should now adopt a “whole record review” standard.
II. Whether the showing by the Environmental Improvement Division that wood smoke from Duke City Lumber’s wood-waste burner tends to cause harm is sufficient to constitute “emission * * * as may with reasonable probability injure human health,” as required by NMSA 1978, Section 74-2-2(B) (Repl.Pamp.1983).
III. Whether there was competent evidence to support a finding that wood smoke from Duke City’s woodwaste burner is injurious to health or safety.
I. Substantial Evidence Rule.
The Air Quality Control Act (Act), NMSA 1978, Sections 74-2-1 through 74-2-17 (Repl.Pamp.1983), specifically provides for judicial review of the Act. Section 74-2-9 states: “Any person to whom the board denies a variance, after a hearing, may appeal to the court of appeals. All appeals shall be upon the record made at the hearing * * The Court of Appeals may set aside the Board’s denial of a variance if it is found to be arbitrary, capricious or an abuse of discretion, not supported by substantial evidence in the record, or otherwise not in accordance with law. Id.
The separation of powers doctrine directs administrative agencies to their duty of implementing legislation. The Legislature grants agencies the discretion of promulgating rules and regulations which have the force of law. The agencies' must also determine whether there has been compliance with administrative decisions, and this is an adjudication. Therefore, agencies exercise in part functions of all three branches of government. This requires a carefully defined standard of review by the courts.
Some statutes, such as the New Mexico Administrative Procedures Act, provide for review of agency actions on the “entire record.” NMSA 1978, § 12-8-22(A). Other statutes, such as the New Mexico Air Quality Control Act before us, do not contain the words “entire record” or “as a whole.” NMSA 1978, § 74-2-9 (Repl. Pamp.1983). Certainly, in eases arising under statutes that expressly require whole record review of administrative decisions, the New Mexico Supreme Court has applied it. Young v. Board of Pharmacy, 81 N.M. 5, 462 P.2d 139 (1969). Also, in certain cases, even without express statutory provision for whole record review, we have engaged in a review of the record as a whole. Ribera v. Employment Security Commission, 92 N.M. 694, 696, 594 P.2d 742, 744 (1979) (deciding “[bjased upon all of the evidence”); Transcontinental Bus System v. State Corporation Commission, 67 N.M. 56, 60, 352 P.2d 245, 247-248 (1959) (reviewing “the testimony of the witnesses, considered as a whole”); Garrett Freight Lines v. State Corporation Commission, 63 N.M. 48, 312 P.2d 1061 (1957) (considering testimony presented by both sides).
When the Legislature does not specify either standard the courts in New Mexico have followed the rule of substantial evidence in the record, requiring the reviewing court to determine whether the record contains substantial evidence to support the agency decision and to ignore evidence to the contrary. Substantial evidence is “such relevant evidence as a reasonable mind might accept as adequate to support a conclusion.” Rinker v. State Corporation Commission, 84 N.M. 626, 627, 506 P.2d 783, 784 (1973).
The United States Supreme Court addressed whole record review as early as 1951. It held that courts are to review and consider not only evidence in support of one party’s contention to determine whether there was substantial evidence to support the agency finding, but courts are to look also to evidence which is contrary to the finding. The reviewing court would then decide whether on balance, the agency’s decision was supported by substantial evidence. Universal Camera Corp. v. NLRB, 340 U.S. 474, 71 S.Ct. 456, 95 L.Ed. 456 (1951). The federal courts require administrative findings of fact to be supplemented by substantial evidence, and also that those findings be reviewed on the whole record. Committee for an Independent P-I v. Hearst Corp., 704 F.2d 467 (9th Cir.1983); United States Soil Conditioning v. NLRB, 606 F.2d 940 (10th Cir.1979).
The Court of Appeals was correct in applying to this case the more limited standard of review and ignoring all evidence unfavorable to the Board’s decision. We have previously held that it is not proper for the Court of Appeals to change the standard of review, but their opinion properly addresses the shortcomings of this limited review and we agree with the Court of Appeals that it should be changed, insofar as administrative boards and agencies are concerned. See Alexander v. Delgado, 84 N.M. 717, 507 P.2d 778 (1973). New Mexico’s present standard of review is not only outdated, but contrary to the rule followed by a majority of other jurisdictions and by the federal courts. Limited by our prior opinions the Court of Appeals concluded that because Section 74-2-9 provides for reversal of'the Board’s denial of variance if found not to be supported by substantial evidence in the record as opposed to substantial evidence in the record as a whole it was compelled to ignore strong evidence of medical effects of wood smoke and deficiencies in the air quality model which was before the Board. Not only does this interpretation shroud the judgment of the reviewing courts with imposed ignorance of enlightening evidence, but it also causes uneven treatment among those who seek review of the actions of various administrative boards and agencies.
We have continued to follow the rule that if there is substantial evidence in the record to support a finding, the reviewing court is bound thereby. Also, in deciding whether the finding has substantial support, the court must view evidence in the light most favorable to support the findings, and any evidence unfavorable to the finding will not be considered. Trujillo v. Romero, 82 N.M. 301, 481 P.2d 89 (1971); Tapia v. Panhandle Steel Erectors Company, 78 N.M. 86, 428 P.2d 625 (1967). This Court has said it will not weigh conflicting evidence or determine credibility of witnesses. Lujan v. Pendaries Properties, Inc., 96 N.M. 771, 635 P.2d 580 (1981); Worthey v. Sedillo Title Guaranty, Inc., 85 N.M. 339, 512 P.2d 667 (1973). We confirm this rule for the judicial review of orders and judgments of trial courts.
However, for administrative appeals we now expressly modify the substantial evidence rule as heretofore adopted by this Court and supplement it with the whole record standard for judicial review of findings of fact made by administrative agencies. A review of the whole record is clearly indicated in those cases where the administrative agency serves not only as the factfinder but also as the complainant and prosecutor. See 73A C.J.S., Public Administrative Law and Procedure § 213 (1983).
The new standard which we have pronounced in this case has been previously considered and applied by this Court in New Mexico Human Services Department v. Garcia, 94 N.M. 175, 608 P.2d 151 (1980), where we stated:
Whether the decision by HSD is supported by substantial evidence in the [record as a] whole, is one of the standards for judicial review of administrative decisions by HSD as required by Section 27-3-4(F), N.M.S.A.1978. The language employed in the statute does not abrogate the substantial evidence rule as that rule has existed in New Mexico. The language does point to the fact that the substantial evidence rule must be applied to the entire record and that segments of the record may not be ignored in applying the rule. The statute does not mean that upon judicial review of the findings by HSD, the Court may reweigh the evidence and reassign the preponderance of evidence.
In order to determine whether the decision by HSD is supported by substantial evidence in the record as a whole, we must view the evidence in the light most favorable to the decision by HSD. While this rule is applicable to decisions of administrative boards and tribunals as well as to decisions of courts, it does not permit accepting part of the evidence and totally disregarding other convincing evidence in the record considered as a whole. Because of the minor departure from the customary substantial evidence rule in reviewing administrative decisions where the record as a whole must be considered, the reviewing court may act on other convincing evidence in the record and may make its own findings based thereon.
Id. at 176-177, 608 P.2d at 152-153 (emphasis added).
II. Tends to Cause Harm.
This case was originally remanded by the Court of Appeals to the agency solely to determine whether the wood smoke Duke City emitted was “injurious to health or safety.” Duke City Lumber Co. v. New Mexico Environmental Improvement Board, 95 N.M. 401, 407, 622 P.2d 709, 715 (Ct.App.1980), cert. denied, 95 N.M. 426, 622 P.2d 1046 (1981).
The Air Quality Control Act defines air pollution as, “the emission ... into the outdoor atmosphere of one or more air contaminants in such quantities and duration as may with reasonable probability injure human health * * *. NMSA 1978, § 74-2-2(B) (Repl.Pamp.1983).
The Board may grant a variance when compliance with air quality regulations will result in arbitrary and unreasonable taking of property or will impose an undue economic burden, and will not result in a condition injurious to health or safety. NMSA 1978, § 74-2-8 (Repl.Pamp.1983). This definition does not permit the denial by the Board of a variance upon a mere showing that a condition “tends to cause harm.” The Board has power under the New Mexico Air Quality Control Act to deny the variance when the air pollution that would result from granting a variance would with “reasonable probability” injure health. The Legislature has provided the standard of reasonable probability, and this Court must adhere to it. The Board and the Court of Appeals erred by expanding the statutory definition of air pollution from emissions from a “reasonable probability” of injuring health to a condition which “tends to cause harm.” The result we have reached under this Point II would be the same whether we applied the old substantial evidence test or the new whole record review standard.
III. Sufficiency of the Evidence (Residuum Rule).
Administrative hearings in this case were conducted under relaxed rules of procedure to obtain information upon which to arrive at a definitive result. Town meeting-type hearings were held by the Board to solicit public participation regarding Duke City’s request for a variance. Unsworn testimony of citizens and testimony of an Española physician was presented in support of the Board’s decision that smoke from Duke City’s mill would be injurious to health. Testimony by the physician was general rather than specific. He referred to and read from source material but he did not relate to or apply that material to the facts in this case. Lay witnesses and the doctor testified that smoke from the burner caused asthma attacks and irritation of eyes, nose and throat.
The New Mexico Administrative Procedures Act provides that evidence may be relied upon “if it is of a type commonly relied upon by reasonably prudent men in the conduct of their affairs.” NMSA 1978, § 12-8-ll(A). The standard for admissibility in an administrative hearing under this Act is therefore one of whether the evidence has any probative value. However, New Mexico courts require that an administrative action be supported by some evidence that would be admissible in a jury trial. This has been referred to as the legal residuum rule. Young v. Board of Pharmacy, 81 N.M. 5, 462 P.2d 139 (1969). New Mexico has continued to require a residuum of competent evidence to support the findings of an administrative agency where a substantial right is at stake. Trujillo v. Employment Security Commission, 94 N.M. 343, 610 P.2d 747 (1980).
Our decision in this case to review the whole record does not negate the residuum rule. The substantial evidence rule and the whole record standard which we now adopt reaffirm the rule that some competent evidence is required to support an action by an administrative agency which affects a substantial right.
In this opinion we have not addressed the question of whether the Duke City burner emissions exceeded the NAAQS. Neither have we made a determination as to whether violation of this standard alone, or in conjunction with medical evidence presented at trial, justifies denial of a variance. The agency decision on these questions should now be reviewed by the Court of Appeals, based upon the standard of review which we have pronounced in this opinion.
The Court of Appeals is reversed and the cause remanded to it for further proceedings consistent with this opinion.
IT IS SO ORDERED.
RIORDAN, STOWERS and WALTERS JJ., concur.
SOSA, Senior Justice, dissents. | [
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OPINION
ALARID, Judge.
This action was filed by the personal representative (Virginia Thompson) of the Estate of Anna D. Barngrover to recover certain funds contained in a bank account which the deceased and her son, James O. Barngrover (appellee), held jointly. The trial court denied a motion by the representative for summary judgment (based on collateral estoppel), and, after trial before a jury, granted Barngrover’s motion for a directed verdict. The representative appeals. We affirm.
FACTS
The pertinent facts are sufficiently set out in Barngrover v. Estate of Barngrover, 95 N.M. 42, 618 P.2d 386 (Ct.App. 1980) (Barngrover I), In summary, Anna D. Barngrover executed a will on September 6, 1973 in Burlington, Iowa. She bequeathed $1,000 to an old friend and neighbor, Carl Piel. The remainder of the estate was to be divided equally among her son, James, James’ former wife, Mary, and their two children, Terry and Virginia. Anna moved to Albuquerque, New Mexico, from Iowa shortly after her husband’s death in early 1977 to live with James. She lived with James until her death in 1978.
Anna kept all her valuable papers, including a copy of her will, in an unlocked strong box in her room. Upon Anna’s death, the will was nowhere to be found. Anna’s attorney produced a photocopy of the will and it was offered into probate. James challenged probate, arguing that Anna intended to revoke the will by destroying the original. The trial court allowed, and this court affirmed in Barngrover I, formal probate of the copy.
The present action was filed March 17, 1981 by the estate’s representative to recover funds from a joint bank account which James held with his mother, Anna. The trial court did not disturb James’ right of survivorship to the account funds. Representative appeals from this adverse ruling, claiming that the account contains substantially all the estate proceeds which Anna intended to devise according to the terms of her will.
DISCUSSION
Appellant’s argument that Anna’s general, continuing intent to distribute her property according to the terms of her will does not, without more, rebut the presumption that a joint account creates a right of survivorship in favor of the surviving account holder. NMSA 1978, § 45-6-104(A); Barham v. Jones, 98 N.M. 195, 647 P.2d 397 (1982). The evidence is undisputed that James and his mother Anna held the funds in a joint account. NMSA 1978, § 45-6-101(D). The appellate record does, not reveal when this joint account was established, thus we do not consider, and no issue is raised as to, Section 45-6-104(E). Section 45-6-104(A), which was taken from the Uniform Probate Code, see Uniform Probate Code, 8 U.L.A. § 6-104(a) (Master Ed.1983), provides as follows:
A. Sums remaining on deposit at the death of a party to a joint account belong to the surviving party or parties as against the estate of the decedent unless there is clear and convincing evidence of a different intention at the time the account is created. If there are two or more surviving parties, their respective ownerships during lifetime shall be in proportion to their previous ownership interests under Section 6-103 [45-6103 NMSA 1978] augmented by an equal share for each survivor of any interest the decedent may have owned in the account immediately before his death. The right of survivorship continues between the surviving parties.
Barham v. Jones describes Section 45-6-104(A) as a statutory presumption of a right of survivorship. This presumption is directed against the estate and the estate, consistent with NMSA 1978, Evid.R. 301 (Repl.Pamp.1983), had the burden of going forward with evidence to rebut or meet the presumption. Because the statute requires clear and convincing evidence, and it is the estate’s burden to come forward with this evidence, the risk of nonpersuasion stated in Evidence Rule 301 does not apply. The comment to U.L.A. Section 6-104(a), supra, states that the effect of this statute “is to make an account payable to one or more of two or more parties a survivorship arrangement unless ‘clear and convincing evidence of a different [intention]’ is offered.” Thus, by the terms of the statute, the risk of nonpersuasion is on the estate.
Brezinski v. Brezinski, 94 A.D.2d 969, 463 N.Y.S.2d 975 (4 Dept.1983), suggests that the burden on the estate may be met by proof that the survivorship account was opened for the convenience of the decedent, or as the result of undue influence, fraud, or lack of capacity. These are examples only. We do not suggest these are the only ways of proving an intent not to establish a survivorship account. The question in this case is whether the evidence shows that a survivorship account was not intended.
In the instant case, there is no evidence which suggests that Anna intended, when the account was created, to deny James a right of survivorship. Appellant suggests that evidence at trial showed Anna’s “continuing intent, over substantial periods of time, to dispose of her estate in the manner described in her will.” This point is conceded, having been established in Bamgrover I, but the assertion does not answer whether Anna intended to include the account funds within her estate so as to defeat James’ claimed right of survivor-ship. Anna’s continuing intent is non-specific; it does not show, as a matter of law, an intent not to establish a survivorship account at the time the account was established. The trial court could properly view Anna’s continuing intent as insufficient to meet the test of clear and convincing evidence. See Matter of Doe, 98 N.M. 198, 647 P.2d 400 (1982).
Appellant also made passing reference in her brief and at oral argument that evidence was proffered that “undue influence, duress or emotional coercion may have existed.” The evidence on this point is minuscule at best. The evidence consists of an “incident in the shoe store where she [Anna] said, in fact, I think my son [James] wants me for my money, but what else can I do.” The trial judge noted that if this conversation took place in the described manner, it shows that Anna “considered her actions.” Under these facts, appellant has far from met her burden of showing that James unduly influenced or coerced Anna into opening the joint account.
On the issue of collateral estoppel, appellant argues that Bamgrover I conclusively established that Anna “intended that her estate be divided to benefit the five persons named in that will, and that revocation was inconsistent with that intent.” This argument begs the essential issue because it assumes that since joint account funds “comprise substantially the entire estate of Anna,” she must have necessarily contemplated that James should not have a right of survivorship. The court in Bamgrover I, however, did not actually or necessarily conclude that the account funds comprised a part of Anna’s estate. The question was not before the trial judge. The issue of the survivorship account was not necessarily involved in the earlier proceeding which concerned admitting a copy of the will to probate.
Collateral estoppel applies to bar subsequent litigation of issues only where such issues were actually and necessarily litigated in a previous action. Mid-Century Ins. Co. v. Varos, 96 N.M. 572, 632 P.2d 1210 (Ct.App.1981). This is not the situation in the present case.
At oral argument appellant relied on First State Bank v. Muzio, 100 N.M. 98, 666 P.2d 777 (1983). Muzio, which concerned a res judicata issue, is not applicable because the cause of action in Bamgrover I and in this case was not the same.
The judgment of the trial court is affirmed. Appellant is to bear all costs.
IT IS SO ORDERED.
WOOD and HENDLEY, JJ., concur. | [
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] |
OPINION
ALARID, Judge.
Delores Wiley, Intervenor-Appellant, appeals from the trial court’s denial of her motion to set aside a decree terminating the parental rights of her son and the denial of her motion to intervene in proceedings concerning the adoption of her grandchild. On appeal, Wiley raises three issues: 1) whether Wiley has standing to attack the termination of her son’s parental rights; 2) whether the district court’s termination of Wiley’s son’s parental rights is void because of insufficient notice or the unconstitutionality of NMSA 1978, Section 40-7-6(A)(2) (Repl.Pamp.1983); and 3) whether the trial court abused its discretion in failing to allow Wiley to intervene in proceedings for the adoption of her grandson for the purpose of contesting custody. We decide that Wiley lacks standing as a grandparent or as a personal representative, that the issue of notice and constitutionality is moot due to lack of standing, and that the trial court did not abuse its discretion in denying intervention in the adoption proceeding. The decision of the trial court will be affirmed.
FACTS
John Doe was born on June 14, 1982, in Clovis, New Mexico, while both parents, who were unmarried, were stationed at Cannon Air Force Base. The natural mother arranged to have the child placed in a foster home when he was five days old.
John Doe’s mother executed a relinquishment of her parental rights and a consent to adoption on June 21, 1982, and on November 4, 1982, Christian Placement Service of the New Mexico Christian Children’s Home (Home) filed a petition to terminate the parental rights of the father, Kevin Gordon, who had been transferred to England. The decree terminating Gordon’s parental rights and placing the child with the Home was entered on August 26, 1983. Gordon died on September 4, 1983, and Wiley was appointed, in Indiana, administratrix of his estate.
