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HonorableHaaer Garrison,Jr., Mreotor
Deprtment of Publio Safety
CemP=bQ
&xitin, Texas
Dear sin opinionHO. -145 ~.
Rer lkuld'a countycommissioner,
by viitue of the faat that
at times he might skre as a
magi&rate, be allowedto
carrytipistol?
Responding to your opinion request of recent &ate on the ques-
tion a8 statedabove,we have oarei'ully investigatedthe authorities.
The pertinentstatutoryprovisionsare containedin Chapter4
of Title 9 of the Texas Penal Code, Articles493 and 494, under the gen-
eral headinguUnlamfullyCarrying&rms.-~~, Ue quote
__- said articlesa
*4rt. 463. 476, 339, 310 Unlkully oarryingarms
"Shoevetshall awry on or about his person,saddle,or
in his,saddlebags any pistol,dir&, dagger,alung-shot,
sword cane, spear or knuoklesmade of any metal or any hard
mbSta?me, bolrie lolife,or aqy other knife manufaoturedor
sold for the purposeof offense cr defense,shall be pun-
ished byfdne not less than#lOO.OO nor more than #600.00
or by oonfinementin jail for not less than one month-nor
more than one year. Aots 1897, p. 6; 4ots 1906, p. 66;
bat.91916, p. 194a
'b-t. 4040 476, 339, 319 Hot applioable
"The precedingarticle shall not-applyto a person in
actual serviceas a militiaman,nor to ang peaoe offioer
in the actual disohargeof his officialduty,nor to the
oarryingof wms on one’s own premisesor plaoe of busi-
ness, nor to personstrpcreling,nor to any deputy oonsta-
ble, or specialpolioemanwho receivescompensationof
Hoa. Homer Garrison,Jr., Director,Page 2
forty dollarsor more per monty for his services
as suoh offiosr,and who is appointed in wmfonn-
ity with the statutesauthorizingsuoh appointmentJ
nor to any deputy,whsn in the aotualdischargeof
his dutiesas suoh,nor to any game wardan,or lo-
oal deputyGeme, Fish end Oyster Commissionerwhen
in the actual disohargeof his dutiesin the county
of his residenos,nor shall it apply to any game
warden or deputyGems, Fish and Oyster Cummissioner
who aotuallyrsoeivesfrormthe State fees or oompsn-
sationfor his servioes. bats 1871, p. 25, Acta
1918, p. 194..
Article 6, Seotion12 of the Constitutionof Texas contains
this statements "All judgesof oourts of this State,by virtue of
their office,be oonservatorsof the peaoe throughoutthe State."
Smtion 1 of said Artiole 6 reads in part:
"The judioislpower of this State shall be vested
in ow SupreneCourt, in Courts of Civil Appeals,in
a Court of Cr5min~lAppeals,in DistriotCourts,in
Chnty Coufts;(b Coliimibsibnera~Couit~~
in thurts~ of
Justioesof~thsPeaoe)‘sridin:suoh other oourta~&s'may
be providedby law." (&~phasisours).
Rhile Camnissioners'Courtsare Courtsof 1imLtedjurisdis-
tion, th sre nevertheless"Courts.' Hill CountyV. Esmilton(Tex.
7 278 S.11,2921 Bradfordv..%ssley (Tex. C~II& App.) 226 6.W.
Civ. &pp.
171, revsrsing(Tsx. Civ. App.) 190 S.U. 824. .~ 1.
Artiole SK &our Code of CriminalProoedurr provides:
"Art.'S3.‘ (41) (42) Rho are magistrates
"Esoh of the f&lowing officersis a %mgistrstelwithinthe
meaning of this Coder The judgesof the.SupremsCourt,the
judgesof the Court of CriminalAppeals,the judgesof the dis-
t&t court,the county judge,sny oountyoonrmissioner, tk
justicesof the peace, the mayor or recorderof en inoorpor-
&ed oity or to%.* (Dnphasihours).
Hon. Homer Garrison,Jr., Page S
Article 54 of.the tide of CriminalProoedureprescribes
the duty of magistratesaa follows*
“Art. S4e (42) (43) Duty of magistrates
"It is the duty of every magistrateto preserve
the peacewithin his jurisdictionby the use of all
lawfulmeans8 to issue all prooassintendedto aid
in preventingand supressingOr-J to cause the
arrest of offendersby the use of lawful,meanain
order that they may be broughtto punislaaont.(0. C.
32.)”
&ile Article 36, Code of %ninalProoadure, reads as fol-
lows,
“&t. 36. (45) (44) Who are peace officers
"The followingare 'peaoeoffioersr' the
sheriffand his deputies,constable,the mar-
shal or policemanof an incorporatedtown Or
oity,.theofficers,non-ocmmiaaioned offioers
and privatesof the State ranger force, and,eny
privateperson speciallyappointedto~exeoute
oriminalprooesa. (0.C. 63, hots 1919a p. 264.)"
The last quoted artialedoes not nams a oou& oamaiaaioner
as a '"peaoe offioer,'neitherdoes it name a justioeof the peace as
8uohJ but in the 0188 of PattonV. State, 129 Ten. '%. Rl 269, 86 S:
W. (Zd) 774, we find.thefollowinglanguage(after oitingthe various
statutes~snd constitutional provisionsquoted abore)r
". . . While a juatioeof the peace is not denom-
inatedas‘a,peaoeoffioerunder articleSS; C.C.P.,
yet this aourthold in the case of JonesV. State
(Tex. Cr. dpp.) 66 S.W. 92, thatt 'tiewho~is auth-
orizedto ,preserve or maintainthe publicpeaoe,is
a peace offioer. of courae,it would hare been
oompetentfor the legialataire, in enactingthe
pistol law, to have prescribedwhat officers. . .
were authoriaedto oarry pisto.laJ but when they
used the genera.1term, excludingfrau the opera-
tion of the law all "peaoe officers,"it applied
Hon. Homer Garrison,Jr., Page 4
as well to those who were constitutedpeaoe offi-
oers under the constitutionas to those who were
peaoe officersby the act of the legislature.
While we have oonoededin what has been said
above that the legislaturedoes not moan or treat
wunQ- judges aa peace offloers,yet us think it
is by no means clear that they did not intendto
regardthem as suoh, aa oertainartioleaof the
Code appearto anathemwith functionspertaining'
to peace officers.+++ Fe hold that the oonstitu-
tion m&es county judgespeace officers,end
that ahen the legislature,in enactingthe pistol
law, exoludedfraa its operationall peaoe officers,
appellantwas embraoedin this list, sndas auoh
peace officerhe was authorizedto oarry a pistol.
e&rt&le 484, P-C., exemptsall peaoe offloers
frau the operationof lirtiole403, P-C., prohibdt-
ing the carryingof a pistol. In the case of
Tippettv. State, 90 Tex. Cr. R. 373, 189 S.W. 466,
486, this court said:.Qyvirtue of section12 of
artiole6 of the Constitution, all judges ++e are +++
peaoe offioers.+** A oounty judge is a peace offi-
osr, then there is no esoapefrom holdingthat a
judge of the oorporationoourt is also a peaoe offi-
oer. eee &d if all judges are pesoe offloeraby
virtue of the oonatitutionalproviai~ hereinbefore
recited,then appellant,bgvirtue of being a judge
of the oorporationoourt,muld be a peaoeoffioer,
and authoriaedto oarry a pistol,evenwhen not in
the
.. actual.'dischargeof the dutiesof tha3~ffloe.':
b.
'We see no good reasonwhy a justiceof tba~: -~,
who-is a judge of a justicecourtwould not oome aith-
in the defdnitionof a peaoe officerunder said ocnati-
tutibnalprovision. We are thereforeoonstrained'to
hold, in keepingalth the authoritiesabove oited,.
that the appellant,being a juatioeof the peace,was
a peace offioerand authoricedto oamy a pistol on
the oocasionin question,even though he ma not in
the actual disohargeof the dutiesof the off3ce.
*. . . . *
Ron* Rcmer C9rrisaP1,
Jr., Page 6
See also Satterwhitevs. State, 112 Tax. Cr. R. 674,
17 S.H. (Zd) 623. at p. 926.
Cles.rly,a countyoaaaissioner, while servingas a magia-
trate,is a peace offioerwithin the meaningof the terms of Arti-
ale 484, Penal Code, supre,which, maong other things,makes inap-
plieableto peace offioersthe provisionsof Artiole 483, Penal
Code, aupra,definingthe ,offenseof unlawfullyoarryingarmso Rut
we cannotbring ourselvesin agreementwith the last statementquotm
ed abovefraa the Patton base, i.e., that a magistrate,3 magistrate,
is authorizedto,oarry a pistol on= oocasionwhen not in the actual
dischargeof the'dutiesof his office. In additionto the language
of Judge.Rawkins, mritingon the ~ats.te's.motion
for rehearingin the
patton o*se, "Ho oannotagree, as insistedby the state, that on the
night of the killing appellantwas not in the dischargeof the duties
of his office,'.whiohwethink olearlyindicatesthe statementin the
originalopinion.tobe obiter dictum,we
showingthat the languageof the statute
literallywhat it sayswhen it exemptsaany
actual dischargeof his officialduty:".TrimbleV. Nate. 132 Tex.
Cr. . 6, 04 S.H. 2d 31 at pp. 34-35 (specialranger; dr%v.ving
cattleat¬ on officiald&)~~Gti&ci V. State,-94Tex. Cr. B. 636;
252.S.W.156 (deputysheriff,drivingjitney and not on'offioralduty)3
Ransomv. State.73 Tax. Cr. R. 442, 165 S.H. 932 (deputysheriffout-
side oounty).
Wethink the proper Lnswer to your queation‘iathat a cow&.
oommisaioneris a -gistrate by virtue of his officesthat when he acts
in the oapaoi* of suoh~magistrate he is a -peaOeOffiOerJ',?$atfi~isE8
end when he sots as aoh peaoe offioerin the aotual disoharg
officialduty,..~.
he la
_..anthoriaedto oarry a pistol and at othe,rtimes he
'i in diEferentpoaition~~than any other citizenor civil offiber.
Gd in?hia connection, we point out that s%rince
its originaleneats&&
our presentArticle484 of the‘Penal-Code has been amended;-This~&at-
ute was formerlyknown as Article47.5in the 1911 reviaionJandwas
Artiale 339 in the revisionof 1596 and Article 319 in the revisionof
1679* The learned judge,writingin the Patton ease on originalsub-
mission,must have overlookedthe ohsnge.appearing for the first time
inthe oodificationof 1911, the languagein the exemptionsof 1896 and
1879 providing,that the prohibitionas to bearingamas shouldnot apply
to ' a person in aotual aervioeas a militiaman,nor to w peace offi-
oer or a poliocman,or person summonedto his aid, nor to a revenue
Hon. Haaer O@rriaon,Jr., Page 6
or other civil officerengaged in the disohargeof offioialduw,"
etc., thus showingthat a "peace offioerawas iamme uuder those
codes fram prosecutionfor Faring anaa at a~ tfme or plaae,
whereasthe peaent statuteolearlylimitsthe peace officer's
exemptionto the time end plase where he would be "in the aotual
disohargeof his officialduty.*
Truatingthat the above fully anwrs yvur inquiry,we
are
Yours vergtru1y
ATTOBBEXGENEEiAL
OF TEXAS
s/ Benjamin&ode11
By Benjtiin%bdall
&saistant
APPROVEiD HOV 15, 1941
G~OV!SFt
SELLERS
FIRST4SSISTOT
AlTORtiEY
GBRBRAL
Zip+vid
Opigdpn Cumittee
byBm
chdrman
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477 F.2d 616
Daniel ROSS et al., Appellants,v.Dr. Stanley BLACKLEDGE et al., Appellees.
No. 73-1314.
United States Court of Appeals,Fourth Circuit.
Submitted Jan. 30, 1973.Decided March 27, 1973.
Daniel Ross, pro se.
Jacob L. Safron, Asst. Atty. Gen., for appellees.
Before SOBELOFF, Senior Circuit Judge, and WINTER and CRAVEN, Circuit Judges.
SOBELOFF, Senior Circuit Judge:
1
Six North Carolina prisoners, who are members of the Islamic, a Black Muslim faith, seek injunctive relief pursuant to 42 U.S.C. Secs. 1983 and 1985 to compel prison authorities to provide them with the pork-free diet required by the tenets of their religious faith. They allege that they cannot obtain a balanced diet by eating only non-pork items because of the frequency with which pork appears as the only meat on the prison menu and because most vegetables are cooked in or seasoned with pork. And, adducing the failure of prison officials to provide them with a "special diet on the same basis as the correctional prisoners who are on ulcer diet," the prisoners proffer an equal protection argument as an additional basis for the relief sought.
2
Initially, the District Court denied a motion to dismiss, directing instead that the State demonstrate that an adequate diet could be maintained by eating only non-pork items and that the State respond to the equal protection allegation. After the State's submission of a supplemental memorandum and supporting affidavits, the District Court granted a motion to dismiss without ever holding an evidentiary hearing.
3
In its Memorandum Opinion and Order, the District Court said that "[t]he affidavits and menus clearly show that the plaintiffs can receive more than adequate nourishment from other foods and that the defendants are providing ample pork free meals and foods" (emphasis added). The court also found that the "record clearly shows" that a rational basis existed for providing a separate diet for prisoners with ulcers but not for Black Muslims. We conclude that the District Court erred in granting summary dismissal and therefore vacate its judgment and remand the case for an evidentiary hearing.
4
In Abernathy v. Cunningham, 393 F. 2d 775, 778 (4 Cir. 1968), this court held that where the District Court found after "an extensive evidentiary hearing" (p. 777) that Muslim prisoners could obtain a balanced ration while avoiding pork and food prepared with pork, the state was not required to provide a separate pork-free diet. Subsequently, in a case involving the attempt of Muslims to secure First Amendment rights, we held that the state may only restrict a prisoner's desire to practice religion "upon a convincing showing that paramount state interests so require. * * * The burden is not met merely by the filing of an answer which controverts the allegations of the complaint or which relies solely on our previous decision in Abernathy v. Cunningham, supra." Brown v. Peyton, 437 F.2d 1228, 1231 (4 Cir. 1971).
5
The value of a full evidentiary hearing is exemplified by Barnett v. Rodgers, 133 U.S.App.D.C. 296, 410 F.2d 995 (1969), which dealt with Black Muslim demands for at least one full-course, pork-free diet per day. The District Court initially dismissed the petitions without a hearing. The dismissal was vacated upon appeal, counsel appointed and an extensive evidentiary hearing held that enabled the District Court to develop a full and complete record. Only examination and cross-examination of witnesses brought out the prevalence of pork in the prison diet. See Abernathy v. Cunningham, supra, 393 F.2d at 780 (Craven, J., concurring and dissenting). Witnesses for the Muslims testified that pork was used to prepare such non-pork main dishes as hamburgers, meat loaf, chili con carne, and gravies served on non-pork meats. While prison authorities contested this testimony, they admitted that pork was present in macaroni and cheese, hot dogs, cold cuts and luncheon meats. The chief steward also admitted that pork was used to season about half of the green vegetables served and many side dishes. Barnett v. Rodgers, supra, 410 F.2d at 998. Nonetheless, the District Court once again dismissed the suit, apparently on the theory that a balanced diet was provided to prisoners generally and if a particular inmate wished to practice his religion, he could refrain from eating those things he found objectionable. The issue of whether an inadequate diet would result from this exercise of "freedom" was not faced.
6
The Court of Appeals for the District of Columbia Circuit ruled that the District Court had erred in its dismissal of petitioners' complaints, reasoning that the request for one full-course, pork-free diet daily was "essentially a plea for a modest degree of official deference to their religious obligation." The onus was to be placed upon the state to demonstrate that the impediments placed in the way of appellants' observance of their dietary creed had compelling justification, such as budgetary constraints or administrative difficulties. The District Court was also to inquire into whether governmental purposes responsible for the impediments could be feasibly "pursued by means that [less] broadly stifle fundamental personal liberties." Barnett v. Rodgers, supra at 1003.
7
While the decisions of prison officials are entitled to considerable weight, they are subject to judicial reviews "to insure that the constitutional rights of prisoners are protected." Brown v. Peyton, supra, 437 F.2d at 1232. The state's only justification for refusing to provide some form of alternative diet is that adequate nourishment could be obtained from non-pork items. This is a conclusory assertion made in an affidavit by W. H. Swart, the official of the North Carolina Department of Correction responsible for preparing and distributing menus. The plaintiffs have not been given an opportunity to submit their own evidence or controvert the Swart affidavit. Nor is it clear to what extent non-pork meat, vegetables and other side dishes are prepared with pork seasonings and derivatives. As a matter of fact, an analysis of the master menus for the months of March, April, May and June, 1972, which were submitted by the defendants, reveals the following with respect to the number of meals at which some form of pork was served as the exclusive meat:1
8
Whether a prisoner could obtain adequate nourishment from the prison ration while refraining from eating all pork-tainted food is a question of medical and scientific fact. Adequacy of diet is not simply measured by determining whether the stomach is so full that pangs of hunger do not persist. There are special nutritional elements found in meats; and when the amount of meat in a diet is reduced, substitutes providing parallel nourishment can be found, but only in certain foods. Adequacy of diet must be viewed qualitatively as well as quantitatively. Since almost half of the meals served at the prison contain pork as the exclusive meat, and many others may contain meat, vegetables or eggs seasoned with pork products, the Department of Correction has not clearly shown that an adequate ration is available to Muslim prisoners wishing to observe their religious creed, in either a quantitative or qualitative sense.
9
The appellants also challenge their treatment vis-a-vis ulcer patients, who are provided a menu which specifically provides that "No pork meats are served" and are also permitted to eat items on the regular menu. The State responds that a failure to provide an ulcer diet to an inmate for whom the diet has been prescribed could conceivably give rise to a claim of denial of adequate medical treatment. This is undoubtedly true and certainly justifies treating ulcer patients differently from the general population with respect to diet. It does not, however, explain the refusal to accord the same privileges to the plaintiffs, who also make a constitutional argument in support of their demands. The prison authorities apparently have arbitrarily chosen to acknowledge the medical claim and to resist the religious claim, but have failed to make any showing that their refusal to provide some minimal form of pork-free diet is based on any "paramount state interest." The State admits that at one time it provided a pork-free diet for Black Muslims. This policy was discontinued, not because of any "paramount state interest," but because allegedly the prisoners did not eat the food provided.
10
Appellants are entitled to an evidentiary hearing on the prevalence of pork in the prison diet, on whether there is adequate nourishment in the pork-free foods currently available to the prisoners and on whether the state can establish an adequate interest for not providing some satisfactory form of alternative diet. Since the District Court erred in its summary dismissal of this case, leave to appeal in forma pauperis is granted, the judgment of the District Court is vacated, and the case is remanded for further proceedings consistent with this opinion.
11
CRAVEN, J., concurs in the result only.
1
The figures for pork-meat meals do not reflect those meals where pork was served accompanied by a non-pork meat. These are classified as non-pork meals. Composition meats which generally include pork are treated as pork meat in the chart. Breakfast meals are included. It is not known whether eggs are cooked in pork derivatives or with pork meats
Total Number of Percent of Meals
Meals
Month (1972) Where Meat Served Number of Non-Pork with Pork Meats
Pork Meats Meats
March 89 43 46 48.3%
April 77 38 39 49.3%
May 90 43 47 46.6%
June 92 44 48 47.8%
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535 U.S. 1120
COCKRELL, DIRECTOR, TEXAS DEPARTMENT OF CRIMINAL JUSTICE, INSTITUTIONAL DIVISIONv.BURDINE.
No. 01-495.
Supreme Court of the United States.
June 3, 2002.
1
C. A. 5th Cir. Motion of respondent for leave to proceed in forma pauperis granted. Certiorari denied. Reported below: 262 F. 3d 336.
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IN THE COURT OF APPEALS OF TENNESSEE
AT KNOXVILLE
October 9, 2013 Session
IN RE: B.R.
Appeal from the Circuit Court for Knox County, Fourth Circuit
No. 120900 Bill Swann, Judge
No. E2013-00714-COA-R3-JV - Filed December 26, 2013
This case arises from juvenile proceedings concerning the then minor child B.R. The
Juvenile Court for Knox County (“the Juvenile Court”) found B.R. to be an unruly child.
B.R. some time later filed a Petition to Vacate Orders and to Dismiss regarding the order
finding B.R. to be an unruly child, citing constitutional, procedural, and jurisdictional
defects. The Juvenile Court denied the petition to vacate. B.R. appealed to the Circuit Court
for Knox County, Fourth Circuit (“the Circuit Court”). The State of Tennessee (“the State”)
moved to dismiss the appeal, arguing the appeal was untimely. The Circuit Court granted
the State’s motion to dismiss. We reversed the Circuit Court on appeal, and remanded for
the Circuit Court to hear the appeal of the denial of the petition to vacate. B.R. filed an
amended petition to vacate and later a motion for summary judgment. The State filed a
cross-motion for summary judgment, arguing, among other things, that B.R.’s claims could
not be redressed by a Tenn. R. Juv. P. 34 petition to vacate. The Circuit Court granted the
State’s motion for summary judgment. B.R. appeals. We affirm.
Tenn. R. App. P. 3 Appeal as of Right; Judgment of the Circuit Court Affirmed;
Case Remanded
D. M ICHAEL S WINEY, J., delivered the opinion of the Court, in which C HARLES D. S USANO,
J R., P.J., and J OHN W. M CC LARTY, J., joined.
Dean Hill Rivkin, attorney and professor; Brenda McGee, attorney; and, Anna Swift,
practicum student attorney, UT College of Law Education Law Practicum, for the appellant,
B.R.
Robert E. Cooper, Jr., Attorney General and Reporter; William E. Young, Solicitor General;
and, Jordan Scott, Assistant Attorney General, for the appellee, State of Tennessee.
OPINION
Background
In May 2010, B.R. was found to be an unruly child by the Juvenile Court and
was placed on probation. No appeal was taken of this order. In January 2011, B.R. filed a
petition to vacate pursuant to Tenn. Code Ann. § 37-1-139 and Tenn. R. Juv. P. 34 in the
Juvenile Court. B.R. argued, inter alia, that there were constitutional, procedural, and
jurisdictional defects in the original proceedings in which B.R. was found to be an unruly
child. The Juvenile Court denied B.R.’s petition to vacate. B.R. appealed the Juvenile
Court’s denial of the petition to vacate to the Circuit Court. The State moved to dismiss
B.R.’s appeal, arguing that the time to appeal a final judgment had expired. The Circuit
Court granted the State’s motion to dismiss B.R.’s appeal. B.R. appealed to this Court. In
In re: B.R., No. E2011-01425-COA-R3-JV, 2012 WL 403871, at *4 (Tenn. Ct. App. Feb. 9,
2012), no appl. perm. appeal filed, we stated that, in keeping with Tenn. Code Ann. § 37-1-
159, “B.R.'s appeal of the Juvenile Court's order denying B.R.'s Petition to Vacate should
have been heard by the Circuit Court.” We reversed the Circuit Court and remanded for the
cause to be heard on its merits as to B.R.’s petition to vacate. Id.
On remand, B.R. filed an amended petition. In July 2012, B.R. filed a motion
for summary judgment. The State filed a cross-motion for summary judgment, arguing,
among other things, that B.R.’s claims could not be redressed by a Tenn. Code Ann. § 37-1-
139 and Tenn. R. Juv. P. 34 petition. In October 2012, the Circuit Court entered an order in
favor of the State. In March 2013, the Circuit Court addressed unresolved claims, granting
the State’s motion for summary judgment. B.R. timely appealed to this Court.
Discussion
B.R. raises a host of issues on appeal. B.R. asks for reversal of the Circuit
Court; declaratory relief to hold that the adjudication of B.R. was defective on constitutional,
jurisdictional, and procedural grounds; and, vacating of the order adjudicating B.R. unruly.
The threshold issue, however, is whether there are grounds for relief under Tenn. Code Ann.
§ 37-1-139 or Rule 34 of the Tennessee Rules of Juvenile Procedure. It bears noting that this
is not an appeal of the Juvenile Court’s order adjudicating B.R. unruly. Rather, this is an
appeal of the Circuit Court’s granting of summary judgment to the State dismissing B.R.’s
Tenn. Code Ann. § 37-1-139 and Tenn. R. Juv. P. 34 petition to vacate.
Tenn. Code Ann. § 37-1-139 provides:
(a) Except as provided in § 36-1-113(q), an order of the court shall be set aside
-2-
if it appears that:
(1) It was obtained by fraud or mistake sufficient to satisfy the legal
requirements in any other civil action;
(2) The court lacked jurisdiction over a necessary party or of the subject
matter; or
(3) Newly discovered evidence so requires.
(b) Except for an order terminating parental rights or an order of dismissal, an
order of the court may also be changed, modified or vacated upon a finding of
changed circumstances and that the change, modification or vacation is in the
best interest of the child. An order granting probation to a child found to be
delinquent or unruly may be revoked on the ground that the conditions of
probation have not been observed.
(c) Pursuant to Tenn. R. Juv. P. 22, in no event shall modification of an agreed
order result in a child being placed into the custody of the department of
children's services without the appropriate petition having been filed with the
clerk of the court alleging the child to be dependent, neglected, abused, unruly,
or delinquent. This subsection (c) shall not be construed as eliminating the
judicial findings required for children in state custody by §§ 37-1-166 and
37-2-409 or as otherwise required by case law and federal regulations.
(d) Any party to the proceeding, the probation officer or other person having
supervision or legal custody of or an interest in the child may petition the court
for the relief provided in this section. The petition shall set forth in concise
language the grounds upon which the relief is requested.
(e) After the petition is filed, the court shall fix a time for hearing and cause
notice to be served as a summons is served under § 37-1-123 on the parties to
the proceeding or affected by the relief sought. After the hearing, which may
be informal, the court shall deny or grant relief as the evidence warrants.
Tenn. Code Ann. § 37-1-139 (2010).
Rule 34 of the Tennessee Rules of Juvenile Procedure somewhat expands
Tenn. Code Ann. § 37-1-139 and states, in part:
-3-
Except in cases where the petition has been heard upon the merits and
dismissed, the procedures herein shall be followed to obtain appropriate relief
under this rule.
(a) Clerical Mistakes. Clerical mistakes in judgments, orders, or other parts
of the record and errors therein arising from oversight or omission may be
corrected by the court at any time on its own initiative or on motion of any
party, after such notice, if any, as the court orders. During the pendency of an
appeal such mistakes may be so corrected before the record on appeal is
docketed in the appellate court and thereafter, while the appeal is pending, may
be so corrected with leave of the appellate court.
(b) Extraordinary Relief. An order of the court shall be vacated if it appears
that it was obtained by fraud or mistake sufficient therefor in a civil action, or
the court lacked jurisdiction over a necessary party or of the subject matter, or
newly discovered evidence so requires.
(c) Modification for Best Interest of Child. An order of the court may also be
modified or vacated on the ground that changed circumstances so require in
the best interest of the child, except an order committing a delinquent child to
the Department of Children's Services or an institution for delinquent children,
an order terminating parental rights or an order of dismissal. An order
granting probation to a child found to be delinquent or unruly may be revoked,
according to the provisions of Rule 35, on the ground that the conditions of
probation have not been observed. Placements after a child has been
committed to the Department of Children's Services shall be reviewed as
provided in Tenn. Code Ann. § 37-1-137, and, in the case of termination of
home placement, Rule 35.
(d) Petitions to Modify or Vacate Orders. Any party to the proceeding, the
probation officer, or any other person having supervision or legal custody of
or an interest in the child may petition the court for the relief provided in
subsections (b) and (c) of this rule. The petition shall be styled “Petition to
Vacate Order” or “Petition to Modify Order,” as the case may be, shall set
forth in concise language the grounds upon which the relief is requested, and
shall include:
(1) The name of the court to which the application is addressed;
(2) The title and action number of the original proceeding;
-4-
(3) The name, age, and address, if any, of the child upon whose behalf the
application is brought;
(4) The name and residence address, if known, of the parent, guardian or legal
custodian or, if not known or if there is no parent, guardian or legal custodian
residing within the state, the name and residence address, if known, of any
adult relative residing within the county, or if there is none, the name and
residence address of the adult relative residing nearest the court;
(5) The date and general nature of the order sought to be modified or vacated;
(6) A concise statement as to the grounds alleged to require the modification
or vacation of the order, including any change of circumstance or new
evidence;
(7) A concise statement as to relief requested; and
(8) A statement as to the petitioner's relationship or interest in the child, if the
petition is brought by a person other than the child. A petition to modify or
vacate an order under this section shall be liberally construed in favor of its
sufficiency.
Tenn. R. Juv. P. 34.
We review a trial court’s denial of a petition brought under Tenn. R. Juv. P. 34
seeking relief from judgment for abuse of discretion. In re: M. J. H., No. W2012-01281-
COA-R3-JV, 2013 WL 3227044, at *10 (Tenn. Ct. App. June 25, 2013), no appl. perm.
appeal filed. What is on appeal to us is solely the Circuit Court’s denial of the Rule 34
petition to vacate. Our Supreme Court has discussed the abuse of discretion standard:
Abuse of discretion is found “ ‘only when the trial court applied
incorrect legal standards, reached an illogical conclusion, based its decision on
a clearly erroneous assessment of the evidence, or employed reasoning that
causes an injustice to the complaining party.’ ” State v. Jordan, 325 S.W.3d 1,
39 (Tenn. 2010) (quoting State v. Banks, 271 S.W.3d 90, 116 (Tenn. 2008)).
The abuse of discretion standard does not permit an appellate court to merely
substitute its judgment for that of the trial court. See Eldridge v. Eldridge, 42
S.W.3d 82, 85 (Tenn. 2001); Henry, 104 S.W.3d at 479. Instead, “[u]nder the
abuse of discretion standard, a trial court's ruling ‘will be upheld so long as
reasonable minds can disagree as to [the] propriety of the decision made.’ ”
-5-
Eldridge, 42 S.W.3d at 85 (quoting State v. Scott, 33 S.W.3d 746, 752 (Tenn.
2000)).
Discover Bank v. Morgan, 363 S.W.3d 479, 487 (Tenn. 2012). Insofar as we base our
decision on different grounds here than did the Circuit Court, our conclusions of law are
made de novo. See S. Constructors, Inc. v. Loudon County Bd. of Educ., 58 S.W.3d 706, 710
(Tenn. 2001). We note that “if the Trial Judge reached the right result for the wrong reason,
there is no reversible error.” Shutt v. Blount, 249 S.W.2d 904, 907 (Tenn. 1952).1
Applying the proper standard, we must determine whether grounds for relief
exist under Tenn. R. Juv. P. 34 and Tenn. Code Ann. § 37-1-139. B.R. alleged numerous
flaws in the process, to wit: 1) failure of notice of truancy charges; 2) non-compliance with
the Tennessee Rules of Juvenile Procedure; and, 3) probation orders exceeded the court’s
authority. Additionally, B.R. asserts that his youth and inexperience with the legal system
prevented early detection of these defects. According to B.R., given the alleged incapacities
and as it was only through eventual appointment of counsel that these myriad problems were
brought to light, justice requires our addressing the underlying merits of B.R.’s appeal.
Nevertheless, from our review of the evidence in the record on appeal, we find
nothing that provides a basis for relief under Tenn. R. Juv. P. 34 and Tenn. Code Ann. § 37-
1-139. As noted, this was not a direct appeal to the Circuit Court of the Juvenile Court’s
original appealable orders. The appeal to the Circuit Court involved only the Juvenile
Court’s denial of the Rule 34 petition to vacate. This appeal now before us involves only the
Circuit Court’s denial of the Rule 34 petition to vacate. Absent any basis for relief under
Tenn. R. Juv. P. 34 and Tenn. Code Ann. § 37-1-139, we will not reach the litany of
underlying issues raised by B.R. which could have been the basis for an appeal of the
Juvenile Court’s original appealable orders. This result may seem stern, but we are obliged
to apply the appropriate standard of review. The importance of choosing and applying the
correct standard of review has been articulated as follows:
The standards of review are the metaphorical hinges on the door to the
realm of appellate review. Even though they are treated by many lawyers and
judges as routine matters, the choice of the correct standard of review can be
influential, if not dispositive. Because of their importance, the choice of the
applicable standard of review should be the starting point for the resolution of
the issues on appeal.
1
We need not and do not decide whether the Circuit Court erred in its conclusions when it addressed
B.R.’s specific underlying issues because, as we will explain, it was unnecessary for the Circuit Court to
decide those specific issues.
-6-
City of Memphis v. Hargett, No. M2012-02141-SC-R11-CV, - - - S.W.3d - - - -, 2013 WL
5655807, at *19 (Tenn. Oct. 17, 2013) (Koch, J., concurring) (citations, footnotes, and
quotations omitted).
We find no basis for relief under any of the stated grounds of clerical mistake,
extraordinary relief, or modification for best interest of the child due to changed
circumstances contained in Tenn. R. Juv. P. 34 and Tenn. Code Ann. § 37-1-139. B.R.’s
Rule 34 petition to vacate, and the amended petitions filed thereafter, simply raise no basis
under Rule 34 to vacate the judgment of the Juvenile Court. While the petitions use the
phrases “newly discovered evidence” and “best interest of the child,” the petitions and the
other items supplied in support of the petitions as contained in the record show that such is
not the actual claimed grounds for vacating the Juvenile Court’s orders. For example, B.R.
focuses on “newly discovered evidence” while acknowledging that the only reason this is
“newly discovered evidence” is because no one looked for it until B.R. was represented by
counsel. In other words, the evidence always was there but no one looked for it until counsel
later was obtained. While not involving Tenn. R. Juv. P. 34, the opinion of this Court in
Isbell v. Travis Elec. Co., No. M1999-00052-COA-R3-CV, 2000 WL 1817252 (Tenn. Ct.
App. Dec. 13, 2000), no appl. perm. appeal filed, is instructive on what is or is not newly
discovered evidence. In discussing a motion to alter or amend based on newly discovered
evidence, this Court stated:
To be successful in a motion on the basis of newly discovered
evidence, the movant must prove that the evidence was
discovered after the trial, that it could not have been discovered
earlier with due diligence, that it is material and not just
cumulative or impeaching, and that it will probably change the
outcome if a new trial is granted.
Isbell, 2000 WL 1817252, at *12. Here, it is not even alleged that the evidence “could not
have been discovered earlier with due diligence. . .” but instead is alleged only that the
evidence was not discovered until counsel was obtained. Additionally, B.R. alleged that Rule
34 relief is appropriate because it is in the “best interest of the child” but does so without
sufficiently even alleging “that changed circumstances so require in the best interest of the
child . . . .” Again, the only alleged changed circumstances are that B.R. later obtained
counsel who then investigated this matter. Each of the claimed constitutional, procedural,
and jurisdictional defects which B.R. alleged in the Rule 34 petition to vacate as being
“evident” in the original proceedings might well have been a legitimate issue on an appeal
of the Juvenile Court’s original appealable orders. This appeal now before us does not
involve such an appeal. B.R.’s Rule 34 petition is nothing more than an attempt to appeal
the Juvenile Court’s original appealable orders long after the time for such an appeal had run.
-7-
That is not the purpose of Rule 34.
B.R.’s reply brief is instructive here. B.R.’s reply brief states that he was
“entitled to relief on [B.R.’s] de novo appeals, which raise constitutional, procedural, and
jurisdictional defects in [his] original proceedings.” The reply brief then misconstrues this
Court’s original opinion remanding this case to the Circuit Court by arguing that this Court
ordered a “plenary handling of the issues raised by [B.R.] . . . .” What this Court actually
ordered was for the Circuit Court to address and resolve the Rule 34 petition to vacate rather
than dismissing it as untimely. If it had been an appeal of the original appealable orders of
the Juvenile Court, such an appeal would have been untimely. What made it timely was that
it was a Rule 34 petition to vacate and not an appeal of the Juvenile Court’s original
appealable orders. Having successfully used Rule 34 to avoid the untimeliness of it having
been an appeal of the original appealable orders of the Juvenile Court, B.R. now wishes it
to be treated not as a Rule 34 petition to vacate but instead as an appeal of the original
appealable orders of the Juvenile Court. This was not what this Court ordered in the first
appeal. We ordered only that the Circuit Court hear and address the Rule 34 petition to
vacate.
Neither Rule 34 nor the statute are intended to allow a juvenile such as B.R.
to, in effect, appeal a decision of the Juvenile Court long after the time has run for such an
appeal. A juvenile may not simply by invoking Tenn. R. Juv. P. 34 effectively eliminate the
requirement that an appeal of an appealable order of a juvenile court be filed within a set
period of time. What B.R. now seeks in his current petition is to be allowed a full appeal of
the Juvenile Court’s original appealable orders long after the appeal time has run based
primarily upon the fact that he was a juvenile in the juvenile court system.
As alleged in the Rule 34 petition to vacate and the amended petitions to
vacate, there was nothing extraordinary about this juvenile’s passage through Juvenile Court.
This purported Rule 34 petition to vacate is nothing more than an attempted appeal of the
Juvenile Court’s original appealable orders long after the time for any such appeal has run,
clearly not the purpose of a Rule 34 petition to vacate. We find and hold that B.R.’s Rule
34 petition to vacate the original appealable orders of the Juvenile Court failed to present any
ground under Tenn. R. Juv. P. 34 or Tenn. Code Ann. § 37-1-139 sufficient for relief. We
affirm, although on different grounds, the grant of summary judgment in favor of the State.
-8-
Conclusion
The judgment of the Circuit Court is affirmed, and this cause is remanded to
the Circuit Court for collection of the costs below. In the interests of justice, the costs on
appeal are assessed against the Appellee, the State of Tennessee.
_________________________________
D. MICHAEL SWINEY, JUDGE
-9-
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31 F.Supp.2d 469 (1999)
UNITED STATES of America,
v.
Awilda ORTIZ, Defendant.
Criminal Action No. 98-371-3.
United States District Court, E.D. Pennsylvania.
January 6, 1999.
*470 Dina A. Keever, U.S. Attorney's Office, Philadelphia, PA, for plaintiff.
Luis Ortiz, Defenders' Association, Philadelphia, PA, for defendant.
MEMORANDUM & ORDER
KATZ, District Judge.
The defendant Awilda Ortiz pled guilty before this court on October 7, 1998 to conspiracy to possess with intent to distribute crack cocaine in violation of 21 U.S.C. § 846. This plea included a stipulation that the drug quantity involved was more than 500 grams but less than 1.5 kilograms of crack cocaine, an amount that placed Ms. Ortiz's base offense level under the Sentencing Guidelines at 36.[1] Under the statute, Ms. Ortiz faces a mandatory minimum of ten years imprisonment with a possible maximum sentence of life imprisonment. The presentence report in this case suggests that the defendant receive a sentence of imprisonment of 168 months for a total base offense level of 35: it reached this number by applying a two level enhancement for possession of a firearm pursuant to U.S.S.G. § 2D1.1(b)(1) and a three level downward adjustment for acceptance of responsibility pursuant to U.S.S.G. § 3E1.1.[2]
Based upon the submissions of parties, three adjustments are now at issue: the applicability of a mitigating role adjustment, the appropriateness of an enhancement for possession of a firearm, and the applicability of the safety valve provisions of U.S.S.G. § 5C1.2.[3]
Mitigating Role Adjustment
The Sentencing Guidelines permit the court to apply a downward adjustment of two, three, or four levels based on the defendant's mitigating role. If the defendant was a minimal participant, a four level decrease is appropriate; if the defendant was a minor participant, the court may grant a two level decrease. See U.S.S.G. § 3B1.2. In cases falling between those two situations, the court may apply a three level adjustment. See id. The commentary states that a minimal participant adjustment generally applies to those individuals who lacked "knowledge or understanding of the scope and structure of the enterprise and of the activities of others." U.S.S.G. § 3B1.2(a) app. note 1. In contrast, a "minor participant means any participant who is less culpable than most other participants, but whose role could not be described as minimal." U.S.S.G. § 3B1.2(b) app. note 2.
Unsurprisingly, such determinations are "heavily dependent upon the facts of the *471 particular case." U.S.S.G. § 3B1.2 background; see also United States v. Isaza-Zapata, 148 F.3d 236, 238 (3d Cir.1998) (discussing same). In general, it is appropriate to consider the "nature of the defendant's relationship to other participants, the importance of the defendant's actions to the success of the venture, and the defendant's awareness of the nature and scope of the criminal enterprise." United States v. Headley, 923 F.2d 1079, 1083-84 (3d Cir.1991) (citations, internal punctuation omitted). The Third Circuit has stated that there are two prerequisites for the application of section 3B1.2: "multiple participants and a differentiation in levels of culpability." Isaza-Zapata, 148 F.3d at 239.
In the present case, the court finds that the prerequisites for the application of a mitigating role adjustment are met. There were at least four participants in the crime, and Ms. Ortiz is relatively less culpable than are other members of the scheme. Although the government's sentencing memorandum indicates that Ms. Ortiz was not an unwitting accomplice to the conspiracy, the information provided demonstrates she was not a leading member. While Ms. Ortiz was involved to some degree in each of the incidents that form the basis for the indictment and the plea, her role was usually to carry messages or drugs back and forth among the other codefendants and the government informants. Based upon the information presented to this court, it does not appear that Ms. Ortiz organized or actively negotiated the transactions, at least not to the degree that other co-defendants did. Ms. Ortiz's relationship to the other defendants is also significant: Ms. Ortiz was the live-in girlfriend of one of the defendants, and her involvement in the conspiracy apparently derived from that relationship. According to the information provided to the court, Ms. Ortiz was not even to receive a share of the profits in the venture. In short, although Ms. Ortiz's degree of knowledge may not have been less than that of her co-defendants, both her involvement and her culpability were materially less than that of other participants. See United States v. Price, 13 F.3d 711, 735 (3d Cir.1994). Consequently, the court finds that Ms. Ortiz warrants a three level downward adjustment based upon her role that, while not minimal, was less than minor.
Enhancement for Possession of a Firearm
The sentencing guidelines provide for an enhancement of two levels if a "dangerous weapon (including a firearm) was possessed." U.S.S.G. § 2D1.1(b)(1). The application notes for this section state that this enhancement "reflects the increased danger of violence when drug traffickers possess weapons." Id. app. note 3. This enhancement shall be applied "if the weapon was present, unless it is clearly improbable that the weapon was connected with the offense." Id.
Initially, then, for such an enhancement to apply, the government has the burden of proving by a preponderance of evidence that the defendant possessed the weapon. See United States v. Watts, 519 U.S. 148, 157, 117 S.Ct. 633, 136 L.Ed.2d 554 (1997) (discussing application of enhancement and stating that an acquittal on weapons charge does not bar a finding by a preponderance of the evidence that the defendant possessed the weapon in connection with a drug offense). Possession may be actual or constructive: a person who knowingly has direct physical control over an object at a given time is in actual possession of it; a person who knowingly has both the power and the intention to exercise control over an object is in constructive possession of it. See United States v. Jenkins, 90 F.3d 814, 817-18 (3d Cir.1996); United States v. Pitts, 3 F.Supp.2d 637, 639 (E.D.Pa.1998). Dominion or control, however, are not established by mere proximity. See Jenkins, 90 F.3d at 818. Assuming that the government demonstrates possession, the Third Circuit has held without discussion that it is the government's burden to prove that the relationship between the firearm and the drug offense is not clearly improbable. See United States v. Price, 13 F.3d 711, 733 (3d Cir.1994); see also United States v. Rowland, Crim.A. No. 93-379-01, 1996 WL 524090, *2 (E.D.Pa. Sept.16, 1996) (noting that defendant did not have burden of disproving connection).
In the present case, the government has not met its burden of demonstrating *472 either that Ms. Ortiz possessed the weapon, or that, as to Ms. Ortiz, the relationship between the firearm at issue and the drug crime was not clearly improbable. See Pitts, 3 F.Supp.2d at 640-41 (holding that possession was not demonstrated when no evidence linking defendant to weapon was produced). The government's sentencing memorandum states that it will not seek the enhancement for possession of a weapon, see Government's Sentencing Mem. at 7, and consequently it has provided no evidence on the matter. In addition, although the defendant does not have the burden of disproving this issue, the court notes that the defendant's sentencing memorandum states that Ms. Ortiz and her boyfriend had been the victims of a violent break-in of their apartment in which both were shot. See Defendant's Sentencing Mem. at 3. According to this representation, Ms. Ortiz's boyfriend purchased the weapon out of fear of the perpetrator of that crime. Particularly given the government's decision not to adduce proof on this matter, this unrefuted evidence provided by the defendant reinforces the court's finding that the enhancement for possession of a firearm is unwarranted.
Application of the Safety Valve
Because the court finds that the defendant did not possess a firearm in connection with the offense of conviction, the safety valve provision applies to Ms. Ortiz. Section 5C2.1 restates the conditions that must be met to permit the court to apply the sentencing guidelines rather than the statutory mandatory minimum otherwise required in certain cases. These provisions state that the safety valve may be applied if
(1) the defendant does not have more than 1 criminal history point ...;
(2) the defendant did not use violence or credible threats of violence or possess a firearm or other dangerous weapon (or induce another participant to do so) in connection with the offense;
(3) the offense did not result in death or serious bodily injury to any person;
(4) the defendant was not an organizer, leader, manager, or supervisor of others in the offense ... and was not engaged in a continuing criminal enterprise ...; and
(5) not later than the time of the sentencing hearing, the defendant has truthfully provided to the Government all information and evidence the defendant has concerning the offense or offenses that were part of the same course of conduct or of a common scheme or plan, but the fact that the defendant has no relevant or useful information to provide or that the Government is already aware of the information shall not preclude a determination by the court that the defendant has complied with this requirement.
U.S.S.G. § 5C1.2; see also 18 U.S.C. § 3553(f) (statutory articulation of same provisions).
The court finds that the defendant meets each requirement of the safety valve. She has no prior criminal history; she was not involved in any violence and did not possess a firearm; no victim suffered bodily injury; she was not a leader or organizer of the offense; and the government represents that she has complied with the final provision requiring cooperation.[4] Consequently, a two level downward adjustment shall be applied pursuant to U.S.S.G. § 2D1.1(b)(6) because the defendant's offense level is high than 26.
Applying these three determinations, the defendant's final offense level is 28, creating a guideline range of 78 to 97 months. The following order incorporates these adjustments and grants the government's motion for a downward departure from that imprisonment range.