On November 18, 1983, an adoption petition was filed by the foster parents, and on November 29, 1983, Wiley moved to intervene in the adoption proceedings “for the purpose of allowing here [sic] to file her motion to stay, and for such other and further relief as the Court deems proper.” On January 25, 1984, a motion to stay was filed, asking the court to stay proceedings in the adoption action until a motion for revivor and motion to set aside the decree in the termination matter, which she filed in the termination of the parental rights case, had been disposed of by the court.
On March 23, 1984, the district court entered orders in the adoption and termination proceedings which denied Wiley’s motions and granted the Home’s motion to dismiss for lack of standing, from which Wiley appeals.
I. WILEY’S STANDING TO CHALLENGE THE TERMINATION OF HER SON’S PARENTAL RIGHTS
Wiley argues that the termination of Gordon’s parental rights should be set aside because he did not receive adequate notice. The district court did not address this issue for two reasons. First, the district court granted the Home’s motion to dismiss for lack of standing. Second, the district court ruled that Gordon’s parental rights became moot upon his death.
The standing issue has two parts: first, an analysis of Wiley’s right, as grandmother, to attack the termination of Gordon’s parental rights; and, second, an analysis of whether Wiley, as Gordon’s personal representative, may assert his rights after his death.
A. STANDING AS A GRANDPARENT
Wiley does not argue that she was entitled to notice or an opportunity to be heard in the termination proceeding. She was afforded no such right under the applicable statute. See NMSA 1978, § 40-7-4(G) (Supp.1984). There is no New Mexico case authority on the question of whether grandparents have a right to participate in proceedings which seek to terminate their children’s parental rights. However, cases from other jurisdictions indicate that, absent special circumstances, no such right exists. See In re Interest of S.R., 217 Neb. 528, 352 N.W.2d 141 (1984) (grandparents, as such, do not have standing to interfere with the process of termination of parental rights); Graham v. Children’s Services Division, Department of Human Resources, 39 Or.App. 27, 591 P.2d 375 (1979) (grandparents have no standing, in general, to appeal from an order terminating the parental rights of the parent of their grandchildren); DY.F.S. v. D.T., 171 N.J. Super. 520, 410 A.2d 79 (1979) (grandparent not entitled to intervene in action to terminate natural parents’ parental rights); compare In Interest of J.R., 315 N.W.2d 750 (Iowa 1982) (grandparents did have right to intervene in termination proceeding where statute expressly gave grandparents right to serve as custodians or guardians of children after termination); cf. In re J.R., 404 So.2d 1144 (Fla.App.1981) (since district court took adequate steps to insure the disclosure of all relevant information, it was not an abuse of discretion to refuse to allow grandmother to intervene in dependency proceeding); In re P.W., 670 S.W.2d 563 (Mo.App.1984) (trial court in neglect proceeding did not err in denying intervention by grandparents in neglect proceeding where the grandparents’ position was adequately presented). Significantly, Wiley does not contend that her interests should have been considered in the termination proceeding; rather, she argues only that her son’s right to notice was violated.
Wiley first argues that the steps undertaken to notify Gordon were not adequate. Wiley, as grandmother, does not have standing to make this argument because questions regarding service of process are personal to the person upon whom service was attempted and generally cannot be raised by others. See Koven v. Saberdyne Systems, Inc., 128 Ariz. 318, 625 P.2d 907 (1980); 62 Am.Jur.2d Process § 158 (1972). Wiley also argues that, to the extent that Section 40-7-6(A)(2) may not have required her son’s consent to adoption, it is unconstitutional. As grandmother, Wiley also lacks standing to make this argument. The constitutionality of a legislative act is only , open to attack by a person whose rights are affected thereby. State v. Marchiondo, 85 N.M. 627, 515 P.2d 146 (Ct.App.1973). Therefore, Wiley had no personal standing as a grandmother to collaterally attack the validity of the termination decree.
B. STANDING AS A PERSONAL REPRESENTATIVE
Wiley also argues that she is entitled, as her son’s personal representative, to attack the termination decree. Wiley cites NMSA 1978, Civ.P. Rule 60(b)(4) (Repl.Pamp.1980), which states that the court may relieve a party “or his legal representative” from a void judgment. The Home argues that parental rights are personal and do not extend beyond death. It is unnecessary to consider either Wiley’s authority as administratrix of the estate under Indiana law or the nature of parental rights, because there is nothing indicating an estate interest in the termination of Gordon’s parental rights. Wiley does not contend that she seeks to protect any estate interest. We only need to examine the relief requested by Wiley, recognize that the requested relief does not pertain to the estate, and determine that Wiley is acting for herself and not as the personal representative of her deceased son’s estate. In such capacity, as we discussed in the previous section, she lacks standing. .
In addition, there are compelling public policy reasons why the personal representative of a deceased parent should not be able to collaterally attack a termination of the deceased parent’s parental rights. Termination proceedings involve a delicate balance between the welfare of the child and the right of the parent to raise his or her children. See State ex rel. Department of Human Services v. Natural Mother, 96 N.M. 677, 634 P.2d 699 (Ct.App.1981). On the other hand, a deceased parent’s estate obviously has no right to raise the children. Under these circumstances, it is contrary to the primacy of the child’s interests, see Section 40-7-4(A), to allow the estate to hinder proceedings which seek to provide an appropriate disposition for the child. The trial court is affirmed as to Wiley’s standing as a personal representative.
C. MOOTNESS
The district court also held that the validity of the termination of Wiley’s son’s parental rights was moot. If Wiley did not have standing to attack the termination of her son’s parental rights, the mootness issue normally would need not be reached. However, much of the analysis under this issue also applies to the question of whether Wiley had an interest in the adoption proceedings to justify intervention under NMSA 1978, Civ.P. Rule 24(a) (Repl.Pamp. 1980).
District courts have power to decide only actual controversies. See Mowrer v. Rusk, 95 N.M. 48, 618 P.2d 886 (1980). The district court reasoned that since Wiley’s son’s consent was not needed for the adoption, Section 40-7-6(A)(2), the termination decree no longer had any practical significance. Wiley argues that the issue was not moot because the question of whether her son’s parental rights were properly terminated affected her right to contest the adoption. Wiley concedes that a grandparent has no natural or inherent right to custody as against the rights of a third party who is seeking to adopt the child. See In re Adoption of Doe, 89 N.M. 606, 555 P.2d 906 (Ct.App.1976). Wiley argues, however, that the legislature intended to confer certain rights upon grandparents by enacting the Visitation by Grandparents Act, NMSA 1978, Sections 40-9-1 to -4 (Repl.Pamp.1983). Citing Section 40-9-4, Wiley contends that her rights to visitation end with the termination or relinquishment of the natural parent’s parental rights. Thus, Wiley seems to be arguing that if her son’s parental rights were never terminated, she has a right to petition for visitation, and that this right required the district court to allow intervention in the adoption proceeding so that Wiley could protect that right.
Section 40-9-2 provides: “If one or both parents of a minor child is deceased and the minor is in the custody of a surviving parent or any other person other than an adoptive parent, any grandparent of the minor may petition the district court for visitation privileges with respect to the minor.” (Emphasis added.) On its face, this section seems to support Wiley’s argument, i.e., visitation rights do survive the death of the natural parents. On the other hand, Section 40-9-4 provides: “The act [40-9-1 to 40-9-4 NMSA 1978] shall have no application in the event of a relinquishment or termination of parental rights in cases of statutory adoption proceedings.” These sections leave two important questions unanswered: first, assuming that both parents’ rights have been relinquished or terminated, whether grandparents may petition for visitation until the child is adopted; second, assuming that a deceased parent’s rights were never terminated, whether the surviving parent’s relinquishment of parental rights deprives the grandparents of their right to petition for visitation before adoption.
The answer to the first question is that statutory visitation rights do not apply in adoption proceedings after the termination of the natural parents’ rights. The greater number of courts which have addressed the question have come to a similar conclusion: courts are not free to intervene on behalf of relatives who seek visitation rights after an adoption decree which terminates parental rights. Ex Parte Bronstein, 434 So.2d 780 (Ala.1983); Poe v. Case, 263 Ark. 488, 565 S.W.2d 612 (1978); Lee v. Kepler, 197 So.2d 570 (Fla.App. 1967); In re Adoption of Schumacher, 120 Ill.App.3d 50, 75 Ill.Dec. 926, 458 N.E.2d 94 (1983); Matter of Adoption of Gardiner, 287 N.W.2d 555 (Iowa 1980); Browning v. Tarwater, 215 Kan. 501, 524 P.2d 1135 (1974); Smith v. Trosclair, 321 So.2d 514 (La.1975); Bikos v. Nobliski, 88 Mich.App. 157, 276 N.W.2d 541 (1979); People ex rel. Levine v. Rado, 54 Misc.2d 843, 283 N.Y. S.2d 483 (1967); Acker v. Barnes, 33 N.C. App. 750, 236 S.E.2d 715 (1977).
Many of these cases rely on the rationale that an adoption terminates the relationship between an adopted child and his or her natural parents. Such a rationale would support the conclusion that when termination has occurred and adoption proceedings are pending, the legislature also intended that the visitation rights provided by statute to natural grandparents would also end. This result is dictated in New Mexico by Section 40-9-4. We hold that the fact that no adoption decree has yet been entered is irrelevant where the termination has occurred and adoption proceedings are pending. See In re Ditter, 212 Neb. 855, 326 N.W.2d 675, 676-77 (1982).
With respect to the second question, there is persuasive authority to the effect that grandparents are bound by effective consent of the parents, or surviving parent, to adoption. See In re Nicholas, 457 A.2d 1359 (R.I.1983) (grandfather had no standing to participate in adoption proceeding where natural father had decided not to contest stepparent adoption); Hayes v. Watkins, 163 Ga.App. 589, 295 S.E.2d 556 (1982) (grandparents are properly denied the right to intervene in an adoption proceeding where at least one of the natural parents is alive and has consented); Lockey v. Bennett, 244 Ga. 339, 260 S.E.2d 56 (1979) (maternal grandparents were not entitled to intervene in adoption proceedings where parents were living and consented to the adoption); Mead v. Owens, 149 Ga.App. 303, 254 S.E.2d 431 (1979) (grandparents have standing to contest adoption only if no father or mother is living); Hester v. Mathis, 147 Ga.App. 257, 248 S.E.2d 538 (1978) (trial court erred in allowing paternal grandfather to file objections to adoption where natural parent was living); see also Muggenborg v. Kessler, 630 P.2d 1276 (Okl. 1981) (consent to adoption by natural parents or surviving parent may not ordinarily be defeated by opposition from a grandparent). If the holding of these cases was applied to this case, then Wiley would have no right to protect in the adoption proceeding, irrespective of whether her son’s parental rights were terminated.
We conclude that the issue of the validity of the termination of Wiley’s son’s parental rights is moot. As a grandparent, Wiley had no right to protect in the adoption proceedings. Adoption of Doe. Therefore, she has demonstrated no error in the trial court’s ruling. Wiley’s right to petition for visitation rights did not survive the relinquishment of parental rights and the consent to adoption of the only surviving parent.
D. CONSTITUTIONALITY OF SECTION 40-7-6(A)(2)
Wiley argues that Section 40-7-6 is unconstitutional in that it does not require the consent of an unwed father. Given that Wiley had no standing to make this argument, this issue will not be reached. Huey v. Lente, 85 N.M. 597, 514 P.2d 1093 (1973) (constitutional questions will not be decided unless necessary to a disposition of the case).
II. INTERVENTION IN THE ADOPTION PROCEEDING
After ruling that the termination issue was moot and after granting the Home’s motion to dismiss for lack of standing, the trial court ruled that all of Wiley’s other motions had been waived. Thus, the trial court found it unnecessary to decide whether Wiley, notwithstanding her inability to attack the termination of her son’s parental rights, should have been allowed to intervene pursuant to Rule 24.
It is not clear either from the orders or the transcript exactly why the trial court felt that the motion to intervene had been waived. The Home argues that the motion was waived because at the January 26 hearing the following exchange took place between the judge and Wiley’s counsel:
THE COURT: * * * All right, you say you want to argue only the Motion to Set Aside the Decree by Default today?
MR. KNUDSON: Yes, Your Honor.
The Home also argues waiver because Wiley’s counsel stated, “[W]e originally thought that we would want to revive this cause of action, but I believe that’s up to the Christian Placement Service if they want to attempt to revive the action.” Waiver cannot be based upon this last statement because from the context of the statement it is clear that counsel was speaking of the termination action and was not waiving the motion to intervene. Therefore, waiver would have to be based upon the exchange between the trial judge and Wiley’s counsel.
“Waiver” is the intentional relinquishment or abandonment of a known right. Wells Fargo Bank v. Dax, 93 N.M. 737, 605 P.2d 245 (Ct.App.1979). Waiver should not be implied contrary to the intent of the party whose rights are affected unless prejudice would result to the opposing party. Brown v. Jimerson, 95 N.M. 191, 619 P.2d 1235 (1980).
The following statements show that Wiley’s counsel repeatedly asserted Wiley’s right to intervene in the adoption proceeding:
But essentially what we intend to do here today is to ask the Court * * * to allow us to intervene * * * to allow us to have a custody hearing to see what is in the best interest of this young child * *.
******
[T]he only thing we are really asking the Court today to allow us to do is to present a case for the best interests of the child * * *. We feel that we can provide the best home for the child, and we are merely asking the Court to allow us an opportunity to present evidence and an opportunity to that effect. ******
She merely asks the Court to allow her to intervene * * *.
******
All we are asking the Court to do is set aside the decree of termination * * * and allow us an opportunity to intervene into the adoption proceeding.
Although arguing that the motion was waived, appellee’s counsel acknowledged that the motion was argued. Under these circumstances, the trial court erred in ruling that the motion to intervene was waived.
A. INTERVENTION OF RIGHT
Rule 24 provides for intervention as of right and for permissive intervention. Rule 24(a) deals with intervention of right as follows:
Upon timely application anyone shall be permitted to intervene in an action:
(1) when a statute 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 he is so situated that the disposition of the action may as a practical matter impair or impede his ability to protect that interest, unless the applicant’s interest is adequately represented by existing parties.
For the reasons discussed above, Wiley could not intervene as of right. Simply by virtue of her status of grandparent, she had no right to custody. Adoption of Doe. Moreover, because the parental rights of one parent had been terminated, and the other parent had relinquished her rights and consented to the adoption, the trial court was not authorized to grant visitation rights. Under these circumstances, Wiley was not entitled to intervene as a matter of right. See Krieg v. Glassburn, 419 N.E.2d 1015 (Ind.App.1981) (grandparents had no right to intervene in adoption proceeding even though their visitation rights would be terminated); Petition of Benavidez, 52 Ill.App.3d 626, 10 Ill.Dec. 362, 367 N.E.2d 971 (1977) (grandparents had no right to intervene in adoption proceeding); Hayes v. Watkins (grandparents had no right to intervene when at least one parent is alive and has consented to the adoption); Lockey v. Bennet (same as Watkins)', Mead v. Owens (same as Watkins); but see Quarles v. French, 272 Ark. 51, 611 S.W.2d 757 (1981) (grandparents were entitled to intervene but decision was expressly limited to the situation where the grandparents stand in loco parentis and had been granted visitation rights).
B. PERMISSIVE INTERVENTION
There are situations where it might be in the best interests of the child to allow intervention. Cf. Freeman v. Chaplic, 14 Mass.App. 493, 440 N.E.2d 1185 (1982), rev’d on other grounds, 388 Mass. 398, 446 N.E.2d 1369 (1983) (children’s maternal stepgrandmother who had custody for many years could challenge the appointment of the paternal grandparents as guardians); Herod v. Davidson, 650 S.W.2d 501 (Tex.Civ.App.1983) (by alleging that they had continuous custody of their grandson for years and provided his support, grandparents could intervene in the parent’s divorce proceeding in order to be appointed managing conservators).
In this case, however, Wiley failed to notify the trial court of sufficient reasons to allow intervention. Rule 24(c) specifies that a motion for intervention “shall state the grounds therefor and shall be accompanied by a pleading setting forth the claim or defense for which intervention is sought.” The only grounds stated in Wiley’s motion were that her son’s parental rights were improperly terminated. Since Wiley had no standing to make this argument, the motion did not state adequate grounds to justify intervention. Not until the motion hearing did Wiley assert that she desired to intervene on the basis of the best interests of the child. This belated “best interests” claim was that Wiley could provide the “best home.” Wiley’s requested, but refused, findings indicate that Wiley desired to intervene in the adoption proceedings in order to seek custody of the child. In advancing this claim, Wiley did not assert any prior relationship with the child. The trial court could properly view the claims made at the time of the motion hearing as being based on the status of grandparent.
In exercising its discretion as to a permissive intervention, Rule 24(b) states, “the court shall consider whether the intervention will unduly delay ... the adjudication of the rights of the original parties.” The trial court did not abuse its discretion in denying intervention on a ground first asserted at the motion hearing when this ground asserted was based on the grandparent status and not any actual relationship.
Each party shall bear its own costs on appeal.
The Clerk of the Court of Appeals is instructed to correct the filing of the trial court’s orders in Cause No. 82SA-14 which were misfiled in Cause No. 83SA-18.
IT IS SO ORDERED.
WOOD and MINZNER, JJ„ concur. | [
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] |
OPINION
RANSOM, Justice.
Frank Padilla, a roofing consultant, sued the Pueblo of Acoma d/b/a Sky City Contractors for breach of contracts under which Padilla supervised Sky City’s installation of roofs on two building projects located off the Acoma reservation. The Pueblo moved to dismiss the suit for lack of subject matter jurisdiction on the grounds of sovereign immunity. Following a hearing, the district court granted the Pueblo’s motion and dismissed the complaint. Padilla appeals. We reverse.
We initially address whether the Pueblo adequately raised lack of subject matter jurisdiction in its motion to dismiss under SCRA 1986, 1-012(B)(1). Padilla submits that, under Aetna Casualty & Surety Co. v. Bendix Control Division, 101 N.M. 235, 680 P.2d 616 (Ct.App.1984), a proper challenge of jurisdiction must contain something more than the bare allegations within the motion. Id. at 240, 680 P.2d at 621. Padilla argues that the Pueblo’s failure either to verify or to accompany its motion with an affidavit or other sworn testimony requires this Court to accept as true Padilla’s allegation that Sky City is an unincorporated association registered and authorized to do business in New Mexico and, by implication, not protected under the Pueblo’s tribal immunity.
The focus in Aetna was limited, however, to factual allegations that would satisfy the “minimum contacts” due process requirements for personal jurisdiction over a nonresident defendant. There, the complaint alleged sufficient facts concerning the commission of a tortious act within the state. The allegations in the complaint had to be taken as true in the absence of affidavits or other testimony under oath supporting a motion asserting lack of personal jurisdiction. In this case, the jurisdictional attack is on the power and authority of the court to act when an Indian tribe asserts its sovereign immunity. The plaintiff’s naming of the Pueblo of Acoma as the defendant, together with the long recognized policy of judicial notice of Pueblo Indian tribes, United States v. Lucero, 1 N.M. 422 (1869),. established the factual basis for the Pueblo’s motion to dismiss on the grounds of sovereign immunity. No sworn testimony was necessary to establish that the defendant was indeed a Pueblo Indian tribe. We accept as true, and discuss later in this opinion, the allegation that the defendant Pueblo was doing business as an unincorporated association registered and authorized to do business in the state.
The issue before us is whether the state courts have the power and authority to exercise jurisdiction over an Indian tribe that has not waived sovereign immunity for liability claimed to arise out of the tribe’s off-reservation conduct. See State v. Patten, 41 N.M. 395, 69 P.2d 931 (1937) (three jurisdictional essentials are jurisdiction over parties, jurisdiction of subject matter, and power or authority to decide particular matters presented).
The laws of the United States are the supreme law of the land, and judges in every state are bound thereby. U.S. Const, art. VI. We feel constrained, therefore, to answer the jurisdictional question in terms of whether the supreme law of the land has divested the courts of the State of New Mexico of the power and authority over an Indian tribe that has not waived sovereign immunity for off-reservation business conduct. Or, to put it in other words, has the supreme law of the land divested state courts of subject matter jurisdiction over a private claim against an Indian tribe that asserts sovereign immunity for its off-reservation business conduct?
Where a tribe’s sovereign immunity obtains, it is well settled and binding upon this Court that only under congressional consent or an effective waiver may a state court exercise jurisdiction over a recognized Indian tribe. Puyallup Tribe, Inc. v. Department of Game of Wash., 433 U.S. 165, 97 S.Ct. 2616, 53 L.Ed.2d 667 (1977). Furthermore, any waiver of tribal immunity from suit “ ‘cannot be implied but must be unequivocally expressed.’ ” Santa Clara Pueblo v. Martinez, 436 U.S. 49, 58, 98 S.Ct. 1670, 1677, 56 L.Ed.2d 106 (1978) (quoting United States v. Testan, 424 U.S. 392, 399, 96 S.Ct. 948, 953-54, 47 L.Ed.2d 114 (1976)). Tribal sovereignty is subject to plenary federal control and definition. Absent federal authorization, tribal immunity is privileged from diminution by the states. Three Affiliated Tribes of the Fort Berthold Reservation v. Wold Eng’g, 476 U.S. 877, 106 S.Ct. 2305, 2313, 90 L.Ed.2d 881 (1986).
Crucial to the concluding decisional portion of this opinion is the absence of any controlling case law specifically divesting state courts of jurisdiction over Indian tribes doing business outside of reservation boundaries as an unincorporated. association registered and authorized to do business in the state. Before reaching the determinative issue in this case, however, we will consider other significant points raised and argued by the parties.
Padilla points to no federal legislation which would constitute congressional consent to sue the Pueblo of Acoma d/b/a Sky City Contractors for breach of contract. He does claim that NMSA 1978, Section 53-9-1 (Repl.Pamp.1983), establishes that the Pueblo Indians may be sued as a corporation and be required to defend such suit in any court of law or equity. Padilla relies on the following statutory language:
The inhabitants within the state of New Mexico, known by the name of the Pueblo Indians, and living in towns or villages built on lands granted to such Indians by the laws of Spain and Mexico * * * shall be known in the law by the name of the Pueblo de * * *, (naming it), and by that name they and their successors shall have perpetual succession, sue and be sued, plead and be impleaded, bring and defend in any court of law or equity, all such actions, pleas and matters whatsoever, proper to recover, protect, reclaim, demand or assert the right of such inhabitants, or any individual thereof, to any lands, tenements or hereditaments, possessed, occupied or claimed contrary to law, by any person whatsoever, and to bring and defend all such actions, and to resist any encroachment, claim or trespass made upon such lands, tenements or hereditaments, belonging to said inhabitants, or to any individual.
The clause “sue and be sued” must be evaluated within the context of the statute and its history. The original enactment of Section 53-9-1 predates the 1848 treaty of Guadalupe Hildago which similarly protected title to Pueblo Indian lands. See Treaty of Peace Between the United States and Mexico, NMSA 1978 (Vol.l Pamp.3); United States v. Joseph, 94 U.S. (4 Otto) 614, 24 L.Ed. 295 (1876), aff'g 1 N.M. 593 (1874). The territorial statute was passed to define the status of Pueblo Indian tribes under United States jurisdiction and to establish their right to protect their lands from encroachment. See Garcia v. United States, 43 F.2d 873 (10th Cir.1930). Further, in Your Food Stores, Inc. v. Village of Espanola, 68 N.M. 327, 361 P.2d 950, cert. denied, 368 U.S. 915, 82 S.Ct. 194, 7 L.Ed.2d 131 (1961), this Court, in examining whether a political subdivision of the state could extend its corporate limits to include lands of an Indian tribe, found that the terms upon which New Mexico was admitted to the United States left no room for a claim by the state to governmental power over the Indian tribes and Indian lands, unless Congress specifically granted jurisdiction or unless the decisions of the United States Supreme Court sanctioned the exercise of jurisdiction. Id. at 330, 361 P.2d at 952. The territorial statute, which clearly was enacted to protect the right of Indians to aboriginal lands, cannot be extended to constitute a federal grant of general jurisdiction over Indian tribes to the State.
Tribal immunity cases generally center upon the Indian Reorganization Act of 1934, codified at 25 U.S.C. Sections 461-479 (1976). See Felix S. Cohen’s Handbook of Federal Indian Law Ch. 6, § A4c (R. Strickland ed. 1982). Under Section 16 of the Act, Indian tribes have been found to have waived immunity by virtue of legislative ordinances enacted under a tribal constitution. See Merrion v. Jicarilla Apache Tribe, 617 F.2d 537 (10th Cir.1980), aff'd, 455 U.S. 130, 102 S.Ct. 894, 71 L.Ed. 2d 21 (1982). Further, federal courts generally have held that the “sue and be sued” proviso of a tribal corporate charter under Section 17 of the Act constitutes a waiver of immunity for the tribe as a corporate entity, although it does not waive the sovereign immunity of the tribe as a political entity. Boe v. Fort Belknap Indian Community, 455 F.Supp. 462 (D.Mont.1978), aff'd, 642 F.2d 276 (9th Cir.1981). However, the Pueblo of Acoma never has availed itself of the opportunity to adopt a constitution and incorporate under the Act. See An Ordinance Prescribing a Code of Law and Order for the Pueblo de Acoma Indian Reservation (1971). Consequently, the Pueblo has no legislative ordinance enacted under a tribal constitution or a corporate charter that arguably could provide the basis for an express waiver of sovereign immunity. See Merrion v. Jicarilla Apache Tribe, 617 F.2d 537 (10th Cir.1980) aff'd, 455 U.S. 130, 102 S.Ct. 894, 71 L.Ed. 2d 21 (1982); Ramey Constr. Co. v. Apache Tribe of Mescalero Reservation, 673 F.2d 315 (10th Cir.1982).
It is further urged that the State’s exercise of jurisdiction over Sky City should be evaluated under the infringement test formulated in Williams v. Lee, 358 U.S. 217, 79 S.Ct. 269, 3 L.Ed.2d 251 (1959), and applied in Chino v. Chino, 90 N.M. 203, 561 P.2d 476 (1977). See also Foundation Reserve Ins. Co. v. Garcia, 105 N.M. 514, 734 P.2d 754 (1987). The infringement test determines whether the application of state law over Indian affairs would infringe upon the self-government of the Indians. Chino, 90 N.M. at 206, 561 P.2d at 479. In applying the test, the court considers the following criteria: (1) whether the parties are Indian or non-Indian; (2) whether the cause of action arose within Indian country; and (3) what is the nature of the interest to be protected. Foundation Reserve Ins. Co., 105 N.M. at 515, 734 P.2d at 755.
Padilla argues that under the infringement test state jurisdiction over this cause of action is warranted because no unique Indian customs or laws are at stake, the cause of action arose off of Pueblo lands, and the interest to be protected is to guarantee the right to a remedy in state court for breach of contract to those who transact business with a tribal commercial entity outside Indian territory. The inherent weakness in Padilla’s argument is that the infringement test applies to individual Indians and is inapplicable to the exercise of state court jurisdiction over an Indian tribe that has invoked its sovereign immunity. In Santa Clara Pueblo, the United States Supreme Court recognized the dichotomy between state jurisdiction over individual tribal members and jurisdiction over the tribe qua tribe. 436 U.S. at 58-59, 98 S.Ct. at 1677. The court in Puyallup Tribe, Inc. also made the same distinction. 433 U.S. at 172-73, 97 S.Ct. at 2621.
Padilla has made no allegations that the contract waives immunity and that, therefore, it confers subject matter jurisdiction upon the district court. Rather, Padilla argues that Pueblo of Acoma d/b/a Sky City Contractors is amenable to suit because it held itself out as a commercial entity to the outside business world and should be estopped from shirking its contractual obligations by cloaking itself with tribal immunity.
Padilla’s contention that Pueblo of Acoma d/b/a Sky City Contractors is es-topped from enjoying the same immunity as the tribe itself cannot withstand scrutiny. We accept the allegations in the complaint that Sky City is an unincorporated association registered to do business in New Mexico. Simply put, it is a subordinate economic organization of the tribe created for commercial purposes. See White Mountain Apache Indian Tribe v. Shelley, 107 Ariz. 4, 480 P.2d 654 (1971). No representations to the contrary appear of record. This is not a case in which an Indian tribe has concealed or misrepresented that it was doing business itself off of the reservation. Padilla makes no such claim.
At oral argument, counsel for Acoma disclosed that a non-Indian agent obtained the state contractor’s license that was necessary for Sky City to do business in the state. See NMSA 1978, § 60-13-12 (Repl. Pamp.1984). From this information, it was surmised further that Padilla might have negotiated his contract with the non-Indian agent. Even if Padilla did negotiate with Sky City’s non-Indian agent, a fact not supported by the record, there is nothing in the record to suggest that Sky City hid from Padilla that it was doing the business of the Pueblo. Once the Pueblo asserted its sovereign immunity, it was incumbent upon Padilla to show that the Pueblo should be equitably estopped to assert immunity from suit. The record says nothing of any representation upon which Padilla reasonably could rely that Sky City either waived its immunity or was acting in a capacity separate and distinct from the tribe. Moreover, given the requirement that waiver of tribal immunity be express and unequivocal, Santa Clara Pueblo, 436 U.S. at 58, 98 S.Ct. at 1677, it would be difficult at best to support a claim that a tribe could, through other than express and unequivocal conduct, be equitably estopped to assert its immunity.
We turn finally to a consideration of whether business conduct engaged in by a sovereign Indian tribe off of its reservation is clothed with the immunity which has been the subject of the foregoing discussion. We believe not. We know of no controlling law that divests the New Mexico courts of jurisdiction over Indian tribes for off-reservation business conduct.
The United States Supreme Court has held the doctrine that “no sovereign may be sued in its own courts without its consent” does not necessarily support a claim of immunity in another sovereign’s courts. Nevada v. Hall, 440 U.S. 410, 99 S.Ct. 1182, 59 L.Ed.2d 416 (1979), aff'g Hall v. University of Nevada, 74 Cal.App.3d 280, 141 Cal.Rptr. 439 (1977) (Hall II). For reasons well articulated in Hicks v. State, 88 N.M. 588, 544 P.2d 1153 (1975), the doctrine of sovereign immunity does not find favor in the common law of this state. It is not necessary to support in the courts of this state any immunity to which another sovereign is not entitled under either acts of Congress or our legislature, or under a specific holding of the United States Supreme Court.
In Hall v. University of Nevada, 8 Cal.3d 522, 105 Cal.Rptr. 355, 503 P.2d 1363 (1972), cert. denied, 414 U.S. 820, 94 S.Ct. 114, 38 L.Ed.2d 52 (1973) (Hall I), the California Supreme Court, reversing the trial court, had held Nevada amenable to suit in California courts on the grounds that sovereignty stops at the state’s border. The case was remanded for trial. On certiorari from Hall II, the United States Supreme Court did not accept the rationale that sovereignty stops at the state’s border, but affirmed, holding that there is no constitutional provision that prohibits a state’s exercise of jurisdiction over sovereign sister states. 440 U.S. at 426, 99 S.Ct. at 1191. Therefore, the policy of a state to refrain from the exercise of jurisdiction over a sister state is solely a matter of comity. Because it was the policy of California to allow full tort compensation against itself, California could refuse to recognize a sister state’s claim to sovereign immunity for a wrong committed by that state in California.
Having found no provision under the supreme law of the land that prohibits a state’s exercise of jurisdiction over sovereign Indian tribes for off-reservation conduct, we believe the exercise of jurisdiction over a sovereign Indian tribe for off-reservation conduct is solely a matter of comity. It is the policy of New Mexico to allow breach of written contract actions against the state. NMSA 1978, § 37-1-23. Therefore, we hold that, regardless of where the contract was executed, the district court may exercise jurisdiction over an Indian tribe when the tribe is engaged in activity off of the reservation as an unincorporated association registered and authorized to do business in this state and is sued in that capacity for breach of a written contract to pay for the performance of contractual obligations accomplished or intended to be accomplished in connection with this off-reservation activity of the tribe.
The dismissal is reversed. We remand to the trial court to proceed in accordance with this opinion.
IT IS SO ORDERED.
STOWERS, and WALTERS, JJ., concur.
. Padilla contends as well that by doing business in the state Pueblo of Acoma d/b/a Sky City is susceptible to state court jurisdiction under the New Mexico "long arm" statute, NMSA 1978, Section 38-1-16 (Repl.Pamp.1987). Reliance on this statute to confer jurisdiction is misplaced. Section 38-1-16 allows the courts of this state to assert in personam jurisdiction over nonresident defendants. Moore v. Graves, 99 N.M. 129, 654 P.2d 582 (Ct.App.1982).
. We note that the extra-territorial' nature of tribal conduct is relevant in determining the applicability of state regulation of tribal activities. Tribal activity beyond reservation boundaries would be susceptible to taxation by the state in the "absence of express federal law to the contrary.” Mescalero Apache Tribe v. Jones, 411 U.S. 145, 148, 93 S.Ct. 1267, 1270, 36 L.Ed. 2d 114 (1973). Consequently, we would assume that when engaged in off-reservation construction projects the Pueblo of Acoma d/b/a Sky City Contractors, working under a state contractor’s license, would be subject to the same regulatory regime as would any other licensed contractor. See Construction Indus. Licensing Act, NMSA 1978, §§ 60-13-1 to 59 (Repl.Pamp.1984 & Cum.Supp.1987). Here, however, the issue is not state regulation of the Pueblo’s construction projects but, rather, state exercise of jurisdiction over the Pueblo of Acoma once the Pueblo has asserted sovereign immunity from suit brought by a private individual. See Santa Clara Pueblo v. Martinez, 436 U.S. 49, 58, 98 S.Ct. 1670, 1677, 56 L.Ed.2d 106 (1978). | [
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] |
OPINION
SOSA, Senior Justice.
The New Mexico State Corporation Commission (Commission) refused to grant a common carrier’s Certificate of Public Convenience and Necessity (Certificate) as requested by Groendyke Transport, Inc. (Groendyke). Groendyke challenged the Commission’s order in an appellate hearing before the First Judicial District Court. The district court affirmed and Groendyke appeals. We affirm.
In July, 1981, Groendyke applied fee a Certificate for a grant of authority to operate a statewide service as a motor common carrier of property under the then controlling New Mexico Motor Carrier Act (Act), NMSA 1978, Sections 65-2-80 to 127, (Repl. Pamp.1981). The requested authority was for the transportation of “petroleum, petroleum products, petroleum by-products in bulk and chemicals in bulk, between points and places in New Mexico.” After a full hearing the Commission found, inter alia, the following: Groendyke already had restricted authority to transport petroleum products and water in certain areas of New Mexico; Groendyke was not presently pro viding services to the extent authorized for either the transportation of petroleum or water; and public witnesses appearing for Groendyke, in support of the application, specifically declined to state a need for additional transportation of crude oil.
Three other transportation companies protested Groendyke’s application. The protesting parties are the intervenors-appellees, Western Oil Transportation Company Inc., Steere Tank Lines, Inc. and Whitfield Tank Lines, Inc. (Protestants). All parties presented evidence at the Commission hearing. The Protestants gave evidence that the public need was being met by existing transportation services and additional authority in the area would be inconsistent with public convenience and necessity. During both the hearing and the motion for reconsideration, the Commission took into account the transportation facilities and services existing in the expanded area and found them reasonably adequate to meet the needs of the public. The Commission concluded that the requested authorization would neither serve a useful public purpose nor respond to a public need or demand, and it would have a damaging impact on existing carriers. There also was a question raised by the Commission as to Groendyke’s “fitness” qualification under Section 65-2-84(D)(l) of the Act, because of non-use of its already existing authority. After considering the evidence before it, the Commission refused to grant Groendyke the Certificate.
Groendyke then appealed the Commission’s decision to the First Judicial District Court and sought the issuance of a writ of mandamus, as provided in Section 65-2-120(A) of the Act, to compel the Commission to grant the requested Certificate. On appeal, the district court affirmed the Commission’s order and denied the admission of new exhibits during the appeal that were not before the Commission in the prior hearing.
Issues presented for review are the following: 1) whether an applicant to receive a Certificate need only present a prima facie case that it is (a) fit, willing and able, and (b) serving a public purpose or responding to a public need; 2) whether decisions interpreting the Federal Motor Carrier Act, 49 U.S.C. §§ 10101 to 11914 (Supp. IV 1980), are controlling in our review of the New Mexico Motor Carrier Act; 3) whether new evidence can be admitted during the appeal process from an administrative agency to the district court; 4) whether the district court applied the correct standard of review to Groendyke’s appeal from the Commission’s determination; and 5) whether there is substantial evidence in the record to support the Commission’s decision.
I. Prima Facie Case
The Act provides in Subsections 65-2-84(D)(l) and (2), the criteria for the granting of a Certificate. Subsection D(l) requires that the applicant be “fit, willing and able to provide the transportation to be authorized.” Subsection (D)(2) mandates that, “on the basis of evidence presented by persons supporting the issuance of the certificate, that the service proposed will serve a useful public purpose, responsive to a public demand or need.” NMSA 1978, §§ 65-2-84(D)(l) and (2) (Repl.Pamp.1981).