NOTES
[1] A base offense level of 36 with no criminal history points creates a sentencing range of 188 to 235 months.
[2] The sentencing range for offense level 35 with no criminal history points is 168 to 210 months.
[3] The parties' plea agreement stipulated to the three-level adjustment for acceptance of responsibility, and the court finds this adjustment to be warranted. The parties also agree that, notwithstanding the defendant's family circumstances, a section 5K2.0 departure is not warranted at this time, and no evidence has been provided to the court on this issue.
[4] Moreover, the government agrees that if the court determines that the firearm enhancement does not apply, the safety valve is appropriate. See Government's Sentencing Mem. at 7.
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IN THE SUPREME COURT OF MISSISSIPPI
NO. 1999-CA-00007-SCT
ROGER HEIGLE
v.
JO ANN HEIGLE (SIMMONS)
DATE OF JUDGMENT: 12/29/1998
TRIAL JUDGE: HON. WILLIAM L. GRIFFIN, JR.
COURT FROM WHICH APPEALED: ISSAQUENA COUNTY CHANCERY COURT
ATTORNEY FOR APPELLANT: ROBERT S. MURPHREE
ATTORNEY FOR APPELLEE: JOHN H. DANIELS, III
NATURE OF THE CASE: CIVIL - DOMESTIC RELATIONS
DISPOSITION: REVERSED AND REMANDED - 11/2/2000
MOTION FOR REHEARING FILED:
MANDATE ISSUED: 11/27/2000
EN BANC.
PITTMAN, PRESIDING JUSTICE, FOR THE COURT:
STATEMENT OF THE CASE AND MATERIAL FACTS
¶1. Roger Heigle ("Roger") and Jo Ann Heigle ("Jo Ann") were granted a divorce on December 1, 1992.
Roger appealed the chancellor's order to this Court on December 28, 1992. This Court vacated the
judgment on both the appeal and cross-appeal and remanded with instructions to the lower court that all
issues, other than the issue of the granting of the divorce, should be stayed until the conclusion of the
bankruptcy proceedings. Heigle v. Heigle, 654 So.2d 895, 898 (Miss. 1995)("Heigle I").
¶2. Jo Ann moved for summary judgment on October 6, 1997. The trial court partially granted Jo Ann's
motion, ruling that as a matter of law and fact, Jo Ann was entitled to equitable distribution of the marital
assets.
¶3. In January, 1998, Jo Ann filed a motion with the trial court, asking that an expert be appointed to
appraise the marital estate as of 1992. Roger opposed the motion and stated that his counsel could not be
present for the hearing on the matter. Regardless, the court heard the motion without the presence of
Roger's counsel. At the hearing, the court appointed an expert, a local accountant, to value the marital
estate.
¶4. The expert failed to have the required report ready for court until December of 1998. Roger's counsel
repeatedly tried to contact the expert to obtain a copy of his report, only to be told by the expert that he
would have to talk to the chancellor before giving Roger's counsel any information.
¶5. Trial on this matter was held on December 17, 1998. At this time, the bankruptcy regarding Heigle
Farms had been settled. The chancellor issued a bench ruling where he valued Heigle Farms at $900,000,
of which $225,000 constituted Roger's interest. The chancellor then placed a $14,000 value on a life
insurance policy owned by Roger and valued the marital residence at $48,150. Jo Ann was awarded 40%
of the marital estate or $114,860. The chancellor went through a series of credits and debits to arrive at a
final figure of $115,060. Roger was ordered to pay $10,000 of Jo Ann's attorney's fees as well as $3,000
in expert fees.
¶6. The chancellor set a supersedeas appeal bond for three times the judgment amount, in direct
contravention to M.R.A.P. 8, which calls for a supersedeas appeal bond of 125% of the judgment. Roger
filed a motion with this Court to reverse the chancellor's order requiring the exorbitant bond. Such order
was granted by this Court. On remand, the chancellor then set the bond at 125%. Roger then appealed the
final judgment to this Court.
STATEMENT OF ISSUES
I. WHETHER THE LOWER COURT ERRED IN GRANTING JOANN'S MOTION FOR
SUMMARY JUDGMENT REGARDING EQUITABLE DISTRIBUTION AND RULING
JOANN WAS ENTITLED TO EQUITABLE DISTRIBUTION PRIOR TO THE TRIAL
OF THE MATTER.
II. WHETHER THE RULING ISSUED BY THE LOWER COURT HAS SUFFICIENT
FACTUAL SUPPORT AND DEVELOPMENT TO ALLOW THIS COURT TO
CONDUCT A MEANINGFUL APPELLATE REVIEW OF THE BASIS FOR THE
LOWER COURT'S RULING IN LIGHT OF THE LOWER COURT'S FAILURE TO
DISCUSS THE FERGUSON FACTORS.
III. WHETHER THE LOWER COURT ERRED IN APPOINTING A COURT
APPOINTED EXPERT TO PREPARE VALUATIONS IN THIS MATTER.
IV. WHETHER THE COURT ERRED IN VALUING THE MARITAL ESTATE AS OF
1998 INSTEAD OF THE TIME OF THE DIVORCE IN 1992.
V. WHETHER THE LOWER COURT ERRED IN EXCLUDING PARTNERSHIP
LIABILITIES ON NOTES SIGNED BOTH BY THE PARTNERSHIP AND ROGER IN
DETERMINING THE VALUE OF THE PARTNERSHIP AND ROGER'S LIABILITIES.
VI. WHETHER THE LOWER COURT ERRED IN THE WAY IT HANDLED ALL THE
ISSUES INVOLVING THE HOUSE THE PARTIES LIVED IN DURING THEIR
MARRIAGE.
VII. WHETHER THE LOWER COURT ERRED IN MAKING ROGER PAY PART OF
JOANN'S ATTORNEYS FEES AS WELL AS THE EXPERT FEES.
VIII. WHETHER THE LOWER COURT ERRED IN REQUIRING THE ATTORNEY
FOR ROGER TO TESTIFY AS A WITNESS FOR JOANN.
IX. WHETHER THE LOWER COURT ERRED IN RELYING UPON ITS OWN
PERSONAL EXPERIENCE AND MATTERS NOT IN THE RECORD IN ITS RULING.
X. WHETHER THE LOWER COURT'S TREATMENT OF ROGER EVIDENCES BIAS
AND PREJUDICE.
XI. WHETHER THE AWARD MADE BY THE LOWER COURT IS EQUITABLE AND
JUST GIVEN THE FACTS AND CIRCUMSTANCES OF THE CASE, INCLUDING
ROGER'S FINANCIAL CONDITION.
XII. WHETHER THE LOWER COURT ERRED IN NOT TAKING INTO ACCOUNT
ROGER'S INABILITY TO PAY IN MAKING THE RULING OF DECEMBER 17, 1998,
THAT FORMED THE BASIS FOR THE JUDGMENT APPEALED FROM AND
WHETHER THE EVIDENTIARY BASIS FOR THE EQUITABLE DISTRIBUTION
ORDERED WAS PROVED BY THE PLAINTIFF.
XIII. WHETHER THE LOWER COURT WAS CONSISTENT IN THE APPLICATION
OF ITS CREDITS AND DEBITS TO THE MARITAL ESTATE IN COMING UP WITH
THE FINAL FIGURE AWARDED TO JOANN.
STANDARD OF REVIEW
¶7. The standard of review in domestic relations cases is well-settled:
Our scope of review in domestic relations matters is limited by our familiar substantial
evidence/manifest error rule. Stevison v. Woods, 560 So.2d 176, 180 (Miss.1990). "This Court will
not disturb the findings of a chancellor unless the chancellor was manifestly wrong, clearly erroneous
or an erroneous legal standard was applied." Bell v. Parker, 563 So.2d 594, 596-97 (Miss.1990).
See also Ferguson v. Ferguson, 639 So.2d 921 (Miss.1994); Faries v. Faries, 607 So.2d 1204,
1208 (Miss.1992). In other words, "[o]n appeal [we are] required to respect the findings of fact
made by a chancellor supported by credible evidence and not manifestly wrong." Newsom v.
Newsom, )557 So.2d 511, 514 (Miss.1990). See also Dillon v. Dillon, 498 So.2d 328, 329
(Miss.1986). This is particularly true in the areas of divorce, alimony and child support. Tilley v. Tilley,
610 So.2d 348, 351 (Miss.1992); Nichols v. Tedder, 547 So.2d 766, 781 (Miss.1989). The word
"manifest," as defined in this context, means "unmistakable, clear, plain, or indisputable." Black's Law
Dictionary 963 (6th ed.1990). Turpin v. Turpin, 699 So.2d 560, 564 (Miss.1997) (quoting Magee v.
Magee, 661 So.2d 1117, 1122 (Miss.1995)).
Clark v. Clark, 754 So.2d 450, 458 (Miss. 1999).
DISCUSSION
I. WHETHER THE LOWER COURT ERRED IN GRANTING JOANN'S MOTION FOR
SUMMARY JUDGMENT REGARDING EQUITABLE DISTRIBUTION AND RULING
JOANN WAS ENTITLED TO EQUITABLE DISTRIBUTION PRIOR TO THE TRIAL
OF THE MATTER.
¶8. This Court's standard of review of a trial court's grant of summary judgment is well established:
Our appellate standard for reviewing the grant or denial of summary judgment is the same standard as
that of the trial court under Rule 56(c) of the Mississippi Rules of Civil Procedure. This Court employs
a de novo standard of review of a lower court's grant or denial of summary judgment and examines all
the evidentiary matters before it-- admissions in pleadings, answers to interrogatories, depositions,
affidavits, etc. The evidence must be viewed in the light most favorable to the party against whom the
motion has been made. If, in this view, there is no genuine issue of material fact and, the moving party
is entitled to judgment as a matter of law, summary judgment should forthwith be entered in his favor.
Otherwise, the motion should be denied. Issues of fact sufficient to require denial of a motion for
summary judgment obviously are present where one party swears to one version of the matter in issue
and another says the opposite. In addition, the burden of demonstrating that no genuine issue of fact
exists is on the moving party. That is, the non-movant should be given the benefit of the doubt.
McCullough v. Cook, 679 So.2d 627, 630 (Miss.1996) (quoting Mantachie Natural Gas Dist. v.
Mississippi Valley Gas Co., 594 So.2d 1170, 1172 (Miss.1992); Clark v. Moore Mem'l United
Methodist Church, 538 So.2d 760, 762 (Miss.1989)).
Mississippi Dep't of Wildlife, Fisheries & Parks v. Mississippi Wildlife Enforcement Officers'
Ass'n, Inc.,740 So.2d 925, 929-30 (Miss. 1999).
¶9. In October, 1997, approximately two and one-half years after this Court's earlier ruling in Heigle I, Jo
Ann moved for summary judgment asking the chancery court to rule that she was "entitled to an equitable
division of the assets accumulated during the time of the marriage between the parties." Jo Ann filed no
additional documents in support of her motion. The chancery court granted Jo Ann's motion, stating that "Jo
Ann Heigle is entitled to an equitable division of the assets accumulated during the time of the marriage
between the parties."
¶10. Roger strenuously objected to Jo Ann's motion, noting that "the earlier ruling of this Court granting an
equitable division of the parties' property has been reversed by the Supreme Court, and the plaintiff now
asks the Court to make the same determination prematurely that has already been reversed once."
¶11. In Heigle I, this Court held the chancellor in error when he found Jo Ann was entitled to an equitable
distribution of the marital estate when the chancellor was unable to value the estate due to bankruptcy.
Heigle I, 654 So.2d at 898. This Court stated:
In the case of property settlement and lump sum alimony, the court's decision must hinge on the value
of the marital estate, or the spouses' separate estates. Ferguson v. Ferguson, 639 So.2d 921, 928-
29 (Miss. 1994); Cheatham v. Cheatham, 537 So.2d 435, 438 (Miss. 1988). In Ferguson, the
Court stated: "Property division should be based upon a determination of the fair market value of the
assets, and these valuations should be the initial step before determining division." 639 So.2d at 929.
In the instant case, that information was not before the court when it made its determination due to the
bankruptcy proceedings involving Heigle Farms. The value of Roger's partnership interest could be
several thousand dollars, or it might be totally worthless. That being the case, the court's decision to
grant JoAnn a property settlement and/or lump sum alimony was premature, and we reverse on this
issue.
654 So.2d at 898.
¶12. The facts that were before the chancellor in Heigle I were the same facts before the chancellor on
remand. Neither JoAnn nor Roger had filed any further evidence with the court that would serve to support
or negate JoAnn's motion for summary judgment. A review of the transcript of the hearing regarding the
motion for summary judgment gives no indication that any new information had been provided the court to
help determine the value of the marital estate. The marital estate had not been assigned a value at the time
summary judgment was granted as was required by this Court in Heigle I. There was no assigned value at
the time of the summary judgment in favor of Jo Ann in 1997.
¶13. The 1997 granting of a summary judgment announcing or awarding equitable distribution is no more
than announcing that the chancellor intended to follow the precedent established by this Court in Ferguson.
Ferguson v. Ferguson, 693 So.2d 921 (Miss. 1994). The trial court's granting of a summary judgment in
its November 1997 order without assigning any value to the marital estate and without any division of such
an estate was a redundant statement of what the law is and did not in any way change the status of the
parties and did no harm to the parties; indeed both parties are entitled to an equitable distribution of the
marital assets.
¶14. The law is clear on this point. As this Court stated in Ferguson, "[p]roperty division should be based
upon a determination of fair market value of the assets, and these valuations should be the initial step before
determining division." Id. at 929. According to Ferguson, the estate must have a value placed upon it
before the chancellor can determine what is an equitable distribution. The chancellor did not place a value
on the marital estate when he awarded Jo Ann 40% of the marital estate. In 1997 the chancellor did not
evaluate the estate, he merely announced that Jo Ann was entitled to an equitable distribution without
deciding what that distribution was.
¶15. Therefore, no harm, no foul, no division of estate, and no reversal on this issue.
II. WHETHER THE RULING ISSUED BY THE LOWER COURT HAS SUFFICIENT
FACTUAL SUPPORT AND DEVELOPMENT TO ALLOW THIS COURT TO
CONDUCT A MEANINGFUL APPELLATE REVIEW OF THE BASIS FOR THE
LOWER COURT'S RULING IN LIGHT OF THE LOWER COURT'S FAILURE TO
DISCUSS THE FERGUSON FACTORS.
¶16. Roger argues that the chancellor committed manifest error in failing to make a record of the findings of
fact and conclusions of law regarding the equitable distribution of the marital estate. Jo Ann, however,
argues that because the chancellor mentioned that he considered the Ferguson factors in his bench ruling,
that is sufficient for this Court to perform a review. After careful inspection of the record before us, this
Court concludes that the chancellor committed manifest error in failing to make the required record of the
findings of fact and conclusions of law regarding the Ferguson factors.
¶17. This Court has made it quite clear that chancellors should make findings of fact and conclusions of law
regarding equitable distribution of the marital estate part of the record to aid this Court in its review. In
Ferguson, the seminal case regarding equitable distribution, this Court stated:
Given the development of domestic relations law, this Court recognizes the need for guidelines to aid
chancellors in their adjudication of marital property division. Therefore, this Court directs the
chancery courts to evaluate the division of marital assets by the following guidelines and to
support their decisions with findings of fact and conclusions of law for purposes of appellate
review.
Ferguson, 639 So.2d at 928 (emphasis added). The Court went on to state in Ferguson that "[t]o aid in
appellate review, findings of fact by the chancellor, together with the legal conclusions drawn
from those findings, are required." Id. at 929 (emphasis added). The Ferguson factors include, but are
not limited to:
1. Substantial contribution to the accumulation of the property. Factors to be considered in
determining contribution are as follows:
a. Direct or indirect economic contribution to the acquisition of the property;
b. Contribution to the stability and harmony of the marital and family relationships as measured by
quality, quantity of time spent on family duties and duration of the marriage; and
c. Contribution to the education, training or other accomplishment bearing on the earning power of the
spouse accumulating the assets.
2. The degree to which each spouse has expended, withdrawn or otherwise disposed of marital
assets and any prior distribution of such assets by agreement, decree or otherwise.
3. The market value and the emotional value of the assets subject to distribution.
4. The value of assets not ordinarily, absent equitable factors to the contrary, subject to such
distribution, such as property brought to the marriage by the parties and property acquired by
inheritance or inter vivos gift by or to an individual spouse;
5. Tax and other economic consequences, and contractual or legal consequences to third parties, of
the proposed distribution;
6. The extent to which property division may, with equity to both parties, be utilized to eliminate
periodic payments and other potential sources of future friction between the parties;
7. The needs of the parties for financial security with due regard to the combination of assets, income
and earning capacity; and,
8. Any other factor which in equity should be considered.
Id. at 928.
¶18. The chancellor, in his bench ruling, stated that "[i]n making my decisions about the equitable
distribution, I have considered all of the factors set forth in Ferguson." He went on to state that "the
'equitable division' of a marital estate is left to the sound discretion of the [c]hancellor, keeping in mind, as I
said earlier, the Ferguson factors." The chancellor made no mention of the Ferguson factors in his Final
Judgment entered December 30, 1998.
¶19. The chancellor then ruled that Jo Ann was entitled to a 40% interest in the marital estate. The
chancellor made no findings of fact or conclusions of law to support this award of 40% of the marital estate
or $114,860. He merely recited the mechanics of how he arrived at that number. Such being the case, this
Court has no basis on which to review the chancellor's 40% award to Jo Ann.
¶20. This Court has not hesitated to reverse chancellors w ho fail to apply the Ferguson factors and make
the requisite findings of fact and conclusions of law as required by this Court. In Sandlin v. Sandlin, 699
So.2d 1198 (Miss. 1997), the chancellor, in making the marital property distribution, mentioned the
Ferguson guidelines and represented that he was applying them to the facts of that case. Id. at 1204.
However, the chancellor failed to make the requisite findings of fact and conclusions of law as required by
Ferguson. This Court held that it "could not evaluate the basis that he [the chancellor] used to determine
the division of property." Id. Finally this Court ruled that "the failure to make findings of fact and conclusions
of law was manifest error requiring reversal and remand." Id.
¶21. In Kilpatrick v. Kilpatrick, 732 So.2d 876 (Miss. 1999), this Court reversed a chancellor for failing
to make the required findings of fact and conclusions of law regarding the distribution of the marital estate.
Id. at 881. While the chancellor did enumerate the actual property division, the chancellor made no
conclusions of law to support the division of the marital estate. Id. at 878-88. This Court reversed and
remanded for specific findings of fact stating that "[w]ithout findings from the Chancellor concerning this
income or use of income, we cannot determine if the distribution of property outlined above meets the
standards of equitable distribution required by Ferguson." Id. at 881.
¶22. In the case sub judice, the chancellor, as did the chancellor in Kilpatrick, enumerated the actual
property division. In this case, as in Kilpatrick, the chancellor failed to make any conclusions of law as to
the Ferguson factors to support the division of the marital estate. As a result of the chancellor's failure to
apply the Ferguson factors properly, this Court has no choice but to reverse and remand this action to the
trial court.
III. WHETHER THE LOWER COURT ERRED IN APPOINTING A COURT
APPOINTED EXPERT TO PREPARE VALUATIONS IN THIS MATTER.
¶23. Roger next cites the chancellor's appointment of an expert witness as error. Jo Ann filed a motion
requesting that the chancellor appoint an expert witness to value the marital estate as of December 31,
1992. Roger opposed the motion, arguing that it would only assist Jo Ann "in proving her case." Roger
further opposed the hearing on the motion because counsel for Roger could not be present on the day of the
hearing. On the day of the hearing Roger's counsel telephoned the court administrator who informed
counsel that the motion was still set to be heard. Roger's counsel asked to participate by phone. The court
administrator told counsel that she would call back if the hearing took place. Counsel was not contacted by
the court administrator. The chancellor held the hearing on the motion, granted the motion and appointed
Donald Tackett and Associates to prepare a valuation of the marital estate.
¶24. In Bryant v. Horton, 124 Miss. 1, 86 So. 642 (1921), this Court reversed the trial court for hearing
and granting a motion to dismiss without notice to opposing counsel or without giving opposing counsel the
opportunity to be heard. This Court stated "[w]e think the proper practice in such a case is to give notice to
opposing counsel when action is to be taken by the court, so that he may appear and be heard, or remedy
the trouble urged against his case." Id. at 643.
¶25. In the case sub judice, Roger's counsel was noticed that the motion was to be heard on February 5,
1998. Counsel immediately notified the court that he could not attend the hearing and asked that it be
rescheduled. Counsel received no reply from Jo Ann's counsel or the chancellor. When counsel attempted
to participate in the hearing telephonically, the court administrator never called counsel to advise him of the
hearing time as she had promised. In effect, counsel was not noticed because the court administrator failed
to notify counsel when the hearing began.
¶26. Furthermore, it is the chancellor's duty and responsibility to make sure that every person who has a
legal interest in a proceeding or his counsel is given "full right to be heard according to law...." Code of
Judicial Conduct, Canon 3(A)(4). Neither Roger nor his counsel was given any right at all to be heard at
this proceeding.
¶27. While we cannot say that the chancellor would not have appointed the expert witness if Roger had
attended the hearing, we can say that Roger was possibly harmed by this appointment. The chancellor
instructed the expert to value the marital estate as of December 31, 1992. The expert testified that he used
a January, 1998, balance sheet to begin his evaluation. Indeed his report stated that he was to determine the
marital estate's "current value."
¶28. Because this is a domestic relations case, we will review the decision of the chancellor to appoint an
expert under the manifest error, abuse of discretion standard applied in domestic relations cases. Clark,
754 So.2d at 458.
¶29. M.R.E. 706 states in pertinent part:
(a) Appointment. The court may on its own motion or on the motion of any party enter an order to
show cause why expert witnesses should not be appointed, and may request the parties to submit
nominations. The court may appoint any expert witnesses agreed upon by the parties, and may
appoint expert witnesses of its own selection. . . .
M.R.E. 706 clearly authorizes the appointment of an expert upon the motion of a party. As the Court of
Appeals correctly noted, "[t]he appointment of an expert by the court under Mississippi Rule of Evidence
706 is done sparingly, and then only in exceptional cases involving complex issues where the expert's
testimony would be helpful to the trier of facts. M.R.E. 706."Trilogy Communications, Inc. v. Thomas
Truck Lease, Inc., 733 So.2d 313, 317 (Miss. Ct. App. 1998).
¶30. The chancellor did not abuse his discretion in appointing an expert. The mechanics of this case are
extremely complicated. Involved in this case is the valuation of a partnership that was in bankruptcy at the
time of the divorce in 1992. As of 1998, the partnership had ended the bankruptcy and had begun
rebuilding the farming operations. The parties had lived in a home allegedly paid for and owned by the
partnership. Living expenses for the parties had been paid by the partnership. Because of the complexity of
the financial matters in this case, it cannot be said that the chancellor abused his discretion in appointing an
expert.
¶31. As stated earlier, though, Roger was possibly harmed by the appointment of the expert witness.
Specifically, Roger should have been allowed input on matters such as the date to be used in the valuation
and the method of selecting the expert. Upon remand, Roger should be given an opportunity to be heard
with regard to the expert witness.
IV. WHETHER THE COURT ERRED IN VALUING THE MARITAL ESTATE AS OF
1998 INSTEAD OF THE TIME OF THE DIVORCE IN 1992.
¶32. Roger asserts that the chancellor erred in valuing the marital estate as of 1998 instead of 1992, the
date of divorce. Jo Ann asserts that the chancellor did value the marital estate as of 1992.
¶33. While Roger cites no authority for this issue, it is necessary for this Court to speak to the issue to give
guidance to the Court below and to avoid confusion on remand.
¶34. In the order appointing the expert, the chancellor stated that the valuation was to be made "as of
12/31/92." Upon examination of the report submitted by the expert, it is clear that the estate was valued in
1998 terms.
¶35. The report is dated December 10, 1998. In the first paragraph the expert states that he was
"appointed to determine the current value of the marital estate." The report goes on to say that a financial
statement dated January 18, 1998, was used in the valuation. The report valued the partners' equity at
$901,945.21 with Roger's 25% interest coming to $225,486.30. The marital residence was valued at $48,
150, with no supporting documentation. Net cash value of a life insurance policy on Roger's life with Jo Ann
as beneficiary was valued at $14,000.
¶36. The chancellor adopted the valuation of the expert. In his bench ruling, the chancellor valued Roger's
interest in Heigle Farms at $225,000, the life insurance at $14,000, and the marital estate at $48,150, for a
total valuation of $287,150.
¶37. The actions of the chancellor in assigning a value to the marital estate constitute manifest error requiring
reversal by this Court. Marital property is defined as "any and all property acquired or accumulated during
the marriage." Hemsley v. Hemsley, 639 So.2d 909, 915 (Miss. 1994). "Assets so acquired or
accumulated during the course of the marriage are marital assets and are subject to an equitable distribution
by the chancellor." Id. Further, "non-marital property is not subject to equitable distribution." Devore v.
Devore, 725 So.2d 193, 196 (Miss. 1998).
¶38. The chancellor committed manifest error in valuing the property as of 1998. In Heigle I, the
chancellor could not place a value upon the partnership as of 1992 because the partnership was in
bankruptcy. Upon remand, it will be incumbent upon the chancellor to value the partnership at the time the
bankruptcy was concluded. This Court is unable to ascertain that date as such information was not
provided to this Court.
¶39. Once the marital estate is assigned a post-bankruptcy value, this Court directs that Jo Ann be
awarded interest on her equitable share of the marital estate with such interest commencing on the date of
the conclusion of the bankruptcy.
VII. WHETHER THE LOWER COURT ERRED IN MAKING ROGER PAY PART OF
JO ANN'S ATTORNEYS FEES AS WELL AS THE EXPERT FEES.
¶40. The chancellor ordered Roger to pay $10,000 of the $15,000 Jo Ann owed in attorney's fees. The
chancellor also ordered that Roger pay $3,000 in expert fees. The chancellor then went on to order that the
court costs be divided "50/50 between the parties."
¶41. It is an abuse of discretion for a trial court to award costs and attorney fees without a showing that one
party is unable to pay the fees in question. Hankins v. Hankins, 729 So.2d 1283, 1286 (Miss. 1999).
Here, the chancellor did not make any findings that Jo Ann was unable to pay her attorney fees or the
expert fees. Because the chancellor made no findings as required by this Court, we reverse the chancellor's
order requiring Roger to pay $10,000 in attorney fees incurred by Jo Ann as well as the $3,000 expert
fees. We reverse and remand this issue for consideration by the court upon remand.
V. WHETHER THE LOWER COURT ERRED IN EXCLUDING PARTNERSHIP
LIABILITIES ON NOTES SIGNED BOTH BY THE PARTNERSHIP AND ROGER IN
DETERMINING THE VALUE OF THE PARTNERSHIP AND ROGER'S LIABILITIES.
VI. WHETHER THE LOWER COURT ERRED IN THE WAY IT HANDLED ALL THE
ISSUES INVOLVING THE HOUSE THE PARTIES LIVED IN DURING THEIR
MARRIAGE.
VIII. WHETHER THE LOWER COURT ERRED IN REQUIRING THE ATTORNEY
FOR ROGER TO TESTIFY AS A WITNESS FOR JOANN.
IX. WHETHER THE LOWER COURT ERRED IN RELYING UPON ITS OWN
PERSONAL EXPERIENCE AND MATTERS NOT IN THE RECORD IN ITS RULING.
X. WHETHER THE LOWER COURT'S TREATMENT OF ROGER EVIDENCES BIAS
AND PREJUDICE.
XI. WHETHER THE AWARD MADE BY THE LOWER COURT IS EQUITABLE AND
JUST GIVEN THE FACTS AND CIRCUMSTANCES OF THE CASE, INCLUDING
ROGER'S FINANCIAL CONDITION.
XII. WHETHER THE LOWER COURT ERRED IN NOT TAKING INTO ACCOUNT
ROGER'S INABILITY TO PAY IN MAKING THE RULING OF DECEMBER 17, 1998,
THAT FORMED THE BASIS FOR THE JUDGMENT APPEALED FROM AND
WHETHER THE EVIDENTIARY BASIS FOR THE EQUITABLE DISTRIBUTION
ORDERED WAS PROVED BY THE PLAINTIFF.
XIII. WHETHER THE LOWER COURT WAS CONSISTENT IN THE APPLICATION
OF ITS CREDITS AND DEBITS TO THE MARITAL ESTATE IN COMING UP WITH
THE FINAL FIGURE AWARDED TO JOANN.
¶42. Because we reverse and remand to the trial court on Issues I, II, III, IV, and VII, we will not address
the remaining issues.
CONCLUSION
¶43. This Court holds that the court below erred in failing to make a record as to the findings of fact and
conclusions of law regarding his application of the Ferguson factors in awarding Jo Ann 40% of the marital
estate.
¶44. While the chancellor did not err in appointing an expert; the expert, in contravention to the order of the
chancellor, valued the marital estate as of 1998 instead of 1992, or at the end of the bankruptcy. This
valuation constitutes manifest error.
¶45. The chancellor was also in error when he ordered Roger to pay part of Jo Ann's attorney fees as well
as the expert fees. The chancellor made no finding that Jo Ann was unable to pay those fees, in direct
contravention to established law.
¶46. The judgment of the Chancery Court of Issaquena County is reversed, and this case is remanded to
that court for further proceedings consistent with this opinion.
¶47. REVERSED AND REMANDED.
PRATHER, C.J., WALLER, COBB AND DIAZ, JJ., CONCUR. SMITH, J., DISSENTS
WITHOUT SEPARATE WRITTEN OPINION. BANKS, P.J., CONCURS IN PART AND
DISSENTS IN PART WITH SEPARATE WRITTEN OPINION JOINED BY McRAE, J.
PRATHER, C.J., JOINS IN PART. MILLS, J., NOT PARTICIPATING.
BANKS, PRESIDING JUSTICE, CONCURRING IN PART AND DISSENTING IN PART:
¶48. I agree that the chancery court's judgment must be reversed and this case remanded for further
proceedings to more precisely articulate a consideration of the Ferguson factors. I also believe, however,
that the chancellor's acceptance of the court-appointed expert's valuation without adequate support for that
expert's disregard of certain partnership debts requires reversal. Finally, I disagree with the majority's
command that the trial court consider only the value of the marital estate as of the time that the bankruptcy
ended for purposes of determining equitable distribution. In my view, the task is a bit more complicated
than that.
I.
¶49. Generally, the valuation of a marital estate is as of a date coinciding with the dissolution of the
marriage. This may be deemed the date of filing for divorce, the date of the hearing at which a divorce is
granted or the date of the hearing at which property issues are determined depending upon the jurisdiction.
See, e.g., Catalfumo v. Catalfumo, 704 So.2d 1095, 1098 (Fla. Dist. Ct. App. 1998)(holding trial court
did not abuse its discretion in finding the date of filing the petition for dissolution as the valuation date for
equitable distribution); Morgan v. Ackerman, 964 S.W.2d 865, 869 (Mo. Ct. App. 1998) (holding that
valuation should occur on the date of the trial at which property issues are determined); Holbrook v.
Holbrook, 309 N.W.2d 343, 346 (Wis. Ct. App. 1981)(holding courts should utilize the date at which the
divorce is granted); our case law suggests that, for valuation purposes, we have generally used a date that
coincides with the end of the marriage. Godwin v. Godwin, 758 So.2d 384, 386 (Miss. 1999)
(determination that order for separate maintenance indicated end of marriage). Courts have also recognized,
however, that if the presumptive date is inequitable for all or some assets, the court, in the application of
principles of equity may choose some other more appropriate date. Goldman v. Goldman, 589 A.2d
1358, 1360 (N.J. Super. Ct. Chan. Div. 1991), aff'd and remanded in part, 646 A.2d 504 (N.J. Super.
Ct. App. Div. 1994).
¶50. Bankruptcy of a business enterprise is among the complications which may cause a delay in valuation.
Whatever the cause, however, it should be recognized that valuation as of a date significantly removed from
the dissolution of the marriage creates additional concerns in determining the percentage of value to be
assigned to the marital estate. See generally, Lynn Weddle Judkins, The Road to Splitsville: How the
Timing of Valuation During Marital Dissolution Leads to Costly Detours, 15 J. Am. Acad. Matrim.
Law. 465 (1998). In the case of a going concern, whether in or out of bankruptcy, a distinction must be
made between value gained by the continuing non-marital efforts of the spouse in possession and that
gained by passive appreciation of business assets. Bednar v. Bednar, 474 A.2d 17, 18 (N.J. Super. Ct.
App. Div. 1984) (When evaluating equitable distribution in light of accretion or enhancement in value, value
must be analyzed in terms of whether the value was attributable to the personal industry of the party
controlling the asset, apart from the non-possessory partner, or simply to fortuitous increase in value 'due
merely to inflation or other economic factors.') (quoting Mol v. Mol, 370 A.2d 509 (N.J. Super. Ct. App.
Div. 1977)).
¶51. In the instant case, the chancellor ordered that the estate be valued as of 1992, but he seems to have
accepted a value based upon an adjustment to 1998 values, which did not necessarily reflect 1992 values.
The majority suggests that the chancellor should have considered only a valuation as of the time that the
bankruptcy ended. There was no testimony as to when the bankruptcy "ended." There was testimony that
the reorganization plan had been confirmed by December 1997, at the time that a loan had been made, but
the date of confirmation of the plan and closing of the Chapter 11 estate was not established. In my view,
the chancellor must determine both the value at the time of dissolution of the marriage and the value at the
time that the distribution is made. Assuming that the latter value is greater, the chancellor must then
determine the percentage of the increase which is attributable to passive growth of marital assets as
opposed to Mr. Heigle's post-marital efforts.
¶52. The chancellor made an effort to consider these factors. He observed that it would be inequitable to
award Mrs. Simmons appreciation in value generated by the post-marital efforts of Mr. Heigle. On the
other hand, he also expressly considered the ways in which the spouse in possession may benefit from the
use of the marital assets. He then arrived at a figure of 40%, a downward departure from what he viewed
as the presumptive 50% established in Hemsley v. Hemsley, 639 So.2d 909 (Miss. 1994) and its progeny,
e.g., Arthur v. Arthur, 691 So.2d 997 (Miss. 1997); Johnson v. Johnson, 650 So.2d 1281 (Miss.
1995). He did so summarily, however, and as a policy matter, this Court requires a more detailed
explanation. Louk v. Louk, 761 So.2d 878, 883 (Miss. 2000).
II.
¶53. Finally, I also find error in the failure of the chancellor to explain adequately the decision to accept the
expert's explanation for disregarding debts owed by the partnership but collateralized by assets outside the
partnership. The suggestion that one's debt may be disregarded because it is secured by the property of
another is simply wrong. There may be a valid reason for disregarding this debt but it does not appear in the
chancellor's opinion. Thus, the judgment should be reversed and this case remanded for this reason as well.
McRAE, J., JOINS THIS OPINION. PRATHER, C.J., JOINS IN PART.
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100 Wn.2d 739 (1984)
675 P.2d 226
JOHN LUND, Appellant,
v.
ALAN CAPLE, ET AL, Respondents.
No. 49156-9.
The Supreme Court of Washington, En Banc.
January 12, 1984.
David A. Summers, for appellant.
Robert P. Piper, Philip A. Talmadge, and Allen R. Sakai (of Karr, Tuttle, Koch, Campbell, Mawer & Morrow, P.S.); Christopher W. Tompkins (of Betts, Patterson & Mines, P.S.); Kenneth Cornell (of Moren, Lageschulte & Cornell, P.S.); and Murray, Dunham & Murray, for respondents Caple.
D. Michael Tomkins and Rosemary J. Irvin, for respondent Westgate Chapel.
BRACHTENBACH, J.
This case poses the question whether a husband's lawsuit for loss of consortium damages is barred by this court's abolition of alienation of affections *741 actions in Wyman v. Wallace, 94 Wn.2d 99, 615 P.2d 452 (1980). The husband brought suit against Westgate Chapel and Pastor Caple alleging that sexual relations between his wife Nanette and Caple constituted outrageous conduct and/or negligent impairment of consortium. The trial court granted defendants' summary judgment motions and dismissed the case, reasoning that the suit amounted to an action for alienation of affections. We affirm and hold that a spouse may not maintain an independent action for loss of consortium damages if that suit is essentially a substitute for an alienation of affections suit.
Alan Caple served as pastor of Westgate Chapel, a church which Mr. and Mrs. Lund attended. In July of 1979 Nanette Lund consulted Caple for marital and personal counseling. The two met for three weekly counseling sessions; they then agreed no further sessions were necessary, but that they could remain "friends". John Lund did not participate in the counseling sessions. After the final session, Caple and Mrs. Lund telephoned each other often and met intermittently over a 2-year period. Eventually, they engaged in sexual relations.
In May 1981, lay officials of the Chapel learned of the relationship and confronted the pastor. Caple then ended his relationship with Nanette and in July of 1981 resigned as pastor.
Upon discovery of the relationship, Mr. Lund filed suit seeking recovery from Caple on two theories: negligent impairment of consortium and outrage. Nanette refused to join in the lawsuit. Mr. Lund also sought recovery from Westgate Chapel under two theories: negligent hiring and retention of Caple and respondeat superior. The trial court granted defendants' motion for summary judgment and dismissed the lawsuit.
I
[1] The husband's first tort theory is that Caple's conduct constitutes outrage. The elements of outrage, as stated in the Restatement (Second) of Torts § 46 (1965) and *742 adopted by this court, are:
(1) One who by extreme and outrageous conduct intentionally or recklessly causes severe emotional distress to another is subject to liability for such emotional distress ...
(2) Where such conduct is directed at a third person, the actor is subject to liability if he intentionally or recklessly causes severe emotional distress
(a) to a member of such person's immediate family who is present at the time ...
Contreras v. Crown Zellerbach Corp., 88 Wn.2d 735, 737 n. 1, 565 P.2d 1173 (1977). Grimsby v. Samson, 85 Wn.2d 52, 59, 530 P.2d 291, 77 A.L.R.3d 436 (1975). The fatal flaw in appellant's outrage theory is that he was not present when the alleged outrageous conduct occurred, and did not even learn of the conduct until several months later. Since appellant was not present, he has not established the tort of outrage. Such presence is a crucial element of a claim for outrage when the conduct is directed at a third person. Restatement § 46(2)(a).
II
The nature of the husband's second tort theory is less straightforward. In general it may be characterized as a tort action in which a "deprived"[1] spouse sues for loss of consortium, without joining the "impaired" spouse upon whose injuries the loss of consortium claim is necessarily based. This claim raises at least two distinct questions. May one spouse sue alone for loss of consortium? If so, are the allegations so similar to an alienation of affections lawsuit as to be barred as a matter of policy? The resolution of these questions requires reconciling two decisions of this court: Wyman v. Wallace, supra, in which we abolished alienation *743 of affections as a viable lawsuit and Lundgren v. Whitney's Inc., 94 Wn.2d 91, 614 P.2d 1272 (1980), in which we awarded loss of consortium damages to a spouse not directly injured by tortious conduct.
A
The question of whether a loss of consortium claim may be maintained as a cause of action without joining the other spouse's underlying tort claims is a novel one. Since an element of loss of consortium is a separate, direct injury to a spouse, most such cases involve the claims of both spouses. An example is Lundgren v. Whitney's Inc., supra, in which this court allowed a wife to recover for loss of consortium damages. In that case, an action for negligence based on a truck accident in which the husband sustained personal injuries, both husband and wife were plaintiffs. The present case differs because the "impaired" spouse (the wife) is not a party to the lawsuit.
[2] Respondents argue that the directly injured spouse must be a party to any action in which the noninjured spouse is seeking loss of consortium damages. Dean Prosser unequivocally characterizes such lawsuits as separate:
The action of the husband and parent is entirely distinct from that which may be maintained on behalf of the wife or child for the original tort itself.
W. Prosser, Torts § 125, at 889 (4th ed. 1971). Discussing joinder of claims, the Restatement (Second) of Torts is equally definitive in characterizing loss of consortium as a separate cause of action.
The invasion of the deprived spouse's interests in the marriage is a separate tort against that spouse, although it is conditioned upon factors that also constitute a tort against the impaired spouse.
Restatement (Second) of Torts § 693(g) (1977). Although the cases normally involve res judicata or collateral estoppel issues, most courts also consider loss of consortium a distinct injury that may be recovered in a separate action. E.g., Millington v. Southeastern Elevator Co., 22 N.Y.2d *744 498, 239 N.E.2d 897, 293 N.Y.S.2d 305 (1968); but see Sisemore v. Neal, 236 Ark. 574, 367 S.W.2d 417 (1963).
In Washington RCW 4.08.030(1) provides:
Either husband or wife may sue on behalf of the community: Provided, That
(1) When the action is for personal injuries, the spouse having sustained personal injuries is a necessary party;
This court has not construed the statute. Respondents contend that under the statute the wife was a necessary party to any action based upon Caple's alleged tortious conduct and absent her joinder the lawsuit should be dismissed. That argument, however, does not sufficiently account for the distinct nature of the injuries to the "deprived" spouse. Loss of consortium relates to the "`loss of love, affection, care, services, companionship, society and consortium ...'". Lundgren, at 94. As such, the alleged injuries relate solely to the "deprived" spouse and are distinguishable from the cause of action of the "impaired" spouse. The better rule is that a "deprived" spouse may sue for loss of consortium damages by either joining in a lawsuit with the spouse who sustained primary injuries or by bringing an independent suit.
B
The next question involves policy arguments raised by the husband's theory that Caple should be held liable for negligent impairment of consortium. In effect, "negligent impairment of consortium" describes a separate tort. An element of this cause of action is the tort committed against the "impaired" spouse. Lundgren v. Whitney's Inc., supra. In this case, the alleged underlying tort is negligence. Appellant's negligence theory is essentially pastoral malpractice. The theory is presented by analogy because this court has never set out a standard of care for pastors. See, e.g., Walker v. Bangs, 92 Wn.2d 854, 859, 601 P.2d 1279 (1979) (attorney's standard of care).
*745 [3] In opposition to that theory, respondents argue that even if an action for pastoral malpractice may be maintained in some situations, dismissal of this case was proper because the gravamen of appellant's case is an action for alienation of affections. The elements of the tort of alienation of affections are:
(1) an existing marriage relation; (2) a wrongful interference with the relationship by a third person; (3) a loss of affection or consortium; and (4) a causal connection between the third party's conduct and the loss.
Carrieri v. Bush, 69 Wn.2d 536, 542, 419 P.2d 132 (1966). In this case those precise elements are presented in the husband's complaint. Wyman v. Wallace, supra, however, abolished that tort and appellant cannot maintain an action based solely upon such a theory. Accord, Irwin v. Coluccio, 32 Wn. App. 510, 648 P.2d 458 (1982) (action for criminal conversation abolished). We believe, however, that the policies underlying Wyman require us to go beyond the mere labels on appellant's claim and consider the nature of his claims.
Appellant claims that Caple's sexual relations with appellant's wife constitute a breach of his professional duties as a counselor that resulted in emotional distress to Nanette. This emotional distress, in turn, so affected Nanette that appellant allegedly lost the benefit of her services and companionship. In essence, Lund seems to claim that his wife's extramarital relations with Caple damaged the Lunds' marital relationship. As such, that claim clearly would satisfy the elements of an action for alienation of affections quoted above. Carrieri, at 542. Respondents, therefore, argue that as a matter of policy this suit should be barred as an attempt to sue for alienation of affections under a different label. The trial court agreed and decided that Lund's allegations circumvented the abolition of the alienation of affections tort.
Other state courts have examined similar claims and concluded that although labeled differently, the plaintiffs in *746 effect were seeking damages for alienation of affections or criminal conversation. For example, in Goldberg v. Musim, 162 Colo. 461, 427 P.2d 698 (1967), a wife brought suit against her husband's girl friend alleging impairment of contract. The wife's theory was that the girl friend convinced the husband to leave the wife, in order for the girl friend to acquire the property and estate accumulated during the marriage. The Colorado Supreme Court held that the complaint set forth a claim for alienation of affections. Goldberg, at 467. Since that action had been abolished by statute, the court affirmed the trial court's dismissal of the complaint.
Similarly, the Michigan Court of Appeals dismissed a complaint because it constituted an action for alienation of affections, even though plaintiff had alleged breach of contract, malpractice, assault and battery, negligence and fraud. Nicholson v. Han, 12 Mich. App. 35, 162 N.W.2d 313 (1968). The case is noteworthy because on the basis of facts very similar to this case the court found that plaintiff's theories were in substance an alienation of affections lawsuit. In Nicholson, the plaintiff and his wife consulted the defendant doctor for psychiatric and marriage counseling services. According to the plaintiff, instead of rendering the agreed-upon services, the doctor persuaded plaintiff's wife to engage in sexual relations with defendant and obtain a divorce. The Michigan statutes abolished the torts of alienation of affections and criminal conversation. The Michigan Supreme Court found that the gravamen of the complaint sounded in tort rather than contract. Since plaintiff argued the fact of the marriage, adulterous intercourse, the inducement to divorce, as well as the loss of society and services, the complaint placed it "squarely within the abolished actions ...". Nicholson, at 43-44. Therefore, the dismissal of the action was affirmed.
As we recognized in Wyman there are several policy reasons for eliminating alienation of affections as a viable lawsuit:
*747 (1) The underlying assumption of preserving marital harmony is erroneous; (2) The judicial process is not sufficiently capable of policing the often vicious out-of-court settlements; (3) The opportunity for blackmail is great since the mere bringing of an action could ruin a defendant's reputation; (4) There are no helpful standards for assessing damages; and (5) The successful plaintiff succeeds in compelling what appears to be a forced sale of the spouse's affections.
Wyman, at 105. Those same considerations apply with equal force in the present case.
Here, John Lund is suing because of alleged sexual misconduct that interfered with his marriage. His wife did not join the lawsuit, which alone would not bar the action, but does indicate at least the possibility of a vengeful motive or a so-called "forced sale" on the part of a wronged husband. As such, this lawsuit is so similar to an alienation of affections action that as a matter of policy it falls within the prohibitions of Wyman v. Wallace, supra.