Groendyke claims it fulfilled these criteria by presenting a prima facie case of being “fit, willing and able.” The Commission and Protestants point out that the Act provides for an additional weighing and balancing process by the Commission of evidence presented by the applicant and any other persons objecting under Sections 65-2-84(E) and 65-2-84(F). Section 65-2-84(E), states that if those protesting the issuance can show “that the transportation to be authorized by the certificate is inconsistent with the public convenience and necessity,” the Commission shall not issue the certificate. The making of a prima facie case merely raises a presumption in favor of Groendyke to receive the Certificate. This is a rebuttable presumption, as the Act provides an opportunity for protestants to object to its issuance in Section 65-2-84(E), and the Act requires the Commission to consider the effect on the existing carriers in Section 65-2-84(F). The Commission is mandated, in Section 65-2-84(F), to consider the overall purpose and effect of the issuance of the certificate on existing carriers, as stated in Section 65-2-81, the policy section which states that the motor vehicle be:
[Supervised and regulated so as to provide for the development, coordination and preservation of a safe, sound, adequate, economical and efficient intrastate motor carrier system that is vital to the public interest of New Mexico. To that end, it is necessary that regulation promote competitive, economical, efficient service by motor carrier, and reasonable charges therefore, without undue preference or advantage; enable efficient and well-managed motor carriers to earn adequate profits, attract capital, and maintain fair wages and working conditions; and provide for competitive motor carrier services at affordable rates for all municipalities, towns, villages and rural communities of New Mexico.
NMSA 1978, § 65-2-81 (Repl.Pamp.1981).
Sections 65-2-84(E) and 65-2-84(F), when read with Section 65-2-81, the policy section of the Act, show the Legislature did not intend a condition of “fit, willing and able” to be the sole criterion for obtaining a Certificate.
Groendyke’s failure to fully utilize existing authority to transport within the state is but one factor to consider in the application process. Non-use does not rise to the level of lack of “fitness” under the Act. It is one of the many factors the Commission may consider when weighing and balancing whether the service proposed will serve a useful public purpose within the meaning of the Act.
The Act requires the Commission when viewing applications for certificates to consider the various factors as set forth in the entire Act, not simply those favorable to the applicant. The Commission was correct in balancing opposing factors as set forth in the Act in arriving at its determination.
II. The Federal Motor Carrier Act
Groendyke asserts that parts of the 1980 Federal Motor Carrier Act, 49 U.S.C. §§ 10101 to 11914 (Supp. IV 1980), are similar to the New Mexico Act. See 49 U.S.C. §§ 10922(b)(1) and (2). These subsections refer to the criteria of “fit, willing and able” and serving a “useful public purpose.” Groendyke interprets the Federal Act as being deregulatory and argues the New Mexico Act should be considered deregulatory. The Commission replies by noting that the Federal Act regulates interstate commerce and the New Mexico Act regulates intrastate commerce.
Nothing we have found in the Federal Act, nor the numerous cases interpreting it, has stated that the Federal Act suggests a specific interpretation for a state act such as the one here. The similarity between the two acts is not sufficient reason to force this State to follow a federal court’s interpretation of a federal law. The very fact that one act controls interstate commerce and the other intrastate commerce is a material difference. Furthermore, in the policy statement of the New Mexico Act, there is a strong reference to regulation as one purpose of the Act, “It is necessary that regulation promote competitive, economical, efficient service by motor carrier ...” NMSA 1978, § 65-2-81 (Repl.Pamp. 1981). In addition the Legislature vested in the Commission the power, authority and duty to regulate common motor carriers. NMSA 1978, § 65-2-83(A) and (D). (Repl. Pamp.1981) (Supp.1983).
Groendyke cites to several federal cases as authority to interpret what the Certificate standard should be under the New Mexico Act. Regarding the prima facie showing as the sole standard, these courts note that the burden shifts to those opposing the certificate (protestants), after the applicant makes a prima facie showing. J.H. Rose Truck Line, Inc. v. Interstate Commerce Commission (Rose I), 683 F.2d 943 (5th Cir.1982); see also Steere Tank Lines, Inc. v. Interstate Commerce Commission, 687 F.2d 104 (5th Cir.1982) cert. denied, 460 U.S. 1038, 103 S.Ct. 1430, 75 L.Ed.2d 790 (1983); Baggett Transportation Co. v. United States, 666 F.2d 524 (11th Cir.1982). Moreover, the cases support the Commission’s position that under the Act the Protestants have an opportunity to persuade the Commission that a proposed certificate is inconsistent with public convenience and necessity. Steere Tank Lines, Inc., 687 F.2d 104, 105-6 (citing to 49 U.S.C. § 10922(b)(1) (West Supp.1982)).
Several federal courts have adopted a “weighing and balancing” approach that we are adopting today. Baggett Transportation Co., 666 F.2d at 531; see also Steere Tank Lines, Inc. (Commission must consider evidence offered by prospective shippers and protestants); J.H. Rose Truck Line, Inc. (Rose I), 683 F.2d at 948 n. 5 (Commission must articulate a rational connection between relevant factors). Citing to several United States Supreme Court cases, Baggett commented that Commission expertise is need to identify, weigh and judge competing interests. Bowman Transportation Inc. v. Arkansas Best-Freight System, Inc., 419 U.S. 281, 95 S.Ct. 438, 42 L.Ed.2d 447 (1974). See, e.g., Interstate Commerce Commission v. J-T Transport Co., 368 U.S. 81, 89, 82 S.Ct. 204, 209, 7 L.Ed.2d 147 (1961). Baggett prescribes that Commission review of the entire motor carrier system should be considered in decisions that weigh and balance the following three factors: 1) consumer benefits; 2) adverse impact on existing carriers; and 3) the fitness of the applying carrier. Once the Commission has weighed these competing interests and come to a conclusion, the courts may not lightly disregard the decision. Baggett 666 F.2d at 531.
While the protestants in Baggett failed to meet their burden of demonstrating that the grant would be inconsistent with public convenience and necessity, the court quite clearly adopted weighing and balancing as the proper standard of review for the granting of a Certificate under the Federal Motor Carrier Act. Consistent with Baggett is the approach in Refrigerated Transport Co. v. Interstate Commerce Commission, 686 F.2d 881 (11th Cir.1982), where the court held that substantial evidence must support the Commission’s determination that a grant of authority will serve a useful public purpose responsive to a public demand or need.
The weighing and balancing approach is exactly what the New Mexico Commission utilized in the instant case. This approach fits within the confines of the New Mexico Act and follows the Federal criteria as explained in Baggett. We hold the Commission’s review of the certificate application was proper.
III. Inadmissibility of New Evidence on Appeal
Concerning the admissibility of new evidence not presented to the Commission, the general rule is that “upon an appeal from an order of the Commission, additional evidence may not be considered, and the court is without authority to try the case anew upon the record.” City of Albuquerque v. New Mexico State Corp. Commission, 93 N.M. 719, 723, 605 P.2d 227, 231 (1979); Transcontinental Bus System v. State Corp. Commission, 56 N.M. 158, 241 P.2d 829 (1952). The district court is limited to the record before the Commission when reviewing a Commission order. State ex rel. State Corp. Commission v. McCulloh, 63 N.M. 436, 321 P.2d 207 (1957). This rule is followed unless an exception is brought to the attention of the court, such as those indicated in NMSA 1978, Section 12-8-20 or Section 12-8-21 of the New Mexico Administrative Procedures Act (NMAPA). No exception under the NMAPA or the Motor Carrier Act was presented to the district court. Groendyke did not use either Section 12-8-20, which allows the appeals court to be petitioned before the hearing date for leave to present additional evidence, or Section 12-8-21, which permits procedural irregularities during the Commission hearing to be a basis for admitting new evidence on appeal.
The role of the district court in the administrative appeal procedure is to review the record made before the Commission and determine if there was sufficient evidence to uphold the administrative agency’s decision. Ferguson-Steere Motor Co. v. State Corp. Commission, 63 N.M. 137, 314 P.2d 894 (1957).
During the appellate review, the district court refused to admit new evidence offered by Groendyke. The evidence concerned Commission orders granting or denying certificates in similar cases. Groen-. dyke claims the Commission used a different standard for Groendyke than that utilized in granting other similar certificates under similar circumstances. Groendyke asserts this variation in the application of standards established discriminatory treatment of Groendyke when compared with other similarly situated applicants whose applications were granted.
Evidence of this asserted discriminatory action was not presented to the Commission at the administrative hearing. Traditionally, cases have uniformly held the hearing of an administrative appeal at the district court level is an appellate procedure, not a trial de novo. Garrett Freight Lines v. State Corp. Commission, 63 N.M. 48, 312 P.2d 1061 (1957). State ex rel. Transcontinental Bus Service v. Carmody, 53 N.M. 367, 208 P.2d 1073 (1949).
The pertinent wording of Subsections 65-2-120(A) to (D), regarding actions to set aside orders of the Commission has remained essentially unchanged over forty years. See NMSA 1978, § 65-2-120(A) to (D) (Repl.Pamp.1981); NMSA 1978, § 65-2-66 (Orig.Pamp.); NMSA 1953, § 64-27-68 (Repl.Vol. 9, 1960); NMSA 1941, § 68-13-63. It is not the function of the trial court to retry the case, Ferguson-Steere Motor Co.; admit new evidence unless under an exception stated in Sections 12-8-20 or 12-8-21 of the NMAPA; or substitute its judgment for that of the Commission. Gas Co. of New Mexico v. New Mexico Public Service Commission, 100 N.M. 740, 676 P.2d 817 (1984); Lloyd McKee Motors, Inc. v. New Mexico State Corp. Commission, 93 N.M. 539, 602 P.2d 1026 (1979); Llano, Inc. v. Southern Union Gas Co., 75 N.M. 7, 399 P.2d 646 (1964).
Additional evidence not presented at the administrative hearing, nor offered under a recognized exception, may not later be heard by the district court sitting in the posture of an appellate court. Here the district court was limited to reviewing that evidence presented to the Commission. We uphold the district court’s decision not to accept new evidence on appeal that was neither offered at the Commission hearing nor under exceptions stated in Sections 12-8-20 and 12-8-21.
IV. Standard of Review on Appeal
This Court’s scope of review in an appeal from an administrative body is defined in the NMAPA. NMSA 1978, § 12-8-22. Unlike the Federal Administrative Procedures Act, which is generally applicable to all federal agencies, see 5 U.S.C. § 551, the NMAPA is not applicable to every state agency. See NMSA 1978, § 12-8-23. Nonetheless, the NMAPA has been used by New Mexico courts as a general guideline for the resolution of administrative law questions. Duke City Lumber Co. v. New Mexico Environmental Improvement Board, 101 N.M. 291, 681 P.2d 717 (1984); City of Albuquerque v. New Mexico Corp. Commission, 93 N.M. 719, 605 P.2d 227 (1978); In re Miller, 88 N.M. 492, 497, 542 P.2d 1182, 1187, (Ct.App.) cert. denied, 89 N.M. 5, 546 P.2d 70 (1975).
Under statute and case law, appellate review of agency determinations is limited to the following: 1) whether the agency acted within the scope of its authority; 2) whether the order was supported by substantial evidence; 3) whether the decision was made fraudulently, arbitrarily or capriciously, NMSA 1978, § 12-8-22(A); Gas Co. of New Mexico; Llano, Inc; and 4) whether there was an abuse of discretion or show of bias by the agency. NMSA 1978, § 12-8-22(A)(6). The focus of the review is on the decision of the administrative agency and this Court must make the same review of the Commission’s determination as the district court. Lloyd McKee Motors; Transcontinental Bus System Inc. v. State Corp. Commission, 67 N.M. 56, 352 P.2d 245 (1959).
There is no dispute as to whether the Commission has the authority to issue a Certificate under the Motor Carrier Act, Section 65-2-84. The dispute arises in the interpretation of the correct standard to be used for the grant of the Certificate. As stated above, we hold the correct standard to be a weighing and balancing of the factors as set out by the Legislature in Sections 65-2-84(E), 65-2-84(F), and 65-2-81 of the Act.
V. Substantial Evidence
After finding the Commission applied the correct standard to Groendyke’s application, we examine whether there is substantial evidence in the record to support the decision of the Commission. The appellate court scrutinizes the record to determine whether the Commission’s order was lawful, reasonable, and supported by substantial and competent evidence. Gas Co. of New Mexico; Transcontinental Bus System Inc. v. State Corp. Commission, 67 N.M. 56, 352 P.2d 245 (1959). We have held that substantial evidence in an administrative agency review is “such relevant evidence as a reasonable mind might accept as adequate to support a conclusion.” Viking Petroleum, Inc. v. Oil Conservation Commission, 100 N.M. 451, 452, 672 P.2d 280, 282 (1983); see also Rinker v. State Corp. Commission, 84 N.M. 626, 506 P.2d 783 (1973). Substantial evidence in an administrative agency review requires whole record review, not a review limited to those findings most favorable to the agency order. NMSA 1978, § 12-8-22(A); Universal Camera Corp. v. NLRB, 340 U.S. 474, 71 S.Ct. 456, 95 L.Ed. 456 (1951); Gas Co. of New Mexico; Duke City Lumber Co.
Furthermore, in reviewing any agency decision, “the special knowledge and experience of state agencies should be accorded deference.” Stokes v. Morgan, 101 N.M. 195, 680 P.2d 335 (1984); see also NMSA 1978, § 12-8-22(A); Viking Petroleum, Inc. Absent an unreasonable or unlawful order; a showing of bias, arbitrary or capricious acts; an abuse of discretion by the Commission; or an order lacking substantial support in the record, this Court and the district court are without power to change the decision of the Commission. Gas Co. of New Mexico; Llano, Inc.
The Legislature has charged the Commission with the administration of the Motor Carrier Act. To fulfill this charge, the Commission must use its special expertise in the field and, after weighing all factors, come to a decision within the bounds of the Act. A review of the record reveals that the Commission’s decision was supported by substantial evidence. There is nothing in the record to support an allegation of an abuse of discretion; arbitrary, capricious, or bias acts by the Commission; or a misstatement of the law that would rise to the level of prejudicial error.
For all the above stated reasons, the decision of the district court is affirmed.
IT IS SO ORDERED.
FEDERICI, C.J., and STOWERS, J„ concur. | [
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OPINION
BACA, Chief Justice.
Appellants Leonard Napolitano and Ellen Goldberg appeal from a judgment in favor of Appellee Thomas McDowell. Based on a jury verdict, the district court awarded Appellee $400,000 for breach of contract against Appellants and adjudged that Appellants take nothing against Appellee on its breach of contract counterclaim. We address the following issues on appeal: (1) Whether the trial court had jurisdiction to hear the claim; (2) whether the trial court erred in refusing to grant a mistrial based on alleged misconduct by Appellee’s counsel and the introduction of certain exhibits; (3) whether the trial court improperly refused Appellants’ jury instructions on the mitigation of damages; and (4) whether Appellee’s Section 1983 claim was properly dismissed. We review this case pursuant to SCRA 1986, 12-102(A)(1) (Repl. Pamp.1992), and affirm.
I
The following facts are pertinent to this appeal. McDowell was hired by the University of New Mexico School of Medicine in 1982 as an assistant professor in the Department of Microbiology. He was considered for tenure during the 1987-88 academic year. Chairman Goldberg submitted a negative recommendation for tenure, citing McDowell’s strained relationships with some of his graduate students and his lack of productivity in research and scholarly publications as the basis for her recommendation. An ad hoc review committee of senior faculty members unanimously concurred in her negative recommendation. In April 1988 Dean Napolitano denied tenure to McDowell. The University issued a final termination contract for the 1988-89 academic year as provided for in the Faculty Handbook.
McDowell appealed the denial of tenure to the University’s Academic Freedom and Tenure Committee (the “AFTC”), following the appeals procedure in the Faculty Handbook. After a hearing the AFTC determined that McDowell had not been adequately advised of his shortcomings in the areas of research and publications in his third year of appointment as required by the Handbook. Therefore, the AFTC ruled that McDowell should be given a probationary contract for the 1989-90 academic year during which a thorough review of his fitness for tenure should be conducted.
Dean Napolitano disagreed with the validity and correctness of the AFTC’s decision and notified McDowell that his employment with the School of Medicine would end with the 1988-89 academic year. In June 1989, McDowell filed a lawsuit seeking to enjoin the termination of his contract. A settlement agreement resulted in maintenance of the status quo during further administrative proceedings. McDowell remained employed on a month-to-month basis pending review by the Regents of Appellants’ appeal from the AFTC decision.
In May 1990, the Regents’ upheld the AFTC decision and directed that a full tenure review be completed by June 30, 1990. The Regents stated that “[i]f the decision is positive, tenure shall be effective July 1, 1990. If the decision is negative, Dr. McDowell shall be given a one-year terminal contract for 1990-91.”
McDowell’s second tenure review resulted in a negative recommendation by the majority of faculty members in the Department of Microbiology. An ad hoc committee of senior faculty concurred and Dean Napolitano denied tenure. McDowell challenged the review process and appealed the second denial of tenure to the University President, who upheld the Dean’s decision. McDowell did not again appeal to the Regents. McDowell was issued a terminal contract effective June 30, 1991.
McDowell filed suit for breach of contract and civil rights violations allegedly arising from his denial of tenure. Appellants counterclaimed for breach of contract. Prior to trial, Appellants unsuccessfully moved for summary judgment on the ground that McDowell had failed to exhaust his administrative remedies as outlined in the Faculty Handbook. The trial court also denied Appellants’ motion for a directed verdict based on failure to exhaust administrative remedies but did grant a directed verdict for Appellants on McDowell’s civil rights retaliation claim. Only McDowell’s contract claims were submitted to the jury.
At the end of the trial, Appellants requested that the court instruct the jury in accordance with SCRA 1986, 13-851 (Repl. Pamp.1991) regarding mitigation of damages for breach of contract of personal employment or, in the alternative, on mitigation of damages based on New Mexico case law. The trial court rejected Appellants’ requested instructions and gave the jury instructions on the general mitigation of damages. See SCRA 13-1811. The jury returned a verdict in favor of McDowell in the amount of $400,-000, which forms the basis for this appeal.
II
The first issue that we address is whether the trial court had jurisdiction over the case. Appellants claim that jurisdiction is lacking because Appellee failed to exhaust his administrative remedies. New Mexico law has long recognized that a party must exhaust all administrative remedies before applying to a court for relief unless the legal or statutory remedies available are inadequate. See First Nat’l Bank of Raton v. McBride, 20 N.M. 381, 401, 149 P. 353, 359 (1915). Appellants argue that Appellee was required to submit a second appeal to the Board of Regents. Appellee counters that he complied with the University’s appeals process. We agree with Appellee that he substantially complied with the appeals process.
The doctrine of exhaustion of remedies is absolute “where a claim is cognizable in the first instance by an administrative agency alone[. In such a case] judicial interference is withheld until the administrative process has run its course.” State ex rel. Norvell v. Arizona Pub. Serv. Co., 85 N.M. 165, 170, 510 P.2d 98, 103 (1973) (quoting United States v. Western Pac. R.R., 352 U.S. 59, 63, 77 S.Ct. 161, 165, 1 L.Ed.2d 126 (1956)); see also Pan Am. Petroleum Corp, v. El Paso Natural Gas Co., 77 N.M. 481, 487, 424 P.2d 397, 403 (1966) (stating that “the exhaustion doctrine ... applies where an administrative agency alone has authority to pass on every question raised” but not to a question of law).
The court has original jurisdiction under the doctrine of primary jurisdiction, however, where there is an applicable common-law or legal remedy apart from or in addition to an administrative remedy, or where there is no applicable statutory administrative remedy. Under the principle of comity, the court may choose to defer to the administrative agency where the interests of justice are best served by permitting the agency to resolve factual issues within its peculiar expertise. Exhaustion of administrative remedies is not absolutely required under the doctrine of primary jurisdiction. Arizona Pub. Serv. Co., 85 N.M. at 171, 510 P.2d at 104. Cf. Gandy v. Wal-Mart Stores, Inc., 117 N.M. 441, 443-44, 872 P.2d 859, 862-63 (1994) (bringing claim under tort for retaliatory discharge does not require exhaustion of remedies under the Human Rights Act and stating that “under the doctrine of primary jurisdiction district courts have discretion to abstain from hearing a case that has been brought simultaneously before an administrative tribunal”).
The court in its discretion may defer, to an administrative agency in the interests of judicial economy, where the agency is in a better position to fully develop a record of the grievance. Seefeldt v. Board of Trustees, 487 F.Supp. 230, 233 (D.D.C.1979). Likewise, the court may defer to the agency where those most familiar with tenure requirements and regulations are best able to interpret the rules and make decisions to resolve the grievance. See Krynicky v. University of Pittsburgh, 560 F.Supp. 803, 807 (W.D.Pa.1983) (holding that court is not proper original forum for contract disputes between faculty and university); Snitow v. Rutgers Unin, 103 N.J. 116, 510 A.2d 1118, 1123 (1986) (finding that professor’s peers and university’s officers are best suited to review tenure grievance because these issues are uniquely within their expertise).
Because there is no statutory remedy available to University faculty, the exhaustion of remedies doctrine is not absolute. The question, therefore, is not whether Appellee failed to exhaust all procedural remedies, but whether he substantially discharged his own contractual obligations so as to be able to complain of a breach by his employer. There appears to be no dispute that during his first appeal Appellee properly followed the appeals process outlined in the Faculty Handbook. Appellants contend that Appellee failed to properly follow the procedures in his second appeal before turning to the court.
Because Appellee pursued the appeals process to the highest authority within the University, the trial court had a sufficient record to review his grievance. Before Appellee turned to the court, the University was able to develop a full and complete record of his grievance. The University exercised its discretion through two review procedures. The Board of Regents fashioned a remedy and made a final determination based on the results of its remedy. The reviews were conducted according to the appeals procedures set out in the Faculty Handbook and utilized the unique expertise of the University faculty and officers. Although Appellee did not take the last step following the second review of appealing again to the Board of Regents, he substantially complied with the terms of his employment contract. After unsuccessfully appealing the second denial to the President of the University, Appellee did not have to take his appeal back to the Regents because they had already made a final determination. We hold that the doctrine of exhaustion of administrative remedies did not apply to bar the litigation of Appellee’s case. The trial court properly denied the motion.
Ill
We next consider whether the trial court erred in refusing to grant a new trial based on alleged misconduct by Appellee’s counsel. The Court recognizes the impropriety of counsel injecting his or her own credibility into a case by vouching for the credibility of witnesses. See SCRA 1986,16-304(E) (Repl.Pamp.1991); State v. Pennington, 115 N.M. 372, 381, 851 P.2d 494, 503 (Ct.App.), cert. denied, 115 N.M. 409, 852 P.2d 682 (1993). Appellants argue that Appellee’s counsel improperly influenced the jury through the frequent use of “I” and “we” during his direct examination of Appellee and during the cross-examination of Appellants and one of Appellants’ witnesses.
Appellants rely on cases in which counsel have clearly engaged in outrageous or prejudicial conduct. See, e.g., Moore v. Taylor Concrete & Supply Co., 553 So.2d 787, 793 (Fla.Dist.Ct.App.1989) (finding counsel improperly alluded to the fact that his client was not charged with a traffic violation in connection with an accident and injected himself into proceedings as a witness for his client); Cottonwood Estates, Inc. v. Paradise Builders, Inc., 128 Ariz. 99, 624 P.2d 296, 302 (1981) (en banc) (denying counsel the right to try case in which he was material witness); Weinberger v. City of New York, 97 A.D.2d 819, 468 N.Y.S.2d 697, 699 (App.Div.1983) (finding as improper defense counsel’s statements during trial as to what he had personally observed; his statement that the jury had a “ ‘sworn duty’ to prevent the city from being ‘ripped off since ‘we are all together in this’ ”; and his argument that plaintiffs expert was not to be believed because he had been paid to testify); Weil v. Weil, 283 A.D. 33, 125 N.Y.S.2d 368, 370 (App.Div.1953) (finding husband’s trial attorney had violated canon of professional ethics by participating in investigation of adultery charges against wife and then giving lengthy testimony as to personal observations during investigation).
A review of the record shows that Appellee was a witness for two days, resulting in over 350 pages of transcripts. From this extensive testimony, Appellants object to a dozen or so incidents in which counsel improperly injected himself into his question with the use of “I” or “we.” In addition, counsel occasionally injected himself into his cross-examination of Appellants and one witness. While it is far better that this type of conduct not occur, the trial court was best able to observe and control the behavior of counsel. In fact, the trial court did caution counsel about the form of his questioning and from the record it appears counsel made an effort, although imperfect, to refrain from the use of “I” or “we.” Unlike the cases cited by Appellants, at no point did counsel expressly assert personal knowledge or vouch for his own or his client’s credibility. The record does not show that counsel belittled or demeaned Appellants or their witnesses. Although counsel’s argument during closing, in which he asserted that he as well as the whole system of justice was being attacked, may come close to vouching for his own credibility, such a statement does not justify a new trial. As stated in Pennington, 115 N.M. at 381, 851 P.2d at 503, counsel have considerable latitude in closing arguments. We hold that counsel’s conduct in the instant case did not rise to the level of misconduct that justifies reversal.
Appellants also argue that the trial court erred in admitting certain exhibits offered by Appellee. The exhibits were letters prepared by counsel during the course of Appellee’s administrative appeals. Defendant argues that the letters written by Appellee’s counsel unfairly influenced the jury’s deliberations because they improperly emphasized Appellee’s version of the facts and arguments.
It has long been held that the admission of evidence “is a matter within the sound discretion of the trial court ... that ... in the absence of a clear abuse of discretion, will not be disturbed on appeal.” Garrett v. Howden, 73 N.M. 307, 311, 387 P.2d 874, 877 (1963). We will find an abuse of discretion when the court’s decision is “without logic or reason, or that it is clearly unable to be defended.” Newsome v. Farer, 103 N.M. 415, 420, 708 P.2d 327, 332 (1985); accord Lowery v. Atterbury, 113 N.M. 71, 74, 823 P.2d 313, 316 (1992). In this ease, the record shows that the court made specific rulings as to all of the exhibits. Some were admitted for all purposes, some were used only for cross-examination or to refresh recollection, others were used in part but not sent to the jury, and some were excluded altogether. Limiting instructions were given at the time the letters were introduced and again when the exhibits were submitted to the jury. From this, it cannot be shown that there was an abuse of discretion by the trial court or that the jury was unfairly prejudiced by the admission of any of these letters. We find no clear abuse of discretion in admitting Appellee’s exhibits.
Appellants also claim that the trial court committed reversible error in allowing Appellee to use a file memorandum prepared by Goldberg on July 10, 1989. Goldberg’s memorandum recorded impressions of her meetings with Napolitano and University Counsel Shannan Carter and concerned efforts to remove Appellee from his facilities at the department. During cross-examination, Goldberg expressly asked “[i]s there something written by me?” The memorandum was produced as a result of her question to refresh her memory. The memorandum was used a second time during the trial, again for the limited purpose of refreshing Carter’s memory. Appellants argue that this memorandum was protected by the attorney-client privilege. SCRA 1986, 11-503 (Repl.Pamp. 1994) states that “[a] client has a privilege to refuse to disclose and to prevent any other person from disclosing confidential communications made for the purpose of facilitating the rendition of professional legal services to the client.”
We need not decide whether the attorney-client privilege applies in this instance because the writing was never exposed to those outside the attorney-client relationship, if such a relationship actually existed. The contents of the memorandum were never admitted into evidence, the jury never saw the memorandum, and the jury never learned of the controversy surrounding its use. We hold that the limited purpose for which Goldberg’s memorandum was used, to refresh recollections, was proper under the circumstances of this case.
IV
Appellants’ final argument concerns whether the trial court erred in refusing their jury instructions concerning mitigation of damages. The court submitted a general theory of mitigation to the jury. “The matter of whether the court should have given the instruction is a question of law to be decided by the trial court based upon the facts and the evidence.” Hansen v. Skate Ranch, Inc., 97 N.M. 486, 490, 641 P.2d 517, 521 (Ct.App.1982). If “instructions, considered as a whole, fairly present the issues and the law applicable thereto, they are sufficient. Denial of a requested instruction is not error where the instructions given adequately cover the issue.” Hudson v. Otero, 80 N.M. 668, 670, 459 P.2d 830, 832 (1969).
Appellants requested the following modification of SCRA 13-851:
The measure of damages for plaintiffs breach of contract claim is the unpaid balance of the employment contract, less the amount plaintiff could through the exercise of reasonable diligence have earned, in the time made available as a result of the breach, from employment of the same quality as his employment under the breached contract.
The court considered this instruction to apply to wrongful discharge claims rather than breach of contract and, therefore, submitted SCRA 13-1811 instead:
In fixing the amount of money which will reasonably and fairly compensate plaintiff, you are to consider that an injured person must exercise ordinary care to minimize or lessen his damages. Damages caused by his failure to exercise such care cannot be recovered.
In closing argument, Appellants focused on the allegations that Appellee had failed to seek other employment or to “cut [his] losses” by trying to find another university-level position. In reviewing these two instructions, the evidence, and the arguments, we hold that the general mitigation instruction was sufficient to alert and adequately instruct the jury -with regard to the question of mitigation of damages.
Y
Finally, we address whether the lower court erred by dismissing Appellee’s civil rights action brought pursuant to 42 U.S.C. § 1983 (1988). The claim alleged retaliatory conduct by Appellants after Appellee filed his lawsuit. Appellee argues that Appellants’ retaliation violated his constitutional right of access to the courts. He argues that because his retaliation claim is based on access to courts rather than on freedom of speech, it is not necessary that he meet the “public concern” requirement set forth by Connick v. Myers, 461 U.S, 138, 103 S.Ct. 1684, 75 L.Ed.2d 708 (1983). We disagree and affirm the dismissal of Appellee’s cross-appeal.
Under a Section 1983 claim, Appellee must first show that he engaged in protected activity. San Filippo v. Bongiovanni, 30 F.3d 424, 430-31 (3d Cir.1994). Next, he must show that the protected activity was a substantial factor motivating his denial of tenure. Id. Finally, Appellants may defeat Appellee’s claim by showing that they would have denied him tenure even in the absence of the protected activity. Id.
The general rule to determine if an activity is protected under a Section 1983 claim for retaliation requires that the party alleging “retaliatory discharge from governmental employment ... establish that the conduct which triggered the discharge was protected under the first amendment.” San Filippo, 30 F.3d at 434. When the conduct consists of speech, the court determines whether the speech addresses issues of “public concern,” because a public employer may censure an employee for making public complaints about private matters. Id.; see also Connick, 461 U.S. at 142, 103 S.Ct. at 1687 (balancing the interests of citizen as employee with the interests of state as employer in promoting efficiency of services that public employees perform).
Appellee argues that a lawsuit does not implicate free speech but falls under the right to petition clause of the First Amendment. However, in San Filippo, the court noted that “each circuit court [that has] considered] the issue has held that a public employee who alleges that he or she was disciplined in retaliation for having filed a lawsuit against his or her employer does not state a claim under Section 1983 unless the lawsuit addressed a matter of public concern.” 30 F.3d at 440.
The right to petition, like the right of free speech, is stated in unqualified terms in the First Amendment. It is well accepted that the right of free speech depends on the context of the speech. Connick, 461 U.S. at 146-49, 103 S.Ct. at 1689-91. We do not need to decide whether there may be contexts in which the right to petition protects additional values because the case before us concerns an underlying dispute between an employee of the University and the University. “A private office dispute cannot be constitutionalized merely by filing a legal action.” Altman v. Hurst, 734 F.2d 1240, 1244 n. 10 (7th Cir.1984) (per curiam). However well-taken Appellee’s argument may be, not every lawsuit represents a matter of public concern. The cases Appellee relies on all present matters of public concern. See, e.g., Morfin v. Albuquerque Pub. Schs., 906 F.2d 1434, 1439 (10th Cir.1990) (holding that defendant was not entitled to summary judgment because plaintiffs right to participate in a labor union is protected by the First Amendment); Smith v. Maschner, 899 F.2d 940, 947 (10th Cir.1990) (upholding right of prisoners to file lawsuits); McKay v. Hammock, 730 F.2d 1367, 1375 (10th Cir.1984) (finding summary judgment inappropriate when party deprived of access to courts by sheriffs officers).
We are not concerned with whether the right of access to the courts, i.e., the right to petition, is a fundamental right. The proper question is: When does retaliation by a public employer for the filing of a lawsuit reach constitutional significance such that a claim for relief under Section 1983 is stated. We find that this is a single-plaintiff lawsuit that does not seek pervasive or systemic relief, nor does it call the public’s attention to Appellants’ allegedly unlawful practices. Because we do not find that Appellee successfully showed that his lawsuit represented a matter of public concern, we do not discuss the other prongs of a Section 1983 claim. We hold that the dismissal of Appellee’s Section 1983 claim was appropriate.
VI
In conclusion, we hold that the trial court had jurisdiction to hear this case; that the conduct of Appellee’s counsel did not rise to the level to warrant reversal and a new trial; that the trial court did not abuse its discretion in refusing Appellants’ jury instructions; and that Appellee’s Section 1983 claim was properly dismissed. The judgment of the trial court is affirmed.
IT IS SO ORDERED.
RANSOM and FRANCHINI, JJ., concur. | [
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OPINION
RANSOM, Justice.
This case is before the Court on writ of certiorari to the court of appeals which had affirmed the dismissal of a worker’s compensation claim filed in an improper venue. James Bracken suffered a fatal heart attack at his worksite while performing duties for his employer, Yates Petroleum Corp. It is uncontroverted that the injury occurred in Santa Fe County and that Bracken resided in Lea County. His wife’s first attorney, however, filed her worker’s compensation claim in Bernalillo County approximately 27 days prior to the expiration of the one-year period of limitations. The employer answered that the action must be dismissed for improper venue and under the doctrine of forum non conveniens. Bracken moved the court for a change of venue. The court, however, dismissed the1 complaint for lack of venue. Such a dismissal is not an adjudication on the merits. See SCRA 1986, 1-041(B). It is, nonetheless, a final order for purposes of appeal. See Bralley v. City of Albuquerque, 102 N.M. 715, 699 P.2d 646 (Ct.App.1985).
On appeal, Bracken complains that the court erred by failing to transfer her worker’s compensation claim to a court of proper venue. We consider the argument and authorities relative to the power of the trial court to transfer to a proper venue, but decline to decide the case on that basis. Rather, we enunciate for the first time a rule that the filing of a complaint in.an improper venue tolls the statute of limitations.
The court of appeals affirmed the dismissal based upon NMSA 1978, Section 52-1-37 (Orig.Pamp.) (repealed effective 5/21/86), which provided that workers’ compensation claims “shall be filed * * * within the judicial district wherein the claimant’s injury occurred or where the claimant resides.” The same statute further provided that any change in venue was to be governed by the same statutes, rules and decisions as in other civil cases.
Our venue statute, NMSA 1978, Section 38-3-3 (formerly Orig.Pamp. & Cum.Supp. 1986) (now Repl.Pamp.1987) specifically allows a change in venue:
(1) whenever the judge is interested in the result of the case, or is related to, or has been counsel for any of the parties; or
(2) when the party moving for a change files in the case an affidavit * * * that he believes he cannot obtain a fair trial in the county in which the case is pending * * *.
Neither ground for change of venue is applicable here.
In affirming the dismissal, the court of appeals expressed that it was bound by the precedent of Jones v. New Mexico State Highway Department, 92 N.M. 671, 672, 593 P.2d 1074, 1075 (1979) (citing 1 Moore’s Federal Practice § 0.146[2] at 1660 (2d ed. 1978) (dismissal in federal court for improper venue prior to the enactment of the Judicial Code of 1984)), in which this Court held “[ajbsent a statute giving it such authority, a trial court has no power to change the venue of a misfiled law suit.” The statute in Jones required all actions against state officers to be filed in Santa Fe County. There, the trial court transferred the cause to another county and this Court reversed and remanded with instructions to dismiss.
However, the more recent case of State ex rel. Southern Pacific Transportation Co. v. Frost, 102 N.M. 369, 695 P.2d 1318 (1985), adopts, without statutory authority, an intrastate forum non conveniens doctrine that did not previously obtain at common law. In Frost, pursuant to the Federal Employers’ Liability Act (FELA), an employee filed suit for damages arising out of personal injuries suffered in the county where his employer did business. FELA provided “for venue where the defendant resides, is doing business, or the cause of action arose.” This Court held that the FELA, with its “generous venue provisions, * * * [did] not preclude application of the doctrine of forum non conveniens in the appropriate case.” Id. at 370, 695 P.2d at 1319. Alleging it could not obtain a fair and impartial trial, the employer moved for change of venue and for dismissal based upon the doctrine of forum non conveniens. Although the trial court denied the motions and the court of appeals denied the interlocutory appeal, this Court determined that, based upon the doctrine of forum non conveniens, the case should be transferred to the court of the county in which the accident occurred and where most of the factual connections to the cause of action were located.