This opinion, however, should not be read as precluding an action against a counselor, pastoral or otherwise, in which a counselor is negligent in treating either a husband or wife. It is conceivable that a malpractice action would be appropriate where a counselor fails to conform to an appropriate standard of care, injures the patient/spouse which in turn results in loss of consortium damages to the other spouse. Where, however, the alleged underlying tort is based upon an extramarital relationship with the "impaired" spouse and the "impaired" spouse does not desire to assert a claim, such an action becomes in essence a suit for alienation of affections. Absent the "impaired" spouse's claims, remaining allegations amount to an alienation of affections action, i.e., a viable marital relationship, wrongful interference with the relationship by a third person, loss of consortium and a causal connection. Therefore, we hold the prohibition of alienation of affections actions extends to those cases in which a lone spouse sues a third party for alleged sexual misconduct with his or her spouse and seeks only loss of consortium damages.
*748 The trial court is affirmed.
WILLIAMS, C.J., ROSELLINI, UTTER, DOLLIVER, DORE, DIMMICK, and PEARSON, JJ., and CUNNINGHAM, J. Pro Tem., concur.
Reconsideration denied March 5, 1984.
NOTES
[1] The terminology used should be clarified. The Restatement characterizes the potential plaintiffs in this type of lawsuit as follows: an "impaired" spouse is one who suffers bodily harm as a result of tortious conduct; while a "deprived" spouse is one who sues for loss of services and society. Restatement (Second) of Torts § 694(a) (1977). Here, John Lund is the "deprived" spouse, suing for loss of consortium. Nanette is the "impaired" spouse who allegedly suffered the underlying injuries.
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Supreme Court of Louisiana
FOR IMMEDIATE NEWS RELEASE NEWS RELEASE #005
FROM: CLERK OF SUPREME COURT OF LOUISIANA
The Opinions handed down on the 30th day of January, 2018, are as follows:
PER CURIAM:
2016-K -1502 STATE OF LOUISIANA v. DARRYL JONES (Parish of Ascension)
Based on the evidence presented, the jury could only speculate
defendant was guilty as a principal to the second degree murder.
When issues are raised on appeal both as to the sufficiency of
the evidence and as to one or more trial errors, the reviewing
court should first assess the sufficiency of the evidence, see
State v. Hearold, 603 So.2d 731, 734 (La. 1992), because the
accused may therefore be entitled to an acquittal under Hudson v.
Louisiana, 450 U.S. 40, 101 S.Ct. 970, 67 L.Ed.2d 30 (1981).
Defendant here is so entitled. See generally State v. Corkern,
593 So.2d 1259, 1260 (La. 1992) (per curiam) (When the state’s
evidence merely invites the jury to speculate on a number of
reasonable probabilities, some consistent with guilt, others
consistent of innocence, a reasonable jury must entertain a
reasonable doubt of the defendant’s guilt.); see also State v.
Schwander, 345 So.2d 1173, 1175 (La. 1978)) (“[a] trial jury’s
inference that an accused aided and abetted in a crime cannot be
‘mere speculation based upon guilt by association.’”) (quoting
State v. Williams, 310 So.2d 513, 515 (La. 1975)). Accordingly,
for the reasons assigned, defendant’s conviction and sentence are
reversed and a judgment of acquittal is entered in his favor.
REVERSED.
WEIMER, J., additionally concurs.
01/30/18
SUPREME COURT OF LOUISIANA
No. 2016-K-1502
STATE OF LOUISIANA
VERSUS
DARRYL JONES
ON WRIT OF CERTIORARI TO THE COURT OF APPEAL,
FIRST CIRCUIT, PARISH OF ASCENSION
PER CURIAM
Codefendants Darryl Jones, Cecil Ray Beals, and Calvin K. Williams were
indicted, tried together, and found guilty of the second degree murder of their
associate Gerald G. Wilkins. The evidence presented at trial established that Beals,
Williams, and the victim regularly visited defendant Darryl Jones’s home in Baton
Rouge. Beals also lived in defendant’s garage. Notably, all were present there on
the day and evening before Wilkins was killed.
Wilkins was found alongside Panama Road in Sorrento, dead, with two
gunshot wounds to the head. The victim was holding a crack pipe and appeared to
have been shot while he was urinating. A witness heard the gunshots and saw a
distinctive vehicle (like that owned by defendant and often used by Beals)
speeding down Panama Road between 3:30 and 4:00 a.m. on January 12, 2013.
Officers obtained surveillance video showing Beals at a gas station near the crime
scene with defendant’s vehicle at 3:38 a.m. The surveillance video also showed an
unidentified driver and an unidentified backseat passenger.
Defendant told police that the victim was at defendant’s home on January
11, 2013, and that the victim left between 10:00 and 11:00 p.m., never to return.
Defendant also told police that the victim was a troublemaker but that defendant
had instructed his friends not to harm the victim. Marvin McGee, another associate
of the codefendants, testified he habitually used drugs at defendant’s residence
with the codefendants. McGee said he was also present at defendant’s home on
January 11 and that, although defendant’s vehicle was gone at about 10:30 or
11:00 p.m. and Williams and Beals with it, defendant stayed home all that night.
McGee also confirmed that the victim was a troublemaker, i.e. he had robbed
Justin Thomas (who retaliated by shooting the victim’s mother’s home), robbed
defendant, and he used counterfeit money to purchase drugs.
McGee also loaned Williams a cell phone. Cell phone records showed that
McGee’s phone was transported from Baton Rouge to Sorrento where it was used
around the time of the murder, and then returned to Baton Rouge. It was used to
call both the victim and defendant’s phones several times as well as a phone
belonging to Williams’s half-brother Shawn Aikens. Defendant’s phone never left
Baton Rouge. Most of the calls to defendant’s phone were unanswered. Nicole
Billingsley, defendant’s girlfriend, testified that defendant was at home in bed with
her at the time of the murder. She said that defendant’s phone often rang and that
defendant had a friendly relationship with the victim.
Jeremiah Billingsley, Nicole’s ex-husband, testified that he was incarcerated
with Beals after the crime. Beals told him that the victim had repeatedly stolen
from defendant and therefore Beals offered to “take care of him” but defendant
declined and instead told Beals not to touch the victim. Beals also told Billingsley
that he and Williams took the victim to Sorrento and killed him when he got out of
the car to urinate. When Beals was interviewed by police, he stated, “If I would
have killed [the victim,] I would have shot him in broad daylight from the distance.
2
I would have not walked up on him from the back and shot him.” At the time of
that statement, police had not disclosed the manner in which the victim was killed.
The court of appeal found this evidence sufficient to prove that defendant
was a principal to the murder although he was not present at the time of the
murder. State v. Jones, 15-0649 (La. App. 1 Cir. 7/7/26) (unpub’d). Specifically,
the court of appeal found it sufficient that the victim was transported to the
location where he was killed in defendant’s vehicle, the cell phone records showed
cell phone contact between the persons who committed the murder and defendant,
and defendant afterward asked McGee to bring the phone he loaned to Williams to
him rather than provide it to police:
Thus, the guilty verdict in this case indicates the jury apparently
concluded that, after being driven to Sorrento in defendant Jones’
vehicle, the victim was murdered, and defendant Jones was a principal
and guilty of that murder. The jury could have reasonably interpreted
the substantial cell phone usage records in evidence as showing that
defendant Jones participated in the murder through repeated contact
with the victim and with Mr. Beals and Mr. Williams throughout the
hours before and after the victim’s murder. The jury’s verdict also
indicates it rejected defendant Jones’ claim that he went to bed at 2
a.m. on the morning of the murder. Further, the jury reasonably could
have interpreted defendant Jones’ instruction to Mr. Magee to
withhold the borrowed cell phone from the police as indicating
defendant Jones’ guilty knowledge of information contained on that
cell phone that implicated him in the murder.
Jones, 15-0649, p. 11.
Judge Theriot dissented finding this circumstantial evidence was insufficient
to exclude every reasonable hypothesis of innocence. Judge Theriot noted that
Billingsley’s testimony did not even implicate defendant, who according to this
jailhouse informant declined Beals’s offer to “take care of” the victim and instead
instructed Beals to leave the victim alone. Judge Theriot also noted that the calls on
the night of the murder to defendant’s phone were unanswered. Finally, Judge
Theriot noted that, although defendant became an accessory after the fact when he
3
tried to obtain McGee’s phone, that crime is not responsive to a charge of murder.
While it is true that defendant’s car was used to commit the crime, Judge Theriot
found that there was no evidence in the record showing that defendant directed
Beals or Williams to commit murder. We agree.
Under the due process standard of Jackson v. Virginia, 443 U.S. 307, 319,
99 S.Ct. 2781, 2789, 61 L.Ed.2d 560 (1979) (emphasis in original), “the relevant
question is whether, after viewing the evidence in the light most favorable to the
prosecution, any rational trier of fact could have found the essential elements of the
crime beyond a reasonable doubt.” When reviewing a conviction based upon
circumstantial evidence, the reviewing court must determine whether, viewing the
evidence in the light most favorable to the prosecution, a reasonable trier of fact
could have concluded beyond a reasonable doubt that every reasonable hypothesis
of innocence had been excluded. See State v. Morris, 414 So.2d 320, 321–22 (La.
1982) (citation omitted); see also State v. Captville, 448 So.2d 676, 680 (La. 1984)
(“When a case involves circumstantial evidence, and the jury reasonably rejects the
hypothesis of innocence presented by the defendant’s own testimony, that
hypothesis falls, and the defendant is guilty unless there is another hypothesis
which raises a reasonable doubt.”). The reviewing court “does not determine
whether another possible hypothesis has been suggested by defendant which could
explain the events in an exculpatory fashion; rather, the reviewing court] evaluates
the evidence in the light most favorable to the prosecution and determines whether
the alternative hypothesis is sufficiently reasonable that a rational factfinder could
not ‘have found proof of guilt beyond a reasonable doubt.’” Captville, 448 So.2d at
680 (emphasis in original; citation omitted).
Principals to an offense are defined as:
All persons concerned in the commission of a crime, whether present
4
or absent, and whether they directly commit the act constituting the
offense, aid and abet in its commission, or directly or indirectly
counsel or procure another to commit the crime, are principals.
La.R.S. 14:24. The crime of second degree murder, in pertinent part, is the killing
of a human being when the offender has a specific intent to kill or to inflict great
bodily harm. La.R.S. 14:30.1(A)(1). Thus, to prove defendant guilty as a principal
to second degree murder in the present case, the state was required to prove
defendant aided or abetted in the killing of a human being when he had a specific
intent to kill or to inflict great bodily harm, or he directly or indirectly counseled or
procured another to commit the crime. 1
We have repeatedly cautioned that the due process standard of Jackson v.
Virginia, 443 U.S. 307, 99 S.Ct. 2781, 61 L.Ed.2d 560 (1979), “does not permit a
reviewing court to substitute its own appreciation of the evidence for that of the
fact finder or to second guess the credibility determinations of the fact finder
necessary to render an honest verdict.” State v. Calloway, 07–2306, p. 10
(La.1/21/09), 1 So.3d 417, 422. In cases of circumstantial evidence, the Jackson
standard means that when a jury “reasonably rejects the hypothesis of innocence
presented by the [defense], that hypothesis falls, and the defendant is guilty unless
there is another hypothesis which raises a reasonable doubt.” State v. Captville,
448 So.2d 676, 680 (La. 1984). Nevertheless, the Jackson standard does not permit
jurors “‘to speculate if the evidence is such that reasonable jurors must have a
reasonable doubt.’” State v. Mussall, 523 So.2d 1305, 1311 (La.1988) (quoting 2
C. Wright, Federal Practice & Procedure, Criminal 2d § 467 at 660–61 and n.23
(2d ed. 1982). Here, as the dissent found, “[t]he record is void of evidence that
1
As proof of the defendant’s guilt the state indicated in its brief that “after the victim
continued to steal drugs from [the defendant] Jones, Beals told Billingsley that Jones told him
‘he’s yours.’ Based upon that affirmation, Billingsley stated that Beals killed the victim.” The
state suggests this was an indication by the defendant to Beals that the victim should be killed.
5
[defendant] gave any counsel to Beals or Williams, directly or indirectly, in the
commission of the crime.” Jones, 15-0649, p. 2 (Theriot, J., dissenting). Based on
the evidence presented, the jury could only speculate defendant was guilty as a
principal to the second degree murder.
When issues are raised on appeal both as to the sufficiency of the evidence
and as to one or more trial errors, the reviewing court should first assess the
sufficiency of the evidence, see State v. Hearold, 603 So.2d 731, 734 (La. 1992),
because the accused may therefore be entitled to an acquittal under Hudson v.
Louisiana, 450 U.S. 40, 101 S.Ct. 970, 67 L.Ed.2d 30 (1981). Defendant here is so
entitled. See generally State v. Corkern, 593 So.2d 1259, 1260 (La. 1992) (per
curiam) (When the state’s evidence merely invites the jury to speculate on a
number of reasonable probabilities, some consistent with guilt, others consistent of
innocence, a reasonable jury must entertain a reasonable doubt of the defendant’s
guilt.); see also State v. Schwander, 345 So.2d 1173, 1175 (La. 1978)) (“[a] trial
jury’s inference that an accused aided and abetted in a crime cannot be ‘mere
speculation based upon guilt by association.’”) (quoting State v. Williams, 310
So.2d 513, 515 (La. 1975)). Accordingly, for the reasons assigned, defendant’s
conviction and sentence are reversed and a judgment of acquittal is entered in his
favor.
REVERSED
However, there was no evidence submitted to the jury to corroborate this statement, which was
made by counsel for the state at a bench conference.
6
01/30/18
SUPREME COURT OF LOUISIANA
No. 2016-K-1502
STATE OF LOUISIANA
VERSUS
DARRYL JONES
ON WRIT OF CERTIORARI TO THE COURT OF APPEAL,
FIRST CIRCUIT, PARISH OF ASCENSION
WEIMER, J., additionally concurring.
I agree with the majority opinion, writing separately to point out that as proof
of defendant’s guilt, the state indicated in its brief that “after the victim continued to
steal drugs from [the defendant] Jones, Beals told Billingsley that Jones told him
‘he’s yours.’ Based on that affirmation, Billingsley stated that Beals killed the
victim.” The state suggests this was an indication by the defendant to Beals that the
victim should be killed. However, there was no evidence submitted to the jury to
corroborate this statement, which was made by counsel for the state at a bench
conference.
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[DO NOT PUBLISH]
IN THE UNITED STATES COURT OF APPEALS
FOR THE ELEVENTH CIRCUIT
________________________ FILED
U.S. COURT OF APPEALS
ELEVENTH CIRCUIT
No. 11-13430
JANUARY 17, 2012
Non-Argument Calendar
JOHN LEY
________________________ CLERK
D.C. Docket No. 0:11-cv-60604-JIC
DR. MASSOOD JALLALI,
llllllllllllllllllllllllllllllllllllll Plaintiff-Appellant,
versus
AMERICAN OSTEOPATHIC ASSOCIATION,
a.k.a. Commission on Accreditation of Colleges
of Osteopathic Medicine,
l lllllllllllllllllllllllllllllllllllllll Defendant-Appellee.
________________________
Appeal from the United States District Court
for the Southern District of Florida
________________________
(January 17, 2012)
Before DUBINA, Chief Judge, MARCUS and MARTIN, Circuit Judges.
PER CURIAM:
Appellant Dr. Massood Jallali (“Jallali”), proceeding pro se, appeals from
the district court’s dismissal of his civil rights action brought pursuant to Bivens v.
Six Unknown Named Agents of Fed. Bureau of Narcotics, 403 U.S. 388, 91 S. Ct.
1999, 29 L. Ed. 2d 619 (1971). The district court dismissed Jallali’s complaint
based on a lack of subject matter jurisdiction, concluding that Jallali’s claims were
barred based on the Rooker-Feldman doctrine.1 The district court also concluded
that Jallali could not state a claim under Bivens, and that Jallali’s claims were
barred by res judicata.
I.
Jallali’s complaint alleged six claims for relief against the American
Osteopathic Association (“AOA”) arising from AOA’s supposed failure to pursue
Jallali’s claims against Nova Southeastern University (“NSU”) after NSU denied
Jallali a degree. In 2006, prior to filing this action, Jallali had attempted to assert
claims for declaratory relief, specific performance, and breach of contract against
AOA in state court. These claims, which also essentially arose from AOA’s
1
The Rooker-Feldman doctrine derives from Rooker v. Fidelity Trust Co., 263 U.S. 413,
44 S. Ct. 149, 68 L. Ed. 362 (1923), and District of Columbia Court of Appeals v. Feldman, 460
U.S. 462, 103 S. Ct. 1303, 75 L. Ed. 2d 206 (1983).
2
alleged failure to require NSU to award him with a medical degree, were
dismissed with prejudice based on the state court’s determination that Jallali could
not state a cause of action.
Jallali contends that his claims in the current case were not barred by
Rooker-Feldman because they included claims that could not have been raised in
the earlier proceeding and over which the state court would have lacked
jurisdiction. He further contends that the district court erred in finding that AOA
was not acting under color of federal or State authority when it dismissed his
Bivens claim and declined to convert it into a claim under 42 U.S.C. § 1983.
II.
“We review dismissals for lack of subject matter jurisdiction de novo.”
Nicholson v. Shafe, 558 F.3d 1266, 1270 (11th Cir. 2009). A court must dismiss
an action if it “determines at any time that it lacks subject-matter jurisdiction.”
Fed. R. Civ. P. 12(h)(3). A finding that a plaintiff failed to state a claim upon
which relief could be granted is reviewed de novo. See, e.g., Simmons v. Sonyika,
394 F.3d 1335, 1338 (11th Cir. 2004).
III.
The Rooker-Feldman doctrine is a jurisdictional rule that precludes lower
federal courts from reviewing state court judgments. Nicholson v. Shafe, 558 F.3d
3
at 1270. The Supreme Court has cautioned that the “[t]he Rooker-Feldman
doctrine . . . is confined to cases of the kind from which the doctrine acquired its
name: cases brought by state-court losers complaining of injuries caused by
state-court judgments rendered before the district court proceedings commenced
and inviting district court review and rejection of those judgments.” Exxon Mobil
Corp. v. Saudi Basic Indus. Corp., 544 U.S. 280, 284, 125 S.Ct. 1517, 1521-22,
161 L.Ed. 2d 454 (2005); see also Lance v. Dennis, 546 U.S. 459, 464, 126 S. Ct.
1198, 1201, 163 L. Ed. 2d 1059 (2006) (noting the “narrowness” of the
Rooker-Feldman rule). The Rooker-Feldman doctrine operates as a bar to federal
court jurisdiction where the issue before the federal court was either actually
adjudicated by the state court or was “inextricably intertwined” with the state court
judgment such that (1) the success of the federal claim would “effectively nullify”
the state court judgment, or (2) the federal claim “succeeds only to the extent that
the state court wrongly decided the issues.” Casale v. Tillman, 558 F.3d 1258,
1260 (11th Cir. 2009) (internal quotation marks omitted).
“In Bivens, the Supreme Court for the first time implied a right of action for
damages against federal officials [for a constitutional violation] in the absence of
an act of Congress authorizing such an action.” Alba v. Montford, 517 F.3d 1249,
1252 (11th Cir. 2008) (internal citation omitted). A claim under 42 U.S.C. § 1983,
4
by contrast, requires that a plaintiff establish that the defendant acted “under color
of any statute, ordinance, regulation, custom, or usage, of any State.” 42 U.S.C. §
1983. Because claims under 42 U.S.C. § 1983 and Bivens are similar, courts
generally apply § 1983 law to Bivens cases. Abella v. Rubino, 63 F.3d 1063, 1065
(11th Cir. 1995). Thus, under Bivens, “a plaintiff must show that he or she was
deprived of a federal right by a person acting under color of [federal] law.” Griffin
v. City of Opa-Locka, 261 F.3d 1295, 1303 (11th Cir. 2001).
IV.
We conclude from the record that the district court did not err in finding that
Rooker-Feldman barred Jallali’s complaint. It is undisputed that the parties in the
state and federal actions were the same, and that the prior state court ruling was a
final judgment on the merits. Except for Jallali’s facially defective claims for
equitable and judicial estoppel, Jallili had a reasonable opportunity to raise his
federal claims in the state court proceeding. Moreover, because a ruling in
Jallali’s favor would effectively nullify the earlier state court judgment, the claims
in this case were inextricably intertwined with the state court’s judgment.
The district court also correctly concluded that Jallali failed to allege any
facts that would support a claim under Bivens. It is clear from the amended
complaint that AOA, an Illinois not-for-profit corporation, was merely a private
5
actor. Cf. Abella v. Rubino, 63 F.3d at 1065, (“The effect of Bivens was, in
essence, to create a remedy against federal officers, acting under color of federal
law, that was analogous to the section 1983 action against state officials.”)
(internal quotation marks omitted). Having found that Jallali’s Bivens claim failed
as a matter of law, the district court properly concluded that it lacked subject
matter jurisdiction over the entire action. See, e.g., Scarfo v. Ginsberg, 175 F.3d
957, 962 (11th Cir. 1999) (“[O]nce the district court determines that subject matter
jurisdiction over a plaintiff's federal claims does not exist, courts must dismiss a
plaintiff's state law claims.”).
Accordingly, we affirm the district court’s judgment of dismissal.
AFFIRMED.
6
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871 F.Supp. 1017 (1994)
WCC FUNDING LIMITED, Plaintiff,
v.
GAN INTERNATIONAL, Defendant/Third-Party Plaintiff,
v.
Darrell BLAESS and Richard Fanslow, Third-Party Defendants.
Darrell BLAESS, Third-Party Counterclaimant,
v.
GAN INTERNATIONAL, Defendant to Third-Party Counterclaim.
No. 93 C 969.
United States District Court, N.D. Illinois, Eastern Division.
December 19, 1994.
*1018 Richard Cartier Godfrey and Lee Radford, Kirkland & Ellis, Chicago, IL, for WCC Funding Ltd., plaintiff.
Bruce R. Alper, Randall Marc Lending, Edward C. Jepson, Jr., and Carlys Elizabeth Belmont, Vedder, Price, Kaufman & Kammholz, Chicago, IL, for GAN Intern., defendant.
OPINION AND ORDER
NORGLE, District Judge:
Before the court are the cross motions of defendant GAN International ("GAN") and of plaintiff WCC Funding Limited ("WCC") for summary judgment on counts I and II of the complaint. For the following reasons, GAN's motion is granted and WCC's motion is denied.
FACTS[1]
WCC is an Illinois corporation, with its principal place of business in Chicago, Illinois, *1019 formed specifically to acquire the outstanding capital stock of Hawkeye National Life Insurance Company ("HNL"). HNL is an Iowa corporation with its principal place of business in Des Moine, Iowa. Third-party defendant Darrell Blaess ("Blaess") was the president and director of HNL during the relevant period. GAN is a French international holding corporation with its principal place of business in France which owns all of the outstanding capital stock of HNL.
On April 15, 1992, WCC and GAN entered into a fully integrated written Stock Purchase Agreement ("Agreement").[2] WCC, as the prospective buyer, and GAN, as the prospective seller, entered into the Agreement for the purpose of buying and selling all of the outstanding HNL capital stock. On April 23, 1992, eight days after the execution of the Agreement, WCC paid $50,000 for the right to conduct the due diligence investigation for a period of thirty days until May 15, 1992. On May 15, 1992, WCC sent a letter identified in WCC's motion as a "notice of breach" which stated that[3]:
As you may be aware, after our discussion yesterday I sent you a letter agreement for purposes of extending the date by which action would have been required to be taken by WCC Funding Limited under Section 2.03 of the Stock Purchase Agreement between WCC Funding Limited and GAN International relating to the sale and purchase of the stock of [HNL]. When I called this morning to find out the status of the letter agreement, I was advised that you are out today, and therefore thought that in light of our discussions, it would be appropriate for me to write to you.
I am sure you can appreciate that because GAN International has still not provided WCC Funding with the terms under which GAN or its affiliates will continue to provide reinsurance to [HNL], an important element of the completion of WCC Funding's due diligence review is missing. As a result, we expect that the extension agreement will be entered into and the missing information promptly provided to assure that WCC Funding can complete its due diligence review with the benefit of all information which your client agreed to provide under the Stock Purchase Agreement before it is required to pay an additional $100,000 to extend the due diligence period
....
(WCC's Ex. 20.) The alleged "notice of breach" only discussed the insufficiency of § 5.04(a) compliance. No other violations were mentioned or referred to in the "notice of breach." After receiving the "notice of breach," GAN allegedly did not cure the § 5.04(a) violation within fourteen days. Therefore, according to WCC, the Agreement terminated on May 30, 1992, pursuant to the operation of § 8.01(3). Despite WCC's position that the Agreement terminated on May 30, 1992, WCC paid $100,000 on May 15, 1992, to extend the thirty-day period to perform due diligence investigation for an additional thirty days, until June 15, 1992.
On June 11, 1992, in a telephone conversation, WCC and GAN agreed to extend the due diligence period from June 15, 1992, to June 26, 1992. Following the conference, WCC sent a letter to GAN which memorialized the discussion. The letter stated in relevant part that:
As we attempt to communicate to you in our telephone conversation, we have serious *1020 interest in continuing a dialogue regarding Hawkeye National with GAN in hopes that we may ultimately resolve our differences amicably. In order to discuss a resolution of the issues pending between us, we accept the offer you made in our telephone conversation today that this matter will be stayed for two weeks, until June 26, 1992. This standstill arrangement will be without prejudice to any parties' position, rights, or remedies....
(WCC's Ex. 17.) In response to the written communication, GAN replied with its own letter on June 15, 1992, which in relevant portion said the following:
Further, since you indicated your serious interest to continue a dialogue regarding the purchase of Hawkeye, we hereby agree to grant you an extension of time to June 26, 1992 in which to complete your due diligence review pursuant to Section 2.03 of the Stock Purchase Agreement dated April 15, 1992 without additional payment from you with respect to this extension....
(GAN's Ex. R.) In extending the due diligence period from June 15, 1992, to June 26, 1992, WCC did not provide additional monetary consideration to GAN. See (Agreement ¶ 8.03.)[4] On June 16, 1992, WCC replied to GAN's June 15, 1992 letter and stated the following:
Thank you for your June 15, 1992 letter. While we are not in accord with all of the statements made, we too look forward to meeting with you on June 18 and June 19 in Chicago.
Pursuant to your request, we will have our consulting actuaries available for the meeting on June 18 with you, Steve Griffith and Darrell Blaess and our counsel will be available for the meeting on June 19 with you, Peter Williams and Paul Meyer. In addition, Richard Fanslow and I believe that a meeting between principals (without counsel) as was planned in Paris for June 12 would help us resolve our differences and, in combination, allow us to craft a mutually beneficial solution. Please advise me if your schedule would accommodate meeting at your hotel for breakfast on Thursday.
(WCC's Ex. 31.) As scheduled, the parties met, but failed to reach a resolution as to the Agreement. Subsequently, more written communication was exchanged between WCC and GAN.
On June 25, 1992, WCC wrote a letter on the assumption that GAN had granted WCC a second extension of the due diligence period from June 26, 1992, to July 10, 1992:
Thank you for taking the time to speak with me and Mr. Fanslow this morning. As you are aware, we have agreed to a standstill under our agreements relating to WCC Funding Limited's acquisition of Hawkeye National Life Insurance Company from GAN International until June 26, 1992. As a follow up to our conversation, this letter will confirm our agreement to extend such standstill for an additional ten business days, until July 10, 1992, without prejudice to any parties' position, rights or remedies.
Since our meeting in Chicago of June 18 and June 19, we have been working diligently to refine our settlement proposal. As we are expecting a summary of covered benefits under Hawkeye National's extended health plan from Paul Meyer at Rogers & Wells yet today, we hope to complete a more definitive proposal for your consideration by Tuesday, June 30 or Wednesday, July 1. If this timetable does not allow you adequate time to both review your options with M. Cato and M. Belinguier and respond to me or Mr. Fanslow by July 10, please contact me at your earliest convenience with a more appropriate arrangement....
(WCC's Ex. 21.) (Emphasis added). In response to this letter, GAN declined to extend *1021 the period and informed WCC of the following:
This letter is written in response to your letter to me dated June 25, 1992 in an effort to avoid any misunderstanding concerning our discussions relating to Hawkeye National Life Insurance Company. As agreed in my letter to you dated June 15, 1992, GAN International granted WCC Funding Limited an extension of time to June 26, 1992 in which to complete its due diligence review pursuant to Section 2[.]03 of the Stock Purchase Agreement. Therefore, the Stock Purchase Agreement remains in effect but, as we discussed in our meeting in Chicago on June 18 and June 19, will terminate and be of no further force and effect unless WCC Funding Limited advises GAN International in writing today that it is accepting the Stock Purchase Agreement....
(GAN's Ex. V.)
On June 26, 1992, WCC did not accept the terms of the Agreement in writing and tender the requisite earnest money into an escrow account. Instead, WCC sent a letter on July 1, 1992, detailing its proposal to liquidate HNL. Subsequently, WCC's counsel sent a letter on July 6, 1992, to GAN's counsel indicating WCC's position for the first time that GAN breached the Agreement. The letter stated the following:
We understand that WCC Funding Limited and GAN International have been actively discussing the possibility of a reinsurance transaction in the context of the liquidation of Hawkeye National. We know that WCC Funding looks forward to continuing those discussions and receiving a response from GAN regarding the detailed proposal sent to Philippe Cornut last week.
This letter, however, is written in response to Mr. Cornut's letter to Quinn Fanning dated June 26, 1992. Although we are encouraged from the recent meetings and conversations that the parties may be able to reach an agreement which will be beneficial to both sides, we also believe it appropriate that you and your client understand WCC Funding's position with respect to the status of the Stock Purchase Agreement in the context of the standstill arrangement currently in effect. While we understand that you may disagree with our view, we believe that GAN has breached the Agreement, that the Agreement terminated as a result of such breach, and therefore, WCC Funding is entitled to its damages resulting from such breach, including, but not limited to, its expenses incurred in connection with this transaction. During the period of the standstill agreement, it is WCC Funding's intention not to pursue its damage claim in the hopes that the parties will be able to come to an agreement regarding this matter.
(WCC's Ex. 25.) Over the next few months, the parties made an attempt to engage in mutually beneficial business decisions. They were unable to accomplish this end.
As a result, on January 6, 1993, WCC wrote GAN pursuant to § 9.01 of the Agreement and sought indemnification for GAN's breach of the Agreement. On February 3, 1993, GAN responded to WCC's letter and informed WCC that pursuant to § 2.03, that GAN is entitled to keep the $150,000 paid to conduct the due diligence review and that neither party has liability to the other. WCC takes the position that because GAN did not respond to the letter of January 6, 1993, within ten days, GAN waived the right to defend WCC's claims for damages under § 9.02. On February 16, 1993, WCC filed a three-count complaint against GAN.[5]
DISCUSSION
Federal Rule of Civil Procedure 56(c) provides that a summary judgment "shall be rendered forthwith if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the *1022 moving party is entitled to a judgment as a matter of law." Fed.R.Civ.P. 56(c); Transportation Communications Int'l Union v. CSX Transp., Inc., 30 F.3d 903, 904 (7th Cir.1994). Summary judgment is not a discretionary remedy; it must be granted when the movant is entitled to it as a matter of law. Jones v. Johnson, 26 F.3d 727, 728 (7th Cir.1994) (per curiam). Even though all reasonable inferences are drawn in favor of the party opposing the motion, Associated Milk Producers, Inc. v. Meadow Gold Dairies, 27 F.3d 268, 270 (7th Cir.1994), presenting only a scintilla of evidence will not suffice to oppose a motion for summary judgment. Walker v. Shansky, 28 F.3d 666, 671 (7th Cir.1994).
Moreover, the disputed facts must be those that might affect the outcome of the suit to properly preclude summary judgment. Beck Oil Co., Inc. v. Texaco Ref. & Mktg., Inc., 25 F.3d 559, 561 (7th Cir.1994). A dispute about a material fact is "genuine" only if the evidence is such that a reasonable jury could return a verdict for the nonmoving party. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 106 S.Ct. 2505, 2510, 91 L.Ed.2d 202 (1986). Accordingly, the nonmoving party is required to go beyond the pleadings, affidavits, depositions, answers to interrogatories, and admissions on file to designate specific facts showing a genuine issue for trial. Bank Leumi Le-Israel, B.M. v. Lee, 928 F.2d 232, 236 (7th Cir.1991).
WCC seeks judgement as a matter of law in its favor on counts I and II of the complaint. In count I, WCC requests the five million dollars or more that WCC would have gained by purchasing HNL stock, and the amounts expended in performing the due diligence investigation.[6] In count II, WCC requests the same but under the theory that GAN is contractually obligated to indemnify WCC for those losses.
WCC contends that the Agreement was a bilateral contract and GAN's failure to comply with the terms resulted in a total breach of the contract. WCC takes the position that during the due diligence period the Agreement was a bilateral contract in which WCC agreed to pay GAN ten million dollars in consideration for HNL capital stock. WCC argues that the parties scheduled a closing date[7] for the subject transaction to take place several months after executing the Agreement on April 15, 1992, to allow WCC to conduct a due diligence investigation and GAN to satisfy its duties and obligations under the terms of the Agreement. WCC further takes the position that the Agreement provided WCC with the option to terminate the Agreement by paying the amount it tendered to GAN for due diligence investigation as liquidated damages. Accordingly, WCC claims that until it terminated the Agreement, GAN assumed a continuing obligation to comply with all of the terms of the Agreement.
WCC also claims that during the first due diligence period, it was confronted with significant financial risks because of the delay between the execution of the Agreement on April 15, 1992, and the scheduled date for the closing of the transaction. To insure against this "significant risk," WCC negotiated §§ 8.01(3) and 8.02. The relevant language of § 8.01(3) provides that:
This Agreement shall terminate ... if there shall have been any material breach of any covenant of Seller hereunder and such breach shall not have been remedied within fourteen (14) days after receipt of by Seller of notice in writing from Buyer *1023 specifying the nature of the breach and requesting such be remedied....
(Agreement § 8.01(3).) The relevant terms of § 8.02 provides that:
In the event this Agreement is terminated as provided in Section 8.01(3) ... this Agreement shall be of no further force and effect ... and there shall be no further liability on the part of Seller or Buyer under this Agreement.... Notwithstanding the foregoing, nothing contained in this Section 8.02 shall relieve any party hereto from liability for its breach of this Agreement, and the non-breaching party shall be entitled to all remedies, at law or in equity, available to it with respect to any such breach; provided, however, that Buyer's liability hereunder shall be limited to $1,000,000.
(Agreement § 8.02.)
In addition to §§ 8.01 and 8.02, WCC asserts that §§ 9.01 and 9.02 provided further protection to WCC against potential losses and damages. In § 9.01, WCC claims that GAN "expressly agreed to indemnify WCC for all damages resulting from any contract breach, including attorneys' fees." (WCC Local Rule 12(M) Stmt. ¶ 14.) Furthermore, § 9.02 detailed the procedure for requesting such indemnification from GAN. Section 9.01 states that:
Seller hereby agrees to indemnify, defend and hold Buyer Free and harmless against any and all damages, claims, demands, losses, liabilities or expenses (including, without limiting the generality of the foregoing, reasonable attorneys' fees and court costs) incurred by the Company or Buyer by reason of (a) the breach of any warranty, representation, covenant or agreement of Seller contained herein, and (b) any disallowance or decrease in an admitted asset or increase in any liability of the Company directed by the Insurance Department of Iowa (the "Department") in connection with its examination of the financial condition of the Company as at December 31, 1991 or a subsequent date, but only to the extent the disallowances, decreases or increases should have been but were not reflected in the 1991 NAIC Statement (except to the extent such matters were reflected in the Closing Financial Statement, or, if not reflected in the Closing Financial Statement, except to the extent other adjustments required by the Department, whether as the result of any increases or decreases in assets or liabilities, would have offset such matters in computing the Purchase Price); provided, however, that the Buyer and the Company shall not make any claim against Seller for indemnification hereunder until the aggregate damage, loss, liability, cost and expense of Buyer or Company exceeds $100,000. Seller's maximum aggregate liability hereunder shall not exceed $5,000,000; provided however, there shall be no limitation on Seller's liability with respect to matters relating to taxes and to the Designated Plans.
(Agreement § 9.01.) Section 9.02 provides that:
If Buyer learns of any matter for which Buyer asserts Seller is liable under Section 9.01, then in order to secure indemnification with respect thereto, Buyer shall notify Seller in writing of the existence of such matter within a reasonable time. Seller shall have the right (but not the obligation) at its sole expense and in the name of Buyer or Company, as may be appropriate, to contest any matter involving a third party for which indemnification or defense has been sought by Buyer, provided Seller proceeds in good faith, expeditiously and diligently. Buyer shall cooperate and cause the Company to cooperate with Seller in such contest, provided any expenditures incurred in such cooperation shall be paid by Seller. If Seller does not serve on Buyer by certified mail, return receipt requested, a written notice of its intention to defend or does not commence to contest any matter within ten (10) business days after receipt of notice from Buyer of the existence of such matter, or if Seller disputes it is liable to Buyer for any sum pursuant to Sections 6.01, 9.01 or otherwise, the right to defend such claim shall be deemed waived, and Buyer shall have full right and power to defend or otherwise deal with and dispose of the matter. Buyer and the Company shall not pay or otherwise *1024 settle compromise or deal with any matter for which Seller may be liable under Sections 6.01 or 9.01 hereof so long as Seller is contesting the matter in good faith, expeditiously and diligently in accordance with this Agreement, and no final judgment has been entered against the Buyer or the Company, as the case may be, except to the extent any such claim or matter may materially impair the ability of Buyer or the Company to engage in its business, in which event Buyer shall have the absolute right to pay, settle, compromise or otherwise dispose of such claim or matter.
(Agreement § 9.02.)
GAN disagrees with WCC's conclusory characterizations of the terms of the Agreement. First, GAN explains that the Agreement is not a bilateral contract for purchase and sale of HNL capital stock. Rather, the Agreement is a unilateral option contract giving WCC the exclusive right to elect whether to purchase HNL capital stock. Unless WCC formally and properly accepted the Agreement to purchase the stock, the Agreement conferred no bilateral rights and obligation to sell and purchase HNL stock.
Second, contrary to WCC's representation, the Agreement did not provide for a closing date. Third, pursuant to § 2.03, WCC's failure to accept the Agreement prior to the expiration of the due diligence period served as an automatic termination of the Agreement. No affirmative action on the part of WCC was necessary to terminate the Agreement. Fourth, WCC was not subject to any financial risk during the period between April 15, 1992, and May 15, 1992, because WCC was not under any contractual obligation to purchase HNL stock unless and until it accepted the terms of the Agreement in writing. Fifth, GAN disputes the purpose and the plain meaning of §§ 9.01 and 9.02. GAN argues that those two sections are not applicable to the instant litigation because WCC never accepted the Agreement to purchase the stock. Furthermore, those provisions govern the contingencies of third party actions, not claims of WCC's own alleged damages.
A cursory review of the parties' argument reveals that many facts, characterizations, interpretations of the Agreement, and assertions are vigorously disputed between WCC and GAN. The court's duty in addressing the cross motions for summary judgment does not simply end with the issue of whether there are controverted facts. Rather, the court must sift through the facts presented by the parties to identify whether there are "genuine" issues of material fact. After a closer examination of the facts and the issues surrounding the instant motions, the court must conclude that the material facts are not in dispute and that GAN is entitled to judgment as a matter of law on counts I and II.
To resolve contract disputes, the court must first look to the language of the purported contract. Woodbridge Place Apartments v. Washington Square Capital, Inc., 965 F.2d 1429, 1436 (7th Cir.1992). In the interpretation of contractual clauses under Illinois law,[8] the court's primary duty is to effectuate the intentions of the parties to the contract. Lomas Mortgage U.S.A., Inc. v. W.E. O'Neil Constr. Co., 812 F.Supp. 841, 843 (N.D.Ill.1993). In doing so, the court must construe the contract as a whole to derive the intentions of the parties. Howard Johnson & Co. v. Feinstein, 241 Ill.App.3d 828, 182 Ill.Dec. 396, 399, 609 N.E.2d 930, 933 (1993). "Contractual terms should be construed to avoid the conclusion that other terms are meaningless." Id. Further, where the relevant terms are unambiguous, the parties' intent must be determined from the language of the contracting instrument itself without resorting to extrinsic evidence. Wikoff v. Vanderveld, 897 F.2d 232, 238 (7th Cir.1990); Bennett & Kahnweiler, Inc. v. American Nat'l Bank & Trust Co. of Chicago, 235 Ill.App.3d 896, 176 Ill.Dec. 112, 601 N.E.2d 810, 816 (1992).
In the instant action, certain provisions demonstrate that the Agreement was an option contract. "An option contract is an agreement in which one binds himself to *1025 perform a certain act, at the sole power and discretion of optionee...." Prime Group, Inc. v. Northern Trust Co., 215 Ill.App.3d 1065, 159 Ill.Dec. 918, 922, 576 N.E.2d 841, 845, appeal denied, 141 Ill.2d 559, 162 Ill. Dec. 507, 580 N.E.2d 133 (1991). The second characteristic of option contracts is that the optionor agrees to leave the agreement in effect for a specified or a reasonable time. Id. In contrast, a bilateral contract binds the offeror and the offeree after there is an offer, acceptance, and consideration. Serpe v. Williams, 776 F.Supp. 1285, 1287 (N.D.Ill. 1991); Faulkner v. Gilmore, 251 Ill.App.3d 34, 190 Ill.Dec. 455, 459, 621 N.E.2d 908, 912 (1993). The burden of proving the necessary elements to contract formation is on the party seeking to enforce the agreement. Commonwealth Edison Co. v. Industrial Comm'n, 167 Ill.App.3d 229, 118 Ill.Dec. 91, 93, 521 N.E.2d 159, 161 (1988).
There is ample evidence within the Agreement to conclude that the agreement to sell HNL stock was an option contract. Article I of the Agreement provides that GAN shall sell HNL stock to WCC for ten million dollars with certain conditions and warranties. (Agreement at 1-2.) Article II, § 2.03 provides that GAN's agreement to sell HNL stock was only good for thirty days, or sixty days in the event WCC provided valuable consideration for a thirty-day extension. (Agreement § 2.03.) In this case, the option period terminated on June 26, 1992. Section 2.03 of the Agreement provides that:
Contemporaneously with the execution of this Agreement, Buyer shall pay to Seller the sum of $50,000 in consideration for Seller's agreement to permit Buyer to complete its due diligence review prior to Buyer's acceptance of this Agreement. Within thirty (30) days after the date hereof, Buyer shall either (i) advise Seller in writing that it is accepting this Agreement or (ii) pay to Seller an additional sum of $100,000 to extend the period of its due diligence review for another thirty (30) days, or (iii) advise Seller in writing that it is not accepting this Agreement. If the period of Buyer's due diligence review is extended for an additional thirty (30) days, on or prior to the end of the second thirty (30) day period, Buyer shall advise Seller in writing that it is either (iv) accepting this Agreement or (v) not accepting this Agreement. If by the applicable time periods set forth herein Seller does not receive a written notice from Buyer as to its intentions hereunder, Buyer shall be deemed to not have accepted this Agreement. If at any time hereafter Buyer advises Seller hereunder that [it] is not accepting this Agreement, this Agreement shall be terminated and of no further force and effect, the monies paid by Buyer to Seller hereunder shall be retained by Seller as liquidated damages and neither party shall have any liability to the other hereunder. In the event that Buyer elects to accept this Agreement as provided herein, Buyer shall make the earnest money deposit required under Article X hereof, the parties shall proceed to consummation of the transaction contemplated herein, and the sums paid by Buyer to Seller pursuant to this Section 2.03 shall be applied to the Purchase Price.
(Agreement § 2.03.) This section demonstrates that the agreement to buy and sell HNL stock was not accepted at the time of the formation of the Agreement on April 15, 1992, thus, no bilateral contract.
This is further evidenced by Article 10, §§ 10.01 and 10.02. Section 10.01 reads as follows:
Contemporaneously with the acceptance of this Agreement by [WCC] pursuant to Section 2.03, WCC and GAN shall execute an Escrow Agreement ... and WCC shall deposit in cash or government securities into the Escrow Account created by the Escrow Agreement the sum of One Million Dollars ... less the sums paid pursuant to Section 2.03.
(Agreement § 10.01.) (Emphasis added). This provision undoubtedly establishes that a binding acceptance of the agreement to buy and sell did not occur on April 15, 1992, but contemplated by the parties to be in the future. Additionally, § 10.02 provides that "[t]he date upon which [WCC] accepts this Agreement pursuant to Section 2.03 shall be the date from and after which [WCC's] obligation to purchase the Shares under this *1026 Agreement shall be deemed to be binding upon and effective as to the Buyer." (Agreement § 10.03.) This section evinces that WCC was under no contractual obligation to purchase the HNL stock on April 15, 1992. Accordingly, on April 15, 1992, with respect to the sale of HNL stock, there was only an option contract, rather than a bilateral sales contract.
Moreover, the option contract never became a bilateral contract binding GAN to sell HNL stock. An option contract becomes a bilateral contract binding both the optionor and optionee to the terms of the option contract when it is accepted and exercised. Industrial Steel Constr., Inc. v. Mooncotch, 264 Ill.App.3d 507, 202 Ill.Dec. 124, 127, 637 N.E.2d 663, 666 (1994); Artful Dodger Pub, Inc. v. Koch, 230 Ill.App.3d 806, 172 Ill.Dec. 760, 763, 596 N.E.2d 39, 42 (1992). The option, however, must be accepted according to its specific terms for the option to become a binding sales contract. Chapman v. Brokaw, 225 Ill.App.3d 662, 167 Ill.Dec. 821, 825, 588 N.E.2d 462, 466 (1992); see also Venture Assoc. Corp. v. Zenith Data Sys. Corp., 987 F.2d 429, 432 (7th Cir.1993) ("Illinois law demands that an acceptance `comply strictly with the terms of the offer[.]'") (quoting Ebert v. Dr. Scholl's Foot Comfort Shops, Inc., 137 Ill.App.3d 550, 92 Ill.Dec. 323, 330, 484 N.E.2d 1178, 1185 (1985)).