We question whether the distinction between proper and improper venue for the initial filing is a meaningful distinction for granting or denying nonstatutory authority to transfer. Jones should be reexamined in light of Frost. See Pribram v. Fouts, 736 P.2d 513 (Okla.1987) (district court has discretionary power to transfer case brought in wrong county to proper forum and, where statute of limitations has run, transfer is desirable to promote justice). We bear in mind that no one questions the jurisdiction of the court to act on the complaint. The objection was to venue only. It is, nonetheless, unnecessary to resolve the question of authority to transfer.
We believe Judge Sutin was correct when, dissenting in Ortega v. Shube, 93 N.M. 584, 603 P.2d 323 (Ct.App.1979), he stated that:
“When these [workers’ compensation] claims were filed, the statutory period of limitation was tolled during their pendency since commencement of an action arrests the running of the applicable statutory period. When plaintiffs’ claims were dismissed * * * they were not dismissed because the district court was without power to adjudicate the claims
The conclusion is that plaintiffs substantially complied with the statutes so as to keep.alive their claims up to the time the claims were filed the second time, notwithstanding more than one year elapsed from the date of the accident to the date of filing the claims * * *.
The period during which the statute is tolled includes the time consumed in an appeal.”
Id. at 588, 603 P.2d at 327. On a separate issue, Ortega had held correctly that, because the Workers’ Compensation Act and Occupational Disablement Law specifically limit commencement of any action or suit to one year, it would not be appropriate to apply NMSA 1978, Section 37-1-14, by which a new suit commenced within six months is deemed a continuation of a prior suit in which plaintiff has failed for any cause. Section 37-1-14 is made inapplicable by Section 37-1-17 to any action or suit limited by separate statute. Accord Estate of Gutierrez v. Albuquerque Police Dep’t, 104 N.M. 111, 717 P.2d 87 (Ct.App.), cert. denied, 103 N.M. 798, 715 P.2d 71 (1986).
Estate of Gutierrez specifically considered the Ortega dissent of Judge Sutin on the issue of whether the two-year statute of limitations contained in the Tort Claims Act, NMSA 1978, Section 41-4-15, was tolled during the pendency of an action in which the Albuquerque Police Department and the Bernalillo County Detention Center had been named defendants in a claim pendent to a civil rights action in federal court. When the pendent state claims were dismissed without prejudice, plaintiff filed suit in state district court.
Plaintiff urges this court to adopt Judge Sutin’s reasoning in this case, but cites this court to no supporting authority for its argument. In fact, plaintiff directs this court to King v. Lujan, 98 N.M. 179, 646 P.2d 1243 (1982), where the New Mexico Supreme Court held that a dismissal without prejudice for failure to prosecute, “operates to leave the parties as if no action had been brought at all.” Id. at 181, 646 P.2d 1243. Plaintiff reasons that because there was no failure to prosecute in this case, the statute of limitations was tolled during the pend-ency of this suit in federal court. This is contrary to the established rule in federal and state courts. See Dupree v. Jefferson, 666 F.2d 606 (D.C.Cir.1981); Diebold Contract Services v. Morgan Drive Away, Inc., 95 N.M. 9, 617 P.2d 1330 (Ct.App.1980). In Diebold, this court quoted the “correct rule” contained in 51 AmJur. Limitations of Actions § 311:
In the absence of statute, a party cannot deduct from the period of the statute of limitations applicable to his case the time consumed by the pendency of an action in which he sought to have the matter adjudicated, but which was dismissed without prejudice to him.
Diebold, 95 N.M. at 12, 617 P.2d at 1333.
Id., 104 N.M. at 115, 717 P.2d at 91. We disagree. In Otero v. Zouhar, 102 N.M. 482, 697 P.2d 482 (1985), this Court criticized procedural anomalies such as the strict holding in Swallows v. City of Albuquerque, 61 N.M. 265, 298 P.2d 945 (1956), that the period during pendency of appeal does not toll the statute of limitations. It is the criticized holding in Swallows that was relied upon by the majority in Ortega. Estate of Gutierrez failed to recognize the previous year’s holding by this Court in Otero.
“When a lawsuit is filed, that filing shows a desire on the part of the plaintiff to begin his case and thereby toll whatever statutes of limitation would otherwise apply. The filing itself shows the proper diligence on the part of the plaintiff which such statutes of limitation were intended to insure.” Goldlawr, Inc. v. Heiman, 369 U.S. 463, 467, 82 S.Ct. 913, 916, 8 L.Ed.2d 39 (1962); see Burnett v. New York Central R.R. Co., 380 U.S. 424, 434-35, 85 S.Ct. 1050, 1057-58, 13 L.Ed.2d 941 (1965) (limitation provision deemed tolled despite absence of “saving” statute where general policy of Congress and the states has been to prevent timely actions brought in improper venues from being time barred, id. at 431 nn. 8 and 9, 85 S.Ct. at 1056 nn. 8 & 9, and in view of the humanitarian purpose of workers’ compensation legislation (FELA)); see also 54 C.J.S. Limitations of Actions § 219, p. 290 nn. 38, 42-43 (1987). ‘ Although Goldlawr addressed the issue under the federal venue statute allowing for transfer of a misfiled case, the rationale enunciated is nevertheless applicable to our holding here.
Because of the applicability of transfer-of-venue statutes or saving statutes (such as NMSA 1978, Section 37-1-14) the tolling issue is seldom considered on a separate public policy basis. The “general” rule that, in the absence of statute, filing of an action in an improper venue does not toll the statute of limitations, is hardly a much applied rule. To the contrary, Texas has held simply that because the Texas Tort Claims Act provision that cases shall be instituted in the county in which the action arises is a venue provision, not a jurisdiction provision, the filing of suit in an improper venue tolls the statute of limitations. Brown v. Owens, 674 S.W.2d 748 (Tex.1984). Using other rationale, a Florida court has held that, for application of the statute of limitations, the filing of a complaint in a proper venue following dismissal in an improper venue is to be treated as an amended complaint. Colin v. State Dep’t of Transp., 423 So.2d 1020 (Fla.Dist.Ct.App.1982).
Therefore, in light of the foregoing, we hold that the one-year statute of limitations under the Workers’ Compensation Act was satisfied by the diligent filing of the complaint. The statutory period of limitations has been tolled during the pendency of this action, including the time consumed on appeal. To the extent that Diebold, Ortega and Estate of Gutierrez or any precedent of this Court enunciates a different rule, those precedents are hereby overruled.
Upon entry of the final order on remand from this appeal, the plaintiff shall have the remainder of the one-year statute of limitations, twenty-seven days, more or less, in which to file her complaint in a proper venue.
IT IS SO ORDERED.
SOSA, Senior Justice, and STOWERS, J., concur.
WALTERS, J., specially concurring.
SCARBOROUGH, C.J., joining in special concurrence.- | [
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] |
OPINION
FRUMAN, Judge.
Defendant appeals his conviction for second degree murder. The issues raised on appeal are addressed in the sequence presented by defendant. The issues raised in defendant’s docketing statement, but not briefed, are deemed abandoned. State v. Romero, 103 N.M. 532, 710 P.2d 99 (Ct. App.1985). We affirm.
In March 1986, defendant was stopped on Interstate 40 in Quay County by New Mexico State Police Officer Sherman Toler (Toler). Defendant’s car was loaded with personal possessions because he was moving from California to Missouri; he was accompanied by his common-law wife. Toler issued a warning ticket for speeding and proceeded to search the car. Although the circumstances are in dispute, it is clear that a fight developed, and Toler was fatally injured. Defendant turned himself in to authorities and was charged with first-degree murder, contrary to NMSA 1978, Section 30-2-1 (Repl.Pamp.1984).
After a jury trial in November 1986, the state filed a supplemental criminal information alleging that defendant had two prior felony convictions. Finding these allegations to be true and also finding aggravating circumstances “in that the defendant used excessive force and needless brutality,” defendant was sentenced to a basic term of twelve years, together with a one-year enhancement pursuant to the jury find ing that defendant used a firearm in committing the offense, and a four-year enhancement pursuant to the habitual offender statute, for a total of seventeen years.
Defendant contends on appeal that late production of certain evidence, as well as non-disclosure of other evidence, denied defendant due process, a fair trial, and effective assistance of counsel. Defendant also contends that the prosecutor’s exercise of peremptory challenges to exclude Hispanic venire members denied him equal protection, due process, a fair trial, and effective assistance of counsel. Defendant further contends that the admission of testimony concerning the circumstances of that conviction deprived him of due process and a fair trial. Finally, defendant contends that the trial court erred in enhancing his sentence for use of a firearm after having aggravated the basic sentence by the maximum amount. Defendant also argues the existence of cumulative error. For the reasons that follow, we hold that there has been no reversible error.
A. Whether the prosecutor’s nondisclosure of defendant’s personal papers until several days prior to trial, in violation of specific orders to produce, denied him due process, a fair trial, and effective assistance of counsel.
At the time of his arrest, defendant had numerous personal papers in his vehicle. Despite several attempts and court orders to have the prosecutor produce those papers, they were not returned to defendant until several days before trial. Defendant claims these papers were essential to help him identify and secure witnesses as to his good character and character for peacefulness, and because of the untimely production of his papers, defendant was not able to do so.
Defendant has cited State v. Lovato, 94 N.M. 780, 617 P.2d 169 (Ct.App.1980), in support of his argument that the prejudice resulting from the untimely production of his personal papers requires the reversal of his conviction. Lovato was distinguished in State v. Sandoval, 99 N.M. 173, 655 P.2d 1017 (1982). In State v. Sandoval, the court held that to determine prejudice where the state initially deprives defendant of the evidence but later produces the evidence, the reviewing court should consider whether the failure to timely disclose the evidence was cured by the trial court. The Sandoval distinction applies in the instant case. Here, the evidence was not destroyed as was the situation in Lovato; rather, defendant’s personal papers were delivered to his counsel shortly before trial. Thus, the decisive issue is whether the untimely production of defendant’s papers was cured by the trial court. State v. Sandoval.
During voir dire, defendant moved for a continuance to make use of his personal papers. In denying the motion, the trial court stated that it would consider a several day recess if, during trial, good cause was presented by defendant. Defendant did not seek a recess during trial. We view this inaction as a cure of any prejudice that may have resulted from the untimely production. See id. We also view defendant’s inaction as a waiver of any claim that the trial court abused its discretion in not granting a continuance. Cf. State v. Johnson, 91 N.M. 148, 571 P.2d 415 (Ct.App. 1977).
In his reply brief, defendant claims that he made sufficient offers of proof of the testimony of material witnesses he was unable to call at trial. However, this testimony related to the character of the victim rather than to defendant’s character, and thus is not related to the production of defendant’s personal papers. Secondly, defendant's reference to the complex procedural requirements of NMSA 1978, Section 31-8-2 (Repl.Pamp.1984) applies to summoning witnesses from this state to appear in another state and does not apply to the converse situation found here.
Furthermore, defendant claimed that he was deprived of a fair trial, in part, on the ground that the lack of access to this material precluded him from locating “the names, current addresses and telephone numbers of * * * good character witness es.” The prejudice part of the test enunciated in State v. Sandoval requires the court to assess whether the omitted evidence created a reasonable doubt that otherwise did not exist. Defendant’s claim did not create such a doubt, in the absence of evidence that particular witnesses as to character could not be located without access to the exhibit. Until defendant indicated with greater specificity what might have been proved, the trial court was not in a position to evaluate the relevance and import of the nonproduction. Cf. State v. Quintana, 86 N.M. 666, 526 P.2d 808 (Ct. App.1974) (holding that before a defendant could be prejudiced, the testimony of an omitted witness must be shown to be important and critical, not merely technical or cumulative).
B. Whether the prosecutor’s nonproduction of Officer Toler’s daily logs until several weeks prior to trial, in violation of specific orders to produce, denied defendant due process, a fair trial, and effective assistance of counsel.
Defendant sought to obtain Toler’s daily logs to determine whether he could discover witnesses regarding Toler’s character for violence during routine traffic stops. After several attempts and court orders to have the prosecutor produce these logs, they were delivered to defendant approximately three weeks prior to trial. Defendant asserts that this delay prevented him from securing the presence at trial of at least four out-of-state witnesses regarding Toler’s character.
The record discloses the following. Approximately two weeks before trial, defendant filed his list of intended trial witnesses. The names and addresses of three of those four out-of-state witnesses were set forth on that list. One of these three witnesses was contacted by defendant approximately five months before trial. Defendant supplemented his witness list several days before trial. The supplement contained the name and address of the fourth witness. The trial court ordered payment of the expenses of all of defendant’s witnesses several days prior to trial. A subpoena for at least one of these character witnesses was issued by the court clerk two weeks before trial.
Prior to trial, defendant sought a continuance because of the late production of the daily logs. In denying the motion, the trial court stated that defendant had sufficient time to utilize the logs. Following trial, defendant sought a new trial, claiming an inability to secure the appearance of the out-of-state witnesses as to Toler’s character because of the late production of the logs. Defendant does not assign error to the denial of his motion for continuance. Rather, defendant maintains he was prejudiced by the late production of the logs because he was therefore unable to obtain the presence of these character witnesses.
We observe that in seeking a continuance to secure the appearance of an absent witness, a party must show that it has used due diligence to obtain the witness' testimony. See State v. Case, 100 N.M. 714, 676 P.2d 241 (1984); State v. Perez, 95 N.M. 262, 620 P.2d 1287 (1980); State v. Haddenham, 93 N.M. 394, 600 P.2d 846 (Ct.App.1979). See also NMSA 1978, § 31-8-3 (Repl.Pamp.1984). Defendant did not make such a showing in requesting the continuance. Also, defendant has not claimed that he advised the trial court, during trial, either that his subpoenaed witnesses were unable or unwilling to appear or that a continuance would have enabled him to secure their appearance. Accordingly, defendant failed to preserve his claim of prejudice regarding the untimely disclosure of the daily logs. See State v. Case. Cf. State v. Hoxsie, 101 N.M. 7, 677 P.2d 620 (1984) (an assertion of prejudice is not equivalent to a showing of prejudice).
We recognize that under some circumstances no more prejudice need be shown than that a line of defense was frustrated by court order. See State v. Orona, 92 N.M. 450, 589 P.2d 1041 (1979). On these facts, however, we cannot conclude that the late production prevented defendant from obtaining witnesses as to the victim’s character. Thus, we hold that defendant has not demonstrated reversible error in this issue. But cf. State v. Slayton, 90 N.M. 447, 564 P.2d 1329 (Ct.App.1977).
C. Whether the intentional nondisclosure by the prosecutor of a conversation between defendant and an escorting officer, in violation of trial court orders, denied defendant due process, a fair trial, and effective assistance of counsel.
While being transported to court several days before trial, defendant discussed his training and experience in karate with his escorting officer. The officer reiterated this conversation to the prosecutor, who did not disclose the conversation to defendant’s counsel. Questions relating to the context of this conversation were asked of defendant during his cross-examination at trial by the prosecutor. As defendant did not object to those questions, and did not alert the trial court that his objection would have been based on the prosecutor’s nondisclosure of the conversation that provided the source of those questions, this issue cannot be considered when raised for the first time on appeal; nor may defendant complain on appeal that he was prejudiced by testimony which he allowed to be interjected into the case. See State v. Gutierrez, 91 N.M. 54, 570 P.2d 592 (1977). See also State v. Quintana.
D. Whether racial discrimination, as inferred by the prosecutor’s exercise of peremptory challenges to exclude Hispanic members of the venire from serving on the jury, denied defendant equal protection, due process, a fair trial, and effective assistance of counsel.
Prior to trial, defendant moved to require the prosecutor to state reasons for exercising peremptory challenges in a racially discriminatory fashion against Hispanic venire members. The motion was denied. During jury selection, defendant renewed the motion following the prosecutor’s exercise of his first peremptory challenge against a Hispanic-surnamed member of the venire. The renewed motion was denied. The prosecutor then exercised five more peremptory challenges against Hispanic-surnamed members of the venire. The final trial jury panel, including the alternates, did have several members with Hispanic surnames.
Defendant, who is black, contends that the prosecutor’s exercise of peremptory challenges to remove most Hispanic-surnamed members of the venire denied him certain rights, requiring reversal of his conviction.
In State v. Sandoval, 105 N.M. 696, 736 P.2d 501 (Ct.App.1987), this court applied the standards set forth in Batson v. Kentucky, 476 U.S. 79, 106 S.Ct. 1712, 90 L.Ed. 2d 69 (1986), for reviewing a claim that a prosecutor has used peremptory challenges to purposefully discriminate against and exclude members of a defendant’s racial group from the jury. In Batson, the Supreme Court held that a defendant may establish a prima facie case of purposeful discrimination in the selection of a trial jury solely on the evidence in his own proceeding concerning the prosecutor’s exercise of peremptory challenges. To establish that case, the defendant must show, in part, that the prosecutor has exercised those challenges to remove members of the defendant’s race. Once defendant has shown a substantial underrepresentation of his racial group, he has made out a prima facie case of discriminatory purpose, and the burden then shifts to the state to rebut that case. State v. Sandoval. Here defendant did not show a substantial under-representation of his racial group and, thus, failed to meet his burden in establishing a prima facie case of discrimination.
Defendant further argues that the prosecutor’s peremptory challenges of most Hispanic members of the venire deprived him of his sixth amendment right to a jury comprised of a fair cross section of the community where his trial was held. Defendant cites Fields v. People, 732 P.2d 1145 (Colo.1987) (en banc), in support of this proposition.
Without deciding whether Fields is applicable in this state, we note that under Fields, a defendant can establish the prima facie case of a sixth amendment claim “by showing that the persons excluded are members of a cognizable group for purposes of the fair cross-section requirement and that considering all the circumstances of the case there is a strong likelihood that the jurors were excused solely because of their membership in the group.” 732 P.2d at 1156.
In the present case, had defendant been convicted of committing murder in the first degree, the crime with which he was charged, the jurors wpuld have had to vote on whether to impose the death penalty. On voir dire, each Hispanic-surnamed individual who was excused by the prosecutor’s peremptory challenge expressed a reservation, to some degree, about his or her ability to vote for that penalty. Defendant contends, however, that several non-Hispanics who expressed similar reservations were not excused by the prosecutor. Even so, because of the existence of these other factors, defendant has failed to demonstrate that the Hispanic-surnamed venire members were excused solely because of their membership in that group as required by Fields. Therefore, defendant’s reliance on Fields is misplaced.