The material facts in this case demonstrate as a matter of law that the Agreement never became a binding contract for the sale of HNL stock. According to the specific terms of the Agreement in this case, if WCC wanted to accept and exercise the option, WCC was required to express its intention to accept in writing. (Agreement § 2.03.) Furthermore, contemporaneously with the written acceptance, WCC was required to execute an Escrow Agreement and deposit one million dollars in cash or government securities, less the sum paid pursuant to § 2.03,[9] into the escrow account. (Agreement § 10.01.) WCC, however, never expressed its intention to exercise the option and to purchase HNL stock, enter into an Escrow Agreement, or deposit the requisite earnest money. Under these circumstances, GAN did not, as a matter of law, breach the Agreement because there was never a valid acceptance of the Agreement. Accordingly, GAN is entitled to a judgment in its favor on counts I and II.[10]
While the court concludes that the Agreement was an option contract which terminated on June 26, 1992, without any legal force, certain provisions of the Agreement did require GAN to perform certain acts during the option period. In defining the parameters of GAN's obligation, the court looks to what WCC received in exchange for the $150,000 payment to GAN in addition to the option period. An examination of the Agreement reveals that sections 1.06(a), 2.01, 2.02, 3.22, 5.01, 5.04(a), 5.05(a), 5.06, and 5.07 govern GAN's obligations during the option period. The issue of whether GAN complied with these provisions will be resolved at an appropriate time under count III when it is properly before the court.
Further, the court finds the other sections of the Agreement irrelevant given its ruling that WCC never accepted the Agreement during the option period. The sections not mentioned would have been relevant only if the option contract became a bilateral contract for the sale of HNL stock on or before June 26, 1992. Accordingly, in litigating count III, the parties are to limit their scope of engagement to the relevant sections of the Agreement.
*1027 CONCLUSION
For the foregoing reasons, GAN's motion for summary judgment on counts I and II of the complaint is granted and WCC's motion for partial summary judgment on counts I and II of the complaint is denied.
IT IS SO ORDERED.
NOTES
[1] The following facts are drawn from various statements the parties submitted in compliance with Rules 12(M) and 12(N) of the Rules of the United States District Court for the Northern District of Illinois ("Local Rules"). Local Rules 12(m) and 12(n) govern the motion submitted by Gan because its motion was filed prior to the effective date of the amendment, April 4, 1994, to the Local Rules. Local Rules 12(M) and 12(N), however, govern WCC's cross motion for partial summary judgment because it filed the motion on April 29, 1994. The court will accept those factual statements that are both well pled and in compliance with the requirements of Local Rules 12(m) or 12(M)(3), 12(n) or 12(N)(3)(a) and 12(N)(3)(b). Further, any facts asserted by the movants in the 12(m), 12(M)(3), and 12(N)(3)(b) statements are deemed admitted unless the responding party contradicts them in the manner specified under Local Rules 12(n) or 12(M) and 12(N)(3)(a). Knox v. McGinnis, 998 F.2d 1405, 1408 n. 8 (7th Cir.1993); see also Early v. Bankers Life & Casualty Co., 853 F.Supp. 1074, 1079 (N.D.Ill.1994) (holding that failure to comply with Rule 12(n) results in material facts being admitted). A mere disagreement with the movant's asserted facts is inadequate if made without reference to specific supporting material. Edward E. Gillen Co. v. City of Lake Forest, 3 F.3d 192, 196 (7th Cir.1993). The Seventh Circuit has repeatedly upheld the district court's strict application of Local Rule 12(N). Schulz v. Serfilco, Ltd., 965 F.2d 516, 519 (7th Cir.1992) (collecting cases).
[2] The parties agree that the terms of the Agreement are plain, clear, and unambiguous.
[3] Quoting the relevant portions, if not all, of the letters the court discusses in this opinion is appropriate because WCC's summary characterization of this letter and others are inaccurate and misleading. Hence, for purposes of determining the facts of the case, the actual language contained in the relevant letters must be examined.
[4] Section 8.03 provides that:
At any time prior to the consummation of the purchase and sale of the Shares, the parties hereto may (a) amend this Agreement, (b) extend the time for the performance of any of the obligations or other acts of the other parties hereto.... Any such amendment, extensions or waiver shall not be effective unless evidenced by a written instrument signed on behalf of the party to be bound thereby....
(Agreement § 8.03.)
[5] The court has jurisdiction over the matter pursuant to 28 U.S.C. § 1332(a)(2) and § 5.10 of the Agreement. The relevant portion of § 5.10 provides that "[s]eller expressly submits and consents to the jurisdiction and venue of any state or federal court located within Cook County, Illinois and any action, suit or proceeding commenced therein in connection with this agreement or any of Seller's obligations thereunder...." (Agreement § 5.10.)
[6] WCC also seeks prejudgment interest on the amount of the damages, but for purposes of these cross motions for summary judgment, this relief is not relevant to the discussion.
[7] Section 1.04 of the Agreement provides that:
The sale and delivery of the Shares to [WCC], the payment of the Purchase Price to [GAN] and the consummation of the other transactions contemplated hereby to occur contemporaneously therewith (the "Closing") shall take place at the offices of Rogers and Wells ... commencing at 10:00 a.m. local time on that date which is the earlier of (a) June 30, 1992 or (b) the business day which is the fifth business day immediately following the date the last regulatory approval or consent required by Section 7.01 hereof is received by [WCC] and [GAN] ... or at such other place, time or date as the parties hereto may hereafter agree to in writing....
(Agreement § 1.04.)
[8] Section 11.06 of the Agreement provides that the "Agreement shall be governed by and shall be construed under the laws of the State of Illinois." (Agreement § 11.06.)
[9] In this case, the required earnest money was $850,000 ($1 million less $150,000).
[10] Gan in its motion for summary judgment seeks judgment in its favor as to counts I and II in their entirety on the basis that these counts are based on WCC's false premise that the Agreement was a bilateral contract when executed on April 15, 1992. Count I, however, also contains allegations that Gan breached its promise to cooperate during the due diligence investigation. This method of pleading, i.e., mixing multiple claims and theories of recovery under one count, violates Federal Rule of Civil Procedure 10(b). For this reason, the court will strike those allegations related to GAN's alleged violation of its duty to cooperate during the due diligence review. Resolving counts I and II in this manner will not prejudice WCC but only clarify the record. The claim that GAN violated its obligation to cooperate with and to provide certain information to WCC is also alleged under count III and will be resolved under count III.
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635 F.Supp. 1270 (1986)
Margaret Suzanne STARNES
v.
Charles Vernon HILL, Ralph Eugene Miller, James Michael Neff, Paul Douglas Scalf, Johnny Wayne Wagner, Charles L. Waldrep, and Gaston County, North Carolina.
No. C-C-83-0053-P.
United States District Court, W.D. North Carolina, Charlotte Division.
May 22, 1986.
*1271 George Daly, Charlotte, N.C., Nicholas Street, Layton & Street, Gastonia, N.C., for plaintiff.
Frank B. Aycock, III, Nelson M. Casstevens, Frank E. Emory, Jr., Charlotte, N.C., Grady B. Stott, Stott, Hollowell, Palmer, & Windham, Gastonia, N.C., Wayne Huckel, Kennedy, Covington, Lobdell, & Hickman, Charlotte, N.C., James C. Fuller, Jr., Thorp, Fuller & Slifkin, Raleigh, N.C., for defendants.
ORDER
ROBERT D. POTTER, Chief Judge.
THIS MATTER is before the Court on remand from the Fourth Circuit Court of Appeals 790 F.2d 1071 (4th Cir.1986) instructing this Court to "grant compensation for expenses reasonably incurred by the attorneys preparing the case." The Court of Appeals further stated on page 1080:
.... The hourly rate at which compensation is awarded should reflect rates in effect at the time the fee is being established by the Court, rather than those in effect at the time the services were performed.
Here the district court awarded fees on the basis of historic rates without accounting in any way for the effect of delay in payment on the value of the fee.... On remand the Court should reconsider the reasonableness of the rates in light of these considerations. The Court may increase the hourly rates to reflect current market rates, or it may increase the lodestar to counterbalance the effect of inflation on the value of the fee. The particular method of accounting for delay in payment is within the discretion of the district court.
The Court, in summarizing its opinion, stated:
In this case, the district court erred in calculating the fee based upon historic rates without accounting for the effect of delay in payment on the value of the fee, and in disallowing reasonable litigation expenses. In all other respects, we find the award to be a proper exercise of the court's discretion.
Footnote 20 required this Court as discussed in Footnote 15 to consider whether the case precluded Daly and Street from taking other employment due to the time commitment required. The Court of Appeals stated in Footnote 15 that "... [i]f the court finds that the case has precluded the attorneys from engaging in other employment, the court should consider whether this factor is already reflected in the hourly rate or whether it necessitates an upward adjustment of the hourly rate to fully compensate the attorneys." Id. at 1081-1082 n. 15.
This Court's Order, 589 F.Supp. 341, was in all other respects affirmed. Turning first to the hourly rate, this Court respectfully disagrees with the interpretation of the Court of Appeals of this Court's Order as to the hourly rate allowed Plaintiff's counsel. As was pointed out in the dissenting judge's opinion, page 1086, this Court stated at page 345 of its Order:
Based upon the affidavits submitted by the parties, legal fees now [emphasis added] ranges from a low of $75.00 per hour to a high [the highest] of $150.00 per hour for in-court work. This case did not involve any "in court" work. Having come to the bench approximately 2½ years ago when the highest range of fees in this locale were approximately $75.00 per hour, I find it difficult to determine that a fee of $90.00 per hour is not the highest figure which would be considered a reasonable fee for out-of-court work [emphasis added] in this area for an attorney of Mr. Daly's competence. It is significant that most of the *1272 hours for which Mr. Daly is claiming compensation were in 1982 and 1983, whereas the affidavits he has filed are based on 1984 hourly rates.
Perhaps the phrase "... whereas the affidavits he has filed are based on 1984 hourly rates ..." misled the appellate Court since the dictionary definition of "whereas" is "while on the contrary." Be that as it may, this Court meant by that phrase that the fees when Mr. Daly's services were performed in 1982 and 1983 were somewhere close to the December 1981 fees (when I came on the bench) of $75.00 per hour, and he was given the benefit of the additional $15.00 an hour for the 1984 assessment of his fee, a 20% increase over the going rate in late 1981 and early 1982.
The North Carolina Bar Association Economic Survey 1985 on page 18 indicates that the typical hourly rate in 1984 is $86.00 for a lawyer admitted to the bar in 1963/1967 and practicing in a law firm of from 1 to 4 members in a city of over 100,000. The survey further indicates the statewide average mean is $84 and the median is $80 per hour with apparently the low being $70 an hour and the high $95 per hour. Mr. Daly, according to Martindale-Hubble, 1985 edition, is a sole practitioner who was admitted to the California Bar in 1966 and the North Carolina Bar in 1969. Charlotte is a city of over 100,000. The Court believes that the hourly rate allowed Mr. Daly for out-of-court work based on 1984 rates was indeed a reasonable attorney's fee, as it was intended to be.
Now, turning to Mr. Street's claim, the Court notes that Mr. Street practices in Gastonia, a city of approximately 47,000 persons. Mr. Street was admitted to the North Carolina Bar in 1972 and is a member of a two-man firm. Again, the North Carolina Bar Association Economic Survey 1985 indicates that the typical hourly rate for a lawyer who was admitted to the Bar in 1968/1972 and who is a member of a 1 to 4-man firm in a city of 35,000 to 50,000 is $67.00 an hour, that the statewide average mean, $79.00, and that the median is $75.00 per hour. The Court felt that in view of Mr. Street's secondary role in this case, with Mr. Daly being the lead attorney, a $70.00 an hour fee was most reasonable in 1984, and still feels that way.
The Court of Appeals on pages 1081 and 1082:
The Court then declined to increase the lodestar fee to account for the excellent results obtained. The result in this case, a $35,000 damages award for emotional harm, is certainly quite good, as the district court acknowledged. However, a prevailing attorney is not entitled to an upward adjustment of the lodestar fee simply because he or she did a good job.
The words "for the excellent results obtained" are those of the Court of Appeals, not this Court. This Court did say on page 5 of its Order, paragraph (g): "The amount and results were most satisfactory...." However, this Court further stated on page 343 of its Order:
The Court concludes that when Mr. Daly made the offer to accept $200,000 he was not interested in settling the matter which he eventually did settle for the far lesser sum of $35,000.00, which he [emphasis added] concludes was an "excellent result", after building up thousands of dollars in attorney's fees....
Obviously the Court has to consider both attorneys' obstinate actions when applying the usually considered factors in arriving at a reasonable attorney's fee.
Thus, the Court factored into its determination of the fee, Plaintiff's counsel's being completely unreasonable in their initial demand, when the Court considered the other factors in Johnson v. Georgia Highway Express, Inc., 488 F.2d 714 (5th Cir.1974).
This Court did not accept as gospel (as to what it should allow Plaintiff's attorney) the affidavits filed by Mr. Daly and Martin Brackett, et al., or by Mr. Street and his affidavits but relied on the Court's knowledge of the case, what was involved, the lack of complexity, and the fees charged in this locality in these and other matters. As stated at page 343 of this Court's Order:
*1273 The Court wants to make it very clear that what one judge has allowed an attorney in another case carries little weight in this Court. Each award depends on the facts and circumstances peculiar to the individual case. It is the responsibility of the individual judge to make an initial estimate of a reasonable fee by multiplying the number of hours reasonably expended in the litigation by a reasonable hourly rate.
This the Court feels it has done.
Therefore, unless directed by the Fourth Circuit Court of Appeals to increase the hourly rate, the Court will not disturb the hourly rate of Mr. Daly of $90.00 per hour in 1984 for out-of-court work in 1982-1983, nor that of Mr. Street of $70.00 an hour in 1984 for out-of-court work in 1982-1983, which the Court determined in its discretion to be reasonable in 1984 for the Plaintiff's attorneys' services in this case.
Turning next to the litigation expenses, the Court disallowed the following expenses:
Travel Charges $165.60
Investigative Charge 78.61
Long Distance Telephone Charge 82.54
Postage Charges 55.01
Copy Charge 351.08
Mileage 54.00
Photocopies 79.90
Long Distance Telephone Charges 52.67
Out-of-Pocket Expenses for Legal
Research 512.00
Other 6.56
_________
TOTAL $1,437.97
__________
The Court of Appeals directed this Court to order compensation for reasonable litigation expenses.
In order to determine if the disallowed expenses were reasonable the Court will need to have more information concerning the disallowed charges as follows:
Travel Charge $165.60
Who travelled?
From where to where?
When?
Purpose?
Method?
Mileage?
What if anything is charged for
other than mileage and
amount of charge?
Investigative Charge $ 78.61
Who made the investigation?
To whom was payment made?
When was the investigation?
What was the purpose of the
investigation?
To whom did the investigator
talk?
What if any documents were
procured as a result of the
investigation?
Long Distance Telephone
Charges 135.21
When was the call made?
From what place to what
place?
By whom and to whom was the
call made?
Purpose of call?
Charge for each such call?
Postage Charges 55.01
What does this consist of?
(At 20¢ per ounce this would be
275 pieces, but obviously this
charge could consist of
parcels of more than one
ounce each.)
Copying Charges 351.08
Photocopies 79.90
______
430.98
What was copied at a cost of
$430.98?
When was it copied?
How much was charged per
page?
To whom was the charge paid?
What was the purpose of the
copying?
Out-of-Pocket Expenses for
Legal Research 512.00
What was the "out-of-pocket
expense"?
What was the purpose?
To whom was the expense
paid?
When was it paid?
Other 6.56
Other what?
When these questions are answered by Mr. Daly and Mr. Street, the Court will reconsider their request. As to the appellate court's concern in Note 15 of its opinion as to whether this case has precluded the attorneys from engaging in other employment, the Court has considered this factor and notes that loss of other employment is already reflected in the hourly rate allowed. Therefore, an upward adjustment is unnecessary, since this Court is of the opinion that $90.00 an hour is adequate for *1274 Mr. Daly and $70.00 an hour is adequate for Mr. Street. In other words, the attorneys have been adequately compensated for the available working hours.
NOW, THEREFORE, IT IS ORDERED:
(1) The Court having considered the fees allowed the attorneys for the Plaintiff, in its discretion, reaffirms its allowance of $90.00 an hour to Mr. Daly and $70.00 an hour to Mr. Street as representative of the proper hourly rate on June 7, 1984 when the Order was filed.
(2) The Plaintiff's attorneys are directed to file within twenty (20) days from the filing of this Order a response to the Court's questions as to the "litigation expenses."
(3) The Court, in its discretion, reaffirms its position that the attorneys for the Plaintiff at the rates allowed will be adequately compensated for any time they would have been able to spend on another matter if they had not been involved in this case.
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572 So.2d 1288 (1990)
Willie Louis RUSSAW
v.
STATE.
4 Div. 364.
Court of Criminal Appeals of Alabama.
October 26, 1990.
*1289 Bryan A. Stevenson, Montgomery, for appellant.
Don Siegelman, Atty. Gen., and Martha Gail Ingram and William D. Little, Asst. Attys. Gen., for appellee.
BOWEN, Judge.
Willie Louis Russaw was indicted and convicted for capital robbery-murder pursuant to Ala.Code 1975, § 13A-5-40(a)(2). He was sentenced to death by electrocution. The defendant raises 21 issues on this appeal from that conviction and sentence.
I.
The trial court committed plain error in its oral instructions to the jury because the jury was not instructed that in order to find the defendant guilty of the capital offense charged in the indictment they had to find that the defendant had a "particularized intent to kill." That error requires a reversal of the defendant's conviction.
The State's evidence shows that the victim died from at least three blunt force injuries to the back of his head and that these injuries were most probably inflicted with an ax handle wielded by Henry James Starks (alias Russaw), a cousin of the defendant. Ronald Grey, Stacey Grey, and Earl Adams were also involved in the robbery.[1] Adams and the Greys testified against the defendant at trial. Adams testified that Starks went inside the store first. About "2 seconds" later, the defendant entered the store and "went around behind the counter and grabbed [the victim] and threw him down. [Starks] went over to the corner and picked up an ax handle and hit him." Ronald Grey testified that he saw the defendant "just standing there ... straddling [the victim] from behind." According to Ronald, Starks was standing in front of the victim "just holding" an ax handle. Ronald did not see Starks hit the victim. The defendant fled from the store into the waiting automobile with the victim's wallet. In his written order imposing the death sentence, the trial court found that "the evidence proves beyond doubt that the defendant was a major participant in the robbery and murder. Although the victim was actually beaten to death by the defendant's co-defendant [Starks], the State proved beyond a reasonable doubt that the defendant personally held the victim down while the victim was being beaten to death."
This evidence was not disputed. Henry Stark was the "triggerman," and there was no contention that anyone else struck the fatal blows. However, there was no testimony of any plan to kill the victim. In fact, under the evidence presented at trial, the only real question the jury had to decide *1290 was whether the defendant was guilty of felony-murder or capital murder-robbery: Was he merely a participant in a robbery during which a person was killed, or was he a knowing accomplice to the intentional killing and robbery of the victim?
In this regard, the trial court instructed the jury as follows:
"Now, this indictment simply reads this way, `That the Grand Jury of said County charges that ... Willie Louis Russaw, ... did intentionally cause the death of Travis Gerald Benton by striking the said Travis Gerald Benton with an axe handle ..., and Willie Louis Russaw caused said death during the time that Willie Louis Russaw was in the course of committing or attempting to commit a theft....'
". . . .
"Now, ladies and gentlemen, this defendant is charged with a capital offense. That means that he is charged with aggravated murder. He's charged with intentional murder with the circumstances of aggravation being that it was committed during the course of a robbery in the first degree. Now, he's charged with capital murder. He's charged with a capital offense.
"Now, thatand the Code of Alabama under which this defendant is charged is charged with this capital offense, Title 13A-5-39(a)(2). [sic]. The following are capital offenses. Murder by the defendant during a robbery in the first degree or an attempt thereof committed by the defendant. That's what the defendant is charged with.
". . . .
"Now, the complicity statutes in the State of Alabama are found in this Code Section, 13A-2-23. Now, that law simply says this. A person is legally accountable for the behavior of another constituting a criminal offense if with the intent to promote or assist the commission of the offense, one he procures, induces, or causes such other person to commit the offense, or two, he aids or abets such other person in committing the offense. Each person who joins an unlawful enterprise is responsible for the result whether committed by one or all. All persons concerned in the commission of a felony directly or indirectly or by aiding and abetting in its commission are equally guilty. This section defines complicity in clear, direct, and explicit terms. The test is whether the accused with the intent to promote or assist the perpetration of an offense did any of the enumerated acts, that is, did he procure, induce, or cause such other person [to] commit the offense or did he aid and abet such other person in committing the offense. It is a general rule of law that each person entering upon an unlawful purpose is responsible for everything which may consequently and proximately flow from that unlawful purpose. This subsection one that I read to you imposes liability in a situation where the defendant is the party who instigates or starts the complicitous conduct. The subsection two that I read to you imposes liability in a section where one joins in the complicitous actions. The classic words aid and abet are used in this section. Aiding and abetting comprehends all assistance rendered by acts or words of encouragement, support of person actual or constructive to render assistance should it become necessary and no particular acts are necessary. The State must adduce some evidence implying that the defendant either recruited, helped or counseled in preparing the crime or understood some part in its commission. So, then, ladies and gentlemen, the law says that a person is criminally liable for the offense if it was committed by his own behavior, meaning actually participated in it or it was committed by the behavior of some other person, or if you assisted in the commission of the offense.
". . . .
"... So, what it boils down to is simply, every person who has joined an unlawful *1291 enterprise is responsible for the results whether committed by one or all. That is, all persons concerned in the commission of a felony are guilty as the actual perpetrator of a criminal act and proved beyond a reasonable doubt that they procured the commission of the crime, they induced or caused some person to commit the offense, or on proof of aiding and abetting another in its commission. Now, that's what the law has to say about complicity.
". . . .
"... As I said to you the defendant is charged with the capital offense of murder during the robbery in the first degree or in [an] attempt thereof committed by the defendant. Now, to sustain a conviction under the statute that I just read to you for capital murder-robbery, the State must prove beyond a reasonable doubt one, a robbery in the first degree or an attempt thereof as defined by Section 13A-8-41, and I'm going to tell you about that in a moment. Two, a murder as defined by Section 13A-6-2(a)(1), and I'll tell you about murder in a minute. And three, that the murder was committed during the robbery or attempted robbery, that is, that the murder was committed in the course of or in connection with the commission of or in immediate flight from the commission of the robbery or attempted robbery in the first degree. Those are the three elements that the State must prove beyond a reasonable doubt for the defendant to be guilty of the capital murder-robbery....
". . . .
"One of the other elements [of capital murder-robbery] is murder. And murder is defined in our Code Section and in the State of Alabama under Section 13A-6-2(a)(1), and that simply says this. A person commits the crime of murder if with intent to cause the death of another person he causes the death of that person or of another person, or he commits or attempts to commit robbery in any degree and in the course of and in furtherance of the crime that he is committing or attempting to commit he or another participant if there be any causes the death o[f] any person. [sic]. Now, that's murder defined under our statutes.
"Now, you heard me use the word intent. Intention in regard to murder would mean that a person acted intentionally with respect to a particular result, that is, death.... So, the intent in murder means that state of mind that mental state in the mind [sic] of a person intending death at the time of the enterprise and the action resulting in death....
"Now, ... to sum up the capital murder charge. To sustain a conviction under subsection (a)(2) title 13A-5-40, under the section for capital murder robbery, the State must prove beyond a reasonable doubt one, a robbery in the first degree or an attempt thereof as I have defined that to you under our applicable law being section 13A-8-41. Two, a murder as I defined it to you under our law section 13A-6-2(a)(1) and three, that the murder was committed during the robbery or attempted robbery, that is that the murder was committed during the course of or in connection with the commission of or in immediate flight from the commission of the robbery or attempted robbery in the first degree.
". . . .
"... There could be a lesser included offense here of murder. There could be a lesser included offense of robbery in the first degree. Now, you're going to have to bear with me because I'm going to have to say the same thing that I just said, except it's a lesser included offense.
"... A person commits the crime of murder, and I'm talking about a lesser included offense if you ladies and gentlemen determine that there is a lesser included offense. A person commits the crime of murder if with intent to cause *1292 the death of another person he causes the death of that person or another person. Or he commits or attempts to commit robbery in any degree and in the course of and in furtherance of the crime that he is committing he or another participant, if there be any, causes the death of any person.
"Now, you've gotthat would constitute the crime of murder.
"Now, you would also, at that point consider the intent, consider what I said about that. [The trial court then repeated the instructions on intent quoted above]." (Emphasis added.)
Nowhere in his instructions did the trial court charge the jury that in order to find the defendant guilty of the capital offense charged in the indictment, the jury had to find that the defendant was an accomplice in the intentional killing as opposed to being an accomplice merely in the robbery.
"[I]n a prosecution for a capital offense, the felony-murder doctrine has no place in securing a conviction of the offense charged, Alabama Code 1975, § 13A-5-40(c); Ex parte Ritter, 375 So.2d 270, 273-75 (Ala.1979), vacated on other grounds, Ritter v. Alabama, 448 U.S. 903, 100 S.Ct. 3044, 65 L.Ed.2d 1133 (1980)." Connolly v. State, 500 So.2d 57, 62 (Ala.Cr. App.1985), affirmed, 500 So.2d 68 (Ala. 1986). "A defendant who does not personally commit the act of killing which constitutes the murder is not guilty of a capital offense ... unless that defendant is legally accountable for the murder because of complicity in the murder itself under the provisions of section 13A-2-23 [defining complicity], in addition to being guilty of the other elements of the capital offense...." Ala.Code 1975, § 13A-5-40(c).
"We have previously held that, while the legislature has prohibited the use of the felony-murder rule to supply the necessary intent in capital felony trials, the accomplice liability doctrine may be used to convict a non-triggerman accomplice if, but only if, the defendant was an accomplice in the intentional killing as opposed to being an accomplice merely in the underlying felony. Ritter v. State, 375 So.2d 270 (Ala.1979). An accomplice to the intentional killing is one who aids and abets the killing by any assistance rendered through `acts or words of encouragement or support or presence, actual or constructive, to render assistance should it become necessary.' Id. at 274.
". . . .
"To affirm a finding of a `particularized intent to kill,' the jury must be properly charged on the intent to kill issue, and there must be sufficient evidence from which a rational jury could conclude that the defendant possessed the intent to kill."
Ex parte Raines, 429 So.2d 1111, 1112-13 (Ala.1982), cert. denied, 460 U.S. 1103, 103 S.Ct. 1804, 76 L.Ed.2d 368 (1983). See also Watkins v. State, 495 So.2d 92, 101-103 (Ala.Cr.App.1986); Waldrop v. State, 462 So.2d 1021, 1029-30 (Ala.Cr.App.1984), cert. denied, 472 U.S. 1019, 105 S.Ct. 3483, 87 L.Ed.2d 618 (1985); Womack v. State, 435 So.2d 754, 762-63 (Ala.Cr.App.), affirmed, 435 So.2d 766 (Ala.), cert. denied, 464 U.S. 986, 104 S.Ct. 436, 78 L.Ed.2d 367 (1983); Evans v. State, 361 So.2d 666, 667 (Ala.1978), cert. denied, 440 U.S. 930, 99 S.Ct. 1267, 59 L.Ed.2d 486 (1979). "`[N]o defendant is guilty of a capital offense unless he had an intent to kill, and that intent to kill cannot be supplied by the felony murder doctrine.'" Lewis v. State, 456 So.2d 413, 416 (Ala.Cr.App.1984). See also Thomas v. State, 452 So.2d 899, 903 (Ala.Cr.App.1984) ("An oral instruction on subsection (3) felony-murder constitutes a fatal variance from an indictment charging subsection (1) intentional murder unless felony-murder can be deemed a lesser-included offense of intentional murder," which is not possible under Alabama's statutory scheme.).
A comparison of the charge given in this case with portions of the pattern jury instructions recommended by the Alabama Supreme Court reveals the glaring deficiencies *1293 of the jury instructions of the trial court.
"[I]f you find that a murder of the intentional killing type of [the victim] was committed by some person ... other than the defendant, the defendant is guilty of that intentional killing type of murder if, but only if, you find beyond a reasonable doubt either that the defendant intentionally procured, induced or caused the other person ... to commit the murder, or that the defendant intentionally aided or abetted the other person's... commission of the murder. Only if you are convinced beyond a reasonable doubt that either or both of those situations exist as a fact can you find the defendant guilty of an intentional killing murder which he did not personally commit himself. A defendant who is guilty of the crime of murder of the intentional killing type because of these principles has committed that crime the same as if he had personally done the killing himself.
". . . .
"A defendant commits the crime of murder of the intentional killing type if with intent to cause the death of another person, he causes the death of that person or another person. A person acts intentionally with respect to a result or to conduct when his purpose is to cause that result or to engage in that conduct. The defendant must intentionally, as opposed to negligently, accidentally or recklessly, cause the death of the deceased in order to invoke the capital statute. The fact that someone dies or is killed during the course of a robbery does not automatically provide that intent. The intent to kill must be real and specific in order to invoke the capital statute."
Alabama Bar Institute for Continuing Legal Education, Proposed Pattern Jury Instructions for Use in the Guilt State of Capital Cases Tried Under Act No. 81-178, pp. 4-5, 15, approved and "recommended" by the Alabama Supreme Court December 6, 1982 (emphasis added). See Ex parte Harrell, 470 So.2d 1309, 1314 (Ala.), cert. denied, 474 U.S. 935, 106 S.Ct. 269, 88 L.Ed.2d 276 (1985), wherein the Alabama Supreme Court declined to find plain error for two reasons, one of which was because "[t]he trial court's instruction follows the pattern jury instruction `recommended' by this Court...."
In Bui v. State, 551 So.2d 1094, 1115-17 (Ala.Cr.App.1988), affirmed, 551 So.2d 1125 (Ala.1989), this Court found no plain error where the trial court included both reckless murder and felony murder in its definition of murder in defining a capital offense, where 1) the trial court further instructed the jury that only portions of the definition of murder would apply to the case and then recharged the jury, defining the specific crime of intentional murder involved in the case and omitting the inapplicable subdivisions previously given, and 2) there was absolutely no evidence in the record that the murders were committed by reckless conduct or in the commission of a felony. Such distinctions are not present in this case.
Furthermore, we find the instructions of the trial court highly confusing because of the failure to clearly distinguish the intent element in the crimes of capital murder, felony-murder, and murder in connection with the doctrine of accomplice liability. While there was no objection at trial, this "`error is so obvious that the failure to notice it would seriously affect the fairness or integrity of the judicial proceedings.'" Ex parte Womack, 435 So.2d at 769. Under Rule 45A, A.R.App.P., "such error has or probably has adversely affected the substantial right of the appellant." Under the facts and circumstances of this case, we have no choice but to hold that the instructions of the trial court constitute plain error requiring the reversal of the conviction.
II.
The defendant's trial was held on March 7 and 8, 1989. The defendant, who represented himself, declined to ask the *1294 jury venire any qualifying questions and refused to participate in striking a jury stating: "It doesn't really make any difference to me. I am not striking any at all." Upon further explanation and questioning by the trial judge, the defendant stated, "Okay. Listen at this clearly. I am not striking at all. Final." The trial judge then ordered the circuit clerk "to sit down at the counsel table and strike the defendant's strikes for him."
Alabama Code 1975, § 12-16-100, provides in pertinent part: "If any defendant shall refuse to exercise a strike to which he is entitled, then the judge presiding shall exercise that defendant's strike for him." (Emphasis added.) See Zeigler v. State, 443 So.2d 1303, 1305, n. 1 (Ala.Cr.App. 1983). We have been cited to no authority granting a trial judge the power to delegate this authority to any other court official. "The right of peremptory challenge in trials by jury is purely statutory, and, in the absence of statute conferring such right, it does not exist." Sorter v. Austen, 221 Ala. 481, 482, 129 So. 51, 52 (1930).
"Generally speaking, peremptory challenges arise from the exercise of a privilege granted by the legislative authority. They are allowed by legislatures as an act of grace, rest entirely within the discretion of legislatures, can be exercised as a matter of right only to the extent allowed by statute, and must be taken subject to the legislative limitations placed upon the manner of their exercise."
47 Am.Jur.2d Jury, § 234 (1969) (footnotes omitted). "There is hardly a more critical stage of trial than the process of striking a jury." Ford v. State, 356 So.2d 720, 722 (Ala.Cr.App.), cert. denied, 356 So.2d 723 (Ala.1978). Where the defendant represents himself without the benefit of counsel and refuses to strike a jury, only the trial judge can exercise the defendant's strikes. We note this error in the trial judge's delegation of this authority to the clerk merely should this issue arise in the event of a retrial. We do not hold that this particular error, under the circumstances of this case, constitutes plain error.
III.
The defendant waived his right to appointed counsel and represented himself at trial. However, he refused to participate in his trial. He did not ask the jury venire any qualifying questions and refused to strike a jury. He made no opening comments and no closing arguments at either the guilt or the penalty phase of the trial. He presented no evidence on his behalf and refused to cross-examine any witness. Throughout the proceedings he made no objection.
On oral argument of this appeal, the defendant's appellate counsel[2] argued that there had been a "total breakdown of the judicial system" in this case. Using those same words, the assistant attorney general candidly admitted such, but maintained that the "breakdown" was the defendant's own fault. We agree that a "breakdown" did occur and that the defendant did not receive a fair trial.
In order to prevent a recurrence of such a breakdown, we strongly recommend, although we do not require, that a trial court undertake a "thorough inquiry" similar to the type set out in Von Moltke v. Gillies, 332 U.S. 708, 68 S.Ct. 316, 92 L.Ed. 309 (1948), in determining whether a defendant's waiver of counsel is intelligent and knowing.[3] In this case, the two circuit *1295 judges involved made significant efforts in making a determination that the defendant had waived his right to counsel. Although we make no evaluation of the sufficiency of those determinations that the defendant's waiver of counsel was intelligent and knowing, we do make the following observations.
At trial, the defendant did not admit indigency and maintained that he had "relatives [he could] get the funds from." The criteria for determining indigency are set out in Ala.Code 1975, § 15-12-5(b). The assets of "friends and relatives" are not included within that subsection. This is in accord with the general rule that "the earnings or property of various persons other than the accused, but in some way related to him, [should] not be considered in determining his indigency, the test being the personal means of the accused." Annot., 51 A.L.R.3d 1108, § 4 (1973). "[T]he court must look only to the defendant's own earnings and assets, disregarding the potential assistance of friends and relatives who have no obligation to support the defendant." 2 W. LaFave and J. Israel, Criminal Procedure § 11.2(e) at 28 (1984).
In making a determination that a defendant's waiver of counsel is intelligent and knowing, the trial court should include a finding that the defendant has the mental competence and intelligence to make such a waiver. In the event a defendant refuses to cooperate in the trial court's waiver of counsel investigation or in the event the defendant refuses to participate in the trial, the trial court, before continuing with the trial, should make a determination on the record that, in the opinion of the court, the defendant is either deliberately, knowingly, and intentionally attempting to obstruct or hinder the judicial process and the prosecution in that particular case, or that the defendant is deliberately, knowingly, and intentionally refusing to participate in the trial, if such be the case. These determinations assume a prior determination by the trial court that the defendant is mentally competent to stand trial and to make a valid waiver of counsel.
Especially in the prosecution of a capital offense, a trial court should also give consideration to the appointment of standby counsel to represent a defendant who elects to waive counsel and then elects to not participate in the trial. See Ford v. State, 515 So.2d 34, 40-44 (Ala.Cr.App. 1986), affirmed, 515 So.2d 48, 51-52 (Ala. 1987), cert. denied, 484 U.S. 1079, 108 S.Ct. 1061, 98 L.Ed.2d 1023 (1988).
"`[T]he trial court has a continuing responsibility to watch over the defendant and insure that his incompetence is not allowed to substitute for the obligation of the state to prove its case. If, during the course of the trial, it becomes apparent that the defendant is simply incapable, because of an inability to communicate or because of a complete lack of understanding, to present a defense that is at least prima facie valid, the trial court should step in and assign counsel. But because the defendant is not to be granted a second chance simply because the first is going badly, counsel should be appointed after trial has begun, or a mistrial ordered, only where it appears *1296 the defendant should not have been allowed to proceed pro se in the first place.' [Pickens v. State], 96 Wis.2d [549] at 568, 292 N.W.2d [601] at 611 [(1980)] (emphasis added)."
Washington v. State, 539 So.2d 1089, 1094 (Ala.Cr.App.1988).
A number of other significant and troubling issues have been raised on appeal. However, because this conviction must be reversed for the reason stated above, we express no judgment on those remaining issues. The judgment of the circuit court is reversed and this cause is remanded for further proceedings not inconsistent with this opinion.
REVERSED AND REMANDED.
All Judges concur.
NOTES
[1] Starks, the Greys, and Adams were all charged with capital murder. Starks was convicted and sentenced to death. See Starks v. State, 4 Div. 381, presently awaiting the filing of briefs and submission in this court. Stacey Grey, the driver of the "get-away" car, pleaded guilty to murder and was sentenced to 25 years' imprisonment. Ronald Grey and Adams pleaded guilty to murder in exchange for a sentence of life imprisonment.
[2] The record does not show how appellate counsel came to represent the defendant. There is no order of appointment contained in the record on appeal.
[3] In Von Moltke v. Gillies, 332 U.S. at 723-24, 68 S.Ct. at 323, Justice Black, writing for a plurality of the United States Supreme Court stated:
"We have said: `The constitutional right of an accused to be represented by counsel invokes, of itself, the protection of a trial court, in which the accusedwhose life or liberty is at stakeis without counsel. This protecting duty imposes the serious and weighty responsibility upon the trial judge of determining whether there is an intelligent and competent waiver by the accused.' To discharge this duty properly in light of the strong presumption against waiver of the constitutional right to counsel, a judge must investigate as long and as thoroughly as the circumstances of the case before him demand. The fact that an accused may tell him that he is informed of his right to counsel and desires to waive this right does not automatically end the judge's responsibility. To be valid such waiver must be made with an apprehension of the nature of the charges, the statutory offenses included within them, the range of allowable punishments thereunder, possible defenses to the charges and circumstances in mitigation thereof, and all other facts essential to a broad understanding of the whole matter. A judge can make certain that an accused's professed waiver of counsel is understandingly and wisely made only from a penetrating and comprehensive examination of all the circumstances under which such a plea is tendered." (Footnotes omitted.)
See also 2 W. LaFave and J. Israel, Criminal Procedure § 11.3(b) (1984); Annot., 98 A.L.R.3d 13 (1980).
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117 F.Supp.2d 997 (2000)
Gary S. LAUGHLIN, Plaintiff,
v.
COMMISSIONER OF INTERNAL REVENUE SERVICE, Defendant.
No. 99-CV-1566.
United States District Court, S.D. California.
March 23, 2000.
*998 Gary S. Laughlin, Oceanside, CA, pro se.
U.S. Attorney CV, U.S. Attorney's Office, Civil Division, San Diego, CA, Jason S. Zarvin, U.S. Dept. of Justice, Tax Division, Washington, DC, for defendant.
ORDER GRANTING DEFENDANT'S MOTION FOR SUMMARY JUDGMENT AND DISMISSING CASE WITH PREJUDICE
JONES, District Judge.
Before the Court is defendant Commissioner of Internal Revenue Service's motion for summary judgment. For reasons set forth below, Defendant's motion is GRANTED.
STATEMENT OF FACTS
In this case arising under the Freedom of Information Act ("FOIA"), plaintiff Gary Laughlin brings this action against the Commissioner of the Internal Revenue Service ("IRS").[1] Plaintiff has asked that the Internal Revenue Service be required to disclose certain documents concerning Joseph Banister, a former IRS Criminal Investigation Division Agent Evidently. Banister, while working for the IRS. became disenchanted with his position and began to believe, among other things, that (1) the government may not require citizens to pay income tax and (2) the procedures employed by the IRS are unconstitutional. Consequently, he prepared a report ("the Report") detailing his conclusions and submitted it to his direct supervisor, Robert Gorini, who placed it in Banister's personnel file. Gorini Decl ¶ 3, 5, 6 Gorini then forwarded a copy of the Report to his Division Chief, Paul B. Varville. Id. at ¶ 6. Banister subsequently resigned his position with the IRS and began selling the Report, which he advertises on the Internet Laughlin Decl ¶ 2-5 Banister now also speaks at conferences and seminars throughout the country, where he sells the Report Id. at ¶ 7
On March 30, 1999, Plaintiff wrote to the IRS and requested:
5. a copy of Banister's report entitled "Investigating the Federal Income Tax: A Preliminary Report," which he submitted to his supervisor on February 8, 1999
6. a copy of the transmittal letter that Banister included with his report
7. a copy of an IRS memorandum dated February 17, 1999 informing *999 Banister that he was being put on a seven day administrative leave
8. a copy of the internal agency memo from Commissioner Charles Rosotti dated April 28, 1998 regarding "reporting of Misconduct, Fraud, Waste and Abuse."
9. a list of all persons, their names, addresses and phone numbers within and without the Internal Revenue Service who received a copy of Mr. Banister's "Investigating the Federal Income Tax: A Preliminary Report"[2]
Complaint, Exh. A. On April 8, 1999, Fannie Davis, a Disclosure Officer with the IRS responded to Plaintiff's request. Complaint. Exh. B Davis sent Plaintiff two News memoranda from Commissioner Charles Rosotti, with release dates of April 27, 1998 and April 28, 1998, in response to Plaintiff's request number 8. Id She, however, declined to disclose anything else, writing
Items 5, 6, 7, and 9. This information is part of Mr. Banister's personnel file, and written consent from Mr. Banister is required for third party requests unless the information is public knowledge. The Office of Personnel Management (OPM) has designated the items of information form an employee's official Personnel Folder (OPF) that are public information, and that information is computer generated on the Public Information Listing (PIL). The six items that can be disclosed are Name, Position Title and Occupational Series, Grade of Employee, Annual Salary, Duty Stations and Position Descriptions.
Complaint, Exh. B. Plaintiff responded with a letter to Davis claiming Items 5, 6, 7, and 9 could be disclosed because the "documents ... are currently public knowledge." Complaint, Exh. D. Davis then sent a sent a second letter to Plaintiff on May 11, 1999 indicating Plaintiff's request would be turned over to the Disclosure Litigation department. Complaint Exh C.
On November 10, 1999, Jason Zarin, counsel for Defendant, sent Plaintiff two documents. (1) the response of Paul Varville to the Report and (2) Joseph Banister's letter to Robert A. Gorini accompanying the Report Zarin Declaration ¶ 2. Zarin explained that these documents were responsive to request items 6 and 7 Id. at ¶ 3. Lauri Takeguchi-Chital, who is responsible for requests related to the Report, reviewed Plaintiff's request and concluded that there was no "list of all persons, their names, addresses, and phone numbers within and without the Internal Revenue Service who received a copy of Mr. Banister's Investigating the Federal Income Tax: A Preliminary Report." Takeguchi-Chital Decl. ¶ 4 At some point, Plaintiff has been able to obtain a copy of the Report from the Internet at no cost
Standard of Review
Summary judgment is properly granted to a moving party when "there is no genuine issue as to any material fact and ... the moving party is entitled to judgment as a matter of law." FED. R. CIV. P. 56(c); see also Celotex v. Catrett, 477 U.S. 317, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986). The "mere existence of some alleged factual dispute between the parties will not defeat an otherwise properly supported motion for summary judgment; the requirement is that there be no genuine issue of material facts" Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 247-48, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1985). Moreover, "as to materiality, the substantive law will identify which facts are material Only disputes over facts that might affect the outcome of the suit under the governing *1000 law will properly preclude the entry of summary judgment." Id. at 248, 106 S.Ct. 2505.
Upon a motion for summary judgment, "an adverse party may not rest upon the mere allegations or denials of the adverse party's pleading, but the adverse party's response, by affidavits or as otherwise provided in this rule, must set forth specific facts showing that there is a genuine issue for trial." FED. R. CIV. P. § 56(e) A nonmovant must submit fact materials of sufficient strength to constitute substantial evidence Anderson v. Liberty Lobby Inc., 477 U.S. 242, 249-252, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986).
Discussion
The IRS contends it is entitled to summary judgment because (a) the Commissioner of the IRS is not a proper defendant to a FOIA suit, (b) Plaintiff is not entitled to relief because he has already received the items he requested, the documents have been voluntarily turned over, or they do not exist, and (c) Plaintiff is not entitled to attorney's fees or costs.
I. The Commissioner of the IRS Is Not a Proper Defendant
The "Commissioner of Internal Revenue Service" is the named defendant in this action. Defendant admits he is an official of the Treasury Department. Def. Mot. 8:7-8. However, he contends that the only proper defendants in FOIA actions are federal departments and agencies. Def. Mot. 8:8-10 (citing 5 U.S.C. § 552(f),[3] 5 U.S.C. § 552a(g)(1)(B),[4] and Thompson v. Walbran, 990 F.2d 403, 405 (8th Cir.1993)) He therefore contends the case should be dismissed because the wrong defendant has been named In response, Plaintiff seeks leave to amend his complaint to properly name the IRS. (Pl. Opp 12).[5]
"Several district courts have held that individual officers of federal agencies are not proper parties to a FOIA action" Petrus v. Bowen, 833 F.2d 581, 582 (5th Cir.1987) (citations omitted) The Fifth Circuit, in Petrus, determined that the plain language of the statute creates a cause of action against federal agencies and not its individual employees. We agree and find that the Commissioner is not a properly named defendant in this action. Accordingly, the action against the Commissioner of the Internal Revenue Service is DISMISSED, with prejudice.[6]
II The IRS Is Entitled to Summary Judgment Because Plaintiff Already Has the Requested Items or the Item Does Not Exist
A. The IRS Is Entitled to Summary Judgment With Respect to Item 5 Because Plaintiff Already Has A Copy of the Report
The IRS contends it is entitled to summary judgment, with respect to item 5, on two grounds (1) the issue is moot and (2) the Report is exempt from disclosure.