E. Whether the admission of defendant’s prior 1974 conviction denied him due process and a fair trial.
1. Probative value versus prejudicial effect.
In 1974, defendant was convicted of assault with a deadly weapon upon a peace officer. Defendant moved to exclude all testimony regarding this conviction. The trial court denied the motion and ruled that it would permit testimony only as to the fact and date of the conviction and the title of the underlying crime. It further ruled that this limited testimony would be admitted only in the event defendant did testify and, in that event, for the sole purpose of impeaching defendant. See SCRA 1986, UJI 14-5022.
Defendant makes several arguments as to why the admission of this conviction denied him due process and a fair trial. Inherent in each argument is defendant’s further argument that the probative value of this evidence was outweighed by its prejudicial effect, and thus the evidence should have been excluded.
Defendant first contends that as dishonesty was not an element of the 1974 crime, it was not appropriate for the purpose of impeachment. Even so, SCRA 1986, 11-609(A)(1) permits the introduction of a prior felony conviction to attack credibility, regardless of whether dishonesty was an element of that felony. State v. Lucero, 98 N.M. 311, 648 P.2d 350 (Ct.App. 1982).
Secondly, defendant contends that because of the similarity between the 1974 crime and the offense in this cáse, there is a clear danger that the earlier crime will prejudice or confuse the jury. However, Rule 11-609 does not prohibit evidence of a prior offense on the basis of its similarity with the presently charged offense. Rather, the question relating to the admissibility of a prior similar offense is whether the decision of the trial court was an abuse of its discretion. Id. This question will be addressed below.
Defendant then argues that the 1974 crime should have been excluded because he also had been previously convicted of three dissimilar crimes and they were admissible for impeachment purposes. Again, Rule 11-609 does not prohibit evidence of a prior conviction for a similar crime when evidence of prior convictions for dissimilar crimes is also available, and again, in such a situation, the question relating to the admissibility of the prior similar crime is whether the trial court abused its discretion when ruling on the admissibility. See State v. Day, 91 N.M. 570, 577 P.2d 878 (Ct.App.1978), cert. denied, 449 U.S. 860, 101 S.Ct. 163, 66 L.Ed.2d 77 (1980); State v. Sibold, 83 N.M. 678, 496 P.2d 738 (Ct.App.1972).
We now turn to the question of whether the trial court abused its discretion in allowing the admission of evidence of defendant’s 1974 conviction. The focus of this question is whether the trial court properly determined that the probative value of the prior conviction outweighed its prejudicial effect against defendant. See SCRA 1986, 11-403 and -609(A)(1). See also State v. Day (discussing the relationship between former Evidence Rules 403 and 609). If the trial court’s ruling is clearly against the logic and effect of the facts and circumstances of the case, its exercise of discretion in admitting the evidence was abused. See State v. Lucero.
The fact that the admission of evidence of a prior conviction may prejudice a defendant to some extent does not mean that the probative value of the evidence has been outweighed. See State v. Hogervorst, 90 N.M. 580, 566 P.2d 828 (Ct.App.1977). When evaluating the probative value of such evidence, consideration must be given to the fact that the supreme court’s adoption of Evidence Rule 11-609 is tantamount to a determination by that court that such evidence does bear on the issue of credibility. See State v. Lucero. See also SCRA 1986, UJI 14-5022. In addition, where evidence is admissible under any particular theory, the decision to admit it will generally be upheld, see State v. Ballinger, 99 N.M. 707, 663 P.2d 366 (Ct.App.1983), rev’d on other grounds, 100 N.M. 583, 673 P.2d 1316 (1984), regardless of whether the appellate court would have reached the same conclusion regarding its admissibility. See Edington v. Alba, 74 N.M. 263, 392 P.2d 675 (1964).
In deciding whether the probative value of evidence of defendant’s 1974 crime, admissible under Rule 11-609(A)(1) for impeachment purposes, outweighed its potential for unduly prejudicing the defendant, the trial court did evaluate the various factors set forth in State v. Lucero as they apply to the circumstances of the case. Our own evaluation of these factors follows.
There is a certain similarity between the crime of assault with a deadly weapon upon a peace officer and the crime of murdering a peace officer with a firearm. Because of the similarity, the possibility does exist that the introduction of evidence of that prior crime will have at least some prejudicial impact against defendant. However, Rule 11-609 inherently recognizes that evidence of a defendant’s criminal history has the potential for creating prejudice, but this potential, by itself, does not render the evidence inadmissible. State v. Garcia, 80 N.M. 21, 450 P.2d 621 (1969).
Defendant’s testimony regarding the events which led to his shooting of Officer Toler was crucial to his defense. Defendant’s version conflicted with that of the state’s witnesses. Thus, defendant’s credibility as a witness was placed in issue and subject to impeachment. Cf. State v. Duran, 83 N.M. 700, 496 P.2d 1096 (Ct.App. 1972) (a decision based upon this common law proposition, prior to the adoption of the Rules of Evidence in 1973). Defendant cites various cases to support his contention that the prejudicial effect of admitting his 1974 conviction for impeachment purposes outweighed its probative value. Several of his authorities are not applicable because they are based upon the additional “exceptional circumstances” requirement for admission as set forth in the Federal Rule of Evidence 609 but which is not present in New Mexico’s Evidence Rule 11-609. Several include the situation where the defendant chose not to testify because his prior convictions may have been admissible, or the situation where the “former conviction” arose out of the same events as those being tried. Defendant’s remaining authorities present guidelines similar to those in State v. Lucero for examining the probative value of a prior conviction.
The trial court conducted a careful review of the Lucero guidelines as they applied to defendant’s case. The trial court then determined that the probative value of defendant’s 1974 conviction, for impeachment purposes only, outweighed its preju dicial effect and permitted its narrowly limited admission. Based upon our review, we cannot say that the trial court’s decision was contrary to the logic and effect of the facts and circumstances of this case. See, e.g., United States v. Givens, 767 F.2d 574 (9th Cir.), cert. denied, 474 U.S. 953, 106 S.Ct. 321, 88 L.Ed.2d 304 (1985) (probative value of prior robbery and armed robbery convictions outweighed their prejudicial effect where defendant’s credibility in armed robbery trial was directly at issue); United States v. Fountain, 642 F.2d 1083 (7th Cir.), cert. denied, 451 U.S. 993, 101 S.Ct. 2335, 68 L.Ed.2d 854 (1981) (no error where trial court knew of and applied balancing factors and did not decide mechanically); United States v. Stewart, 581 F.2d 973 (D.C.Cir.1978) (where there was a direct conflict in testimony, it was of paramount importance for jury to have all information to assess credibility); United States v. Lamb, 575 F.2d 1310 (10th Cir.), cert. denied, Clary v. United States, 439 U.S. 854, 99 S.Ct. 165, 58 L.Ed.2d 160 (1978) (where credibility was a central issue, prior convictions were admissible when the trial court carefully weighed their impeachment value against their prejudicial effect); United States v. Hawley, 554 F.2d 50 (2d Cir.1977) (where defendant asserted the increased prejudice because of the similarity between his prior conviction and the charged offense, there was no reason to assume that the trial court incorrectly considered this factor).
Because of the foregoing, we hold that the trial court did not abuse its discretion in admitting evidence of defendant’s 1974 conviction.
2. Remoteness in time.
Defendant also contends that his 1974 conviction was not admissible because of the time limitation set forth in Rule 11-609(B). This rule does prohibit the admission of evidence of a conviction “if a period of more than ten (10) years has elapsed since the date of the * * * release of the witness from the confinement imposed for that conviction.”
Defendant was confined in the Central Institute for Men in California because of his 1974 conviction. On September 13, 1976, he was transferred to the Central City Community Center, which defendant describes as a halfway house. On November 20, 1976, defendant was released on parole. Trial in this cause commenced November 5,1986, and defendant testified two days later.
Defendant asserts that his release on September 13, 1976, to the halfway house constituted a release from confinement for the 1974 conviction. Defendant thus contends that the ten-year period of admissibility elapsed about two months prior to his trial and, therefore, proof of the earlier conviction was barred.
In California, a “person is deemed confined in a ‘state prison’ if he is confined in any of the prisons and institutions specified in Section 5003.” Cal.Penal Code § 4504(a) (West 1982). The provisions of Section 5003 include “(q) Such other institutions and prison facilities as ... the Director of Corrections may be authorized by law to establish.” Cal.Penal Code § 5003(q) (West 1982). The Director is authorized to “establish and operate facilities to be known as community correctional centers.” Cal.Penal Code § 6250(a) (West Cum.P.P. 1987).
It appears reasonable to conclude that the Central City Community Center is a community correctional center. Since defendant was not released from that center until November 20, 1976, the ten-year period of admissibility of his 1974 conviction pursuant to Rule 11-609(B) had not expired as of the date defendant testified in this trial.
Defendant’s arguments regarding Cal. Penal Code § 2900.5 (West 1982) are not germane because that section relates only to the award of credit for time spent in custody prior to the commencement of a sentence rather than to the meaning of “confinement.”
F. Whether the trial court erred in allowing testimony concerning the circumstances behind defendant’s 1974 conviction, thereby depriving him of due process and a fair trial.
Defendant shot Officer Toler with the officer’s own service revolver. As part of his defense, defendant presented a witness who testified about and demonstrated the difficulty of removing a revolver from Officer Toler’s service holster. The state later presented the testimony of Officer Owens as rebuttal.
Officer Owens was involved in the incident that led to defendant’s 1974 conviction. While he did not mention the fact of that conviction, Owens testified that defendant had obtained the revolver of Owens’ police partner, who was also involved in the incident. Owens did not know how defendant had obtained the weapon, but stated that his partner’s holster was similar to Toler's. Owens also testified that defendant had pointed that revolver at his head.
Defendant sought to exclude Owens’ testimony, claiming that it would create unfair prejudice against him. See Rule 11-403, which permits the exclusion of relevant evidence when it is found to be more prejudicial than probative. The trial court determined that the testimony was relevant with regard to defendant’s prior knowledge and use of a holster similar to Toler’s, as well as to defendant’s opportunity and motive, and that the testimony had more probative weight than prejudicial effect. Thus, Owens was allowed to testify.
Under some circumstances, relevant evidence of other wrongs or acts to prove knowledge, opportunity, and motive is admissible. See State v. Ross, 88 N.M. 1, 536 P.2d 265 (Ct.App.1975). Admission is permitted when the trial court finds the evidence relevant to a disputed issue other than a defendant’s character. See State v. Beachum, 96 N.M. 566, 632 P.2d 1204 (Ct. App.1981). If such relevancy is found, the trial court must then weigh the prejudicial effect of the evidence of other wrongs or acts against its probative value. Id. Following that, the decision on whether to admit the evidence is a matter addressed to the sound discretion of the trial court and will be upheld absent an abuse of that discretion. State v. Smith, 92 N.M. 533, 591 P.2d 664 (1979). See also State v. Hargrove, 81 N.M. 145, 464 P.2d 564 (Ct.App.1970).
The fact that Owens’ testimony may have had some prejudicial effect does not require its exclusion. See State v. Hogervorst. The testimony was relevant and probative of the issues stated by the trial court and initially raised by defendant. The similarity between the 1974 incident and the incident in this case does not justify a finding that the trial court abused its discretion in admitting Owens’ testimony, see State v. Allen, 91 N.M. 759, 581 P.2d 22 (Ct.App.1978), and we will not hold otherwise.
G. Whether the trial court exceeded its statutory authority and deprived defendant of due process by imposing a special “use of firearm” alteration of the basic sentence, consecutive to the maximum general alteration for aggravating circumstances.
Defendant was sentenced to a term of nine years for his conviction of second-degree murder. Upon determining that aggravating circumstances existed in the commission of the crime, the trial court enhanced that term by one-third, or three years, pursuant to NMSA 1978, Section 31-18-15.1(C) (Repl.Pamp.1987), and then imposed a one-year consecutive sentence for defendant’s use of a firearm in the commission of a felony, pursuant to NMSA 1978, Section 31-18-16 (Repl.Pamp.1987).
Defendant argues that the trial court exceeded its sentencing authority by imposing the one-year sentence for firearm use. because Section 31-18-15.1(0) provides that “in no case shall the alteration exceed one-third of the basic sentence.” We read the words “the alteration” as applying to the alteration of the basic sentence only where mitigating or aggravating circumstances surround the offense or concern the offender. This statute specifically precludes the fact that a firearm was used from the trial court’s determination that aggravating circumstances exist.
Defendant was charged with the use of a firearm in the murder of Officer Toler, and the jury found that he did use a firearm in committing that crime. In this regard, we read Section 31-18-16 as providing a separate and distinct basis for further altering defendant’s basic sentence in addition to the alteration permitted by Section 31-18-15.1; the language and requirements of each statute are totally independent of the other. See, e.g., State v. Reaves, 99 N.M. 73, 653 P.2d 904 (Ct.App.1982).
As the sentences required by each of these statutes are mandatory upon the trial court, see State v. Mayberry, 97 N.M. 760, 643 P.2d 629 (Ct.App.1982), we hold that the trial court did not exceed its sentencing authority.
H. Whether cumulative error denied defendant equal protection, due process, a fair trial, and effective assistance of counsel.
Defendant argues that, in the aggregate, the assignment of errors he has raised on appeal denied him his right to a fair trial. We have addressed his claims on appeal and have found either that no errors were committed or that insufficient prejudice was established at trial or on appeal to support a conclusion that he was denied a fair trial. See State v. Martin, 101 N.M. 595, 686 P.2d 937 (1984); State v. McGuinty, 97 N.M. 360, 639 P.2d 1214 (Ct.App.1982); State v. Vallejos, 86 N.M. 39, 519 P.2d 135 (Ct.App.1974). The doctrine of cumulative error has no application where no errors were committed and where defendant has received a fair trial. State v. Taylor, 104 N.M. 88, 717 P.2d 64 (Ct.App. 1986). Thus, we rule against defendant on this issue.
Defendant’s conviction, judgment and sentence are affirmed.
IT IS SO ORDERED.
ALARID, J., concurs.
MINZNER, J., concurs specially.
. In so holding, Batson modified the earlier ruling in Swain v. Alabama, 380 U.S. 202, 85 S.Ct. 824, 13 L.Ed.2d 759 (1965), under which a defendant was required to show systematic ex-elusion of jurors based upon race from facts beyond those in his own case. See State v. Sandoval. | [
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] |
OPINION
BIVINS, Judge.
The state appeals a district court order suppressing all evidence seized pursuant to a search warrant. The sole issue is whether the district court erred in its determination that the search warrant issued constituted a general search warrant and, therefore, violated the fourth amendment to the United States Constitution. We hold that where the complexity of the criminal investigation requires piecing together a number of items of evidence that may not appear incriminating when taken alone, the fourth amendment prohibition against unreasonable searches and seizures must be applied with a practical margin of flexibility. When so applied here, we determine the search warrant proper and reverse.
The affidavit for search warrant, made by an undersheriff, recites that the Tatum police received information that defendant, the owner of Chaveroo Supply, Inc. (Chaveroo), an oil field supply business, had purchased a large quantity of new connections from a roustabout at a fraction of their retail value (11%). Defendant paid for these items by check. It further states that the roustabout had confessed to stealing the connections from Phillips Petroleum Company. The affidavit continues that defendant’s knowledge of the value of new connections, coupled with the small amount paid to someone who would not be expected to own a large quantity of new connections, suggested that defendant knew the items had been stolen.
The affidavit also recites that the criminal investigation had been initiated based on statements of an employee of Chaveroo, who had seen a list of the connections purchased from the roustabout. The list was in defendant’s handwriting and showed the retail value, wholesale value, and the amount paid. The employee provided a photocopy of the list. The Chaveroo employee stated that the connections had been “placed into the new stock and posted into company inventory cards by Earl Jones,” the defendant. The employee said that, during the seven years he worked at Chaveroo, defendant had purchased stolen oil field connections so many times from different sources that the employee could not even estimate the number. He also said that information as to stolen items would be posted in red ink, whereas information concerning items acquired through legitimate sources would be posted in black ink and would include a purchase order number or invoice number. The employee said defendant had told him that no one could ever prove he bought stolen property because of the way his business was “set up.”
Based on this information, a magistrate issued a search warrant for “Chaveroo Supply [sic] invoices, inventory cards, checkbooks, bank records to include can-celled checks, and any other records that show items bought or sold in the operation of Chaveroo Supply Company.” The search warrant was not limited to time. Acting under this search warrant, the sheriff seized business records of Chaveroo. Defendant moved to suppress all evidence seized by the state.
The fourth amendment provides that “no Warrants shall issue, but upon probable cause ... and particularly describing the ... things to be seized.” This appeal concerns the particularity requirement. The fourth amendment, made applicable to the states through the fourteenth amendment, prohibits states from using general search warrants that do not describe with particularity the things to be seized. Stanford v. Texas, 379 U.S. 476, 85 S.Ct. 506, 13 L.Ed. 2d 431 (1965). “The requirement that warrants shall particularly describe the things to be seized makes general searches under them impossible and prevents the seizure of one thing under a warrant describing another. As to what is to be taken, nothing is left to the discretion of the officer executing the warrant.” Marron v. United States, 275 U.S. 192, 196, 48 S.Ct. 74, 76, 72 L.Ed. 231 (1927). This requirement is aimed at preventing “general, exploratory rummaging in a person’s belongings.” Coolidge v. New Hampshire, 403 U.S. 443, 467, 91 S.Ct. 2022, 2038-2039, 29 L.Ed.2d 564 (1971).
The Supreme Court has, however, recognized that a complex criminal investigation may require piecing together “[l]ike a jigsaw puzzle” a number of items of evidence that may not appear incriminating when taken alone. Andresen v. Maryland, 427 U.S. 463, 481, n. 10, 96 S.Ct. 2737, 2748-2749, 49 L.Ed.2d 627 (1976). “The complexity of an illegal scheme may not be used as a shield to avoid detection when the State has demonstrated probable cause to believe that a crime has been committed and probable cause to believe that evidence of this crime is in the suspect’s possession.” Id.
We hold that the state has demonstrated probable cause to believe defendant was engaged in criminal activity and probable cause to believe that evidence of the crime was in defendant’s possession. Based on the roustabout’s statement that he sold stolen equipment to defendant at a greatly reduced price and an employee’s statement that defendant purchased stolen equipment on numerous occasions, the affidavit provided probable cause to believe defendant had committed the crime of receiving stolen property. Based on the employee’s statement that defendant kept track of the stolen equipment by making entries into his inventory records, probable cause existed to believe that defendant’s business records contained evidence of defendant having received stolen property.
As the court in United States v. Wuagneux, 683 F.2d 1343, 1349 (11th Cir.1982), cert. denied, 464 U.S. 814, 104 S.Ct. 69, 78 L.Ed.2d 83 (1983), noted: “It is universally recognized that the particularity requirement must be applied with a practical margin of flexibility, depending on the type of property to be seized, and that a description of property will be acceptable if it is as specific as the circumstances and nature of activity under investigation permit.” We believe the case before us meets that criteria.