The IRS contends this case is moot because Plaintiff has admitted he has a copy of the Report. Laughlin Decl ¶ 9 Courts have concluded FOIA actions become moot when the materials are voluntarily turned over See, e.g., Carter v. Veterans Admin., 780 F.2d 1479, 1481 (9th Cir.1986)
*1001 The Court agrees that the request for the Report is moot. "Simply stated, a case is moot when the issues presented are no longer `live' or the parties lack a legally cognizable interest in the outcome." See Powell v. McCormack, 395 U.S. 486, 496, 89 S.Ct. 1944, 23 L.Ed.2d 491 (1969). To the extent that the FOIA "seeks to permit access to official information long shielded unnecessarily from public view," Department of the Air Force v. Rose, 425 U.S. 352, 361, 96 S.Ct. 1592, 48 L.Ed.2d 11 (1976) (citing EPA v. Mink, 410 U.S. 73, 80, 93 S.Ct. 827, 35 L.Ed.2d 119 (1973)), the request, with respect to the Report, is moot because the Report is now in the hands of Plaintiff.[7][8]
B. The Government Is Entitled to Summary Judgment With Respect to Items 6, 7 and 8 Because the IRS Has Already Turned Over these Documents
Plaintiff sought injunctive relief "to order defendants to produce certain documents for inspection and copying" Complaint ¶ 1 The Government contends Plaintiff's request for equitable relief is moot because the IRS has already released items 6, 7, and 8. Zarin Declaration ¶ 2-4 (explaining that he sent Plaintiff copies of (1) the response of Paul Varville to Joseph Banister's Report and (2) Joseph Banister's letter to Robert A Gorini accompanying his "report."); Complaint, Exh. B (Fannie Davis April 8, 1999 letter to Plaintiff explaining that enclosed were "two NEWS memos from Commissioner Charles Rosotti with the release date of April 27, 1998 and April 28, 1998"). The Court agrees that because the documents have already been produced, these requests are moot. See Carter v. Veterans Admin., 780 F.2d 1479, 1481 (9th Cir. 1986).
C. There is no evidence that a Document Responsive to Item 9 of the Request Exists
The IRS argues that if there is no document responsive to a FOIA request, the Agency is not required to create one Def. Mot. 6:9-12 (relying on N.L.R.B. v. Sears Roebuck & Co., 421 U.S. 132, 162, 95 S.Ct. 1504, 44 L.Ed.2d 29 (1975)[9]). It then points out that it conducted a reasonable, good faith search for a document that would be responsive to Plaintiff's request item 9 and has determined that no such document exists. Def Mot 6:13-15, Takeguchi-Chital Declaration ¶ 4. Accordingly, it contends it is entitled to summary judgment on this aspect of Plaintiff's complaint
Plaintiff concedes that he is unaware as to whether the IRS has, in fact, created a list of names, phone numbers, and addressees of persons within and without the IRS who might have seen Mr. Banister's report. However, he points out that the original letter from Fannie Davis suggested that such a list existed. Specifically, Davis wrote. "Items 5,6,7, and 9: This information is part of Mr. Banisters [sic] personnel file, and written consent from Mr. Banister is required for third party requests unless the information is public knowledge." Complaint, Exh. B (emphasis added). Seemingly, Plaintiff contends the use of the present tense suggests that such a document does exist but that it could not be disclosed because it was part of Banister's personnel file. However, the letter simply states that the information would be part of Mr. Banister's personnel file not that the document actually existed *1002 Plaintiff has failed to offer any evidence beyond his mere speculation that the requested document exists Accordingly, the Government is entitled to summary judgment on this ground because Plaintiff has not created a genuine issue of material fact regarding whether the IRS failed to disclose a document responsive to request number 9.[10]
III Plaintiff Is Not Entitled to Attorney's Fees and the Court Declines to Award Costs
The IRS correctly observes that, as a pro se plaintiff, Laughlin may not collect attorney's fees See Carter v. Veterans Admin., 780 F.2d 1479, 1481 (9th Cir. 1986). This Court, however, has explained that a pro se plaintiff may be awarded costs. See id. To be entitled to costs, a plaintiff must substantially prevail. 5 U S C § 552(a)(4)(E). The plaintiff must demonstrate (1) the filing of the action could reasonably have been regarded as necessary to obtain the information, and (2) the filing of the action had a substantial causative effect on the delivery of the information. See Church of Scientology v. U.S. Postal Service, 700 F.2d 486, 489 (9th Cir. 1983). Even upon such a showing, a court must consider: (1) the benefit to the public, if any, deriving from the case; (2) the commercial benefit to the complainant; (3) the nature of the complainant's interest in the records sought, and (4) whether the government's withholding of the records sought had a reasonable basis in law See id at 492
The Government first argues Plaintiff has failed to show that the prosecution of the suit was necessary to obtain the requested records Plaintiff's possession of the Report and the disclosure of Item 8 prior to the filing of the suit clearly establishes that the suit was unnecessary as to these documents As to items 6 and 7. Plaintiff suggests that the lawsuit was necessary and points to the timing of the Zarin's disclosure on the eve of the IRS' summary judgment motion. However, even if the IRS's disclosure of Items 6, and 7 were prompted by the filing of the action, the Court declines to award costs due to other considerations.
Plaintiff cannot establish any of the four factors that might entitle him to an award of fees. There is no conceivable public purpose to this lawsuit given that the Report is readily accessible commercially. Moreover, there is no reason to believe that its disclosure promotes the public interest as it appears to be nothing more than the private opinions of a single former government agent. With respect to Items 6, and 7, there is no apparent public benefit to the release of such material, this information in no way furthers the FOIA's goal of "shed[ding] light on an agency's performance of its statutory duties." Department of Justice v. Reporters Comm., for Freedom of the Press, 489 U.S. 749, 773, 109 S.Ct. 1468, 103 L.Ed.2d 774 (1989). Rather, this information pertains to the agency actions as to an individual employee
The second factor also suggests Plaintiff is not entitled to costs The Ninth Circuit has explained that where the potential for private commercial benefit is sufficient incentive to encourage a plaintiff's pursuit of his claim, the court has discretion to deny the request. See Church of Scientology, 700 F.2d at 494 (explaining that "... if the potential for private commercial benefit [is] sufficient incentive to encourage plaintiff's pursuit of his claim, it would not be improper for the district court to deny his attorney's fees request"). Here, Plaintiff has conceded that the FOIA request will *1003 further a lawsuit he is currently pursuing against the IRS. Accordingly, he has a sufficient incentive to pursue the FOIA request such that the additional incentive of an award of costs is not necessary.
Further, the Government's proffered reason for declining to disclose the materials was reasonable. The Government could have justifiably believed that the disclosure of these documents constituted "a clearly unwarranted invasion of personal privacy" into the personnel files of Mr. Bannister which would exempt these document from disclosure under § 552(b)(6). Accordingly, the Court declines to award Plaintiff costs for this action
Conclusion
Based upon the foregoing, Defendant's motion for summary judgment is hereby GRANTED. Defendant Commissioner of Internal Revenue Service is DISMISSED, with prejudice. Plaintiffs request for Items 5, 6, 7, 8 and 9 are DENIED. Accordingly, this case is DISMISSED, WITH PREJUDICE
IT IS SO ORDERED.
NOTES
[1] Although Plaintiff names the Commissioner as the defendant, Plaintiff names the Internal Revenue Service as defendant in the body of his complaint (Complaint ¶ 4).
[2] This numbering reflects the scheme Plaintiff used in his original letter to the IRS Plaintiff originally only requested these five documents
[3] 5 U.S.C. § 552(f)(1) provides in part: "For purposes of this section, the term`agency' as defined in section 551(1) of this title includes ... any independent regulatory agency"
[4] 5 U S C § 552(g)(1)(B) provides "Whenever any agency ... refuses to comply with an individual request under subsection (d)(1) of this section, the individual may bring a civil action against the agency, and the district courts of the United States shall have jurisdiction in the matters under the provisions of this subsection" (emphasis added)
[5] Plaintiff's request to amend his complaint is not properly brought before the Court as a motion.
[6] The Court does not grant Plaintiff leave to amend the complaint because we grant summary judgment on another basis
[7] At least one court has treated a request as moot where plaintiff had possession of the requested document. See, Lawrence v. Commissioner of the Internal Revenue Service, No. ED CV 99-251 (C D CA, Nov 8, 1999)
[8] Because the Court finds the request for the Report moot, we decline to address whether the Report is exempt from disclosure
[9] In Sears, the court held that the FOIA does not compel agencies to create documents which they would not otherwise required to create, the Act "only requires disclosure of certain documents which the law requires the agency to prepare or which the agency has decided for its own reasons to create" 421 U.S. 132, 162, 95 S.Ct. 1504
[10] Plaintiff alternatively argues that the IRS could have satisfied the number 9 request by turning over all routing slips that documented the transfer of the report between IRS employees. This memorandum suggests this contention is unavailing. Plaintiff requested a "list" and a compilation of routing slips is not a list such that it could fall within the scope of the number 9 request Accordingly, Plaintiff cannot now expand the original request to encompass this additional request.
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213 Cal.App.3d 118 (1989)
261 Cal. Rptr. 502
THE PEOPLE, Plaintiff and Respondent,
v.
WILLIAM EDWARD PRESTON MAY, Defendant and Appellant.
Docket No. A038542.
Court of Appeals of California, First District, Division Two.
August 16, 1989.
*122 COUNSEL
Jay Ruskin for Defendant and Appellant.
John K. Van de Kamp, Attorney General, Steve White, Chief Assistant Attorney General, John H. Sugiyama, Assistant Attorney General, David D. Salmon and Gloria F. DeHart, Deputy Attorneys General, for Plaintiff and Respondent.
OPINION
SMITH, Acting P.J.
Defendant and appellant William Edward Preston May was found guilty of two counts of forcible oral copulation (Pen. Code, § 288a, subd. (c))[1] and one count of assault with intent to commit rape. (Pen. Code, § 220.) Three prior felony convictions were also found to be true. He was sentenced to concurrent eight-year terms on the copulation convictions and a concurrent six-year term on the assault; he was also given an additional year for each of the priors, for a total prison sentence of eleven years.
We will conclude that the court's failure to give an instruction on reasonable good faith belief in consent (the so-called Mayberry instruction) and the court's additional failure to define the crime of rape for the jury, constituted reversible error.
BACKGROUND
Maria T., a divorcee with three children, testified that on the afternoon of Sunday, November 16, 1986, she and her friend Tim went to Joe Frogger's bar in Santa Rosa. She had met Tim at the same bar two weeks ago and had spent the previous night at his apartment.
Maria had two Bloody Marys and was finishing some soup when defendant May walked in. He came up and sat next to her and they engaged in pleasant conversation. He gave her his business card and bought drinks for her. At one point Maria told May she was going to the bathroom to "powder her nose" which, she explained, meant that she was going to snort cocaine. May then told her that he could obtain more cocaine for her. Maria accepted the offer. Without notifying Tim, she left the bar with May, to whom she admitted she felt an attraction.
*123 Maria and May drove to a bar called "Till Two," where they played pool and drank beer. Maria was feeling the effects of the alcohol. They proceeded to a third bar where they had more drinks, and finally drove to May's apartment. By this time it was getting dark.
Maria walked in and immediately noticed May's father sitting in a wheelchair in the living room. Upon entering, May told Maria that the bedroom light was on and that she should go in there and take her clothes off. He then went into the kitchen and starting cooking something on the stove. She followed him into the kitchen, told him "no" and grabbed a steak knife. May took the knife out of her hand and slapped her face. He grabbed her arm, led her to the bedroom and again told her to disrobe. This time she did not refuse, but "stood there for awhile." Finally, because she was afraid, she took her clothes off and got on the bed.
May removed his clothes and got on the bed with her. She then tried to roll off the bed, but he slapped her again. He positioned himself so that his penis was in her mouth and his mouth was on her vagina. He told her to get his penis "nice and hard," and she began to suck on it because she felt she "had no choice." While they were on the bed, May struck her a number of times with his open hand and closed fist and licked and bit her vagina. At some point while she was orally copulating him, she felt sick and vomited over the side of the bed. Just then the phone rang and May got up and left the bedroom. Maria took advantage of this opportunity to get dressed and left the apartment. She then phoned Tim and obtained a ride back to her car.
May took the stand in his own defense. He testified that at Joe Frogger's Maria looked over at him and smiled and he smiled back. He introduced himself and bought drinks for her and her friends. After "powdering her nose" in the bathroom, Maria returned and asked him if he wanted to "buy some pussy" for $50. He agreed, and they left the bar together.
According to May, after visiting several bars, drinking beer and flirting with each other, he drove Maria to his father's apartment. She followed him into the kitchen where they were "giggling ... fondling, playing around." She visited the bathroom for a few minutes and then invited him into the bedroom. She offered him cocaine, but he declined because he didn't use hard drugs. She ingested the cocaine herself, and they embraced on the bed. She took off all her clothes, unzipped his fly and orally copulated him. He told her to stop because he had too much to drink and couldn't get an erection. Maria got dressed and told him not to worry because "it could happen to anybody."
*124 They went outside his apartment and she asked for $20 "for the blow job." When he declined to pay because he had not achieved erection, she threatened to have him killed and slapped him. Instinctively, he slapped her back and told her to get lost. When she attempted to kick him in the groin, he slapped her again and kicked her in the groin. He explained his behavior as the product of a "flashback" from an episode in prison when he was assaulted with a pipe and almost killed.
May's father testified that he saw his son and Maria come in to the apartment holding hands and whispering to each other. They drank a beer in the kitchen and she visited the bathroom. She then whispered something in his ear and led him to the bedroom. After 15 to 20 minutes they exited, fully dressed. Mr. May never saw anyone wield a knife, did not hear any unusual noises emanating from the bedroom or observe any bruises on Maria when she left.
APPEAL
I
(1a) May contends that the court committed reversible error by failing, sua sponte, to give a Mayberry instruction. A motion for new trial on this ground was denied by the trial court. We agree that the instruction should have been given.
(2) "Under People v. Mayberry (1975) 15 Cal.3d 143 [125 Cal. Rptr. 745, 542 P.2d 1337], a defendant who entertains both a reasonable and bona fide belief that the victim voluntarily consents to engage in the sexual offense does not have the necessary wrongful intent to be convicted of the crime. [Citations.] The rationale is simple: one who labors under a mistake of fact that negates the existence of any criminal intent cannot be convicted of a crime. [Citations.]" (People v. Castillo (1987) 193 Cal. App.3d 119, 124 [238 Cal. Rptr. 207].) CALJIC No. 10.40.1 conveys the Mayberry defense as it applies to the charge of forcible oral copulation.[2]
(3) The trial court has a sua sponte duty to instruct on a defense wherever "it appears that the defendant is relying on such a defense or if there is *125 substantial evidence supportive of such a defense and the defense is not inconsistent with the defendant's theory of the case." (People v. Sedeno (1974) 10 Cal.3d 703, 716 [112 Cal. Rptr. 1, 518 P.2d 913], italics added; People v. Romero (1985) 171 Cal. App.3d 1149, 1156 [215 Cal. Rptr. 634] (Romero); People v. Castillo, supra, 193 Cal. App.3d at p. 125.)
(1b) It is evident on the record below that May did not rely on the defense of reasonable good faith belief in consent. The essence of his testimony was that Maria was a prostitute. According to May, what transpired was nothing more than a sex-for-money transaction from the outset. However, the Sedeno test is disjunctive, not conjunctive. We must therefore still determine whether the defense was (1) supported by substantial evidence and (2) consistent with the defense raised at trial.
(4a) As we first pointed out in Romero, supra, although actual consent and Mayberry consent are compatible defenses and may be raised together, they are not inseparable. (171 Cal. App.3d at p. 1154, disagreeing with People v. Hampton (1981) 118 Cal. App.3d 324, 329-330 [173 Cal. Rptr. 268].) Thus, if the only evidence from the defendant is unequivocal consent and from the victim nonconsensual forcible sex, a sua sponte Mayberry instruction is not required. (Id., at p. 1156; accord People v. Rhoades (1987) 193 Cal. App.3d 1362, 1369 [238 Cal. Rptr. 909].) However, where the record contains "some evidence of equivocal conduct by the victim which led [the defendant] to reasonably believe that there was consent where in fact there was none," the instruction should be given. (Romero, supra, 171 Cal. App.3d at p. 1156; see also People v. Castillo, supra, 193 Cal. App.3d at p. 126; People v. Mayberry, supra, 15 Cal.3d at p. 156.) This evidence may come solely from the defendant's mouth (People v. Burnham (1986) 176 Cal. App.3d 1134, 1148 [222 Cal. Rptr. 630]), solely from the victim's (Castillo, supra, at p. 126), or even from that of a third party (People v. Anderson (1983) 144 Cal. App.3d 55, 62 [192 Cal. Rptr. 409]). There is such evidence in this case.
(1c) Maria's testimony concerning May's behavior from the time she met him at Joe Frogger's to their encounter in the kitchen had all the characteristics of a casual "pick up." May, a man to whom she felt attracted, gave her his business card and bought her drinks; on the promise that he could provide her with cocaine, she left the bar with May without telling the man with whom she came in and in whose apartment she had just spent the previous night. May and Maria went on to visit several other bars, engaged in pleasant conversation, and consumed more alcohol before returning to the apartment of May's father. Upon entering the apartment, May led Maria right past his father, instructed her to take off her clothes, and went into the kitchen.
*126 Maria's version of subsequent events is, to say the least, enigmatic. Instead of voicing an objection to his instruction to disrobe, Maria followed May into the kitchen, brandished a steak knife at him and told him "no." On cross-examination, she could not explain why she had not simply turned around and walked out the front door. May responded by taking the knife out of her hand and slapping her.[3] He did not attempt to use the knife nor did he threaten her, but instead led her into the bedroom and again instructed her to take off her clothes. This time Maria displayed no resistance at all; she simply "stood there" for awhile and finally complied.[4] The only other plausible manifestation of nonconsent to the ensuing sex acts was Maria's attempt to roll off the bed, to which May again reacted by slapping her. At no time did he bar her from exiting the apartment, which she did when he got up to answer the telephone. Maria's behavior in willingly accompanying him to the apartment after several hours of merriment, her failure to escape when presented with the opportunity, and her lack of verbal objection while in the bedroom could reasonably have been misinterpreted by May as the conduct of someone playing games rather than resisting his advances. The testimony of May's father further strengthened the inference that Maria behaved as if she were a willing participant in the sexual encounter. Thus, there was unquestionably evidence substantial enough to permit a jury to find that the defendant had a good faith, albeit mistaken, belief that Maria consented to the sexual acts he performed.
The key question we next face is whether the Mayberry defense was inconsistent with the defendant's theory of the case. The People claim that it was because May testified that the transaction was strictly sex-for-hire. There is no way, the People argue, that such a story can be reconciled with a reasonable good faith belief. Their contention finds some support in language from People v. Rhoades, supra, 193 Cal. App.3d 1362 (Rhoades).
In Rhoades the victim testified that the defendant, whom she had known for many years, came to her home, held her at knifepoint, robbed her, handcuffed her and forced her to orally copulate him. The defendant, on the other hand, testified that they engaged in oral copulation by mutual consent and that the victim had made up the whole story out of spite. (193 Cal. App.3d at pp. 1365-1366.) The court properly rejected the claim that Mayberry instructions were required sua sponte, because there was "no evidence in the record to support the theory that defendant mistakenly *127 believed Sharon consented even though she in fact did not. Neither account of the encounter brought into focus the reasonableness of defendant's belief that Sharon freely agreed to engage in oral copulation with him. Either the sexual act was entirely consensual or the obvious product of force, depending upon which testimony was credited." (Id., at p. 1369, italics ours.)
However, in dictum, the court went on to state that a Mayberry instruction is not required "unless the evidence reveals some way to harmonize the conflicting accounts of defendant and prosecutrix through a mistake of fact, so that the jury can evaluate proof relating to defendant's belief in consent (as distinguished from his mere assertion of consent)...." (193 Cal. App.3d at p. 1369.) This language unfortunately confuses the Sedeno requirement of "consistency" with the concept that the two versions of the encounter must be "harmonizable" or "reconcilable," a notion which the facts of Mayberry itself prove false.[5] Few defendants raising a consent defense make mistaken belief the centerpiece of their case; the jury is almost always presented with somewhat conflicting versions of the incident. We have already noted that one purpose of the Mayberry instruction is to allow the jury to consider the possibility that both the victim and the accused are, in some respects, telling the truth. (Romero, supra, 171 Cal. App.3d 1149, 1155.) (4b) It is equally evident that the instruction should be given where the jury may reasonably conclude that both parties are being less than totally truthful about what happened. (1d) As illustrated in this case, even if the jury refused to give credence to May's testimony recounting an agreement for prostitution, they were still entitled to consider whether, based on his father's testimony and the equivocal conduct set forth in Maria's version of events, he harbored a reasonable and good faith belief in her consent. (5) As stated in People v. Anderson, supra, 144 Cal. App.3d 55, "[i]t is elementary that a defendant's state of mind is most often shown through circumstantial evidence which often prevails over the direct testimony of the defendant to the contrary." (Id., at p. 62, italics added.)
(6) The fact that May claimed Maria agreed to exchange sex for money did not remove good faith as an issue in the case. This was not a situation where the defense consists of alibi, mistaken identity, or blanket denial of an obviously forced sexual encounter. May never denied his active participation in the sexual conduct at issue, and substantial evidence produced by both sides supported an inference that he believed she was consenting. *128 Hence, the Mayberry defense was not inconsistent with defendant's theory of the case. (7) (See fn. 6.) (See People v. Burnham, supra, 176 Cal.App 3d 1134, 1144.)[6]
(8a) The error in failing to give the instruction must be deemed prejudicial. (9) An erroneous failure to instruct on a defense presented by substantial evidence constitutes a denial of the right to have the jury determine every material issue. (Mayberry, supra, 15 Cal.3d at pp. 157-158.) The error may not be cured by our weighing the evidence and finding it not reasonably probable that a correctly instructed jury would have found the defendant guilty since they were never given that opportunity. (People v. Anderson, supra, 144 Cal. App.3d 55, 62; People v. Rivera (1984) 157 Cal. App.3d 736, 743 [203 Cal. Rptr. 842].)
The only exception to this rule is where it can be determined the jury necessarily decided the issue adversely to the defendant in another context. (People v. Anderson, supra, 144 Cal. App.3d at p. 63; People v. Sedeno, supra, 10 Cal.3d 703, 721.) (8b) This exception is inapplicable here. Although the jury resolved the issue of actual consent against May, that determination says nothing about how they would have resolved the issue of reasonable belief in consent, since they were never asked to consider it. (People v. Burnham, supra, 176 Cal. App.3d 1134, 1150; People v. Rivera, supra, 157 Cal. App.3d at p. 744.) The error must be deemed prejudicial. (People v. Anderson, supra, 144 Cal. App.3d at p. 63.)
The failure to give a Mayberry instruction infects not only the forcible copulation convictions, but the assault offense as well. (10) The crime of assault with intent to commit rape requires an assault accompanied by the specific intent to commit the act of forcible rape. (People v. Rivera, supra, 157 Cal. App.3d at p. 741.) "The intent must be to have intercourse against the victim's will. It is not enough to prove merely a purpose to have intercourse." (1 Witkin and Epstein, Cal. Criminal Law (2d ed. 1988) Crimes Against the Person, § 411, p. 472.) (8c) If the jury found that May *129 harbored a reasonable belief in Maria's consent to have sexual relations, they would also have to conclude that he lacked the specific intent to commit rape. (People v. Rivera, supra, 157 Cal.3d at pp. 741-742.) The omitted instruction therefore deprived May of his right to have the jury determine every issue material to the assault charge. (People v. Mayberry, supra, 15 Cal.3d at pp. 157-158.)
II
(11) May also contends the assault count cannot stand due to the court's failure to define the crime of rape for the jury. He is correct.
Where a defendant is charged with assault with intent to commit rape, the jury must first be given CALJIC No. 9.05.5 (listing the elements of this crime) followed by CALJIC Nos. 9.00 and 10.00 defining the crimes of assault and rape, respectively. (People v. Rivera, supra, 157 Cal. App.3d 736, 741.) In giving only CALJIC Nos. 9.05.5 and 9.00 without giving 10.00, the court's instructions were clearly inadequate. (Ibid.) The error requires reversal unless it can be said to be harmless beyond a reasonable doubt. (People v. Lee (1987) 43 Cal.3d 666, 676 [238 Cal. Rptr. 406, 738 P.2d 752]; Pope v. Illinois (1987) 481 U.S. 497, 503-504, fn. 7 [95 L.Ed.2d 439, 447, 107 S.Ct. 1918]; Chapman v. California (1967) 386 U.S. 18, 21 [17 L.Ed.2d 705, 709, 87 S.Ct. 824, 24 A.L.R.3d 1065].)
The People concede the instructional error but claim that it was cured by references to the crime of rape in closing argument of the prosecutor and defense attorney. The cited excerpts, however, contain only oblique references to the crime and are raised only in the context of exploring why Maria initially falsely stated that she had been raped. Nowhere does either counsel go over the elements of the crime in a fashion consistent with or resembling CALJIC No. 10.00. Moreover, the jurors were told not to consider statements of counsel as evidence (CALJIC No. 1.02) and that their duty was to follow the law as stated to them by the court. (CALJIC No. 1.00.)
People v. Lee, supra, 43 Cal.3d 666, cited by the People, is radically different from the case at bar. There, in addition to arguments of counsel focusing on the subject, there was "quite strong" evidence of the element (intent to kill) upon which an instruction was lacking. (Id., at p. 677.) Here it was undisputed that no sexual intercourse ever took place, and while there was ample evidence of intent to orally copulate, there was almost no evidence of an intent to rape. For this additional reason, the omission was not harmless beyond reasonable doubt and the assault with intent to rape conviction cannot stand.
*130 DISPOSITION
The judgment is reversed. Due to this disposition, we do not reach the remaining assignments of error.
Benson, J., and Peterson, J., concurred.
Respondent's petition for review by the Supreme Court was denied November 15, 1989.
NOTES
[1] Unless otherwise indicated, all further statutory references are to the Penal Code.
[2] CALJIC No. 10.40.1 states: "It is a defense to a charge of forcible oral copulation that the defendant entertained a reasonable and good faith belief that the other person voluntarily consented to engage in oral copulation. If from all the evidence you have a reasonable doubt whether the defendant reasonably and in good faith believed such other person voluntarily consented to engage in oral copulation, you must give the defendant the benefit of that doubt and acquit him of said charge."
Note: CALJIC Fifth edition, published in 1988, revised and renumbered the instructions applicable to sex crimes. All CALJIC references herein are to the Fourth edition, which was in use at the time of trial.
[3] The trial judge deemed the knife episode sufficiently serious that he gave a sua sponte instruction on self-defense.
[4] Maria's care in disrobing was such that one of her earrings (which were of the pierced ear variety) together with two backings were found laid out on the bedside table. This troubled the jury enough to send a separate inquiry to the judge asking if the earring posts had been bent before being put in the evidence package.
[5] In Mayberry the victim testified that the defendant accosted her on the street, seized her by the arm, struck her with a bottle, and threatened her in order to get her to accompany him to his apartment. The defendant, on the other hand, testified that she willingly walked home with him and engaged in consensual sex. Mayberry still held that the instruction was required because of the victim's testimony that on several occasions she apparently had the opportunity to signal for help or escape, but did not. (15 Cal.3d at pp. 147-149.)
[6] The People's citation to People v. Bruce (1989) 208 Cal. App.3d 1099 [256 Cal. Rptr. 647] does not aid their cause. There, the defendant's attorney expressly disclaimed a Mayberry defense in an attempt to preclude the prosecution from using evidence of a prior rape. He insisted his only defense was actual consent and that the victim was a liar. Nevertheless the court permitted the prosecutor to introduce testimony of a prior rape, purportedly on the issue of defendant's reasonable belief in consent. (Id., at pp. 1103-1104.) Division Four of this court reversed, holding that because the Mayberry issue had been eliminated, introduction of the prior was irrelevant and prejudicial. (Id., at p. 1105.) By contrast, here there was abundant evidence of equivocal conduct by Maria and defense counsel never renounced a good faith defense.
We take this opportunity to emphasize, however, that a trial judge is under no duty to give Mayberry instructions where counsel for the accused objects or, for strategic reasons, otherwise disavows reliance on that defense.
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No. DA 06-0022
IN THE SUPREME COURT OF THE STATE OF MONTANA
2006 MT 325N
IN THE MATTER OF THE MENTAL
HEALTH OF M.B.,
Respondent and Appellant.
APPEAL FROM: The District Court of the Eighth Judicial District,
In and For the County of Cascade, Cause No. CDI 2005-025,
Honorable Kenneth Neill, Presiding Judge
COUNSEL OF RECORD:
For Appellant:
Lawrence A. LaFountain, Attorney at Law, Great Falls, Montana
For Respondent:
Hon. Mike McGrath, Montana Attorney General, Mark W. Mattioli,
Assistant Attorney General, Helena, Montana
Brant Light, Cascade County Attorney, Marvin Anderson,
Deputy County Attorney, Great Falls, Montana
Submitted on Briefs: October 10, 2006
Decided: December 12, 2006
Filed:
__________________________________________
Clerk
Justice James C. Nelson delivered the Opinion of the Court.
¶1 Pursuant to Section 1, Paragraph 3(d)(v), Montana Supreme Court 1996 Internal
Operating Rules, as amended in 2003, the following memorandum decision shall not be
cited as precedent. Its case title, Supreme Court cause number and disposition shall be
included in this Court’s quarterly list of noncitable cases published in the Pacific
Reporter and Montana Reports.
¶2 M.B. appeals from the District Court’s November 4, 2005 Findings of Fact,
Conclusions of Law, and Order for Commitment to Inpatient Mental Health Care. In its
decision, the court concluded that M.B. suffers from a mental disorder as defined in § 53-
21-102(9), MCA (2005), and that because of his mental disorder, M.B. is unable to care
for himself and provide for his basic needs of food, clothing, shelter, health and safety.
The court also concluded that M.B. is a threat to harm himself and other members of the
community, and that the least restrictive placement for M.B., after the consideration of all
alternatives necessary to protect M.B. and the public, and to permit effective treatment, is
commitment to the Montana State Hospital.
¶3 On appeal, M.B. contends that he was illegally committed to the Montana State
Hospital because the State failed to prove beyond a reasonable doubt that he was in need
of commitment as required by § 53-21-126(1)(a)-(c), MCA.
¶4 Basically, M.B. contends that the State proved none of the factors required under
§ 53-21-126(1)(a)-(c), MCA, beyond a reasonable doubt. The State argues that the
District Court had more than sufficient evidence in which to conclude that M.B.’s
progressively worsening symptoms of chronic paranoid schizophrenia would, if
2
untreated, threaten M.B. or others with imminent harm or prevent M.B. from being able
to provide for his own basic needs. The State notes that M.B. had lost weight because he
thought he was living off of “spiritual food” and that he had not been taking his
medications as prescribed. The State notes also that M.B. was associating with people
who were taking advantage of him, and that he had become extremely delusional and
paranoid. The State argues that M.B.’s condition caused him to become more aggressive,
confrontational, threatening, and self-destructive.
¶5 Section 53-21-126(2), MCA, provides:
The standard of proof in a hearing held pursuant to this section is
proof beyond a reasonable doubt with respect to any physical facts or
evidence and clear and convincing evidence as to all other matters.
However, the respondent’s mental disorder must be proved to a reasonable
medical certainty. Imminent threat of self-inflicted injury or injury to
others must be proved by overt acts or omissions, sufficiently recent in time
as to be material and relevant as to the respondent’s present condition.
¶6 Having reviewed the record in this matter, we conclude that the State presented
sufficient evidence to meet its burden of proof as required under the foregoing statute.
¶7 Accordingly, we have determined to decide this case pursuant to Section 1,
Paragraph 3(d) of our 1996 Internal Operating Rules, as amended in 2003, which
provides for memorandum opinions. It is manifest on the face of the briefs and the
record before us that the appeal is without merit because the court’s findings of fact are
supported by substantial evidence, and because the legal issues are clearly controlled by
settled Montana law which the District Court correctly interpreted.
3
¶8 On that basis, we affirm the District Court’s November 4, 2005 Findings of Fact,
Conclusions of Law, and Order for Commitment to Inpatient Mental Health Care.
/S/ JAMES C. NELSON
We Concur:
/S/ KARLA M. GRAY
/S/ PATRICIA COTTER
/S/ JOHN WARNER
/S/ BRIAN MORRIS
4
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IN THE UNITED STATES COURT OF APPEALS
FOR THE FIFTH CIRCUIT United States Court of Appeals
Fifth Circuit
FILED
April 30, 2009
No. 08-40791
Conference Calendar Charles R. Fulbruge III
Clerk
UNITED STATES OF AMERICA
Plaintiff-Appellee
v.
PEDRO VEGA-SANCHEZ
Defendant-Appellant
Appeal from the United States District Court
for the Southern District of Texas
USDC No. 2:08-CR-266-1
Before JONES, Chief Judge, and JOLLY and ELROD, Circuit Judges.
PER CURIAM:*
The Federal Public Defender appointed to represent Pedro Vega-Sanchez
has moved for leave to withdraw and has filed a brief in accordance with Anders
v. California, 386 U.S. 738 (1967). Vega-Sanchez has not filed a response. Our
independent review of the record and counsel’s brief discloses no nonfrivolous
issue for appeal. Accordingly, counsel’s motion for leave to withdraw is
GRANTED, counsel is excused from further responsibilities herein, and the
APPEAL IS DISMISSED. See 5 TH C IR. R. 42.2.
*
Pursuant to 5TH CIR . R. 47.5, the court has determined that this opinion should not
be published and is not precedent except under the limited circumstances set forth in 5TH CIR .
R. 47.5.4.
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490 So.2d 48 (1986)
THE FLORIDA BAR, Complainant,
v.
Carlos Celso CRUZ, Respondent.
No. 67309.
Supreme Court of Florida.
June 26, 1986.
John F. Harkness, Jr., Executive Director and John T. Berry, Staff Counsel, Tallahassee, and Paul A. Gross, Bar Counsel, Miami, for complainant.
Robert J. Van Der Wall, Coconut Grove, for respondent.
PER CURIAM.
This disciplinary proceeding is before us on complaint of The Florida Bar and report of the referee. The referee recommended that respondent be disbarred. Respondent challenges that recommendation.
The facts giving rise to this disciplinary action are as follows. In December, 1982, respondent, who was the United States Marshal for the Southern District of Florida, was indicted for five counts of bribery of a United States government official and one count of conspiracy to bribe a United States government official. The indictment alleged that respondent, along with two other men, had bribed the warden of the Metropolitan Correctional Center in an effort to gain special privileges for an inmate. During the three-month period of time in which the offense occurred, the warden's conversations with respondent and his co-conspirators were taped via a "body bug" worn by the warden.
Respondent pled not guilty to the charges and proceeded to trial. In April, 1983, respondent stopped the trial proceedings and pled guilty to the conspiracy to *49 bribe count and one count of bribery of a United States government official. He was sentenced to incarceration for one year and one day, and is currently on probation.
On August 29, 1983, as a result of his felony convictions, respondent was suspended from practicing law in Florida. The Florida Bar filed a complaint against respondent seeking disbarment, and this Court appointed a referee. At the hearing, respondent acknowledged that he had pled guilty to and was sentenced for the two felonies. Based on those convictions, the referee found that respondent had violated Disciplinary Rules 1-102(A)(3), 1-102(A)(5), and 1-102(A)(6).
Respondent then introduced three witnesses to testify in his behalf, two of whom participated in the federal trial proceedings. The first of these witnesses was the United States District Court judge who presided at respondent's trial and accepted respondent's guilty plea. He testified that respondent is religious, "not a criminal type," and "essentially a very good person." The judge also testified that, with respect to the offense, respondent
was more of an aider or abettor really rather than a conspirator, in the strict sense of the word. He never got anything for it, but there was enough there so that a jury could have nailed him, if it had elected to do so. I don't know whether the decision to plead guilty was the right decision or not... .
... I wish the sentence could have been less and maybe it should have been.
Respondent called as his second witness the probation officer who conducted the investigation for respondent's PSI report. The investigator testified that respondent had an "exemplary background," that he did not feel respondent had used his position as an attorney to violate any laws, and that respondent's involvement in the events surrounding the crime was the result of poor judgment rather than an attempt to further a criminal conspiracy. Respondent also called as a witness Bishop Armando Leon, who testified favorably concerning respondent's character.
Respondent testified in his own behalf that his involvement in the events surrounding the bribery was minimal, and that he was not a party to the bribe.
The referee recommended disbarment and cited The Florida Bar v. Vernell, 374 So.2d 473 (Fla. 1979), for the proposition that the referee in a disciplinary hearing should not "go beyond the convictions." Respondent contends that the referee erred in not reviewing 60 hours of tapes on which the bribery charges were based. According to respondent, the tapes would have demonstrated his lack of complicity in the offense.
We recognize that respondent has a due process right to explain the circumstances of the alleged offense and to offer testimony in mitigation of any penalty to be imposed as discipline. The Florida Bar v. Fussell, 179 So.2d 852 (Fla. 1965). We find that respondent was afforded full opportunity to present mitigating evidence concerning the extent of his complicity in the conspiracy. It is apparent from this record that the referee gave credence to the mitigating testimony concerning the limited extent of respondent's participation in this offense because she recommended his disbarment be effective on August 29, 1983, the date of respondent's suspension, thereby allowing respondent to seek readmission in less than a year from the date the referee filed her report.
We approve the referee's recommendation. Accordingly, the respondent, Carlos Celso Cruz, is disbarred from the practice of law in Florida, effective August 29, 1983. Judgment for costs in the amount of $671.10 is hereby entered against respondent, for which sum let execution issue.
It is so ordered.
BOYD, C.J., and OVERTON, McDONALD, EHRLICH, SHAW and BARKETT, JJ., concur.
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7 P.3d 883 (2000)
Bart HOWE and Connie Howe, husband and wife, d/b/a Future Electric, Appellants,
v.
DOUGLAS COUNTY, WASHINGTON, a municipal corporation, Respondent.
No. 18415-3-III.
Court of Appeals of Washington, Division 3, Panel Four.
September 12, 2000.
Brian J. Dorsey, Davis, Arneil Law Firm, Wenatchee, for Appellants.
Robert R. Siderius, Jr., Wenatchee, for Respondent.
SWEENEY, A.C.J.
This is a land use case. Douglas County required the developer of Bart and Connie Howe's subdivision to waive "all claims for damages against any governmental authority arising from the construction or maintenance of public facilities...." The Howes' property was flooded because of either poorly designed or maintained drainage facilities. The question here is whether public policy considerations prohibited the County from requiring a general waiver of liability as a condition for annexation of this subdivision; we agree with the trial court that they do not. We therefore affirm the summary dismissal of the Howes' claims for damages.
FACTS
Fancher Heights Associates developed Fancher Heights, a residential subdivision, in East Wenatchee, Washington. As part of the permit process, it solicited comments from governmental agencies. The U.S. Department of Agriculture's (USDA) Soil Conservation Service responded that at least some of the lots were susceptible to flooding. Roofs, pavement, and the general development of the area exacerbated the problem. Several months later the USDA again voiced concerns because streets proposed in the subdivision cut across natural drainage ways. The South Douglas County Conservation District agreed with the concerns voiced by the USDA.
Fancher Heights Associates submitted drainage plans that would have accommodated a 10-year flood. Douglas County responded by requiring the drainage plan to accommodate a 25-year flood. The County *884 did so because of the concerns expressed by the governmental agencies.
Fancher Heights Associates constructed the storm drainage system in November 1988. It then transferred ownership and maintenance of the improvements to Douglas County. As a condition of final approval, Fancher Heights Associates agreed to "waive on behalf of themselves and their successors in interest, all claims for damages against any governmental authority arising from the construction and maintenance of public facilities and public property within the subdivision."
The Howes bought a lot in the subdivision in November 1992. Their property is located on a cul-de-sac at the base of a natural drainage channel. The warranty deed conveying title refers to the waiver given by the County as part of the annexation process.
Surface water runoff from three rainstorms caused the drainage system in Fancher Heights to fail on May 31, 1993, July 4, 1994, and August 25, 1994. The runoff flooded and damaged the Howes' property. The storm drains overflowed, apparently because the County had not cleaned sand from catch basins and drywells. County employees also told the Howes that the single catch basin and drywell at the bottom of the cul-de-sac could not handle the water. The County added a new drywell and a slotted culvert/trench drain to improve the drainage.
The Howes sued Douglas County for damages caused by these three storms. The County ultimately settled and the dispute was resolved.
The Howes' property flooded again on June 21, 1997, following a rainstorm. Again, the catch basins and drywells failed. In November of 1997, the County installed two drywells above the Howes' cul-de-sac.
The Howes sued Douglas County for negligence. That lawsuit is the subject of this appeal. The County moved for summary judgment, relying primarily on the waiver of damages claims by the Howes' predecessor, Fancher Heights Associates, the developer. The trial judge agreed and dismissed the Howes' claims.
ANALYSIS
Standard of Review. The dispositive question here is whether the developer's waiver is void because it is contrary to public policy. This is a legal question. And so the standard of review is de novo. Mountain Park Homeowners Ass'n v. Tydings, 125 Wash.2d 337, 341, 883 P.2d 1383 (1994). Other questions raised, including whether the County was negligent; whether the County is protected by the public duty doctrine; or whether the damage occasioned by this flood was a result of improper construction, design or improper maintenance, all fall by the wayside if the developer's waiver is valid and enforceable.
Waiver. Pronouncement of public policy falls within the domain of democratically elected legislators, unless some clear constitutional provision is implicated. But none is here. So to identify the relevant public policy considerations, we look at any applicable statutes. In re Marriage of Burke, 96 Wash. App. 474, 478, 980 P.2d 265 (1999); Allstate Ins. Co. v. Raynor, 93 Wash.App. 484, 499-500, 969 P.2d 510, 975 P.2d 517, 980 P.2d 765, review granted, 139 Wash.2d 1001, 989 P.2d 1136 (1999).
The Legislature has not been reluctant to declare public policy in a wide range of areas. Waterjet Technology, Inc. v. Flow Int'l Corp., 140 Wash.2d 313, 322, 996 P.2d 598 (2000) (employment agreements); National Elec. Contractors Ass'n, Cascade Chapter v. Riveland, 138 Wash.2d 9, 40, 978 P.2d 481 (1999) (favoring prison industries); In re Disciplinary Proceedings Against Turco, 137 Wash.2d 227, 268, 970 P.2d 731 (1999) (Sanders, J., dissenting) (domestic violence); Niece v. Elmview Group Home, 131 Wash.2d 39, 61-62, 929 P.2d 420 (1997) (Johnson, J., concurring in part and dissenting in part) (rights of developmentally disabled); Comenout v. Burdman, 84 Wash.2d 192, 200, 525 P.2d 217 (1974) (jurisdiction over Native Americans and reservations); Callahan v. Keystone Fireworks Mfg. Co., 72 Wash.2d 823, 838-39, 435 P.2d 626 (1967) (fireworks); First Nat'l Bank v. Tiffany, 40 Wash.2d 193, 202, 242 P.2d 169 (1952) (homestead and exemption *885 laws); Smaby v. Shrauger, 9 Wash.2d 691, 699, 115 P.2d 967 (1941) (wage earners); Burke, 96 Wash.App. at 480, 980 P.2d 265 (child welfare dissolution action); Children's Hosp. & Med. Ctr. v. Department of Health, 95 Wash.App. 858, 865 n. 13, 975 P.2d 567 (1999) (health care), review denied, 139 Wash.2d 1021, 994 P.2d 847 (2000); Raynor, 93 Wash.App. at 499-500, 969 P.2d 510 (insurance contracts); Roberts v. Dudley, 92 Wash.App. 652, 656-57, 966 P.2d 377 (1998) (gender discrimination), aff'd, 140 Wash.2d 58, 993 P.2d 901 (2000).
And the courts appropriately proceed very cautiously in declaring public policy. Roberts, 92 Wash.App. at 656-57, 966 P.2d 377.
The Howes argue that the County should not be allowed to avoid a statutorily imposed obligation (review of privately developed public works) by requiring a waiver. Specifically, they rely on RCW 58.17.110 that gives the County authority to approve or disapprove subdivisions. In doing so, the County can consider open spaces, drainage ways, streets, roads, alleys, and the like. RCW 58.17.110(1)(a).
First of all, we do not read RCW 58.17.110 as subjecting a municipality to liability for the inadequacy of various improvements required as part of annexation. The municipality is required to "determine ... [i]f appropriate provisions are made for, but not limited to, the public health, safety, and general welfare, for open spaces, drainage ways, streets or roads, alleys, other public ways, transit stops, potable water supplies, sanitary wastes, parks and recreation...." RCW 58.17.110(1)(a). Douglas County, by passing upon the improvements in this subdivision, performed this legislative act. See RCW 58.17.110; Miller v. City of Port Angeles, 38 Wash.App. 904, 913, 691 P.2d 229 (1984). Neither the language of the act nor case law suggests that the statute would subject the County to liability if any of its required provisions or improvements failed. RCW 58.17.110; Miller, 38 Wash.App. at 913, 691 P.2d 229. The County is not a guarantor of these public improvements. It would therefore not be against public policy, at least based on this statute, to require a waiver of liability as a condition of annexation.
Again because the declaration of public policy is a legislative function, we look to the related statutory schemes and the applicable statutes here. RCW 58.17.165 permits a municipality to require a waiver of damages "occasioned to the adjacent land by the established construction, drainage and maintenance of said road." (Emphasis added.) The Howes argue that this statute focuses on roads only and therefore would not include the drainage system here. We disagree. First, drainage is necessarily incident to public streets and roads. A landowner is required to construct drainage and maintenance facilities secondary to the roads and the subdivision. 11 EUGENE MCQUILLIN, THE LAW OF MUNICIPAL CORPORATIONS § 31.18 (3d rev. ed.1991). But even accepting the Howes' argument that the statute does not specifically address the drainage facilities here, the statute, nonetheless, shows at least a legislative policy to allow a waiver of liability as a condition of acceptance of a subdivision. Or, said another way, at least it evidences no legislative hostility to such waivers. Nor do we find any such hostility in any of the statutes in this statutory scheme.
The plat dedication statute, RCW 58.17.110, also suggests no legislative intent to prohibit waivers. That statute only precludes a release from damages from "other property owners." This has been interpreted as applying to property owners not in the subdivision. See 1 Op. Att'y Gen. (1970).
The Howes rely on Employco Personnel Servs., Inc. v. City of Seattle[1] for their argument that the waiver of liability here is against public policy. The court in Employco analyzed the question much the same way as we have here. In Employco, several downtown Seattle business owners sued Seattle City Light following a lengthy power outage. Their claim was that the City had negligently failed to locate and identify its own underground electrical facilities, and as a result a contractor damaged those facilities.
*886 The City had as part of its ratemaking authority passed Seattle Municipal Code § 21.49.110(S), which essentially immunized the City for any claim of damages:
"The Department shall not be liable for any loss, injury, or damage resulting from the interruption, restoration, or reduction of electric service from any cause, including but not limited to the failure of generation and distribution systems...."
Employco Personnel Servs., Inc. v. City of Seattle, 117 Wash.2d 606, 610, 614, 817 P.2d 1373 (1991). But the Supreme Court noted that the ordinance was directly contrary to a state statute, RCW 80.04.440, which imposed liability on such public service companies:
"In case any public service company shall do, cause to be done or permit to be done any act, matter or thing prohibited, forbidden or declared to be unlawful, or shall omit to do any act, matter or thing required to be done, either by any law of this state, by this title or by any order or rule of the commission, such public service company shall be liable to the persons or corporations affected thereby for all loss, damage or injury caused thereby or resulting therefrom...."
Employco, 117 Wash.2d at 613 n. 4, 817 P.2d 1373 (emphasis added). The court went on to note that the "City may exercise only such power as is delegated to it by the Legislature." Id. at 617, 817 P.2d 1373. Clearly, the Seattle ordinance was contrary to a Washington statute. The court then ruled the ordinance invalid because it contravened state statute and was preempted by state statute. Id. at 618, 817 P.2d 1373.
Here, there is no such prohibition. And, as we have noted, related statutes suggest a legislative policy authorizing such waivers. Moreover, the waiver here is the result of an agreement between the County and a developer. Unlike the waiver obligation in Employco, it is not a blanket statute immunizing Douglas County of any liability.
The Howes next argue that the waiver runs contrary to the abolition of governmental immunity. RCW 4.96.010. But the abolition of sovereign immunity did nothing more than expose governmental entities, including counties, to the same potential liability as any individual or corporation. J & B Dev. Co. v. King County, 29 Wash.App. 942, 951-52, 631 P.2d 1002 (1981), aff'd, 100 Wash.2d 299, 669 P.2d 468, 41 A.L.R.4th 86 (1983). It did not create a different sort of liability against municipalities. Georges v. Tudor, 16 Wash. App. 407, 411 n. 3, 556 P.2d 564 (1976). Nothing in the statute abolishing governmental immunity suggests that a government entity, now subject to potential liability, cannot take steps to avoid or insulate itself from that liability much as any private citizen or organization can and does. RCW 4.96.010.
In sum, we hold that neither the public policy of this state nor the abolition of sovereign immunity prohibits Douglas County from requiring a liability waiver as a condition of annexation of a subdivision.
The judgment of the trial judge is affirmed.
SCHULTHEIS, J., and KATO, J., concur.
NOTES
[1] 117 Wash.2d 606, 614, 817 P.2d 1373 (1991).
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UNPUBLISHED
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
No. 99-7366
UNITED STATES OF AMERICA,
Plaintiff - Appellee,
versus
DANNY MYERS,
Defendant - Appellant.
Appeal from the United States District Court for the District of
South Carolina, at Florence. C. Weston Houck, Chief District Judge.
(CR-90-430, CA-97-1006-4-2)
Submitted: February 22, 2000 Decided: March 14, 2000
Before WILKINS and LUTTIG, Circuit Judges, and HAMILTON, Senior
Circuit Judge.
Dismissed by unpublished per curiam opinion.
Danny Myers, Appellant Pro Se. Mary Gordon Baker, Assistant United
States Attorney, Columbia, South Carolina, for Appellee.
Unpublished opinions are not binding precedent in this circuit.
See Local Rule 36(c).
PER CURIAM:
Danny Myers seeks to appeal the district court’s order denying
his motion filed under 28 U.S.C.A. § 2255 (West Supp. 1999). We
have reviewed the record and the district court’s opinion and find
no reversible error. Accordingly, we deny a certificate of appeal-
ability and dismiss the appeal on the reasoning of the district
court. See United States v. Myers, No. CR-90-430, CA-97-1006-4-2
(D.S.C. Aug. 9, 1999). We dispense with oral argument because the
facts and legal contentions are adequately presented in the mate-
rials before the court and argument would not aid the decisional
process.
DISMISSED
2
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576 S.E.2d 438 (2003)
265 Va. 334
PGI, INC.,
v.
RATHE PRODUCTIONS, INC.
Record No. 021181.
Supreme Court of Virginia.
February 28, 2003.
*439 John S. Jenkins, Jr. (E. Duncan Getchell, Jr., William H. Baxter, II; Amy M. Burden; Sean F. Murphy; McGuire Woods, McLean, on brief), for appellant.
No brief or argument for appellee.
Present: HASSELL, C.J., LACY, KEENAN, KOONTZ, KINSER, and LEMONS, JJ., and CARRICO,[1] S.J.
Opinion by Justice DONALD W. LEMONS.
In this appeal, we consider whether the trial court erred by striking plaintiff's claim for punitive damages and refusing to submit the issue to the jury for determination, and by setting aside a plaintiff's jury verdict on a claim of tortious conversion of property.
I. Facts and Proceedings Below
PGI, Inc. ("PGI") specializes in the marketing and production of various events including exhibitions, conferences, and corporate meetings. Rathe Productions, Inc. ("Rathe") is a specialty producer of museum displays. Beginning in 1997, both PGI and Rathe provided a range of services to the Smithsonian Institute ("Smithsonian") for the management and production of "America's Smithsonian Exposition," a traveling museum that displayed a variety of historical and cultural exhibits (the "Exposition"). The Exposition was scheduled to tour ten selected cities in the United States. However, after touring just five cities, the Smithsonian's *440 funding was depleted. The Smithsonian solicited bids for private operation, financing, and management of the Exposition.
PGI and Rathe ("PGI/Rathe") submitted a joint proposal to manage and operate the Exposition, which the Smithsonian accepted. To help secure needed corporate sponsorship to finance the completion of the Exposition's 1997 tour, PGI/Rathe subcontracted Odell, Simms & Associates, Inc. ("OSA"). Unfortunately, the tour ended after reaching only eight of the ten scheduled cities.
Although the Exposition did not complete its tour due to lack of resources, the Smithsonian was encouraged by attendance at the exhibits in the cities visited. Accordingly, the Smithsonian hired PGI/Rathe for $250,000 to conduct a market study (the "Market Study") to investigate the feasibility of producing and touring a self-sustaining international Exposition. PGI/Rathe subcontracted with OSA for aid in the completion of the Market Study. A PGI executive presented the findings of the Market Study to the Smithsonian, which concluded that the risks of such a venture outweighed the potential benefits. After the Market Study was completed, PGI, on behalf of PGI/Rathe and OSA, submitted an invoice to the Smithsonian for the previous management of the Exposition and for conducting the Market Study. The Smithsonian did not immediately pay the amounts invoiced, and asked for a more detailed accounting and explanation of the charges.
In an effort to collect all monies owed by the Smithsonian, PGI/Rathe officials met and decided that it would be more advantageous for Rathe to actively pursue payment from the Smithsonian because of its ongoing business relationship with the Smithsonian. After submission of additional billing information, the Smithsonian responded with an offer to pay $127,153.06 for the Market Study and $65,588.51 for management of the Exposition. Rathe countered the Smithsonian's offer by asking for $315,588.51, which included $250,000 for the Market Study and $65,588.51 for management of the Exposition. In a letter dated April 14, 2000, Rathe offered to settle the Market Study and management accounts for $258,320. The letter also indicated that distribution of settlement proceeds would include PGI and OSA. On July 20, 2000, Rathe entered into a settlement agreement with the Smithsonian to satisfy the Market Study and management invoices in exchange for $250,000. Rathe failed to notify either PGI or OSA of the settlement or to distribute any of the proceeds to them. After learning of the settlement approximately six months later, representatives from OSA and PGI demanded that Rathe properly distribute the settlement proceeds, but Rathe refused.
On February 1, 2001, PGI filed a motion for judgment in the Circuit Court of Arlington County. Subsequent to PGI filing its motion for judgment, OSA filed a separate suit in the Circuit Court of Arlington County on March 1, 2001 against PGI and Rathe seeking to recover $50,000 in compensatory damages from PGI and/or Rathe for breach of contract. By Order dated May 25, 2001, OSA's suit was consolidated with PGI's suit. Count One of PGI's motion for judgment alleged conversion and sought $125,000 in compensatory damages and $125,000 in punitive damages. In the alternative, Count Two of the motion for judgment alleged assumpsit and sought $125,000 in compensatory damages plus interest and costs, including attorney's fees. Prior to jury selection, Rathe submitted a motion in limine requesting the trial court to order PGI to choose between its tort theory of conversion and its contract theory of assumpsit. The trial court granted Rathe's motion. Forced to choose, PGI chose to proceed to trial on its conversion claim.
Upon completion of PGI's presentation of evidence, the trial court sustained Rathe's motion to strike the claim for punitive damages. At the conclusion of PGI's case-in-chief and after Rathe's motion to strike was argued, OSA presented its evidence on its claim of breach of contract for the subcontracting work it performed for PGI/Rathe. Thereafter, Rathe presented its evidence. At the conclusion of Rathe's presentation of evidence, Rathe again moved to strike PGI's evidence. The trial court refused the motion and allowed the case to be presented to the jury. The trial court instructed the jury that *441 it should return a verdict for PGI if it found that PGI proved by clear and convincing evidence[2] that Rathe had converted PGI's property. The jury returned a verdict in favor of PGI against Rathe in the amount of $100,000, and a verdict of $50,000 in favor of OSA against Rathe.
Rathe's post-trial motions included a renewed motion to strike PGI's evidence and a motion to set aside the verdict. The trial court granted Rathe's motion to strike, set aside the verdict, and entered judgment in favor of Rathe. PGI appeals the adverse judgment of the trial court.
II. Analysis
On appeal, PGI maintains that the trial court erred by ordering it to elect between its cause of action based in contract and its cause of action based in tort. PGI further maintains that the trial court erred in striking PGI's claim for punitive damages, and in setting aside the jury's verdict and entering final judgment for Rathe. Rathe did not file briefs in the case on appeal and did not participate. We agree with PGI that the trial court erred in striking its claim for punitive damages before it was submitted to the jury, and in striking its evidence entirely, setting aside the jury's verdict, and entering final judgment for Rathe.
The final judgment order in this matter recites that the jury's verdict is set aside and final judgment is ordered in favor of Rathe "for the reasons stated in the Court's letter opinion." A review of the trial court's letter opinion reveals three reasons for the trial court's action:
(1) PGI did not present evidence at trial to establish that a partnership existed between the parties or that the parties had common law duties to each other.
(2) PGI's claims are solely based on a breach of contract theory, therefore, an action in tort is not appropriate.
(3) PGI did not present credible evidence to support its claim for conversion.
The trial court erred in each of these holdings.
A. The Joint Venture
We have previously stated that "[a] joint venture exists where two or more parties enter into a special combination for the purpose of a specific business undertaking, jointly seeking a profit, gain, or other benefit, without any actual partnership or corporate designation." Roark v. Hicks, 234 Va. 470, 475, 362 S.E.2d 711, 714 (1987).
A joint adventure exists when two or more persons combine a joint business enterprise for their mutual benefit, with an express or implied understanding or agreement that they are to share in the profits or losses of the enterprise, and that each is to have a voice in its control and management.
Smith v. Grenadier, 203 Va. 740, 744, 127 S.E.2d 107, 110 (1962) (quoting 10 Michie's Jurisprudence, Joint Adventures § 2, p. 695).
The trial court properly instructed the jury concerning the evidence necessary to find a joint venture between PGI and Rathe. On the theory of conversion, the jury had to find that a joint venture existed in order to reach its verdict in favor of PGI. As we have recently stated,
the trial court's authority to set aside a jury verdict "can only be exercised where the verdict is plainly wrong or without credible evidence to support it. If there is a conflict in the testimony on a material point, or if reasonable [persons] may differ in their conclusions of fact to be drawn from the evidence, or if the conclusion is dependent on the weight to be given the testimony, the trial judge cannot substitute his conclusion for that of the jury merely because he would have voted for a different verdict if he had been on the jury."
Shalimar Dev., Inc. v. Federal Deposit Ins. Corp., 257 Va. 565, 569-70, 515 S.E.2d 120, 123 (1999) (quoting Lane v. Scott, 220 Va. 578, 581, 260 S.E.2d 238, 240 (1979)).
The record is more than adequate to support the jury's finding, and the trial court erred by substituting its own view of the evidence. In a letter from the Smithsonian dated May 12, 1997 to PGI and Rathe, referred *442 to as a "Notice to Proceed," the following "understandings" are evident:
[T]he Smithsonian is confident that Rathe/PGI, together with its proposed team, will provide the management and production expertise needed to bring new levels of success to [America's Smithsonian Exposition] and to launch a similar and even more successful international exhibition.
This letter serves to formally notify Rathe/PGI that it has been chosen as the exclusive contractor of the [Smithsonian] for management and production of the remainder of [the America's Smithsonian Exposition]. . . . This letter also authorizes Rathe/PGI . . . as the exclusive producer of a similar international tour . . . .
The "Notice to Proceed" letter is replete with references to PGI and Rathe in a joint capacity, namely "PGI/Rathe," for a limited purpose. The letter is signed "ACCEPTED AND AGREED" by representatives of PGI and Rathe. The exhibits introduced at trial include a "Proposed International Tour Feasibility Study" submitted to the Smithsonian as "A Joint Venture Report by Rathe/PGI." Finally, the testimony overwhelmingly supports the finding of a joint venture and includes the testimony of Cynthia Engel, President and Chief Operating Officer of PGI, that the relationship with Rathe was "a joint venture and that all expenses would be paid and if there was a profit, it would be split." The evidence reveals that Rathe and PGI created a joint venture with shared management responsibilities and the expectation of shared profits. The trial court erred in holding otherwise.
B. Basis for PGI's Cause of Action
The trial court held that "PGI's claims are solely based on a breach of contract theory[;] therefore, an action in tort is not appropriate." The trial court's ruling misapprehends the nature of the relationship created between PGI and Rathe and the law that applies. In Legum Furniture Corp. v. Levine, 217 Va. 782, 787, 232 S.E.2d 782, 786 (1977), we cited 46 Am.Jur.2d Joint Ventures §§ 36, 37 with approval as follows:
The rights, duties, and obligations of joint venturers and of members of syndicates, as between themselves, depend primarily upon the terms of the contract by which they assumed that relationship. They are also affected, however, by certain general principles which operate in the absence of specific provisions in the contract, or sometimes in conjunction with such provisions. These principles . . . are much the same as, or at least are clearly analogous to, those which govern the relations of partners.
In Roark, 234 Va. at 475, 362 S.E.2d at 714, we restated the principle at stake with greater emphasis: "the rules of law governing the rights, duties, and liabilities of joint venturers are substantially the same as those which govern partnerships."
There is no express contract between PGI and Rathe which establishes this joint venture. As previously stated, the evidence more than amply establishes an implied contract for a joint venture. To the extent that this implied agreement does not address an issue, the law of partnership is applied. The Virginia Uniform Partnership Act (the "Act"), Code §§ 50-73.79 to -73.149, "governs relations among the partners and between the partners and the partnership" except as provided in a partnership agreement and to the extent that the agreement does not violate certain specific statutory requirements. Code § 50-73.81. If the issue in question is not addressed by the partnership agreement or the Act, "the principles of law and equity" apply. Code § 50-73.82.[3]
At common law, ordinarily one partner was not permitted to sue another partner before settlement of all partnership business occurred. See, e.g., Dulles Corner Props. II Ltd. P'ship v. Smith, 246 Va. 153, 155, 431 S.E.2d 309, 311 (1993). But even at common law, an exception to the general rule was made for circumstances such as those presented in this case. In Pugh v. Newbern, 193 N.C. 258, 136 S.E. 707, 708-09 (1927) *443 (citations omitted), the Supreme Court of North Carolina stated such an exception:
The general rule is that one partner cannot sue another partner at law until there has been a complete settlement of the partnership affairs and a balance struck.
....
There are, however, well established exceptions to the general rule. A partner may maintain an action at law against his copartner upon claims growing out of the following state of facts:
....
6. Where the partnership is for a single venture or special purpose which has been accomplished, and nothing remains to be done except to pay over the claimant's share.
See also Johnson v. Jackson, 82 F.Supp. 915, 917 (E.D.Pa. 1949); L.H. Heiselt, Inc. v. Brown, 108 Colo. 562, 120 P.2d 644, 646 (1941); Ruschoff v. Wachsmuth, 185 Minn. 579, 242 N.W. 296, 297 (1932); Warren v. Warren, 784 S.W.2d 247, 252 (Mo.Ct.App. 1989); Davis v. Johnson, 689 S.W.2d 297, 300 (Tex.Ct.App.1985); 59A Am.Jur.2d Partnership § 552 (2002).
Nothing in the Act abridges this common law exception. Rather, the Act expands the exception by providing the following:
§ 50-73.103 Actions by partnership and partners.
....
B. A partner may maintain an action against the partnership or another partner for legal or equitable relief, with or without an accounting as to partnership business, to:
1. Enforce that partner's rights under the partnership agreement;
2. Enforce that partner's rights under this chapter, ... [; or]
3. Enforce the rights and otherwise protect the interests of that partner,....
A cause of action for conversion lies independent of an action in contract and may provide a separate basis, distinct from the contract, upon which one partner may sue another. The trial court erred in holding to the contrary.
C. Conversion
In United Leasing Corp. v. Thrift Ins. Corp., 247 Va. 299, 305, 440 S.E.2d 902, 905 (1994) (quoting Universal C.I.T. Credit Corp. v. Kaplan, 198 Va. 67, 75, 92 S.E.2d 359, 365 (1956)), we stated that the tort of conversion "encompasses `any wrongful exercise or assumption of authority ... over another's goods, depriving him of their possession; [and any] act of dominion wrongfully exerted over property in denial of the owner's right, or inconsistent with it.'" The trial court erred in holding that PGI did not prove the elements of conversion.
As previously noted, PGI proved the creation of a joint venture with Rathe with the expectation of "split" profits. Upon completion of the objective of the joint venture, all that remained was the collection of accounts receivable from the Smithsonian and payment of OSA. When difficulties arose in the collection of sums due to the joint venture from the Smithsonian, a further agreement was reached between the joint venturers to authorize Rathe to negotiate and settle the claim. Thereafter, Rathe wrote the Smithsonian indicating that a compromised settlement figure "will allow PGI, [Rathe] and [OSA] to receive a reduced final payment." A settlement was reached with Rathe executing the settlement agreement on behalf of its co-venturer, PGI. Rathe received $250,000 from the Smithsonian but refused to pay any of the proceeds to PGI or pay the outstanding billing of OSA, contrary to its express agreement to do so.
Upon the evidence presented, the jury was entitled to find that Rathe without justification wrongfully withheld settlement proceeds from PGI. None of the elements to sustain a cause of action for conversion are missing.
D. Punitive Damages
Citing insufficient evidence, the trial court struck PGI's claim for punitive damages without submission of the issue to the jury. In Baker v. Marcus, 201 Va. 905, 909-10, *444 114 S.E.2d 617, 620-21 (1960) (internal citations omitted), we summarized our prior cases concerning the award of punitive or "exemplary" damages.
Compensatory damages are awarded as compensation for the pecuniary lossas amends or recompense for the injury inflicted. Exemplary damages are something in addition to full compensation, and something not given as plaintiff's due, but for the protection of the public, as a punishment to defendant, and as a warning and example to deter him and others from committing like offenses.
....
The theory upon which exemplary, punitive, or vindictive damages, sometimes called "smart money," are allowed is not so much as compensation for the plaintiff's loss as to warn others, and to punish the wrongdoer if he has acted wantonly, oppressively, recklessly, or with such malice as implies a spirit of mischief, or criminal indifference to civil obligations.
. . . .
Exemplary damages are allowable only where there is misconduct or malice, or such recklessness or negligence as evinces a conscious disregard of the rights of others. But where the act or omission complained of is free from fraud, malice, oppression, or other special motives of aggravation, damages by way of punishment cannot be awarded, and compensatory damages only are permissible....
Wilful or wanton conduct imports knowledge and consciousness that injury will result from the act done. The act done must be intended or it must involve a reckless disregard for the rights of another and will probably result in an injury. Ill will is not a necessary element....
Proof of actual malice is not necessary. Malice may be inferred from circumstances.
No evil intent can be presumed from a mere mistake, or misadventure. "An absence of evil purpose is an absence of malice. No mere inadvertence, mistake, or accidental occurrence can be malicious, although negligent...."
Viewing the evidence in the light most favorable to PGI, as we must, PGI and Rathe were joint venturers for a particular purpose. They agreed to split revenues equally. Upon completion of the venture, billing problems arose. Empowered with the authority to settle, Rathe accepted $250,000 from the Smithsonian in full satisfaction of outstanding claims of the joint venture on July 25, 2000. In breach of its duty of loyalty, duty of care, and obligation of good faith and fair dealing (Code § 50-73.102), Rathe did not inform PGI that it had received the $250,000 in settlement from the Smithsonian. Approximately six months later in late January 2001, PGI discovered through a telephone conversation with an OSA representative that Rathe had received the settlement funds. That same day, PGI telephoned Rathe and made a demand for its and OSA's portion of the proceeds. Rathe refused. Thereafter, PGI filed suit.
If reasonable persons, upon the facts presented, could differ regarding whether the conduct in question was so willful and wanton as to show a conscious disregard for the rights of others, "the trial court may not remove the issue of punitive damages from the jury's consideration." Huffman v. Love, 245 Va. 311, 315, 427 S.E.2d 357, 360 (1993). The trial court erred in doing so in this case.
E. Election
PGI assigns error to the trial court's order that it elect between theories of tort and contract. Our resolution of other issues in this appeal renders it unnecessary to address this assignment of error.
F. Conclusion
For the reasons stated, the trial court erred in refusing to submit the issue of punitive damages to the jury and in setting aside the verdict of $100,000 in favor of PGI and entering judgment for Rathe. We will reinstate the jury's verdict and remand to the trial court with directions to enter judgment on the verdict and empanel a jury to hear *445 evidence and decide PGI's claim for punitive damages.
Reversed and remanded.
NOTES
[1] Chief Justice Carrico presided and participated in the hearing and decision of this case prior to the effective date of his retirement on January 31, 2003.
[2] There is no issue before us concerning the evidentiary standard to be applied.
[3] There is no dispute that the law of Virginia applies to this controversy. See Code § 50-73.84.
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72 F.Supp. 81 (1947)
BARNETT INV. CO.
v.
NEE.
No. 1947.
District Court, W. D. Missouri, W. D.
June 20, 1947.
Haysler A. Poague, of Clinton, Mo., and Cowgill & Popham, of Kansas City, Mo. (Sam Mandell, of Kansas City, Mo., of counsel), for plaintiff.
Sewall Key, Acting Asst. Atty. Gen., Andrew D. Sharpe and James P. Garland, Sp. Assts. to Atty. Gen., and Sam M. Wear, U. S. Atty., of Kansas City, Mo., for defendants.
REEVES, District Judge.
The only question for decision in this case is whether the plaintiff was entitled to a deficiency dividend credit under certain provisions of the Revenue Law.
Admittedly the plaintiff is a personal holding company and concededly it did not comply with the provisions of the statute enabling it to claim a deficiency credit dividend. It is alleged in the complaint (and the testimony and arguments of counsel support the allegation), that the plaintiff was under a misapprehension as to its rights and that one Chiles J. Cridlin, an Internal Revenue Agent, advised its officers erroneously with respect to the effect of a certain instrument signed by it. It believed (and says it was so advised), that the instrument thus signed was "a final closing agreement under Section 606 of the Revenue Act of 1928 [26 U.S.C.A. Int.Rev.Acts, page 458]."
However, a note to such agreement contained the express provision that: " * * * It is not, however, a final closing agreement under Section 606 of the Revenue Act of 1928 and does not, therefore, preclude the assertion of a further deficiency in the manner provided by law should it subsequently be determined that additional tax is due, nor does it extend the statutory period of limitation for refund, assessment, or collection of the tax."
Based upon the theory and advice of a revenue agent that such an instrument was a closing agreement the plaintiff asserted its claim for a refund upon such alleged deception and alleged misapprehension. Thereafter specified steps and formal actions were taken by the plaintiff, all with the end in view to legalize its claim to a deficiency dividend credit. Concededly such actions were not seasonably made, nor did they comply with the statutory requirements. *82 The plaintiff rested its right of recovery upon the allegations:
"* * * that it, in good faith, and with due diligence and acting upon the advice of able counsel, took all steps necessary to secure the deficiency dividend credit of $1,584.84; that if such steps were not taken in the chronological order prescribed by the statutes through misadvertence, such misadvertence was caused and brought about by the failure of the Treasury Department to promptly furnish the proper forms and to promptly prescribe the procedure it desired followed, and by the failure of the Treasury Department to properly advise plaintiff as to the effect of the steps it had taken and was taking to secure such credit and on which plaintiff asked for and obtained advice from the Treasury Department as above set forth; * * *."
"* * * That in all good conscience and equity the defendant should be estopped from taking advantage of plaintiff's situation with respect to the technical chronological order of the steps taken by it to secure the deficiency dividend credit, since defendant and his agents and the other agents of the Treasury Department misinformed and misled the plaintiff with respect thereto."
The plaintiff now sues for the return of the sum of $1,606.97, the amount which the government exacted of the plaintiff.
It is unnecessary to set out the details of the several transactions plaintiff had with the Collector or agents of the Treasury Department.
1. An examination of the statute discloses the precise steps necessary for a taxpayer (in the situation of the plaintiff) to take in order to secure the credit claimed. These steps are prescribed by the Congress and Regulations, and it is not within the power of an agent to waive such provisions, and, since the taxpayer is presumed to know the law and the provisions of the law, it could not accept the advice of an agent of the government or follow the course according to its own judgment contrary to the law and yet expect to obtain such credit.
2. It is the rule that the doctrine of estoppel must be applied with great caution as against the government and its officers. Vestal v. Commissioner of Internal Revenue, 80 U.S.App.D.C. 264, 152 F.2d 132, loc. cit. 136. Subordinate officers of the United States are without power to dispose of the rights and property of the United States save only where it has been conferred upon them by Act of Congress or is to be implied from other powers granted to them. And collectors of internal revenue are subordinate officers charged with the ministerial duty of collecting taxes. Royal Indemnity Co. v. United States, 313 U.S. 289, loc. cit. 294, 61 S.Ct. 995, 997, 85 L.Ed. 1361. In the latter case it was specifically held, in referring to collectors of internal revenue, that: "There is no statute in terms authorizing them to remit taxes, to pass upon the claims for abatement of taxes or to release any obligation for their payment. Only the Commissioner, with the consent of the Secretary of the Treasury, is authorized to compromise a tax deficiency for a sum less than the amount lawfully due."
The only instance in which an officer of the government would be bound by his acts would be in cases where such acts or omissions of the officer had been authorized by law. Ritter v. United States, 3 Cir., 28 F.2d 265, loc. cit. 267.
In the case at bar no officer of the government was authorized to waive or nullify the law which prescribed precisely what a taxpayer should do in order to obtain the credit claimed in this instance. The agent named was not so authorized and the plaintiff followed his advice at its peril. However, the plaintiff was not justified in accepting the advice of an agent with respect to the meaning of a document which showed on its face that the agent was giving bad advice.
The equitable principles invoked by the plaintiff cannot be applied or employed in this case to give the relief sought. It follows that recovery should be denied, and it will be so ordered.
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237 S.W.3d 43 (2006)
Andre Deon McEWING, Appellant,
v.
STATE of Arkansas, Appellee.
No. CR 05-1366.
Supreme Court of Arkansas.
June 1, 2006.
*44 William R. Simpson, Jr., Public Defender, and Lance Sullenberger, Deputy Public Defender, by: Erin Vinett, Deputy Public Defender, Little Rock, AR, for appellant.
Mike Beebe, Att'y Gen., by: Misty Wilson Borkowski, Ass't Att'y Gen., Little Rock, AR, for appellee.
JIM HANNAH, Chief Justice.
Appellant Andre Deon McEwing was charged with aggravated robbery, theft of property, and first-degree battery in connection with the assault of Floyd Ross and the subsequent theft of his vehicle. A Pulaski County jury found him guilty of all three charges, and McEwing was sentenced to a term of life imprisonment for aggravated robbery, forty years' imprisonment for theft of property, and forty years' imprisonment for first-degree battery as a habitual offender, with the sentences to run concurrently. McEwing's sole point for reversal is that the circuit court abused its discretion in excluding one of his alibi witnesses from testifying at trial. As this is an appeal in which a term of life imprisonment has been imposed, our jurisdiction is pursuant to Ark. Sup.Ct. R. 1-2(a)(2). We find no error and, accordingly, we affirm.
At trial, the State's central witness was the victim, Floyd Ross. Ross testified that on Christmas Eve of 2003, he went to the area of Arkansas Baptist College, in Little Rock, to find some firewood to buy. While in the vicinity of the college, Ross was stopped by a man he identified as McEwing, whom he had met the previous October at a college event. McEwing told Ross that he was having car trouble and needed help. According to Ross, McEwing told him that he was cold, and Ross let him sit in his car as he drove toward McEwing's van. Once inside Ross's vehicle, McEwing waved a friend over, and the friend got in the backseat of Ross's vehicle. Ross testified that he "got a gut feeling," looked in the backseat via the rearview mirror, and saw that McEwing's friend had a gun.
McEwing's friend fired a shot but missed Ross, breaking out Ross's driver's side window. McEwing then pushed Ross into the backseat and shot him in the buttocks. Ross told the jury that he was begging for his life, trying to get out of the back door of the vehicle, and struggling with the man in the backseat who was trying to keep him inside the vehicle.
Ross testified that he managed to get out of the vehicle and watched as McEwing drove it away. The van, which McEwing had claimed was broken down, then pulled in after Ross's vehicle and drove away after it. Ross ran to a nearby house and contacted the police, and paramedics *45 took him to a hospital for treatment of his gunshot wound. On the night of the shooting, Ross was unable to identify McEwing by any name other than Big Dre. The next day, however, Ross gave McEwing's full name to Little Rock detectives. Ross testified that he eventually recovered his vehicle in Monticello, Arkansas.
At trial, McEwing sought to mount an alibi defense. On the morning of trial, he notified the State that he had two alibi witnesses: his mother, Annette McGee, and another woman named Janelle Young. Both women were expected to testify that McEwing was in Dermott at the time the alleged offense occurred in Little Rock. The State objected to allowing the witnesses to testify as follows:
DEPUTY PROSECUTING ATTORNEY: The other issue, your Honor, regards defense witnesses.
THE COURT: Okay.
DEPUTY PROSECUTING ATTORNEY: Apparently, Mr. Sullenberger found out about two witnesses on Friday and notified yesterday, which was approximately 24 hours before the trial. Then this morning, he notified us that one of those witnesses won't be testifying, but yet a new witness will testify. This is the I believe, third trial setting. And the only reason that it's going today and not last Thursday, when there were no witnesses and even at the Omnibus Hearing, when asked, there were no witnesses. First trial setting, no witnesses. Second trial setting, when he didn't show up on time, no witnesses. And now we're here the day of trial; we get a new witness. The day before trial we get a new witness. This is basically trial by ambush at this point, where we're stuck not being able to prepare for this. If it were if the shoe were on the other foot and these were substantive witnesses, I don't think that the Court would allow us to introduce them and hold us to our burden of proof. And I just ask the same.
THE COURT: Mr. Sullenberger?
DEFENSE COUNSEL: This is a what Mr. Finklestein is saying is true, your Honor. And Annette McGee is one of those. She is Mr. McEwing's mother. She is mentioned in the report as owning the vehicle that was allegedly used in this this robbery. The other one, I was not made aware of until this morning. These witnesses are crucial for the defense, your Honor. If the State would like to take some time to interview those witnesses that would be fine with me, your Honor.
THE COURT: Who's the other witness? What's their
DEFENSE COUNSEL: Her name is Janelle Young.
THE COURT: Well, what is she going to testify to?
DEFENSE COUNSEL: That both of them will testify that Mr. McEwing was in Dermott at the time the alleged offense occurred.
THE COURT: Well, they're alibi witnesses.
DEFENSE COUNSEL: They are.
THE COURT: Why why weren't they made available until today?
DEFENSE COUNSEL: I had asked called and asked Mr. McEwing a couple of weeks ago to furnish me with a witness list or any witnesses that he would have. And I've had no contact with him until Friday Thursday and Friday of last week.
DEPUTY PROSECUTING ATTORNEY: So if he shows up for trial last week on, I believe it was a Wednesday, with no witnesses. He comes here. We're ready you know we're ready for trial *46 but another case goes. And so he doesn't have any witnesses. He comes two and a half [sic] late for his jury trial on Thursday. Again, with no witnesses and gets what he wanted, which was he didn't want to go to trial that day. And now we're stuck with okay, well now we have alibi's [sic] that, you know, in a case that happened I think it was Christmas Eve 2003. And lo and behold, you know, almost two years later we come up with alibi's [sic] on the eve of trial or sorry, the day of trial with one of them. I just think it's unfair to the State to have to you know, based on the defendant's conduct. I'm not saying Mr. Sullenberger did anything wrong. And in fact, I'm saying it's the defendant who created this situation and now is trying to gain some benefit from it.
DEFENSE COUNSEL: Your Honor, Ms. McGee is mentioned in the file and she was her [sic] last Thursday. She's been here every time, she tells me.
THE COURT: Okay. Well, what I'll do is this. I'll let the State talk to both the witnesses, Janelle what is her last name?
DEFENSE COUNSEL: Young.
THE COURT: Young and Annette McGee. I'm not going to if the State won't allow you all if you all can't prepare a response to the to their testimony, I'm going to exclude Janelle Young. If McGee, Annette McGee is in the file, then I'll allow her to testify, but I'll exclude Janelle Young if the State doesn't if they can't, because they may want to do her record or find out on that. It's just unfair. You can't do that. I won't allow it unless the State has had a chance to talk to the witness and if it feels that it can adequately do a cross examination then I'll allow it. But otherwise I'm not going to allow that witness to testify. All right.
Thus, the circuit court allowed the testimony of McEwing's mother because her name was contained in the State's file as having been associated with the case from the beginning. However, the circuit court's ruling on Janelle Young was postponed until later, and depended on the State's ability to prepare a cross-examination of Young.
This issue of Young's testimony was taken up again at the close of the State's case, at which time the circuit court excluded her, as follows:
DEFENSE COUNSEL: The witness my other witness?
THE COURT: Did you guys have a chance to talk to the other witness?
DEPUTY PROSECUTING ATTORNEY: Your Honor, we've had so many problems getting our own witnesses here.
THE COURT: Okay. All right. I'll allow the one witness, the mother.
DEFENSE COUNSEL: Okay. For the record, I would like to state that I think, you know, they could've called and checked or had their office in the five hours, four hours that we've been here and call ACIC at least and check and see if she had any record or anything like that.
THE COURT: All right.
Matters pertaining to the admissibility of evidence are left to the sound discretion of the circuit court, and we will not reverse such a ruling absent an abuse of that discretion. See, e.g., Bell v. State, 334 Ark. 285, 973 S.W.2d 806 (1998); Bailey v. State, 334 Ark. 43, 972 S.W.2d 239 (1998). Nor will we reverse absent a showing of prejudice, as prejudice is not presumed. Hill v. State, 337 Ark. 219, 988 *47 S.W.2d 487 (1999). Here, the circuit court excluded the testimony of Young based upon the defense's failure to disclose the name of the witness until the morning of trial. Ark. R.Crim. P. 18.3 provides the applicable discovery rule in criminal cases:
Subject to constitutional limitations, the prosecuting attorney shall, upon request, be informed as soon as practicable before trial of the nature of any defense which defense counsel intends to use at trial and the names and addresses of persons whom defense counsel intends to call as witnesses in support thereof.
The State moved for discovery of defense witnesses on May 5, 2005. However, McEwing did not disclose the two alibi witnesses until the morning of trial, on August 23, 2005. Sanctions by the circuit court for failure to adhere to discovery rules include granting a continuance, excluding the evidence, or ordering the discovery. Ark. R.Crim. P. 19.7; see also Williams v. State, 338 Ark. 178, 992 S.W.2d 89 (1999).
In the instant case, the circuit court excluded Young's testimony because it determined that the State was unable to adequately prepare a response to her testimony. McEwing contends that the State conducted a competent cross-examination of McEwing's mother without prior notice of her status as a witness. And, further, McEwing contends that the State had several hours in which to use its considerable investigatory and support-staff resources to look into the criminal history and general background of Young. Thus, McEwing submits that the late notice of Young as a possible witness should not have been a bar to her testimony. We disagree.
As noted in the testimony above, the circuit court allowed McEwing's mother to testify because her name was disclosed in the case file. Furthermore, McEwing's argument that Young should have been allowed to testify because the State had several hours in which to look into her background ignores the fact that the circuit court stated that it would not allow Young to testify unless the State had a chance to talk to her and adequately prepare a cross-examination. The deputy prosecuting attorney stated that he did not have an opportunity to speak with Young in the hours prior to trial. This court has noted that discovery in criminal cases, within constitutional limitations, must be a two-way street. Mitchell v. State, 306 Ark. 464, 816 S.W.2d 566 (1991) (citing Weaver v. State, 290 Ark. 556, 720 S.W.2d 905 (1986)). This interpretation promotes fairness by allowing both sides the opportunity to full pretrial preparation, preventing surprise at trial, and avoiding unnecessary delays during the trial. Mitchell, supra (citing Weaver, supra). Here, the circuit court excluded Young because it determined that it was unfair to the State to allow her to testify. The circuit court did not abuse its discretion.
Moreover, as noted by the State, McEwing failed to demonstrate that he was prejudiced by not being allowed to call Young as an alibi witness. Although McEwing claims that Young, like McGee, would testify that McEwing was in Dermott on Christmas Eve in 2003, the substance of Young's testimony is not evident from the record as McEwing failed to proffer her testimony. This court has held that a proffer of excluded testimony is necessary in order to determine whether an appellant has suffered prejudice. See, e.g., Huddleston v. State, 339 Ark. 266, 5 S.W.3d 46 (1999) (citing McGehee v. State, 338 Ark. 152, 992 S.W.2d 110 (1999)). Nevertheless, McEwing argues that in this case, a proffer was unnecessary because the record already reveals that Young was going to testify to his alibi. McEwing *48 contends that the exclusion of Young's testimony caused prejudice to his case, and that this is apparent without a proffer. In support of this proposition, McEwing states that this case was all about credibility, and that Young would have perhaps been more credible in the content of her testimony. He also argues that, in any event, what is less speculative is that any witness other than a criminal defendant's mother would have had less perceived or actual bias than the mother. The problem with this argument, which is illustrated by the language McEwing uses to make it, is that it is based purely on speculation. Although the record reveals that McEwing expected Young to provide an alibi in her testimony, without the proffer, we would be forced to speculate if we were to presume prejudice and reverse on this basis. This we will not do.
In sum, because McEwing failed to disclose Young as a defense witness until the day of trial, the circuit court did not abuse its discretion by excluding her as a witness. Furthermore, McEwing failed to proffer her testimony for appellate review or to otherwise show prejudice from the exclusion. In compliance with Ark. Sup. Ct. R. 4-3(h), the record has been examined for all objections, motions, and requests made by either party that were decided adversely to the appellant, and no prejudicial error has been found.
Affirmed.
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[Cite as Regions Bank v. Sabatino, 2012-Ohio-4254.]
STATE OF OHIO ) IN THE COURT OF APPEALS
)ss: NINTH JUDICIAL DISTRICT
COUNTY OF SUMMIT )
REGIONS BANK C.A. No. 25907
Appellee
v. APPEAL FROM JUDGMENT
ENTERED IN THE
PAUL A. SABATINO COURT OF COMMON PLEAS
COUNTY OF SUMMIT, OHIO
Appellant CASE No. CV 2010-12-8404
DECISION AND JOURNAL ENTRY
Dated: September 19, 2012
CARR, Presiding Judge.
{¶1} Appellant, Paul Sabatino, appeals the judgment of the Summit County Court of
Common Pleas. This Court reverses.
I.
{¶2} On December 22, 2010, Regions Bank filed a complaint against Sabatino for
breach of a credit agreement. Regions alleged that, in December 2005, Sabatino executed a
credit agreement for $225,000 secured by a second mortgage on real property located in Collier
County, Florida. Regions further alleged that Sabatino had defaulted on the agreement and owed
$238,000. A copy of the credit agreement was attached to the complaint.
{¶3} On February 1, 2011, Sabatino filed a pro se “Motion for Extension of Time.” In
the motion Sabatino requested a 60-day extension and explained that the bank had contacted him
in early November and he had responded by sending the bank a “letter and validation request
(Debt Collector Disclosure Statement) asking [Regions’] attorney to respond within thirty (30)
2
days.” Sabatino further explained that, rather than responding to his request, the bank filed suit
against him. The day after Sabatino filed his motion, the trial court granted a 21-day extension.
In the order, the trial court stated that Sabatino shall “respond to the Complaint on or before
February 28, 2011.”
{¶4} On February 25, 2011, Sabatino filed a motion in which he asked the trial court to
“delay the Complaint until the Florida Attorney General’s Office completes [its] investigation of
the alleged filing of improper documents in the courts.” Sabatino explained that “[t]he attorneys
representing [Regions] on the 1st (First) Mortgage (Florida Default Law Group) are under
investigation by the State of Florida Attorney General’s Office * * * for alleged[ly] filing
improper documents in the courts to speed up foreclosures.” Sabatino further asked that the trial
court require Regions’ lawyers to respond to his “Validation Debt Collector Disclosure
Statement as required by law.” On February 28, 2011, the trial court issued an order denying the
motion, but giving Sabatino until March 11, 2011, to answer the complaint. The journal entry
further indicated that “[f]ailure to file an Answer will result in Default Judgment against the
defendant.”
{¶5} On March 11, 2011, Sabatino filed a “Request for Production of Documents”
directed to the attorneys for Regions. In his motion, Sabatino again requested that the trial court
order Regions to respond to his Validation Debt Collector Disclosure Statement. Regions
subsequently filed a motion for default judgment. On March 28, 2011, Sabatino filed a motion
to compel Regions to respond to his Validation Debt Collector Disclosure Statement. On that
same day, the trial court issued an order granting default judgment in favor of Regions. On April
6, 2011, the trial court issued a journal entry denying the motion to compel on the basis that it
was moot.
3
{¶6} Sabatino filed a timely notice of appeal and raised two assignments of error.
II.
{¶7} In his assignments of error, Sabatino raises general due process arguments
relating to the trial court’s decision to enter default judgment. The crux of Sabatino’s argument
is that the trial court entered default judgment before he had an opportunity to gather evidence
regarding the status of the property in question.
{¶8} At the outset, we note that Sabatino has presented his arguments before the trial
court and this Court pro se. With respect to pro se litigants, this Court has observed:
[P]ro se litigant should be granted reasonable leeway such that their motions and
pleadings should be liberally construed so as to decide the issues on the merits, as
opposed to technicalities. However, a pro se litigant is presumed to have
knowledge of the law and correct legal procedures so that he remains subject to
the same rules and procedures to which represented litigants are bound. He is not
given greater rights than represented parties, and must bear the consequences of
his mistakes. This Court, therefore, must hold [pro se appellants] to the same
standard as any represented party.
(Internal citations omitted.) Sherlock v. Myers, 9th Dist. No. 22071, 2004-Ohio-5178, ¶ 3.
{¶9} The Ohio Supreme Court has stated that “[i]f the defending party has failed to
appear in the action, a default judgment may be entered without notice.” Ohio Valley Radiology
Assoc., Inc. v. Ohio Valley Hosp. Assn., 28 Ohio St.3d 118, 120 (1986); see also Chuck Oeder,
Inc. v. Bower, 9th Dist. No. 23785, 2007-Ohio-7032, ¶ 13. The high court continued:
Default, under both pre-Civil Rule decisions and under Civ.R. 55(A), is a clearly
defined concept. A default judgment is a judgment entered against a defendant
who has failed to timely plead in response to an affirmative pleading. McCabe v.
Tom, 35 Ohio App. 73 (6th Dist.1929). As stated by the court in Reese v. Proppe,
3 Ohio App.3d 103, 105 (8th Dist.1981), “[a] default by a defendant * * * arises
only when the defendant has failed to contest the allegations raised in the
complaint and it is thus proper to render a default judgment against the defendant
as liability has been admitted or ‘confessed’ by the omission of statements
refuting the plaintiff's claims. * * *” It is only when the party against whom a
claim is sought fails to contest the opposing party’s allegations by either pleading
or “otherwise defend[ing]” that a default arises. This rule applies to original
4
claims as well as to counterclaims (Civ.R. 55[C]), and is logically consistent with
the general rule of pleading contained in Civ.R. 8(D), which reads in part that
“[a]verments in a pleading to which a responsive pleading is required * * * are
admitted when not denied in the responsive pleading.”
Ohio Valley Radiology at 121.
{¶10} Here, the trial court erred in granting default judgment against Sabatino. There is
no dispute that Sabatino appeared in this matter. Sabatino filed several motions in the trial court
including two motions for extensions of time as well as several motions pertaining to the
proceedings in Florida that allegedly impacted the status of the property in question. This Court
has held that when a party appears in an action, the trial court is required to conduct a hearing on
a motion for default judgment and provide the parties with at least seven days’ notice pursuant to
Civ.R. 55(A). Pickett v. Katz & Co. Spalon, 9th Dist. No. 25851, 2011-Ohio-4396, ¶ 4 - 5. The
failure to conduct a hearing prior to entering default judgment when a party ha's appeared in an
action constitutes reversible error. Id. at ¶ 5. Despite the fact that Sabatino appeared in this
action, the trial court did not hold a hearing prior to entering default judgment. As the trial court
failed to conduct a hearing, Sabatino’s assignments of error are sustained.
III.
{¶11} Sabatino’s assignments of error are sustained. The judgment of the Summit
County Court of Common Pleas is reversed and remanded for further proceedings consistent
with this opinion.
Judgment reversed,
and cause remanded.
There were reasonable grounds for this appeal.
5
We order that a special mandate issue out of this Court, directing the Court of Common
Pleas, County of Summit, State of Ohio, to carry this judgment into execution. A certified copy
of this journal entry shall constitute the mandate, pursuant to App.R. 27.