Because of the complexity of defendant’s scheme, it was not possible to identify which particular documents contained evidence of criminal activity. Statements by defendant’s employee demonstrate that records containing evidence of criminal activity were inseparably mixed with inventory records of legitimate business transactions. Under the circumstances it would have been practically impossible for officials to describe the incriminating documents with greater specificity than provided in the search warrant. Moreover, defendant himself had bragged about the difficulty anyone would encounter in trying to prove he had bought stolen property, because of the measures he had taken to avoid detection.
Defendant argues that the search warrant could and should have described the items with far more specificity. We disagree. First, to limit the search warrant to inventory cards marked with red ink, as defendant suggests, would be meaningless. The criminal nature of the records could be shown only by comparing the inventory cards written in red ink with the legitimate cards written in black ink. The affidavit recites that defendant paid eleven percent of value for the stolen property. In order to demonstrate this, it would be necessary to compare the stolen inventory items with similar items in the legitimate inventory. A similar comparison would be required as to the sources of acquisition.
Nor would it have been reasonable to limit the search warrant only to documents from specific dates and periods of time. The employee stated to the affiant that defendant had bought stolen property and integrated it into his inventory so many times during the employee’s seven years of employment that he could not estimate the number of occasions. Under these circumstances, it would not be reasonable to identify every instance where a specific illegal purchase took place. See State v. Kornegay, 313 N.C. 1, 326 S.E.2d 881 (1985) (unreasonable to believe bookkeeper informant could recall and identify each document in long-standing fraud scheme).
Defendant relies on cases that have held that all business records may not be seized unless there is probable cause to believe the entire business is a criminal enterprise. See, e.g., Williams v. Kunze, 806 F.2d 594 (5th Cir.1986); United States v. Kail, 804 F.2d 441 (8th Cir.1986); Voss v. Bergsgaard, 774 F.2d 402 (10th Cir.1985); United States v. Hershenow, 680 F.2d 847 (1st Cir.1982); United States v. Roche, 614 F.2d 6 (1st Cir.1980). Since the search warrant does not authorize seizure of all of Chaveroo’s business records, defendant’s reliance on these cases is misplaced. As noted by the state, the search warrant was restricted as to the records to be seized, and did not permit seizure of other records dealing with matters such as personnel, payroll, taxes, insurance, worker’s compensation or social security. The cases cited by defendant do not apply.
We hold that the search warrant described the items to be seized with sufficient specificity, given the circumstances and nature of the criminal activity being investigated. Because of the complexity of the illegal scheme, we apply the particularity requirement with a practical margin of flexibility, taking into account the manner in which defendant allegedly set up the scheme and the nature of the seized items. Our holding accords with cases that have considered similar search warrants. See, e.g., United States v. Sawyer, 799 F.2d 1494 (11th Cir.1986), cert. denied sub nom., 479 U.S. 1069, 107 S.Ct. 961, 93 L.Ed. 2d 826 (1987); United States v. Wuagneux; United States v. Timpani, 665 F.2d 1 (1st Cir.1981); State v. Hughes, 433 So.2d 88 (La.1983).
Defendant vigorously contends the state failed to preserve for review the argument that the complexity of defendant’s criminal activity precluded a more narrow search warrant being drawn. See G.M. Shupe, Inc. v. Bureau of Revenue, 89 N.M. 265, 550 P.2d 277 (Ct.App.1976) (arguments not made below will not be considered on appeal). We reject this contention. The prosecutor argued below that the seizures were justified by the affidavit, which included the confession of the roustabout who sold the goods to defendant, as well as the statements of the employee. That is the argument the state makes on appeal.
For the reasons stated above, we hold that the search warrant in the present case was supported by probable cause and the description of the property to be seized pursuant to the search warrant was sufficiently specific to satisfy the particularity requirement. Accordingly, we reverse the district court’s order finding the search warrant to be a general search warrant and suppressing the evidence seized under it.
IT IS SO ORDERED.
GARCIA and APODACA, JJ., concur. | [
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This cause having heretofore been argued, submitted and taken under advisement, and the Court being now sufficiently advised, announces its decision quashing the writ of habeas corpus heretofore issued herein, for the reasons given in the findings of the Court on file. | [
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PER CURIAM.
. Petitioner seeks discharge from custody of the respondent under a writ of habeas corpus.
The uncontradicted facts are that on. March 23, 1955, petitioner was sentenced by the district court of Bernalillo County to a term of not less than 5 nor more than 15 years in the penitentiary for the crime of armed robbery. On January 2, 1959, petitioner voluntarily signed a parole agreement which contained the following pertinent provisions:
“5. I understand that any violation of this Agreement may result in the revocation of my parole. I understand that, upon conviction of any crime, I may be imprisoned not only for that offense but also to continue serving my sentence as a parole violator.”
“6. During my parole if I should be in another state, I hereby agree to return to New Mexico voluntarily, and waive extradition proceedings, at the request of the New Mexico Board of Parole for any reason.”
“8. SPECIAL CONDITIONS: I agree to be paroled to the detainer held by the Sheriff of Maricopa County, Phoenix, Arizona. Upon disposition of these charges, I will immediately notify the Director of Parole, P. O. Box 1219, Santa Fe, New Mexico. If the charges in the detainer do not result in imprisonment, I agree to a supervision plan in the community for the balance of my parole in such state as may be indicated.”
On January 4, 1959, petitioner was released to the sheriff of Maricopa County, Arizona, and thereafter it appears that the charges against petitioner in Maricopa County were dismissed. In accordance with paragraph 8 of the parole agreement quoted above, petitioner1 notified the director of parole in New Mexico and a plan of parole was worked out whereby petitioner remained in Arizona under supervision of the Arizona authorities. On August 5, 1960, petitioner absconded from supervision in Arizona, and on September 1, 1960, his arrest was directed by the 'director of parole in New Mexico. It appears that after departing Arizona, and on or about August, 1960, petitioner was convicted of attempted armed robbery in Kentucky and served in prison there until December, 1964, when he was paroled by Kentucky authorities to a detainer in Oklahoma, and that he was held in Oklahoma for some ten months until he was released under a writ of habeas corpus. It was at this time that he was taken into custody by New Mexico officers pursuant to the September 1, 1960 directive.
Petitioner argues here that his imprisonment and detention amount to a denial of due process of law as guaranteed by Art. II, § 18, of the Constitution of New Mexico, and the Fifth and Fourteenth Amendments of the Constitution of the United States, in that by releasing petitioner to a detainer in the State of Arizona, jurisdiction over him was lost by the State of New Mexico, and that it could not be regained.
Petitioner places his principal reliance on the cases of People ex rel. Bar rett v. Bartley, 383 Ill. 437, 50 N.E.2d 517, 147 A.L.R. 935, and Jones v. Rayborn (Ky. App.1961) 346 S.W.2d 743. They are easily distinguishable. Both are cases in which the prisoner had been placed on parole without his consent and then transferred by direction of the Governor to another jurisdiction to stand trial. Without in any way indicating if we agree with the conclusion reached we can readily understand the basis therefor and the reasoning followed. Here, however, the situation is entirely different, and a different result is indicated.
Our statute, § 41-17-24.1, N.M.S.A. 1953, specifically authorizes parole to de-tainers. This was not true in Illinois at the time of People ex rel. Barrett v. Bartley, supra, and the court recognized that if the convict had actually been on parole when extradited, a different result would have been reached. In addition, petitioner here specifically agreed to the parole to the de-tainer and to the conditions as set forth in his parole agreement and was actually paroled in accordance therewith. This was not true either in People ex rel. Barrett v. Bartley, supra, or in Jones v. Rayborn, supra. The difference between those cases and the one now under consideration is clearly recognized in People ex rel. Milburn v. Nierstheimer, 401 Ill. 465, 82 N.E.2d 438, and again in People ex rel. Pring v. Robinson, 409 Ill. 105, 98 N.E.2d 119. In neither of those cases was there a valid parole, but the court held that to result in a surrender of jurisdiction of the prisoner it was necessary that the delivery be made pursuant to-direction of the Governor. There can be no question that waiver of jurisdiction to enforce the original sentence upon violation of the parole terms did not result under the facts here present. See note in 147 A.L.R. 941, 943; Heston v. Green, 174 Ohio St. 291, 189 N.E.2d 86. Compare Rider v. McLeod (Okl. Cr.App. 1958) 323 P.2d 741, where the facts are strikingly similar to' those here present.
We are clear that in granting parole to detainer in Arizona, under the facts here present, there was no surrender of jurisdiction over petitioner such as would prevent his being reincarcerated to complete his sentence upon his violation of the terms of his parole being established. Neither has he been deprived of any constitutionally protected right. The writ of habeas corpus heretofore issued should be quashed and the petitioner remanded to the custody of respondent.
It is so ordered. | [
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OPINION
SUTIN, Judge.
Plaintiff Bernie Marquez appeals from an order of the trial court entered August 14, 1973. The order denied the motions made by this plaintiff because a complaint filed by him and two other plaintiffs had been dismissed with prejudice by a previous court’s order in January, 1970. The previous court’s order was entered January 8, 1970.
On November 18, 1968, Perfecto Barela, Jose L. Vallejos, administrator, and Bernie Marquez filed a complaint in Valencia County against defendant in separate causes of action. Defendant answered.
On August 26, 1969, a settlement hearing was held before the Honorable D. A. Macpherson, Jr., District Judge of District Two. The defendant questioned Barela and Vallejos, under oath, to affirm a stipulation of settlement between these plaintiffs and defendant.
On January 8, 1971, Judge Macpherson entered an order:
(1) “That the settlement stipulation between the parties ought to be and is hereby approved.” The parties were Barela, Vallejos and defendant.
(2) Thereafter, the words of the order changed from “parties” to “plaintiffs” and ordered compliance with the settlement.
(3) The order concluded:
That, on account of, and in consideration of said settlement stipulation among the parties hereto, hereby approved by this court, Plaintiffs complaint is hereby dismissed with prejudice.
This order was approved by the attorneys for plaintiffs and defendant. No appeal was taken from this judgment.
On March 14, 1973, two years after Judge Macpherson’s order, plaintiff moved the court for summary judgment, judgment by default and to set the case for trial at the earliest convenience of the court.
On March 29, 1973, plaintiff served notice that the cause had been set for hearing on April 10, 1973, on plaintiff’s motions before the Honorable Filo M. Sedillo, District Judge of Valencia County because Valencia County had then become a district separate from District Two.
During argument on the motions, Judge Macpherson’s order of dismissal on January 8, 1971, supra, was raised. Defendant contended the whole case had been dismissed. Plaintiff offered for the record, the transcript of the settlement proceedings but the trial court denied consideration of it. The court believed that if Judge Macpherson made a mistake, he signed the order and it could not be changed; that plaintiff had a duty to file a motion to set the order aside or have it modified.
On July 23, 1973, plaintiff gave notice of a hearing on August 14, 1973, “on form of order.” We find no record of any proceedings on that date except entry of the order.
The trial court entered its order “that said motions are denied because they are not properly before the Court, the complaint on file herein having been dismissed with prejudice by the Court’s order of January, 1970.”
Judge Macpherson’s order was final. “A motion to alter or amend the judgment shall be served not later than ten [10] days after entry of the judgment.” Section 21-1-1(59) (e), N.M.S.A.1953 (Repl. Vol. 4). No such motion was filed.
On motion, and upon such terms as are just, the trial court could have relieved plaintiff Marquez from a final order for mistake, inadvertence, surprise, or excusable neglect, provided the motion was made not more than one year after the order was entered. The court could have relieved plaintiff Marquez for “any other reason justifying relief from the operation of the judgment”, provided the motion was filed within a reasonable time. Section
21-1-1(60) (b), N.M.S.A.1953 (Repl. Vol. 4). Plaintiff filed no such motions.
Rule 60(b), supra, provides further:
This rule does not limit the power of a court to entertain an independent action to relieve a party from a judgment, order, or proceeding * * *.
Plaintiff relies on Rule 54(b) [§ 21 — 1— 1(54) (b), N.M.S.A.1953 (Repl. Vol. 4)]. This rule involves judgment upon multiple claims or involving multiple parties. This rule is not applicable because the Macpherson final order did not affect “one [1] or more but fewer than all of the claims .” nor did it adjudicate “all issues as to one [1] or more, but fewer than all parties.” It dismissed plaintiffs’ complaint with prejudice. This covered all the claims of all the parties. We cannot look beyond the order to the record. Hollingsworth v. Hicks, 57 N.M. 336, 258 P.2d 724 (1953).
Other contentions of plaintiff Marquez are without merit.
Affirmed.
It is so ordered.
HENDLEY and LOPEZ, JJ., concur. | [
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] |
OPINION
HENSLEY, Chief Judge, Court of Appeals.
Appellee, The Citizens Bank, Farmington, New Mexico, filed its suit against Alfred Elliott and Robinson Brothers Wrecking, a Partnership,- alleging that the defendant Alfred Elliott was in default under the provisions of a security agreement covering a pickup truck and further alleging that defendant Robinson Brothers Wrecking claimed an interest in the vehicle. Ap-pellee further alleged that it was entitled to possession of the vehicle that was being wrongfully detained by the defendants, all to the appellee’s damage in the amount of $500.00.
The appellee filed its complaint, its affidavit in replevin, and its bond in replevin in the district court. On the same day, the clerk of the court issued a writ of replevin in the case to the sheriff for service. On the following day, the sheriff served the writ of replevin and a copy of the complaint on Elmer Robinson, one of the partners in Robinson Brothers Wrecking, and took possession of the vehicle, which was then delivered to the plaintiff. No process was ever served on the defendant Alfred Elliott. Approximately forty days after the service of the writ and a copy of the complaint, the clerk of the court issued and filed a certificate of default as to the defendant Robinson Brothers Wrecking. On the same day, a judgment was signed and filed, finding the issues in favor of the appellee and against the defendant Robinson Brothers Wrecking. Some two months after judgment, the de fendant Robinson Brothers Wrecking filed a motion to set aside the judgment, on the ground that it had never been served with a summons. From an order denying this motion, the defendant has appealed.
The appellant and the appellee agree that no civil “summons” as provided by § 21-1-1(4) (b), N.M.S.A., 1953 Comp., was served upon the appellant.
The sole contention made here by the appellant is that no summons having been issued and served, the court ■ was without jurisdiction of the appellant and the judgment subsequently entered was void.
The writ of replevin that was issued by the clerk and served by the sheriff and the sheriff’s return are disclosed by the record to be in the following form:
“STATE OF NEW MEXICO COUNTY OF SAN JUAN IN THE DISTRICT COURT
THE CITIZENS BANK, FARMINGTON, NEW MEXICO Plaintiffs, Vs. ALFRED ELLIOTT and ROBINSON BROTHERS WRECKING, a Partnership
“WRIT OF REPLEVIN
“TO THE SHERIFF OF SAN JUAN COUNTY, NEW MEXICO, GREETINGS :
“You are commanded that, without delay, you cause to be replevined unto THE CITIZENS BANK, FARMINGTON, NEW MEXICO, the goods and the chattels following, to-wit :
One 1959 Chevrolet Ton Pickup Truck, Serial No. 313595131279 License 16-4013 — 1963 Tab
Which Defendants wrongully [sic] detains from the said The Citizens Bank and that you summon the said defendants to appear before the District Court of the First Judicial District of New Mexico sittin [sic] in San Juan County, New Mexico, within thirty days from the date of service hereof to answer unto the said The Citizens Bank for the unlawful detention of the goods and chattels aforesaid.
“Given under my hand and the seal of the District Court this 23 day of September 1964
(SEAL) s/ Virginia A. Kittell
Clerk of the District Court”
''“STATE OF NEW MEXICO ' COUNTY OF SAN JUAN
IN THE DISTRICT COURT
The Citizens Bank, Farmington, New Mexico Plaintiffs Vs. Alfred Elliott and Robinson Brothers Wrecking, a Partnership Defendants.
No. 12631
“Sheriff’s Return of Service
“I, Roy Marcum a duly qualified and acting Sheriff in and for the County and State aforesaid, hereby certify that I received a Writ Of Replevin and Complaint in the above entitled matter on the 23rd day of September, 1964, and that I served the same on the 24th day of September, 1964, by delivering to
Elmer Robinson in person at Robinson Brother’s Wrecking in Aztec, New Mexico Attachment was made on one 1959 Chevrolet Ton Pickup Truck, Serial No. 313595131279 License 16-4013 — Vehicle given to Calvin Coy of Citizens Bank.
in person, within the County and State aforesaid, a true copy of the said Writ Of Replevin to which was attached a true and correct copy of the complaint on file in the within entitled action.
“Dated .this 25th day of September, 1964.
“Service Fee: $3.00
Mileage .50
Total $3.50
Attorney:
Palmer and Frost
200 North Allen
Farmington, New Mexico
File: A-l-dó-Robinson
Roy Marcum SHERIFF
By s/ Bruce P. Brimhall
Deputy
Bruce P. Brimhall”
An examination of the writ of replevin and the sheriff’s return discloses that the appellant was fully apprised of every pertinent fact that would have been made known to it had the statutory form of summons been employed. The form of the instrument served -on the appellant would have been different, but the substance would have been the same.
Section .21-1-1 (1), . N.M.S.A., 1953 Comp., is as follows:
“These rules govern the procedure in the district courts of New Mexico in all suits of a civil nature whether cognizable as cases at law or in equity, except in special statutory and summary proceedings where existing rules are inconsistent herewith.”
The action of replevin is a statutory proceeding designed to take the place of the common law actions of replevin and de-tinue, Troy Laundry Machinery Co. v. Carbon City Laundry Co., 27 N.M. 117, 196 P. 745.
In Johnson v. Terry, 48 N.M. 253, 149 P.2d 795, the proposition urged by the appellant was answered in reverse. There the plaintiff sued in replevin and caused a summons to be issued rather than a writ of replevin. In that case we stated:
“ * * * The jurisdiction of the court, to hear and determine actions in replevin instituted pursuant to this statute, is dependent upon the issuance and service of the writ which brings under the control of the court the property for the purpose of rendering a judgment in accordance with the object and purpose of the statute, viz.: To determine the right to the immediate possession of the property, and damages for its unlawful caption or detention. * * * ”
We conclude that the writ of replevin in an action of replevin accomplishes the same function in process, as does a summons in an ordinary civil action.
The action of the trial court in denying the defendant’s motion to set aside the judgment is affirmed, and IT IS SO ORDERED.
MOISE and COMPTON, JJ., concur. | [
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