Immediately upon the filing hereof, this document shall constitute the journal entry of
judgment, and it shall be file stamped by the Clerk of the Court of Appeals at which time the
period for review shall begin to run. App.R. 22(C). The Clerk of the Court of Appeals is
instructed to mail a notice of entry of this judgment to the parties and to make a notation of the
mailing in the docket, pursuant to App.R. 30.
Costs taxed to Appellee.
DONNA J. CARR
FOR THE COURT
BELFANCE, J.
CONCURS.
DICKINSON, J.
DISSENTING.
{¶12} There seems to be some confusion in this case about Mr. Sabatino’s assignments
of error. There are two, and neither suggests that the trial court incorrectly entered default
judgment against him because it failed to hold a hearing:
The Trial Court erred by failing to take into consideration that the Defendant’s
Motion was filed prior to the Court’s Final Order and then ruled the Defendant’s
motion was moot.
The Trial Court erred by denying the Appellant Due Process because their
Summary Judgment was handed down while crucial Foreclosure evidence and
issues are unresolved and still being developed in many courts throughout the
country.
6
This Court has often written, even in criminal cases, that “an appellant’s assignment of error
provides this Court with a roadmap to guide our review.” E.g., State v. Hoang, 9th Dist. No.
11CA0013-M, 2012-Ohio-3741, ¶ 12 (quoting Akron v. Johnson, 9th Dist. No. 26047, 2012-
Ohio-1387, ¶ 3). In certain types of cases, however, it is apparently becoming appropriate for the
Court to “chart [its] own course.” But see Hoang, 2012-Ohio-3741, at ¶ 12 (“We decline to chart
our own course when, as in this case, the appellant has failed to provide any guidance.”).
INTRODUCTION
{¶13} Paul Sabatino, acting pro se, failed to respond to the allegations in the complaint
filed against him by Regions Bank. Therefore, the trial court granted the bank’s motion for
default judgment against him. Mr. Sabatino has appealed, arguing that the trial court incorrectly
denied his motion to compel as moot because it “fail[ed] to take into consideration that the . . .
[m]otion was filed prior to the [c]ourt’s [f]inal [o]rder[.]” He has also argued that the trial court
denied him due process by entering judgment against him “while crucial [f]oreclsoure evidence
and issues are unresolved and still being developed in many courts throughout the country.” I
would affirm because, in light of Mr. Sabatino’s failure to answer the complaint, the trial court
properly granted default judgment against him and denied his motion to compel.
BACKGROUND
{¶14} In December 2010, Regions Bank sued Paul Sabatino for breach of contract. The
bank alleged that, in December 2005, Mr. Sabatino executed a credit agreement for $225,000
secured by a second mortgage on real property located in Collier County, Florida. It also alleged
that Mr. Sabatino defaulted on the agreement and owed it over $238,000. The bank attached a
copy of the agreement to its complaint.
7
{¶15} Without hiring a lawyer, Mr. Sabatino filed a document he called a “Motion for
Extension of Time- Review of Pending Documents[.]” Through the motion, Mr. Sabatino
requested “an extension of sixty (60) days” and explained that the bank had contacted him in
early November and he had responded by sending the bank a “letter and validation request (Debt
Collector Disclosure Statement) asking [the bank’s] attorney to respond within thirty (30) days.”
Mr. Sabatino explained that, rather than responding to his “validation request[,]” the bank filed
suit against him. The day after Mr. Sabatino moved for an extension of time, the trial court
granted a 21-day extension. In the order, the trial court wrote that Mr. Sabatino “shall respond to
the Complaint on or before February, 28, 2011.”
{¶16} Three days before the new deadline for answering the complaint, Mr. Sabatino
filed a document he called a “Motion to Delay Complaint Until Completion of Investigation by
Florida Attorney General – Production of Documents.” Via this motion, Mr. Sabatino asked the
trial court to “delay the Complaint until the Florida Attorney General’s Office completes [its]
investigation of the alleged filing of improper documents in the courts.” He explained that “[t]he
attorneys representing [the bank] on the 1st . . . Mortgage (Florida Default Law Group) are under
investigation by the State of Florida Attorney General’s Office . . . for alleged[ly] filing . . .
improper documents . . . to speed up foreclosures.” Mr. Sabatino also requested that the trial
court order the bank’s lawyers to respond to his “Validation Debt Collector Disclosure Statement
as required by law.” Three days after Mr. Sabatino moved “to delay [the] complaint[,]” the trial
court entered an order denying the motion, but giving Mr. Sabatino until March 11 to answer the
complaint. The order of February 28, 2011, indicates that “[f]ailure to file an Answer will result
in Default Judgment against the defendant.”
8
{¶17} On March 11, Mr. Sabatino filed a document he called a “Request for Production
of Documents Directed to [the bank’s] Attorney[.]” In it, he again asked the trial court to order
the bank to respond to his “validation[.]” The bank then moved for default judgment based on
Mr. Sabatino’s failure to answer the complaint. The bank served the motion for default
judgment on Mr. Sabatino by regular mail service on March 17. Mr. Sabatino did not respond to
the motion, but moved to compel a response to his debt validation request on March 28. That
same day, the trial court granted the bank’s motion, noting that it had instructed Mr. Sabatino to
file his answer on or before March 11 and had warned him that failure to do so would result in
default judgment being entered against him. The court entered default judgment against Mr.
Sabatino in the amount of $238,917.08, plus post-judgment interest and costs. Nine days later,
the trial court denied as moot the motion to compel that Mr. Sabatino had filed just minutes
before the trial court entered default judgment against him.
DEFAULT JUDGMENT
{¶18} Mr. Sabatino’s second assignment of error is that the trial court incorrectly
entered judgment against him “while crucial [f]oreclosure evidence and issues are unresolved
and still being developed in many courts throughout the country.” This argument is apparently
related to his discussion of investigations of various states’ attorneys general into foreclosures
completed with the help of “Robo-Signers.” He has argued that the trial court should not have
entered judgment against him while investigations continue into suspicious foreclosure practices
in Florida. His argument about investigations in other states does not affect whether the trial
court properly granted default judgment against him in this case.
{¶19} “Litigants may choose to represent themselves in court, but they will be held to
the same standard as represented parties.” Nagel v. Nagel, 9th Dist. No. 09CA009704, 2010-
9
Ohio-3942, at ¶ 38. “Although this Court has held that pro se litigants ‘should be granted
reasonable leeway’ in the construction of their pleadings and motions in order to ensure that
courts address issues on their merits if possible, ‘a pro se litigant is presumed to have knowledge
of the law and correct legal procedures so that he remains subject to the same rules and
procedures to which represented litigants are bound.’” Id. (quoting Smith v. Downs, 9th Dist.
No. 25021, 2010-Ohio-2571, at ¶ 7). “A pro se litigant ‘is not given greater rights than
represented parties, and must bear the consequences of his mistakes.’” Id. (quoting Smith, 2010-
Ohio-2571, at ¶ 7). Under Rule 55(A) of the Ohio Rules of Civil Procedure, “[w]hen a party
against whom a judgment for affirmative relief is sought has failed to plead or otherwise defend
as provided by these rules, the party entitled to a judgment by default shall apply . . . to the court
therefor . . . .”
{¶20} In this case, Mr. Sabatino must bear the consequences of his mistake, specifically,
failing to timely answer the complaint, even after being given two extensions of time to do so.
Mr. Sabatino filed multiple motions in this action, but never filed anything that could be
construed as an answer to the complaint. In each of Mr. Sabatino’s motions, he wrote that the
bank sued him on December 22, 2010, instead of responding to his “Debt Collector Disclosure
Statement validation.” He also wrote that, “[o]n January 8, 2011[,] at approximately 10:30 AM,”
he “picked up and signed” for a summons mailed to him by the Clerk of the Summit County
Court of Common Pleas. That summons included an announcement in bold print that “[y]ou are
hereby summoned and required to serve upon the plaintiff’s attorney . . . a copy of an answer to
the complaint within twenty-eight days after service of this summons on you . . . .” Rule 8(B) of
the Ohio Rules Civil Procedure provides that “[a] party shall state in short and plain terms the
party’s defenses to each claim asserted and shall admit or deny the averments upon which the
10
adverse party relies. If the party is without knowledge or information sufficient to form a belief
as to the truth of an averment, the party shall so state and this has the effect of a denial.”
{¶21} The complaint included only three paragraphs, alleging that the bank is the holder
of a credit agreement signed by Mr. Sabatino in December 2005, that Mr. Sabatino was in
default of his obligations under that agreement, and that he owed the bank $238,917.08. Mr.
Sabatino did not deny any of those allegations despite filing various motions and being warned
by the court that he must file an answer in a timely fashion or risk default judgment. The trial
court correctly granted the bank’s motion for default judgment after Mr. Sabatino failed to plead
or otherwise defend the allegations as required by the Ohio Rules of Civil Procedure. Civ. R.
55(A). Mr. Sabatino’s second assignment of error should be overruled.
MOTION TO COMPEL
{¶22} Mr. Sabatino’s first assignment of error is that the trial court improperly denied
his third motion as moot after it entered default judgment against him. In his “Motion to
Compel[,]” Mr. Sabatino again asked the court to require the bank to respond to his debt
validation letter. He has argued that the court failed to consider the fact that he filed the motion
to compel before the court entered final judgment against him.
{¶23} The trial court implicitly overruled Mr. Sabatino’s motion to compel by granting
the bank’s motion for default judgment. The trial court had already given Mr. Sabatino two
extensions of time to file an answer to the complaint. While ignoring the trial court’s warning
that default judgment would be rendered against him if he did not answer the complaint by
March 11, Mr. Sabatino requested that the trial court order the plaintiff to answer his questions.
As the motion to compel could not have been construed as an answer as described in Rule 8(B)
11
of the Ohio Rules of Civil Procedure, the trial court properly denied it. Mr. Sabatino’s first
assignment of error should be overruled.
CONCLUSION
{¶24} Mr. Sabatino’s assignments of error should be overruled. The trial court correctly
granted default judgment to the bank because Mr. Sabatino never answered the complaint, even
after being given two extensions of time and a warning about default judgment. In light of Mr.
Sabatino’s failure to answer the complaint, the court properly denied his motion to compel. The
judgment of the Summit County Common Pleas Court should be affirmed.
APPEARANCES:
PAUL A. SABATINO, pro se, Appellant.
MATTHEW G. BERG, Attorney at Law, for Appellee.
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Error: Couldn't open file '/var/www/court-listener/alert/assets/media/pdf/2009/11/12/Gentile_v._Sun_Products.pdf': No such file or directory.
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UNPUBLISHED
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
UNITED STATES OF AMERICA,
Plaintiff-Appellee,
v. No. 97-4056
COREY M. AVENS,
Defendant-Appellant.
Appeal from the United States District Court
for the District of Maryland, at Baltimore.
Marvin J. Garbis, District Judge.
(CR-96-383)
Submitted: February 17, 1998
Decided: March 3, 1998
Before WIDENER and MURNAGHAN, Circuit Judges, and
BUTZNER, Senior Circuit Judge.
_________________________________________________________________
Affirmed by unpublished per curiam opinion.
_________________________________________________________________
COUNSEL
Janis R. Harvey, LAW OFFICE OF JANIS R. HARVEY, P.A., Balti-
more, Maryland; Roland Walker, WALKER, VANBAVEL, AMA-
RAL & MEAD, P.A., Baltimore, Maryland, for Appellant. Lynne A.
Battaglia, United States Attorney, Thomas M. DiBiagio, Assistant
United States Attorney, Baltimore, Maryland, for Appellee.
_________________________________________________________________
Unpublished opinions are not binding precedent in this circuit. See
Local Rule 36(c).
_________________________________________________________________
OPINION
PER CURIAM:
Corey M. Avens pleaded guilty to one count of accessory after the
fact in violation of 18 U.S.C. § 3 (1994) and was sentenced to three
years' probation. On appeal, Avens contends that the court's denial
of his motion for a continuance violated his due process rights under
the Fifth and Fourteenth Amendments and his Sixth Amendment right
to effective assistance of counsel. We affirm the conviction and sen-
tence.
Avens, an ensign in the United States Navy, along with several oth-
ers, was indicted for conspiring to transport, possess, receive, and sell
stolen motor vehicles in violation of 18 U.S.C.§§ 371, 2312, 2313
(1994). The conspiracy involved stealing cars from New York, trans-
porting them to Maryland, retitling them fictitiously, and reselling
them for profit.
Avens filed a motion for a continuance on September 30, 1996,
alleging that counsel, due to other court commitments, did not have
adequate time to prepare Avens's case for trial. Having already
granted one motion for a continuance, albeit not on request of Avens,
the court denied the motion on October 1, 1996, finding that Avens
knew by at least September 6, 1996, that he was going to be tried if
he did not plead, and was therefore afforded sufficient trial prepara-
tion time. In accordance with a plea agreement, Avens ultimately
pleaded guilty to aiding and abetting.
The denial of a motion for a continuance is reviewed for an abuse
of discretion. See Morris v. Slappy, 461 U.S. 1, 11-12 (1983). A
denial that constitutes "an unreasoning and arbitrary `insistence upon
expeditiousness in the face of a justifiable request for delay'" is both
abusive and violates an accused's Sixth Amendment right to assis-
tance of counsel. Id. (quoting Ungar v. Sarafite, 376 U.S. 575, 589
2
(1964)). In order to prove an abridgement of the right to effective
assistance, however, a defendant must show that the denied continu-
ance "specifically prejudiced" his case. See United States v. Larouche,
896 F.2d 815, 823 (4th Cir. 1990). Furthermore, due process protec-
tions are implicated only when the denial is arbitrary and fundamen-
tally unfair. See United States v. Sellers, 658 F.2d 230, 231 (4th Cir.
1981).
Avens does not dispute the trial court's finding that he knew by
September 6, 1996, that he would be tried on October 21, 1996, in the
absence of a plea. We do not find that the court's denial constituted
"an unreasoning and arbitrary insistence upon expeditiousness in the
face of a justifiable request for delay." With respect to Avens's con-
tention that trial counsel did not have time to adequately prepare for
trial, Avens presents no evidence that the denial specifically "preju-
diced" his case. See United States v. Lorick , 753 F.2d 1295, 1297 (4th
Cir. 1985) (holding that counsel's failure to make a concrete showing
of either specific prejudice or exculpatory evidence to be sought dur-
ing the requested delay precluded a finding of abuse of discretion in
the court's denial of a motion for a continuance).
Accordingly, we affirm Avens's conviction and sentence. We dis-
pense with oral argument because the facts and legal contentions are
adequately presented in the materials before the court, and oral argu-
ment would not aid the decisional process.
AFFIRMED
3
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No. 04-00-00339-CR
EX PARTE Stephen S. DELORENZO
From the 379th Judicial District Court, Bexar County, Texas
Trial Court No. 2000-W-0114
Honorable Bert Richardson, Judge Presiding
Opinion by: Paul W. Green, Justice
Sitting: Catherine Stone, Justice
Paul W. Green, Justice
Karen Angelini, Justice
Delivered and Filed: March 28, 2001
AFFIRMED
This is an appeal from the denial of habeas corpus where the appellant, Stephen
DeLorenzo, sought relief from a governor's warrant directing his extradition to the state of
Massachusetts. In one point of error, DeLorenzo complains the trial court erred in denying
relief because both the governor's warrant and the underlying demand contain fatal
deficiencies. We affirm.
Background
DeLorenzo was convicted in Massachusetts on two counts of assault with intent to
murder and one count of unlawfully carrying a firearm. Following his incarceration, he
escaped, was arrested in Mexico, and extradited to Texas. DeLorenzo filed a writ of habeas
corpus and was granted a hearing. At the hearing, the State introduced the executive warrant
of the governor of Texas, together with the Massachusetts governor's demand for extradition,
including supporting documentation of DeLorenzo's convictions and escape. After an
evidentiary hearing, the trial court denied habeas corpus relief and ordered DeLorenzo's
extradition to Massachusetts.
Standard of Review
The legality of extradition proceedings may be reviewed by habeas corpus, but the
validity of the demanding state's prosecution or confinement may not be challenged. Ex
parte McClintick, 945 S.W.2d 188, 190 (Tex. App.-San Antonio 1997, no pet.). When
reviewing the legality of an arrest under a governor's warrant, we consider only the
following issues: (1) are the extradition documents valid on their face; (2) did the demanding
state charge the applicant/appellant with a crime; (3) is the applicant/appellant the person
named in the request for extradition; and (4) is the applicant/appellant a fugitive? Ex parte
Lopez, 988 S.W.2d 788, 789 (Tex. App.-San Antonio 1999, no pet.). DeLorenzo's point of
error focuses on the validity of the documents.
The governor of the asylum state may not recognize a demand for extradition unless
the demand includes either (1) a copy of an indictment; (2) an information supported by
affidavit; (3) a copy of an affidavit before a magistrate in the demanding state, together with
the warrant that issued on it; or (4) a copy of a judgment of conviction or of a sentence
imposed in execution thereof, together with a statement by the demanding executive claiming
the individual has escaped from confinement or violated the terms of bail, probation, or
parole. Tex. Code Crim. Proc. Ann. art. 51.13, § 3 (Vernon 1979); McClintick, 945
S.W.2d at 192 (citing Noe v. State, 654 S.W.2d 701, 702 (Tex. Crim. App. 1983)). These
requirements show the applicant/appellant was charged in the regular course of judicial
proceedings. Ex parte Rosenthal, 515 S.W.2d 114, 119 (Tex. Crim. App. 1974). The
documents supporting the governor's warrant may be used to meet these requirements. Ex
Parte Morales, 810 S.W.2d 470, 473 (Tex. App.-Amarillo 1991, no pet.).
Discussion
In his first challenge, DeLorenzo claims the demand for extradition is insufficient
because it fails to state he escaped from confinement as required by Tex. Code Crim. P.
Ann. art. 51.13 § 3. We disagree. The demand from the Executive Authority, the governor
of Massachusetts, includes statements that DeLorenzo is "CHARGED BY THE COMPAINT
(sic) OF ESCAPE which [is] a crime under the laws of [Massachusetts]" and DeLorenzo
"fled from the justice of this State." We may take judicial notice of the elements of the crime
of "escape" as set forth in Mass. Gen. Laws ch. 268, § 16 (2000). To be charged with
escape, the accused must have been in the custody of or committed to a Massachusetts penal
institution. Id. Therefore, the Massachusetts governor's demand properly contains a
statement that DeLorenzo escaped from confinement.
DeLorenzo also complains the demand for extradition fails to include a charging
instrument charging him with escape. However, the demand for extradition is not based
solely on the charge of escape. It is primarily based on the three convictions and the fact that
DeLorenzo escaped from prison and fled the state before completing his sentence for those
crimes. Failure to include a charging instrument for the escape charge does not render the
demand insufficient.
DeLorenzo says the demand fails because it contains no judgments showing
DeLorenzo was convicted of a crime. A demand for extradition may be accompanied by any
one of several different documents listed in Tex. Code Crim. P. Ann. art. 51.13 § 3. Ex
parte Morales, 810 S.W.2d at 473. In this case, the demand includes (1) copies of
DeLorenzo's indictments for assault with intent to murder and unlawfully carrying a weapon
and (2) copies of the sentences imposed in execution of the convictions. Article 51.13 § 3
requires only one of these for the demand to be sufficient.
In his last complaint, DeLorenzo says the demand for extradition is insufficient
because it fails to comply with the requirements of Tex. Code Crim. P. Ann. art. 51.13 §
23(1-3) (Vernon Supp. 2000). Section 23 applies only to "the return to this State [Texas] of
a person charged with crime in this State." By its terms, section 23 does not apply to the
extradition of a prisoner from Texas to another state. Id., McClintick, 945 S.W.2d at 192.
Even if the Massachusetts version of the Uniform Criminal Extradition Act contains a
provision identical to section 23 of article 51.13, we may not look beyond the requisition to
question the application. McClintick, 945 S.W.2d at 192.
Conclusion
We hold the governor's warrant and accompanying demand for extradition are
sufficient and overrule DeLorenzo's point on appeal. The judgment of the trial court is
affirmed.
PAUL W. GREEN,
JUSTICE
DO NOT PUBLISH
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631 F.2d 10
1980-2 Trade Cases 63,559
READING INDUSTRIES, INC., Plaintiff-Appellant,v.KENNECOTT COPPER CORPORATION et al., Defendants-Appellees.
No. 731, Docket 79-7762.
United States Court of Appeals,Second Circuit.
Argued April 3, 1980.Decided Sept. 24, 1980.
Jerry S. Cohen, Washington, D. C. (Harold E. Kohn, Michael D. Hausfeld, and Kohn, Milstein & Cohen, Washington, D. C., on brief), for plaintiff-appellant.
Michael A. Cooper, New York City (Bruce E. Clark, Janette Patterson, Darrell K. Fennell, and Sullivan & Cromwell, New York City, on brief), for defendants-appellees Kennecott Copper Corporation and Chase Brass & Copper Company, Inc.
Andrew C. Hartzell, Jr., New York City (Martin F. Evans, Douglas S. Eakeley, Mark A. Conley, and Debevoise, Plimpton, Lyons & Gates, New York City, on brief), for defendants-appellees Phelps Dodge Corporation and Phelps Dodge Industries, Inc.
Paul G. Pennoyer, Jr., New York City (Michael S. Davis, Kathryn A. Brown, and Chadbourne, Parke, Whiteside & Wolff, New York City, on brief), for defendants-appellees The Anaconda Company and Anaconda American Brass Company.
Before MANSFIELD and NEWMAN, Circuit Judges, and GOETTEL,* District Judge.
NEWMAN, Circuit Judge:
1
This appeal concerns a somewhat bizarre attempt to obtain damages under the antitrust laws. Reading Industries, Inc. (Reading) alleges that a conspiracy to keep prices low caused it, through a series of complex market interactions, to pay prices that were unduly high. The District Court for the Southern District of New York (Morris E. Lasker, Judge) granted defendants' motion for summary judgment on the grounds that Reading lacked standing to sue. 477 F.Supp. 1150.1 We affirm the judgment for defendants.
2
Reading, a refiner of copper scrap and a manufacturer of copper tubing, brought this suit for treble damages under section 4 of the Clayton Act, 15 U.S.C. § 15 (1976), against defendants Kennecott Copper Corporation, Phelps Dodge Corporation, and the Anaconda Company, vertically integrated firms, which together produce approximately 60 percent of the refined copper used by the nation's copper fabricators. Reading charged that during the period 1964-1970 defendants conspired to fix the price of domestically refined copper and to monopolize the market for its sale, in violation of sections 1 and 2 of the Sherman Act, 15 U.S.C. §§ 1 and 2 (1976).2
3
During the 1960's, there were three significant pricing systems for copper. The first was a price quoted by defendants for domestically refined copper; this was known in the industry as the "producers' price." The second consisted of the prices quoted for refined copper on the London Metal Exchange (LME), a futures market significant to fabricators only insofar as many small domestic and the major foreign producers based their copper price on its quotations. The third consisted of the prices quoted in the copper scrap market, in which several hundred independent dealers traded. Reading purchased the copper needed for its fabricating operations in this scrap market. According to the complaint, prices in this market closely followed the LME prices.
4
Between 1964 and 1970, all major domestic producers quoted identical prices, each meeting any price change initiated by another. This producers' price was considerably lower than the LME price throughout the period. The refined copper sold by defendants was thus cheaper than copper available from other sources, including scrap dealers. Acknowledging that they could have charged higher prices and still maintained their level of short-run sales, defendants contended that, acting independently, they set low prices in order to protect long-run sales. This was done, they asserted, to avoid declining demand, a matter of concern because other metals can be readily substituted for copper.3 Defendants also contended they were responding to governmental pressure for low prices.4
5
The core of Reading's theory of recovery is derived from this complex market structure. Reading contends that the defendants conspired to maintain the producers' price at artifically low levels, well below the LME price, and that this resulted in Reading's paying higher prices in the copper scrap market. The mechanism by which defendants were alleged to affect these two markets was a rationing system that allocated their low-priced copper among customers who demanded more copper at that price than defendants were willing to supply. These customers, who were copper fabricators like Reading, then turned to other markets to meet their copper requirements and were able to "bid up" the price of copper scrap from savings on their purchases of defendants' refined copper. In this respect, Reading argues, although its amended complaint does not allege that it ever purchased or sought to purchase refined copper from defendants, it was injured by their actions because it paid more for copper scrap than it would have paid had defendants not held their prices for refined copper below the market clearing price.
6
Antitrust law has long recognized that defendants who may have violated a provision of the antitrust statutes are not liable to every person who can persuade a jury that he suffered a loss in some manner "that might conceivably be traced" to the conduct of the defendants. Hawaii v. Standard Oil Co. of California, 405 U.S. 251, 263 n.14, 92 S.Ct. 885, 31 L.Ed.2d 184 (1972). Various doctrines have evolved to delineate categories of circumstances under which losses are not recoverable, even though causally related to an antitrust violation. Unfortunately, the perimeters of these categories are not clearly marked, a consequence perhaps partially due to uncertainty as to whether the pertinent inquiry concerns whether a proper plaintiff is suing or whether a proper claim is being pursued. The inquiry is usually said to concern standing, which implies that the focus is upon the appropriateness of the particular plaintiff, though frequently the nature of the claim is being examined. See Berger & Bernstein, An Analytical Framework for Antitrust Standing, 86 Yale L.J. 809 (1977). This Circuit has stated that plaintiffs who have suffered injuries causally related to an antitrust violation lack standing if the injury is "indirect or incidental, or if their business was not in the target area of the allegedly illegal acts." Long Island Lighting Co. v. Standard Oil Co. of California, 521 F.2d 1269, 1274 (2d Cir. 1975), cert. denied, 423 U.S. 1073, 96 S.Ct. 855, 47 L.Ed.2d 83 (1976). Neither "direct injury" nor "target area" are concepts that admit of easy application. Both are ultimately tests of whether there is a legally significant causal relationship between the alleged violation and the alleged injury. See II P. Areeda & D. Turner, Antitrust Law § 334a (1978).
7
In this case, Reading asserts standing as a competitor of the defendants, directly injured by their conduct. Reading at one point sought damages as a competitor of defendants in the sale of refined copper, but at an earlier stage of this litigation, dropped the claim of its refining subsidiary.5 Reading's essential claim is that it was injured as a competitor of defendants in the sale of fabricated copper products, primarily copper tubing. In advancing this claim, Reading is not claiming injury derived from harm to some other party more proximately related to the consequences of the alleged violation. See Schwimmer v. Sony Corp. of America, --- F.2d ---- (2d Cir. July 10, 1980); Calderone Enterprises Corp. v. United Artists Theatre Circuit, Inc., 454 F.2d 1292 (2d Cir. 1971), cert. denied, 406 U.S. 930, 92 S.Ct. 1776, 32 L.Ed.2d 132 (1972); Billy Baxter, Inc. v. Coca-Cola Co., 431 F.2d 183 (2d Cir. 1970), cert. denied, 401 U.S. 923, 91 S.Ct. 877, 27 L.Ed.2d 826 (1971). Nevertheless, we agree with Judge Lasker that the causal relationship between defendants' alleged violation and Reading's payment of high scrap prices is too remote to permit the imposition of liability.6
8
Reading's theory of antitrust injury depends upon a complicated series of market interactions between the two sources of copper: the refined copper market in which defendants acted and the copper scrap market in which Reading allegedly sustained injuries. To establish a causal chain, the actions of innumerable individual decision-makers must be reconstructed, including the decisions to purchase additional quantities of copper by fabricators who bought copper from the defendants; the impact of those purchasing decisions on the speculators in the LME market; the pricing decisions of copper end-product users, as affected by the LME price, who sold their consumed copper goods for scrap to scrap dealers; and finally the pricing decisions of the independent scrap dealers who determined the scrap market price that Reading faced.
9
In Illinois Brick Co. v. Illinois, 431 U.S. 720, 97 S.Ct. 2061, 52 L.Ed.2d 707 (1977), the Supreme Court held that no antitrust action could be brought for higher prices paid by an indirect purchaser, who stood at the end of a vertical distribution line, extending from the sale of the raw material, where the alleged conspiratorial conduct occurred, to its use in a finished product, which the plaintiff purchased as the ultimate consumer, three levels down the distribution chain. The list of speculative economic behavioral assumptions about the marketplace that the Court found sufficiently remote to invalidate that chain, id. at 741-42, 97 S.Ct. at 2072, pales in comparison to those necessary to support Reading's claim.7 Indeed, to find antitrust damages in this case would engage the court in hopeless speculation concerning the relative effect of an alleged conspiracy in the market for refined copper on the price of copper scrap, where countless other market variables could have intervened to affect those pricing decisions. The court's task of tracing would be difficult, if not impossible, raising in aggravated form the problem that Illinois Brick was intended to avoid. While it is true that Illinois Brick holds narrowly only that indirect purchasers may not recover damages for the passing-on of overcharges due to antitrust violations, it has a broader significance in indicating that there are inherent limitations in the substantive protection afforded by the antitrust laws: they exclude claims based on conjectural theories of injury and attenuated economic causality that would mire the courts in intricate efforts to recreate the possible permutations in the causes and effects of a price change. Cf. Mid-West Paper Products Co. v. Continental Group, Inc., 596 F.2d 573, 583-85 (3d Cir. 1979).
10
It could be said that Reading, as a purchaser in the scrap copper market, is not in the target area of the defendants' alleged violation in maintaining artificially low prices in the sale of refined copper. Normally, those in the target area of a conspiracy to maintain low prices would be sellers unable to compete at the artificially low prices. In this case, where the alleged conspirators not only maintained low prices but also restricted output, those in the target area could also be purchasers denied an opportunity to buy from the defendants. Reading is not claiming damages in either capacity. Moreover, in the capacity in which it does sue, it predicates its claim of injury on a basis too tenuous and conjectural for a valid causal finding of anticompetitive effect and damages.
11
Affirmed.
*
Of the United States District Court for the Southern District of New York, sitting by designation
1
Defendants also moved for summary judgment on grounds that the undisputed evidence available for trial failed to show any violation and that the decision in Illinois Brick Co. v. Illinois, 431 U.S. 720, 97 S.Ct. 2061, 52 L.Ed.2d 707 (1977), foreclosed the action. Judge Lasker rejected these two contentions, though relying in part on the reasoning of Illinois Brick in granting defendants' motion. 477 F.Supp. 1150 (S.D.N.Y.1979)
2
The initial complaint in this complex litigation was filed in 1971, and after seven years of pretrial motions and extensive discovery, an amended complaint was filed on July 9, 1979 because the plaintiff's theory of the case had changed radically over the course of the proceedings
3
In other words, long-run demand for copper is elastic
4
The 1960's was a period of worldwide shortages in copper supply, because of the combined effects of labor and political problems in copper producing countries and sharply surging demand for copper, primarily caused by the heavy defense requirements in Vietnam. See generally Y. Levy, Copper: Red Metal in Flux 22 (1968) (Federal Reserve Bank of San Francisco Monthly Review Supplement)
5
This claim was presumably dropped for lack of any facts to indicate that Reading, as a seller of refined copper, was prevented from making sales due to defendants' alleged maintenance of low prices. In fact, as a seller of refined copper, Reading appears to have benefited from the price rise, which it attributes to defendants' conduct
6
The standard for review is that of Fed.R.Civ.P. 56(e) for summary judgments; Reading is to be given the benefit of all reasonable doubts in determining whether a genuine issue of material fact exists. Heyman v. Commerce & Indus. Ins. Co., 524 F.2d 1317, 1320 (2d Cir. 1975). While summary proceedings in antitrust litigation are disfavored, Poller v. Columbia Broadcasting Sys., Inc., 368 U.S. 464, 473, 82 S.Ct. 486, 491, 7 L.Ed.2d 458 (1962), they are not to be read out of the antitrust laws, First Nat'l Bank of Arizona v. Cities Serv. Co., 391 U.S. 253, 289-90, 88 S.Ct. 1575, 1592-1593, 20 L.Ed.2d 569 (1968). In Poller, the crucial issue was one of motive and intent, which is a question particularly unsuited for judgment on affidavits, but no such issue of motivation is presented in this case. Where the claim turns on documentary evidence and not intent, summary judgment is appropriate. White Motor Co. v. United States, 372 U.S. 253, 259, 83 S.Ct. 696, 699, 9 L.Ed.2d 738 (1963); see also First Nat'l Bank of Arizona v. Cities Serv. Co., supra, 391 U.S. at 289, 88 S.Ct. at 1592 (where crucial issue of fact is also issue of law, party cannot rest on allegations in complaint to oppose properly supported motion for summary judgment against him)
7
Reading's economic reasoning is as attenuated as its theory of causality. For example, to argue that scrap prices rose because competing fabricators would pay more due to savings at the lower producers' price ignores the fundamental economic fact that optimal profit-maximizing decisions depend upon marginal cost per unit and not average cost. See W. Baumol, Economic Theory and Operations Analysis 34-37 (4th ed. 1977)
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844 F.2d 786
Anglinv.Assoc. Metals & Minerals*
NO. 87-1819
United States Court of Appeals,Fifth Circuit.
MAR 28, 1988
1
Appeal From: N.D.Tex.
2
AFFIRMED.
*
Fed.R.App.P. 34(a); 5th Cir.R. 34.2
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184 F.3d 463 (5th Cir. 1999)
UNITED STATES OF AMERICA, PLAINTIFF-APPELLEE,v.PEDRO RAMOS GARCIA, DEFENDANT-APPELLANT.
No. 98-51001
U.S. Court of Appeals, Fifth Circuit
August 06, 1999
1
Appeal from the United States District Court for the Western District of Texas
2
Before Jones and Wiener, Circuit Judges, and Little, District Judge.*
3
The opinion of the court was delivered by: Little, District Judge
4
Pedro Ramos Garcia was convicted of possession of marijuana with intent to distribute, 21 U.S.C. §§ 841(a)(1), and importation of marijuana, 21 U.S.C. §§ 952(a). On appeal, Garcia argues that the government failed to produce sufficient evidence at trial to justify conviction on either count. We disagree and affirm the jury's verdict.
I. Facts
5
On the morning of 10 January 1998, Garcia was visited at his home in Mexico by a friend of his and man unknown to Garcia at the time, one Juan Jiminez. Jiminez offered Garcia $500 to drive a white pickup truck with Mexican license plates from Garcia's home to Eagle Pass, Texas, only four miles away. The truck's bed was empty save a toolbox, which was likewise empty. Jiminez instructed Garcia to leave the truck in the parking lot of a supermarket near the border with the keys under the truck's floor mat. Garcia agreed. The additional money would aid Garcia in celebrating his nearing birthday.
6
Garcia arrived at the border at about 11:00 a.m. In the primary inspection lane, Immigration Inspector John Hernandez asked Garcia the standard battery of questions, including whether Garcia carried with him anything obtained in Mexico. Garcia replied in the negative and presented his resident alien card. Hernandez, finding it odd that a resident alien of the United States would drive a truck with Mexican plates from Mexico into Texas, referred Garcia to a secondary inspector. Hernandez testified at trial that Garcia appeared nervous during their colloquy.
7
The secondary inspector, Customs Inspector Alberto Mendoza, asked Garcia to open the hood of the truck and then stand on the other side of a nearby table. Garcia opened the hood but according to Mendozaseemed to hesitate and linger near the truck. Mendoza again asked Garcia to step aside, and Garcia complied. Upon inspecting the truck, Mendoza grew suspicious that the gas tank had been tampered with and ordered a canine inspection. As the canine alerted, Mendoza observed Garcia looking towards Mexico.
8
Inspectors discovered 70 pounds of marijuana in a hidden compartment behind the empty toolbox. Special Agent Enemencio Torres issued a Miranda warning to Garcia; Garcia waived his rights prior to Torres's interrogation. Garcia recounted the events of the day and denied any knowledge of the marijuana. At that time, Garcia claimed that he thought that the truck was going to be used to transport illegal aliens. Torres testified that Mendoza told him that during the search of the vehicle, Garcia appeared uneasy and paced back and forth. Mendoza did not mention these facts during his testimony. Until the canine search revealed the compartment, no inspector had suspected the presence of the hidden chamber in the cab or smelled marijuana.
9
A jury convicted Garcia of possession of marijuana with intent to distribute in violation of 21 U.S.C. §§ 841(a)(1) and importation of marijuana in violation of 21 U.S.C. §§ 952(a). The trial Judge sentenced Garcia to 27 months on each count, to be served concurrently, with three years' supervised release and a $200 special assessment. Garcia filed a timely notice of appeal challenging the sufficiency of the evidence as to a necessary element of both crimes: his knowledge that the truck he drove carried drugs.
II. Analysis
A. Standard of Review
10
We review challenges to the sufficiency of evidence under a mere rationality standard: that is, we affirm "if a rational trier of fact could have found that the evidence established the essential elements of the offense beyond a reasonable doubt." United States v. Lopez, 74 F.3d 575, 577 (5th Cir. 1996) (citing Jackson v. Virginia, 443 U.S. 307, 319 (1979)). We determine only whether the jury's decision was rational without passing on whether or not we believe it was a correct one. See United States v. Dean, 59 F.3d 1479, 1484 (5th Cir. 1995). We therefore must view the evidence in the light most favorable to the jury's verdict without second-guessing the weight or credibility given the evidence by the jury. See United States v. Ortega Reyna, 148 F.3d 540, 543 (5th Cir. 1998); United States v. Resio-Trejo, 45 F.3d 907, 910 (5th Cir. 1995). While the jury is free to choose among reasonable constructions of the evidence, see Ortega Reyna, 148 F.3d at 543; Dean, "[i]f the evidence . . . gives equal or nearly equal circumstantial support to a theory of guilt and a theory of innocence, we must reverse the conviction, as under these circumstances 'a reasonable jury must necessarily entertain a reasonable doubt.'" Lopez, 74 F.3d at 577 (quoting United States v. Sanchez, 961 F.2d 1169, 1173 (5th Cir. 1992)).
B. Knowledge
11
"The knowledge element in a possession case can rarely be established by direct evidence. Knowledge can be inferred from control of the vehicle in some cases; however, when the drugs are hidden, control over the vehicle alone is not sufficient to prove knowledge." United States v. Garza, 990 F.2d 171, 174 (5th Cir. 1993). This is so because "it is at least a fair assumption that a third party might have concealed the controlled substances in the vehicle with the intent to use the unwitting defendant as the carrier in a smuggling enterprise." United States v. Diaz-Carreon, 915 F.2d 951, 954 (5th Cir.1990). Thus, it is the general rule in this circuit that where the case involves a hidden compartment, control must be supplemented by other circumstantial evidence "that is suspicious in nature or demonstrates guilty knowledge." Garza, 990 F.2d at 174; see also Diaz-Carreon, 915F.2d at 954; United States v. Anchondo-Sandoval, 910 F.2d 1234, 1236 (5th Cir. 1990); United States v. Olivier-Becerril, 861 F.2d 424, 426 (5th Cir. 1988); United States v. Richardson, 848 F.2d 509, 513 (5th Cir. 1988).
12
The government claims that the jury's verdict is supported by the necessary additional circumstantial evidence because: (1) Garcia's ignorance of the marijuana in the face of suspicious circumstances is implausible; (2) it is implausible that Garcia would be entrusted with such a large quantity of marijuana without his knowledge; and (3) Garcia was nervous during his encounter with Immigration Inspector John Hernandez and Special Agent Enemencio Torres. We agree with the government that these additional factors adequately support the jury's verdict.
1. Implausible Story
13
The government correctly points out that an implausible story advanced by a defendant to explain his actions can provide circumstantial evidence from which a jury might infer the defendant's guilty knowledge. See Ortega Reyna, 148 F.3d at 544; United States v. Casilla, 20 F.3d 600, 607 (5th Cir. 1994); Garza, 990 F.2d at 175; Diaz-Carreon, 915 F.2d at 954; Anchondo-Sandoval, 910 F.2d at 1237; Richardson, 848 F.2d at 13. The government finds it implausible that Garcia, when presented with the opportunity to earn $500 by driving an empty truck four miles across the U.S.-Mexico border, would not conclude that the truck is likely to carry drugs. We agree with the government that Garcia's story is rather implausible, and his failure to ask any questions about the trip smacks of a willful ignorance consistent with guilty knowledge. Garcia attempts to neutralize the inference of guilty knowledge by positing an alternative explanation for his behavior: although he believed the circumstances were suspicious, he suspected not the presence of drugs hidden in the truck, but that the truck he was delivering was destined for use in smuggling illegal aliens. While this may be a plausible explanation, it is one that the jury evidently did not believe, and "[w]e will not second guess the jury in its choice . . . ." United States v. Zuniga, 18 F.3d 1254, 1260 (5th Cir. 1994). The jury was free to infer Garcia's guilty knowledge from the implausibility of his story.
2. Quantity of Drugs
14
The government contends that Garcia's story is also implausible because it is unreasonable to believe that Garcia would have been entrusted with a large quantity of drugs without his knowledge. For this proposition the government relies on United States v. Del Aguila-Reyes, 722 F.2d 155 (5th Cir. 1995), where this court upheld a jury's inference of a defendant's guilty knowledge based in part on the quantity of drugs involved. See id. at 157. Although this "reasonable inference, . . . if there were nothing more, might well not support a finding of guilty knowledge[,]" see id., in this case we have more: Garcia's apparent willful ignorance. This factor, therefore, also lends support to the jury's verdict.
3. Nervousness
15
The government points to the testimony of Immigration Inspector John Hernandez and Special Agent Enmencio Torres indicating Garcia's nervousness during questioning to support the jury's inference of guilty knowledge. In Fifth Circuit case law, the character of a defendant's reaction to scrutiny at the border is a double-edged sword for the defendant. While this court has found that nervousness during an investigation often indicates guilty knowledge, see Shabazz, 993 F.2d at 442; Olivier-Becerril, 861 F.2d at 427; Richardson, 848 F.2d at 13, a calm reaction to the suspicion of border agents has also been considered incriminating. See Resio-Trejo, 45 F.3d at 913; Aguila-Reyes, 722 F.2d at 158. Because nervousness is "a normal reaction to . . . being stopped at a border[,] . . . anxiety is inconclusive unless viewed in the context of other facts" indicating guilty knowledge. United States v. Williams-Hendricks, 805 F.2d 496, 500 (5th Cir. 1986). In this case, as we have seen, sufficient indicia of guilty knowledge exist to lend significance to Garcia's nervousness. Viewed in context with the implausibility of Garcia's story, the jury could have inferred Garcia's guilty knowledge from his nervousness under questioning.
16
In sum, the inference of Garcia's guilty knowledge is supported by his possession of the truck in combination with the implausibility of his story and his nervousness under questioning. The jury's verdict as to Garcia's knowledge was therefore supported by sufficient evidence. We AFFIRM.
Notes:
*
District Judge of the Western District of Louisiana, sitting by designation.
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185 U.S. 270
22 S.Ct. 645
46 L.Ed. 906
CITY OF COVINGTON, KENTUCKY, and John N. Middendorf, Assessor, of the City of Covington, Appts.,v.FIRST NATIONAL BANK OF COVINGTON, KENTUCKY.
No. 255.
Argued March 6, 7, 1902.
Decided April 28, 1902.
Messrs. F. J. Hanlon, W. H. Julian, and Harvey Myers for appellants.
Mr. James W. Bryan for appellee.
Statement by Mr. Justice White:
On July 23, 1900, the appellee herein filed a bill seeking to enjoin the threatened assessment and collection by the defendants below (appellants here) of municipal taxes under the assumed authority of an act of the general assembly of the state of Kentucky approved March 21, 1900, a copy of which is excerpted in the margin.1
In substance, it was averred in the original bill and in an amendment thereto that the complainant was chartered on November 17, 1884, for a term of twenty years; that in 1886, by the acceptance of the provisions of an act of the general assembly of Kentucky, approved May 17, 1886, known as the Hewitt act, a contract was entered into with the state of Kentucky, irrevocable during the existence of the charter of the bank, whereby the complainant became obligated to pay to the state taxes upon the shares of its stock, surplus, and undivided profits at a designated rate, such taxes to be in full of all other taxes (state, county, or municipal), except those levied upon its real property; that complainant had regularly made the payments stipulated in said contract up to and including the payment due July 1, 1900; that the taxes thus paid much exceeded the regular taxes imposed by the state during said period upon other real and personal property; and that the fact of the existence of an irrevocable contract had been conclusively determined by the judgment and decree of the court of appeals of Kentucky in a litigation between the bank and the state and the city of Covington, growing out of an attempt to collect state and city taxes upon the franchise of the bank, under the authority of an act of the general assembly of Kentucky, approved November 11, 1892. It was also averred that, notwithstanding the foregoing, the general assembly of Kentucky enacted the statute of March 21, 1900, already referred to, and that the defendants were attempting, under the assumed authority of said act, to compel complainant to list for taxation its shares of stock, and that the defendants designed and intended to assess said shares, and to collect municipal taxes thereon for the benefit of the city of Covington fot the years 1893 to 1900, both inclusive.
At much length facts were detailed in the bill and amendment regarding a reduction of the capital stock of the complainant made in July, 1897, as to the regular payments of dividends to stockholders during the years for which the tax was sought to be assessed and collected, and as to changes in the ownership of the stock during said period. The unconstitutionality of the statute and the illegality of the threatened proceedings thereunder were asserted upon various grounds.
The defendants filed a plea to the jurisdiction, and also demurred for want of equity. A motion for a temporary injunction was heard and granted, the court embodying its views in an elaborate opinion. 103 Fed. 523. The order for the temporary injunction concluded as follows:
'It is ordered, adjudged, and decreed by the court that the defendants and each of them, until the further order of the court, is enjoined and restrained from making, either against the complainant or any holder of its shares, any assessment or levy of any taxes upon the shares of complainant's capital stock for any purpose for any time or period previous to March 21, 1900; and the said defendants, until the furthere order of the court herein, are also restrained from collecting, either from the complainant or from any of the holders of the shares of its capital stock, any taxes upon said shares upon any assessment or levy to be made therefor for any time subsequent to that date. Defendants are left at liberty to make assessments of said shares for taxation for any proper time or period after March 21, 1900, but not to make any collection of the taxes so assessed until the court shall have determined from the evidence whether the taxes so assessed are at a higher rate than is permitted by law, and to what extent.'
The complainant thereupon moved that the injunction be made permanent, and by stipulation the cause was submitted to the court 'upon said motion, and also upon the plea of the defendants to the jurisdiction of the court, and also upon their demurrer to the bill of complaint,' it being agreed that 'if the said plea and said demurrer are both disallowed and overruled, then the cause is submitted for the judgment of the court as upon a final hearing, the bill then to be taken for confessed, and further delay thereon being waived.'
On December 17, 1900, the following decree was entered: 'This cause came on to be further heard at this term, and was argued by counsel; and thereupon, upon consideration thereof and of the stipulation filed herein, it is ordered, adjudged, and decreed as follows, namely:
'First. That the plea of the defendants to the jurisdiction of the court be, and the same is, disallowed and overruled.
'Second. That the bill of complaint, as amended and to which the demurrer and plea were considered as applying, is sufficient and contains matters of equity meet to be considered by the court, and the demurrer thereto is also disallowed and overruled.
'Third. Upon the reasons given in the opinion of the court heretofore filed herein, and upon other good and sufficient reasons appearing to the court, it is further ordered, adjudged, and decreed by the court that the defendants and each of them are perpetually enjoined and restrained from making, either against the complainant or any holder of its shares any assessment or levy of any taxes upon any of the shares of complainant's capital stock for any purpose for any time or period previous to March 21, 1900, and the said defendants, until the further order of the court herein, are also restrained from collecting, either from the complainant or from any of the holders of the shares of the capital stock, any taxes upon any of said shares, upon any assessment or levy to be made therefor for any time subsequent to that date. The defendants are left at liberty to make assessments of and upon said shares for taxation for any proper time or period after March 21, 1900, but not to make any collection of taxes so assessed until the court shall have determined, upon further pleadings and evidence herein, should the defendants elect to present the same, whether the taxes so assessed are at a higher rate than is permitted by law, and to what extent.
'Fourth. And the court hereby retains control of this cause for the purpose of adjudicating and settling any question which may arise upon any assessment made upon any of the shares of the capital stock of the complainant at any time between the entry of this judgment and the expiration of the present and existing articles of incorporation of the complainant.' An application for the allowance of an appeal was filed by the city of Covington and Middendorf; and an assignment of errors was also filed on behalf of said defendants, the grounds, as stated therein, being reproduced in the margin.1
An order allowing the appeal as prayed was made. No appeal was prayed by the complainant.
Mr. Justice White, after making the foregoing statement, delivered the opinion of the court:
1
It is apparent that the bill as amended sought by injunction to prevent the collection of taxes on the shares of stock of the bank for the years 1893 to 1900, both inclusive, and indeed it is obvious from the decree that the court considered the case also involved the question whether any other than the taxes provided by the Hewitt act could be imposed upon the bank during the remainder of its corporate existence. The relief sought was based upon the following grounds: 1. There was a contract with the bank by which the taxes authorized by the act of 1900 could not be levied without impairing the obligation of such contract. 2. The existence of this contract and its binding efficacy was concluded by the thing adjudged. 3. The tax provided by the act of 1900 was discriminatory and repugnant to § 5219 of the Revised Statutes. Now, although the circuit court enjoined the assessment and collection of taxes for the years prior to March 21, 1900, it did so, not upon the consideration and determination of the questions of contract or res judicata, but solely upon the question of discrimination. So far, however, as any taxes subsequent to March 21, 1900, were concerned, they were not disposed of, for the decree expressly provided as follows:
2
'The defendants are at liberty to make assessments of and upon said shares for taxation for any proper time or period after March 21, 1900, but not to make any collection of taxes so assessed until the court shall have determined, upon further pleadings and evidence herein, should the defendant elect to present the same, whether the taxes so assessed are at a higher rate than is permitted by law, and to what extent.
3
'Fourth. And the court hereby retains control of this cause for the purpose of adjudicating and settling any question which may arise upon any assessment made upon any of the shares of the capital stock of the complainant at any time between the entry of this judgment, and the expiration of the present and existing articles of incorporation of the complainant.'
4
While the decree on its face thus unambiguously discloses that the court did not finally dispose of the entire controversy made by the pleadings, as inspection of the opinion of the court makes it perfectly clear that the court did not intend to and did not dispose of the entire controversy which was involved in the cause.
5
The only opinion pronounced was that rendered on the decision made upon the application for a preliminary injunction. Though in that opinion some reference was made by the court to the contentions of contract and res judicata, the court expressly declared that it would not make a 'final expression on the question,' but would leave that subject open for further consideration. And when the court came to render the decree which is appealed from, making the injunction permanent, although it in substance reiterated the provisions of the order allowing the preliminary injunction, it added thereto the 4th paragraph, expressly retaining the clause 'for the purpose of adjudicating and settling any question which may arise upon any assessment made upon any of the shares of the capital stock of the complainant, at any time between the entry of this judgment and the expiration of the present and existing articles of incorporation of the complainant.'
6
The court below, in effect, having reserved for future determination the right of the complainant below to enjoin the collection of a municipal tax for 1900, and subsequent years, this court obviously cannot decide that controversy. Matters within the pleadings having been left undetermined, and the cause having been retained for the purpose of thereafter passing on them and for the entry of a further decree, the decree entered was not final. McGourkey v. Toledo & O. C. R. Co. 146 U. S. 536, 545, 546, 36 L. ed. 1079, 1083, 13 Sup. Ct. Rep. 170, and cases cited. As a necessary result this court cannot adjudicate upon the contention respecting that portion of the issue which was actually determined by the circuit court, because a decree of a circuit court upon the merits can be reviewed here only by appeal, which cannot be taken until after a final decree has been made disposing of the whole cause. The case is not to be brought here in fragments by successive appeals. Southern R. Co. v. Postal Teleg. Cable Co. 179 U. S. 641, 644, 45 L. ed. 355, 356, 21 Sup. Ct. Rep. 249, and cases cited.
7
Appeal dismissed.
1
'Whereas the Supreme Court of the United States has lately decided
that article 3, chapter 103, of the acts 1891, 1892, 1893, is void and of no effect in so far as the same provides for the taxation of the franchise of national banks, in consequence of which decision there is not now and has not been since adoption of said article, in 1892, any adequate mode of taxing national banks, while state banks are now, and have been ever since 1892, taxable for all purposes, state and local; therefore
'Be it enacted by the general assembly of the commonwealth of Kentucky:
'Sec. 1. That the shares of stock in each national bank of this state shall be subject to taxation for all state purposes, and shall be subject to taxation for the purposes of each county, city, town, and taxing district in which the bank is located.
'Sec. 2. For purposes of the taxation provided for by the next preceding section, it shall be the duty of the president and the cashier of the bank to list the said shares of stock with the assessing officers authorized to assess real estate for taxation, and the bank shall be and remain liable to the state, county, city, town, and district for the taxes upon said shares of stock.
'Sec. 3. When any of said shares of stock have not been listed for taxation for any of said purposes under levy or levies of any year or years since the adoption of the revenue law of 1892, it shall be the duty of the president and cashier to list the same for taxation under said levy or levies; provided, that where any national bank has heretofore, for any year or years, paid taxes upon its franchise as provided in article 3 of the revenue law of 1892, said bank shall be excepted from the operation of this section as to said year or years; and provided further, that where any national bank has heretofore, for any year or years, paid state taxes under the Hewitt bill in excess of the state taxes required by this act for the same year or years, said bank shall be entitled to credit by said excess upon its state taxes required by this act.
'Sec. 4. All assessments of shares of stock contemplated by this act shall be entered upon the assessor's books, certified and reported by the assessing officers as assessments of real estate are entered, certified, and reported, and the same shall be certified to the proper collecting officers for collection as assessments of real estate are certified for collection of taxes thereon.
'Sec. 5. The assessments of said shares of stock and collection of taxes thereon, as contemplated by this act, may be enforced as assessment of real estate and collection of taxes thereon may be enforced.
'Sec. 6. The purpose of this act is to place national banks of this state, with respect to taxation, upon the same footing as state banks as nearly as may be consistently with said article 3 of the revenue law and said decision of the Supreme Court.
'Sec. 7. Whereas, it is important that state banks and national banks should be taxed equally for all purposes, and emergency exists, and this act shall take effect and be in force from and after its passage.'
1
'Come now the defendants and each of them and file the following assignment of errors, upon which they and each of them will rely:
'First. The court erred in overruling the defendants' plea to the jurisdiction of the court.
'Second. The court erred in holding the bill of complaint as amended, to which the plea and demurrer were considered as applying, sufficient, and in overruling the demurrer of the defendants thereto.
'Third. The court erred in enjoining the defendants and each of them from assessing the shares of stock in complainant bank, and from levying taxes thereon for any purpose for any time or period previous to March 21, 1900, and erred in enjoining and restraining the collection of any taxes, either from the complainant bank or from any of the holders of the shares of the capital stock of said bank, for any time subsequent to that date.
'Fourth. The court erred in retaining control of this cause for any purpose.
'Fifth. The court erred in decreeing costs herein against defendant.
'Sixth. The court erred in decreeing any injunction or restraining order herein, and in not dismissing complainant's bill of complaint.'
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81 F.2d 28 (1936)
HEFFNER
v.
PENNSYLVANIA R. CO.
MINCHHOFF
v.
SAME.
Nos. 201, 202.
Circuit Court of Appeals, Second Circuit.
January 13, 1936.
*29 Burlingham, Veeder, Clark & Hupper, of New York City (Ray Rood Allen, of New York City, and Allan B. Lutz, of Brooklyn, N. Y., of counsel), for appellant.
Thomas J. O'Neill, of New York City (Jeremiah J. Riordan, of New York City, of counsel), for appellees.
Before L. HAND, SWAN, and AUGUSTUS N. HAND, Circuit Judges.
SWAN, Circuit Judge.
Clayton R. Heffner and Frank J. Minchhoff were employees of the defendant railroad. They were killed in a collision between two trains of the defendant, which occurred on the night of March 22, 1934, near Norris Tower, Pa., and their respective personal representatives brought these actions under the Federal Employers' Liability Act (45 U.S.C.A. § 51). Each plaintiff recovered a verdict and judgment, from which the defendant has appealed. The primary question is whether there was sufficient evidence to support a verdict that the decedents were engaged in interstate commerce at the time of the collision.
Heffner was brakeman and Minchhoff was conductor of one of the colliding trains, consisting of an engine, tender, and caboose. This train left Philadelphia shortly after 8 p. m. on the fatal evening under orders to proceed light to Marsh, Pa., to pick up 89 empty coal cars. At Norris Tower the train backed onto a Y track leading to a storage yard at Marsh, and it was during this backing movement and before the yard was reached that the caboose came into collision with the rear end of a standing train. There was no direct testimony as to what cars conductor Minchhoff's train was to pick up nor where they were to be taken, but the plaintiffs contend that the evidence justifies an inference that the decedents were to get a string of empty "hoppers," that is, coal cars, and continue an interstate movement of them which had begun at South Amboy, N. J., on the morning of the same day. If so, the decedents were engaged in interstate commerce within the ruling of North Carolina R. R. Co. v. Zachary, 232 U.S. 248, 259-260, 34 S.Ct. 305, 58 L.Ed. 591, Ann.Cas.1914C, 159.
Marsh Yard is a storage yard, used chiefly for coal cars, on the Philadelphia Division, and is a division interchange point for the Wilkes Barre Division, the Philadelphia Terminal Division, and the Harrisburg Division. About 1.30 p. m. on March 22d an interstate train from South Amboy under the direction of Conductor Gemperling dropped off at Marsh Yard a string of 91 empty coal cars belonging to the defendant. Eighty-nine of them were left coupled together on one track, and for lack of room two cars were placed on another. The 91 cars so left were not "billed" or "carded," nor was there any testimony that any destination beyond Marsh had been designated for them when they set out from South Amboy or at any time before the fatal accident. On the afternoon of the day following the accident, an engine in charge of Detwiler was sent to Marsh, to pick up empties. Arrived there, he was assigned 70 of these cars, and received orders to move them to Mt. Carbon, Pa., a station on the Wilkes Barre Division and in the coal region. Only 40 were actually taken there, because while en route Detwiler received orders to leave 10 cars at Reading and 20 on a siding near Schuylkill Haven. The hoppers from South Amboy were not the only empty hoppers in Marsh Yard on the evening of the accident. One witness testified that the total number was approximately 200. The operator at Marsh testified without contradiction that empty cars left at Marsh Yard were subject to his direction and he could release what cars he pleased to fill a call for empty hoppers. This was *30 said to be true of the hoppers left by Conductor Gemperling. Although more commonly used to carry coal, hoppers are not necessarily so used; sometimes they are sent to quarries for stone.
To sustain their claim as to interstate commerce, the plaintiffs had to prove (1) that Heffner and Minchhoff were on their way to pick up the particular hoppers that had come in from South Amboy, and (2) that those hoppers had not yet ended their interstate journey, but were to be picked up and moved in furtherance of it. The order given to Conductor Minchhoff at Philadelphia to proceed to Marsh for 89 empty hoppers did not identify the cars he was to get, except in so far as an inference may be drawn from the correspondence in number that he was to take the string that Gemperling had left coupled together on one track. Such an inference seems somewhat speculative, in view of the presence of other cars and the testimony of the Marsh operator that he was free to designate the cars to be taken. But, even if it be assumed that there was evidence for the jury on this issue, we think the evidence was insufficient on the second point; namely, that the cars were to be picked up in furtherance of an interstate movement of them.
Empty coal cars which are being brought "home" from without the state by the carrier owning them will ultimately, in all probability, reach some point in the coal fields where they are needed for loading coal. But it does not follow that their interstate journey should be deemed to continue until that point is reached. On the contrary, it seems a more realistic view to say that the interstate journey ends at the first place within the home state where they are dropped off to await a decision by the carrier as to the service in which they shall be used. Such halt is not merely incidental to their journey to loading points, but is a cessation of their activities for a time, during which the railroad may decide to do any number of things with them. Possibly it may send them to a repair shop, or loan them to some other company, or send them back along the way they had come, rather than onward to the coal regions all this after the lapse of such interval of time as may occur before the decision is reached. In short, at that point they become "drifters," waiting to be assigned to service, bound nowhere, and requiring a further designation to place them again in the stream of interstate commerce. So the courts have held in the few cases found which have discussed the point. Pennsylvania R. R. Co. v. Knox, 218 F. 748, 751 (C.C.A.3); Philadelphia & Reading Ry. Co. v. Cannon, 296 F. 302, 304 (C.C.A.3); Mo. Pac. R. R. Co. v. Industrial Com., 348 Ill. 355, 358, 180 N.E. 912; Louisville & N. R. R. Co. v. Strange's Adm'x, 156 Ky. 439, 448, 161 S. W. 239; Chicago & Erie R. R. Co. v. Feightner, 75 Ind.App. 677, 114 N.E. 659. Hence it was necessary for the plaintiffs to show that the cars in question had an assigned destination beyond Marsh at the time they were left there. There was no evidence to justify such a finding. They were not billed or carded for any destination. Gemperling said that Marsh was the usual place for dropping such cars, and he dropped them there. It is a fair inference from Krail's testimony that the cars Minchhoff was to get were to be taken to some destination on the Schuylkill Valley (Wilkes Barre) Division, but the decision to send them there is as likely to have been made just before Minchhoff got his order in Philadelphia at 8 p. m. as to have been made prior to their arrival at Marsh at 1.30 p. m. Indeed, the uncontradicted testimony that empties left there were moved out as the Marsh operator directed strongly militates against the cars having had a definite destination beyond Marsh at the time of their arrival. And the fact that 40 of them were taken to Mt. Carbon by Detwiler the following day is as equally consistent with the assignment of that destination after the cars reached Marsh as before. It proves nothing. Any inference that Mt. Carbon was their destination when they began their interstate journey at South Amboy would be pure speculation.
The plaintiffs rely upon Hester v. East Tenn. & W. N. C. R. Co., 254 F. 787 (C. C.A.4). There the court held that it was a jury question whether certain narrow gauge ore cars which had been carried to Blevins, Tenn., within a few miles of the North Carolina line, were destined for a smelter across the border. It was shown that the regular practice was to take the narrow gauge ore cars from Blevins into North Carolina, and the jury was allowed to infer that the particular cars would have followed that practice. But Blevins was not a storage yard where assignment of cars was made, as at Marsh. The case *31 is plainly distinguishable from the authorities cited above relating to distributing points where cars come to rest to await assignment for service.
Therefore, even on the assumption that the jury could find that Heffner and Minchhoff were going to pick up the string of 89 cars that had come from South Amboy, the evidence would not support a finding that those cars were still in interstate commerce. The motion for a directed verdict on this ground should have been granted.
The defendant asks us to direct dismissal for lack of jurisdiction rather than to remand for a new trial. But the authority relied upon in support of this request, Baltimore & Carolina Line, Inc. v. Redman, 295 U.S. 654, 55 S.Ct. 890, 79 L.Ed. 1636, does not justify it. In that case decision of the motion was reserved until after verdict; here it was not; and Slocum v. New York Life Insurance Co., 228 U.S. 364, 33 S.Ct. 523, 57 L.Ed. 879, Ann. Cas. 1914D, 1029, controls.
If there is a new trial, evidence as to the funeral expenses should be excluded. Delaware, L. & W. R. R. Co. v. Hughes, 240 F. 941 (C.C.A.2); Philadelphia & R. R. Co. v. Marland, 239 F. 1 (C.C.A.3).
Judgments reversed, and causes remanded.
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502 F.Supp.2d 143 (2007)
UNITED STATES of America
v.
Maximano SILVA and Crystal Silva, Defendants.
Criminal Action No. 05-10295-PBS.
United States District Court, D. Massachusetts.
February 26, 2007.
*144 J. Martin Richey, Federal Defender's Office, Frances L. Robinson, Davis, Robinson & White, LLP, Boston, MA, for Maximano Silva and Crystal Silva.
Thomas E. Kanwit, United States Attorney's Office, Boston, MA, for United States of America.
MEMORANDUM AND ORDER
SARIS, District Judge.
INTRODUCTION
Defendant Maximano Silva moves to suppress evidence of identity fraud seized *145 pursuant to a search warrant. He argues that the warrant was based on evidence illegally seized by defendant's brother who was allegedly acting as a government agent during two searches of defendant's bedroom. After hearing, the Court DENIES the motion.
FINDINGS OF FACT
1. The Theft of the Wallet
In December 1999, John D'Angelo, a resident of Marlborough, Massachusetts, reported the theft of his wallet by a female hitchhiker to the Hudson Police Department. Later, in March of 2000, D'Angelo reported to the Hudson Police that someone had opened a cell phone account in his name and that copies of the bills were being sent to 22 High Street in Hudson. Detective Charles Devlin took the report. He had been at this address multiple times and knew the fractious inhabitants, including defendant, who had a prior conviction for larceny. Devlin had encountered defendant twenty times over the space of ten or more years, including four times the previous year, and believed Max to be a trouble-maker.
22 High Street is a two-family residence that was converted into a single family home. Everyone living at 22 High Street is related. The defendant lived on the first floor where he shared a bedroom with his wife, Crystal, and infant child. Defendant's mother and stepfather also lived on the first floor. The defendant's brother Norman lived on the second floor with a stepsister and another relative.
Detective Devlin determined that a cell phone associated with the account in D'Angelo's name had been shipped to 22 High Street. On March 7, 2000, Devlin placed a call to that number. A male voice answered. Devlin knew it was not D'Angelo and suspected, but wasn't sure, that it was the defendant, Max Silva. He asked, "Is Max there?" and the person replied, "There is no Max here." When Devlin asked what the person's name was, he answered "John" but refused to give his last name before hanging up. Devlin had spoken to Max many times over the years and thought he recognized Max's voice on the phone.
2. The First Entry
On May 9, 2000, Norman Silva, defendant's brother, went to the Hudson Police Department concerned that he was a victim of identity theft. He spoke with Detective Devlin. Norman said that he learned from a friend, Christina Monteiro, that Max had used his identity during one or more traffic stops, and that speeding tickets had been issued in his name. Norman explained to Devlin that he had gone into Max's bedroom and found the tickets. Further, he told Devlin that he was receiving medical bills for treatment he had not received and believed that his brother Max was using his identity.
He also said that while searching Max's room he had seen a driver's license and cell phone bill in someone else's name with an address in Marlborough. Moreover, he said that Max had talked about receiving a phone call regarding his cell phone and had gotten rid of it because he believed the call was from the police. Norman did not bring any of the items discovered in Max's room to the police station. Devlin explained that he couldn't do anything to help Norman without the documents.
3. The Second Search
That same day, Norman returned to 22 High Street, entered Max's bedroom again, and procured at least one speeding ticket. He brought the speeding ticket and medical bills to Devlin later that afternoon, but did not bring the cell phone bill *146 or driver's license. When Detective Devlin asked Norman where the missing documents were, he replied "at home". Devlin instructed him to bring the other documents so that he could get a search warrant.
4. The Third Search
Norman went back into Max's bedroom a third time and obtained the missing documents. On May 10, he provided Devlin with photocopies[1] of John D'Angelo's Massachusetts driver's license and a Bell Atlantic Notice of Discontinuance for a cell phone addressed to 22 High Street. Norman told Devlin that he had found the documents in Max's bedroom under the mattress. Norman did not have permission from Max to retrieve any documents; however, the door to his bedroom was unlocked.
Detective Devlin investigated Norman's claim that the tickets had been erroneously issued in his name. He contacted two police officers who had issued tickets to a person who identified himself as Norman. When Devlin showed the officers photographs of Norman and Max, both informed Devlin that the person they had issued the tickets to was Max. On May 31, Devlin obtained a search warrant for 22 High Street where evidence of identity fraud was found.
DISCUSSION
1. The Searches
Defendant argues that the search warrant was based on improperly seized evidence because Norman was acting as a government agent when he entered his brother Max's bedroom and took the documents.
The Fourth Amendment protection against unreasonable searches and seizures does not apply to searches by a private citizen unless he was acting as a government agent when conducting the search. See Skinner v. Ry. Labor Executives' Ass'n, 489 U.S. 602, 614, 109 S.Ct. 1402, 103 L.Ed.2d 639 (1989) ("Although the Fourth Amendment does not apply to a search or seizure, even an arbitrary one, effected by a private party on his own initiative, the Amendment protects against such intrusions if the private party acted as an instrument or agent of the Government." (citation omitted)). Furthermore, a private search or seizure "does not deprive the government of the right to use evidence that it has acquired lawfully." Walter v. United States, 447 U.S. 649, 656, 100 S.Ct. 2395, 65 L.Ed.2d 410 (1980).
The First Circuit has set forth various factors which should be considered in determining whether a private citizen was acting as a government agent, including:
1. the extent of the government's role in instigating or participating in the search;
2. its intent and the degree of control it exercises over the search and the private party; and
3. the extent to which the private party aims primarily to help the government or to serve its own interests.
United States v. Pervaz, 118 F.3d 1, 6 (1st Cir.1997) (declining, however, to adopt a specific standard or test). Incidental contact with law enforcement agents is not sufficient to subject a private search to Fourth Amendment protections. See United States v. Walther, 652 F.2d 788, 791 (9th Cir.1981) ("[D]e minimis or incidental *147 contacts between the citizen and law enforcement agents prior to or during the course of a search or seizure will not subject the search to fourth amendment scrutiny. The government must be involved either directly as a participant or indirectly as an encourager of the private citizen's actions before we deem the citizen to be an instrument of the state.")
When a search begins as a private search and morphs into a governmental search, "the critical issue is the point in time when the object of the search has been completed." United States v. Knoll, 16 F.3d 1313, 1320 (2d Cir.1994). The government cannot become a party to a private search once the object of the search has been accomplished, but law enforcement also "may not expand the scope of an ongoing private search unless it has an independent right to do so." Id. (remanding case for additional fact-finding where burglars turned over to the government evidence of a crime obtained without government involvement, but the government subsequently instructed them to go back through the burgled files to look for additional evidence, because a "private party acting as a government agent also may not expand upon a previously private search without running afoul of the Fourth Amendment").
With this caselaw in mind, I address the three searches. Norman's initial search of Max's bedroom before his contact with Detective Devlin was wholly private and not subject to the Fourth Amendment. See United States v. Mendez-de-Jesus, 85 F.3d 1, 2-3 (1st Cir.1996) (holding that when two private citizens brought suspected illegal immigrants to a police station, the seizure was not subject to the Fourth Amendment because there was "no suggestion that the government initiated or participated in the citizen action"); United States v. Coleman, 628 F.2d 961, 965-66 (6th Cir.1980) (where a private party repossessing the defendant's vehicle voluntarily and on his own initiative turned over to local police the defendant's personal effects found in the car, including drug and gun evidence, the private party was not acting as a government agent).
The second foray into the bedroom occurred immediately after Norman's initial meeting with Devlin. This search yielded the citations and medical bills in Norman's name that were found in Max's room. Because Norman retrieved these documents to show theft of his own identity, Norman's primary aim in surrendering these items to Detective Devlin was to serve his own interests, not those of the government. The government instigated the search only in the sense that Devlin said he couldn't help him without the documents. Moreover, Devlin exercised no control over how the search was conducted. Thus, this search was not covered by the Fourth Amendment.
The third bedroom entry, however, is a much closer call. When Norman presented the speeding citations and medical bills, Detective Devlin pressed Norman to get the items he had seen in other people's names, including the driver's license and the telephone bill in someone else's name. Although Devlin did not expressly tell him to re-enter the bedroom, that was the foreseeable result of the instruction. In this re-entry, Norman's primary aim was to comply with Devlin's instructions, not to promote his own interests. The defendant contends that Norman became a government agent because Devlin instructed him to conduct this additional search.
The government insists that this was not a government search because Devlin did not actively participate in the search or direct it in any way. See, e.g., United States v. Reed, 15 F.3d 928, 932-33 (9th Cir.1994) (holding that police officers *148 watching hotel manager's search of defendant's suitcases and drawers in hotel room while manager called out drug evidence as he discovered it was a warrantless government search).
While Devlin did not micromanage the search, I find that Devlin's direct instruction to Norman to return a third time with the goal of proving an ongoing identity theft investigation rendered Norman a government agent for purposes of the third search only. When Norman re-entered as a government agent to seize the evidence, the government exceeded the scope of the private search. Cf. United States v. Runyan, 275 F.3d 449, 462 (5th Cir.2001) (finding Fourth Amendment violation where police officers exceeded the scope of private search by examining the contents of an entire collection of computer disks turned over by the private searchers for evidence of child pornography, rather than confining their search to the selected disks examined by the private searchers).
2. Privacy
The next question the court must answer is whether Max had a legitimate privacy interest in his bedroom at 22 High Street. Normally, of course, a person has a legitimate expectation of privacy in his own bedroom protected by the Fourth Amendment. Thus, to the extent a private person acting as a government agent enters to conduct a warrantless search, the search is invalid. The complicating factor here is that the "government agent" is the defendant's brother who lived in the same home with defendant.
At the time of his searches of Max's bedroom, all residents of 22 High Street were related to each other by blood or marriage. Max lived in his room with his wife and child. The door was typically unlocked. Significantly, Norman said he had never been in Max's bedroom when Max was not present. However, Norman also acknowledged that, if Max was not in his room, he could walk into Max's room and borrow something (like socks). Although Max could do the same in Norman's room, Norman did acknowledge that neither of them would tolerate the other "rifling through" the other's room without permission.
Based on these facts, the government argues that Norman, as the brother, had the authority to consent to his search as a government agent. It asserts that Norman would be filling two roles: one as a resident of the home with authority to consent to the search, and one as an agent of the police to conduct the search after having consented to it.
A co-tenant of a dwelling may grant consent to search if he or she has common authority over the property when the suspect is not present to refuse consent. Georgia v. Randolph, 547 U.S. 103, 126 S.Ct. 1515, 1520, 164 L.Ed.2d 208 (2006) (holding, however, that a warrantless search of a shared dwelling over the express refusal of consent by a physically present resident cannot be justified as reasonable as to him on the basis of consent given by another resident). The exception for consent "extends even to entries and searches with the permission of a co-occupant whom the police reasonably, but erroneously, believe to possess shared authority as an occupant." Id. (citing Illinois v. Rodriguez, 497 U.S. 177, 186, 110 S.Ct. 2793, 111 L.Ed.2d 148 (1990)). Common authority is defined by whether there is "mutual use of the property by persons generally having joint access or control for most purposes." United States v. Matlock, 415 U.S. 164, 171 n. 7, 94 S.Ct. 988, 39 L.Ed.2d 242 (1974). A co-tenant may not consent to a search of another co-tenant's space unless the co-tenant giving consent has some shared dominion over that space. *149 Contrast United States v. Heisman, 503 F.2d 1284, 1288-89 (8th Cir.1974) (holding that co-tenant did not have authority to consent to search of other co-tenant's private office to which he "normally" did not have permission to enter), with United States v. Kelley, 953 F.2d 562, 566 (9th Cir.1992) (upholding validity of search consented to by co-tenant because the only telephone was in the suspect's bedroom).
More on point, courts have also addressed the authority of a family member to consent to searches of the rooms of other adult members. In United States v. Clutter, 914 F.2d 775, 777 (6th Cir.1990), for example, the Sixth Circuit held that "mature family members" may consent to a police search of their entire home because "in common experience family members have the run of the house." This common authority, however, would not extend to areas where a family member manifests an expectation of privacy by excluding other members from that area. See id. at 777-78. Other courts have held that a parent's consent to a search of an adult child's bedroom is valid. United States v. Rith, 164 F.3d 1323, 1331 (10th Cir.1999) (holding that, although there was insufficient proof that parents had joint access to their 18-year-old son's bedroom, because the son did not pay rent, the parents had "sufficient control for most purposes . . . over the entire home" to consent to search of his room); United States v. Robinson, 999 F.Supp. 155, 159-60 (D.Mass.1998) (holding that, in the absence of proof of joint access and use or a rebuttal by defendant proving exclusive use, the, parent-child relationship weighed in favor of authority to consent).
The question is whether Norman, an adult sibling living in one home with his brother, functions more like a co-tenant or a parent. There is no evidence that Norman pays rent for Max's space or that he had the "run of the house." The government has not demonstrated that Norman had sufficient access, control, or authority over his brother's bedroom to consent to the search of the room or to rummage under the mattress for the documents. I add that there is no evidence of bad faith on the part of Officer Devlin, who had experience with the residence and knew both brothers lived in the same house and could in good faith have believed Norman had actual or apparent authority to enter the bedroom to retrieve the documents. (There is no evidence Devlin knew the documents were under a mattress at the time of the third search.) Accordingly, I conclude that the third search violated the Fourth Amendment.[2]
3. The Validity of the Search Warrant
Even though the search is invalid, the government argues that Devlin received sufficient information from Norman's initial two visits to establish probable cause for a search warrant. See Murray v. United States, 487 U.S. 533, 537-38, 108 S.Ct. 2529, 101 L.Ed.2d 472 (1988) (describing independent source rule); Runyan, 275 F.3d at 466-67 (same). When a court reviews a warrant "containing information obtained pursuant to an illegal search," it must excise that information and determine whether the remaining information establishes probable cause and whether the police would have pursued the warrant absent the illegal information. United States v. Dessesaure, 429 F.3d 359, *150 367 (1st Cir.2005). In answering the second question, the court is not bound by the subjective, post hoc assurances of the officer's intent, but rather "must assess the totality of the attendant circumstances to ascertain whether those assurances appear `implausible.'" Id. at 369 (quoting Murray, 487 U.S. at 540 n. 2, 108 S.Ct. 2529).
Even after excising the hard copies of the license and phone bill that Norman seized as a government agent in his third search, I find that the affidavit established probable cause for the search warrant. The affidavit identifies several sources of information independent of the excised materials that give rise to probable cause, including: (1) John D'Angelo's statement that an account was opened in his name and that bills were being sent to defendant's address; (2) Devlin's suspicion that the person who answered the cell phone associated with the account in D'Angelo's name was Max Silva; (3) Norman's statement that Max had talked about receiving a phone call from someone he believed to be a police officer, and canceled his account the next day; (4) Norman's statement that he saw a license and cell phone bill belonging to someone else with a Marlborough address; (5) the traffic citations and medical bills provided by Norman; and (6) the confirmation by two police officers that Max had used Norman's name during traffic stops.
In light of all this information, I find that Devlin would have applied for a search warrant even if Norman had not reentered the bedroom a third time to retrieve the documents.
ORDER
This Court DENIES the motion to suppress.
NOTES
[1] The record is unclear as to whether Norman or Devlin photocopied the documents, and when the photocopies were made.
[2] Arguably, Devlin's reasonable belief that Norman had authority ends the inquiry under Rodriguez, 497 U.S. at 186, 110 S.Ct. 2793. However, the government does not brief the point, and Devlin did not testify about his belief as to Norman's authority to reenter. Indeed, Devlin's main point was that Devlin did not tell him he had to re-enter. I am reluctant to rest on this point.
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695 P.2d 776 (1984)
The PEOPLE of the State of Colorado, Plaintiff-Appellee,
v.
John David BROWN, Defendant-Appellant.
No. 82CA1265.
Colorado Court of Appeals, Div. II.
November 23, 1984.
Rehearing Denied December 20, 1984.
*777 Duane Woodard, Atty. Gen., Charles B. Howe, Chief Deputy Atty. Gen., Richard H. Forman, Sol. Gen., Thomas R. Bergh, Sp. Asst. Atty. Gen., Denver, for plaintiff-appellee.
David F. Vela, Colorado State Public Defender, Douglas D. Barnes, Deputy State Public Defender, Denver, for defendant-appellant.
STERNBERG, Judge.
After pleading guilty to a vehicular homicide charge, the defendant, John David Brown, was denied probation and was sentenced to a term of three years at Empathy House, a community corrections facility. He was also ordered to participate in a monitored Antabuse program for so long as the probation department and Empathy House personnel deemed it appropriate. After being in the program for some 4 months, before any review or discharge, and without authorization, defendant left the facility. He was arrested and following a jury trial, was convicted of escape pursuant to § 18-8-208, C.R.S. (1984 Cum. Supp.). On his appeal of that conviction, we affirm.
The defendant contends that he was not in lawful custody at the time he left Empathy House because the court had unlawfully delegated its sentencing authority to the probation department and Empathy House, and he had satisfied Empathy House's standards for release. This contention is without merit.
Section 17-27-105(1), C.R.S. (1978 Repl. Vol. 8) authorizes a court to sentence an offender to a term to be served at a community correctional facility. While serving such a sentence, the offender is still in custody, see People v. Lucero, 654 P.2d 835 (Colo.1982), and is still subject to the authority of the court, see § 17-27-103(3) and § 17-27-104(3), C.R.S. (1978 Repl. Vol. 8). Under § 17-27-108, C.R.S. (1978 Repl. Vol. 8), an unauthorized absence from the assigned institution is deemed escape from custody and is punishable under § 18-8-208. An offender is not free of custody until he is discharged, which occurs only after completion of the full term. People v. Lucero, supra.
*778 Here, in its sentence of defendant, the court delegated to the probation department and Empathy House supervisory functions, such as how long to require defendant to participate in the Antabuse program while at Empathy House, but it did not delegate any authority, either directly or by adoption of Empathy House's internal rules for review, relative to the length of defendant's sentence.
Also, at sentencing the court did state that "it's up to probation how long you're going to stay at Empathy House ...." However, we agree with the People that in the context of the other statements at the hearing and the written orders concerning the sentence, this statement was not a delegation of authority to the probation department. Rather, it was an advisement that, in supervising defendant, the probation department would report any violations of the terms and conditions of the placement, and, for those violations, the sentencing court could order defendant transferred to another facility. See § 17-27-103(3); People v. Johnson, 42 Colo.App. 350, 594 P.2d 601 (1979). We interpret the statement as being a warning to underscore the importance of compliance with the terms of placement, and not a delegation of authority.
In any event, even if there were an irregularity in the proceedings, defendant's only justifiable remedy was to seek judicial relief, not to escape. People v. Rivera, 37 Colo.App. 4, 542 P.2d 90 (1975).
We conclude that defendant was lawfully sentenced to Empathy House for a term of three years and that at no time was his term of commitment altered or discharged; therefore, he was properly subject to prosecution for escape after his unauthorized departure from Empathy House.
Judgment affirmed.
SMITH and KELLY, JJ., concur.
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40 Cal.2d 178 (1953)
DOROTHEA COLE et al., Appellants,
v.
PAUL RUSH et al., Defendants; FRANK VAN STONE, Respondent.
L. A. No. 22358.
Supreme Court of California. In Bank.
Jan. 20, 1953.
John C. Stevenson and Lionel Richman for Appellants.
Parker, Stanbury, Reese & McGee and A. P. G. Steffes for Respondent.
THE COURT.
[1] This is an appeal from an order sustaining a demurrer without leave to amend. Such an order is nonappealable (Evans v. Dabney (1951), 37 Cal.2d 758, 759 [235 P.2d 604], and authorities there cited; 3 Cal.Jur.2d 476), and this court must, therefore, dismiss the appeal of its own motion. (Collins v. Corse (1936), 8 Cal.2d 123, 124 [64 P.2d 137]; Estate of Brady (1948), 32 Cal.2d 478, 480 [196 P.2d 881]; Rosenberg v. Knesboro (1947), 80 Cal.App.2d 36, 38 [180 P.2d 750]; see, also, 4 Cal.Jur.2d 337, and cases there cited.)
The appeal is, therefore, dismissed.
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United States Court of Appeals
FOR THE EIGHTH CIRCUIT
___________
No. 11-1800
___________
United States of America, *
*
Appellee, * Appeal from the United States
* District Court for the
v. * Western District of Missouri.
*
Octavio Huerta-Medina, * [UNPUBLISHED]
*
Appellant. *
___________
Submitted: September 7, 2011
Filed: September 9, 2011
___________
Before MELLOY, BOWMAN, and SHEPHERD, Circuit Judges.
___________
PER CURIAM.
Octavio Huerta-Medina pleaded guilty to attempting to assault, impede, and
injure a federal officer engaged in his official duties, a violation of 18 U.S.C.
§ 111(a)(1) and (b). According to undisputed portions of the presentence report,
Huerta-Medina was driving his vehicle with his pregnant girlfriend and a young child
as passengers, when law enforcement officers attempted to execute arrest warrants on
him. Huerta-Medina then rammed his vehicle into a police car, drove off at high
speed, struck a bystander’s vehicle, drove into oncoming lanes of traffic, and
ultimately collided with the victim-FBI agent’s vehicle. The District Court1 sentenced
him to 70 months in prison. On appeal, his counsel has filed a brief under Anders v.
California, 386 U.S. 738 (1967), seeking to withdraw and arguing that the District
Court erred by (1) applying enhancements under both U.S.S.G. § 2A2.2(b)(6) and
§ 3A1.2(c)(1) and (2) applying an enhancement for reckless endangerment during
flight based on the same conduct encompassed in the offense Guideline, see U.S.S.G.
§ 3C1.2, comment. (n.1).
We conclude that the District Court properly applied the Guidelines. See
United States v. Bates, 584 F.3d 1105, 1108 (8th Cir. 2009) (standard of review).
First, the Guidelines expressly required both a 2-level increase for Huerta-Medina’s
conviction under section 111(b), see U.S.S.G. § 2A2.2(b)(6), and an official-victim
enhancement, see U.S.S.G. § 2A2.2, comment. (n.4) (“If subsection (b)(6) applies,
§ 3A1.2 (Official Victim) also shall apply.”). Second, we conclude that the reckless-
endangerment enhancement was proper because Huerta-Medina endangered other
motorists and his own passengers during the car chase and that conduct was not the
same as his eventual assault of a federal officer. Cf. United States v. Miner, 108 F.3d
967, 970 (8th Cir.) (approving Chapter Three adjustments both for official victim,
based on defendant’s ramming his car into police roadblock, and for reckless
endangerment during flight, based on defendant’s conduct during car chase that
created risk of serious injury to other drivers and pedestrians), cert. denied, 522 U.S.
904 (1997).
Having independently reviewed the record under Penson v. Ohio, 488 U.S. 75
(1988), we have found no nonfrivolous issue. Accordingly, we grant counsel leave
to withdraw and we affirm the judgment of the District Court.
______________________________
1
The Honorable Dean Whipple, United States District Judge for the Western
District of Missouri.
-2-
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859 So.2d 264 (2003)
William A. RAY, et al., Plaintiffs-Appellants,
v.
CITY OF BOSSIER CITY, et al., Defendants-Appellees.
No. 37,708-CA.
Court of Appeal of Louisiana, Second Circuit.
October 24, 2003.
*267 Walker, Tooke & Lyons by Henry C. Walker, H. Clay Walker, Shreveport, for Appellant.
Cook, Yancey King & Galloway by Kenneth Mascagni, Shreveport, Robert Kennedy, Colfax, for Appellee.
Before BROWN, C.J., PEATROSS, DREW and MOORE, JJ., and TRAYLOR, J. Pro Tem.
BROWN, C.J.
The trial court granted defendants' motions for summary judgment and summarily dismissed plaintiffs' claims. For the following reasons, we affirm in part and reverse in part.
Factual and Procedural Background
On March 22, 2001, William A. Ray and Thomas M. Patten filed suit against the *268 City of Bossier City, Danny R. Dison, James D. Hall, David Jones, and Michael Halphen (collectively referred herein as "the City"), claiming that they were constructively discharged from their jobs as Bossier City Police Officers[1] in retaliation for engaging in protected activity.
On October 23, 2002, all defendants filed motions for summary judgment, which were scheduled for a hearing on November 14, 2002; plaintiffs' attorney was not served until October 28, 2002.[2] Under La. C.C.P. art. 966 and applicable Louisiana State District Court Rules 9.9(d) and 9.10(c), plaintiffs were required to have served counter affidavits on opposing counsel no later than four days before the hearing (November 10 was a Sunday and the 11th was Veterans' Day, a legal holiday). Defendants had attached 41 exhibits (affidavits, depositions, statements, and documents) in support of their motions.
On November 12, plaintiffs filed a "Motion for Extension to Respond to Defendant's Summary Judgment Motions." This motion to extend was also set for argument on November 14. On that date, the trial court made the following ruling:
...I would allow you [plaintiffs] to file a written response, but would not allow you to file any counter-affidavits. In other words, I'd take the position that I would just decide the case on what has already been offered into evidence, or affidavits, or depositions that are contained in the record, ... I would merely allow you a brief period of time toto write a response in the form of a memo, but not in the responsenotbut not to allow you to offer any additional affidavits
* * *
[W]hen I say affidavits, any additional evidence.
(Emphasis added).
On November 22, 2002, plaintiffs filed an opposition brief and attached 15 exhibits, claiming that these exhibits, which primarily were excerpts from depositions, had all been produced in discovery. On December 10, 2002, the trial court granted defendants' motion to strike all of plaintiffs' exhibits. Plaintiffs claim never to have been notified of this ruling. On February 3, 2003, the trial court granted defendants' motions for summary judgment and dismissed all of plaintiffs' claims. Plaintiffs appealed.
The 15 exhibits stricken by the trial court are not in the record. Therefore, plaintiffs attached 13 exhibits to their original appellate brief. The City moved in this court to strike these exhibits and the portions of the brief which refer to them. Claiming to have never received notice of the interlocutory ruling by the trial court striking their exhibits, plaintiffs moved for a stay of the proceedings to seek supervisory review of the trial court's granting of the City's original motion to strike. This court denied both the City's motion to strike and plaintiffs' motion for stay.
Discussion
At the time in question, Danny R. Dison was the Chief of the Bossier City Police Department, James D. Hall was the City Attorney for Bossier City, David Jones was a member of the City Council for Bossier City, and Michael Halphen was the Public Information Officer for the Bossier City Police Department.[3]
*269 Plaintiffs contend that Dison, Hall, Halphen, and Jones all conspired to terminate their employment in realiation for statements plaintiffs had made concerning Halphen and Jones driving while under the influence of alcohol. Plaintiffs contend that after Jones filed a harassment claim against them, an Internal Affairs ("IA") investigation ensued and thereafter, Chief Dison coerced Patten now resign and Ray to retire. Ray and Patten now claim that they were constructively discharged.[4]
The City claims that plaintiffs solicited other officers to make a stop or arrest of Halphen and Jones "on the basis of created probable cause or suspicion." The city correctly contends that such solicitation is an abuse of police power and is not a constitutionally protected activity.
Standard of Review for Summary Judgment
A motion for summary judgment shall be granted "if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to material fact, and that the mover is entitled to judgment as a matter of law." La. C.C.P. art. 966 B. Summary judgment procedure is designed to secure the just, speedy, and inexpensive determination of all except certain disallowed actions; the procedure is favored and shall be construed to accomplish these ends. La. C.C.P. art. 966 A(2); Magnon v. Collins, 98-2822 (La.07/07/99), 739 So.2d 191. After adequate discovery or after a case is set for trial, a motion which shows that there is no genuine issue of material fact and that the mover is entitled to judgment as a matter of law shall be granted. La. C.C.P. art. 966 C(1).
The mover may point out to the court that there is an absence of factual support for one or more elements essential to the plaintiff's claim. The burden then shifts to the plaintiff who must demonstrate that he has evidence which if believed would support the essential elements of his claim. La. C.C.P. art. 966 C(2); Hardy v. Bowie, 98-2821 (La.09/08/99), 744 So.2d 606. Mere speculation is not sufficient. Babin v. Winn-Dixie La. Inc., 00-0078 (La.06/30/00), 764 So.2d 37. Appellate review of a grant or denial of summary judgment is de novo. Independent Fire Ins. Co. v. Sunbeam Corp., 99-2181 (La.02/29/00), 764 So.2d 226; Belt v. Wheeler, 36,585 (La.App.2d Cir.12/18/02), 833 So.2d 1256; McEachern v. Mills, 36,156 (La.App.2d Cir.08/16/02), 826 So.2d 1176. Thus, the appellate court asks the same questions the trial court asked in determining whether summary judgment was appropriate. Magnon, supra.
Appellate Evidentiary Record
We must first address the trial court's rejection of exhibits submitted by plaintiffs in opposition to the summary judgment motions.
As previously noted, the trial court allowed an extension of time for plaintiffs to submit an opposition memorandum. The trial court, however, specifically denied plaintiffs' motion for an extension of time to submit "counter affidavits." The trial court stated that it would consider depositions already submitted by defendants.
All of the exhibits submitted with plaintiffs' memorandum to the trial court were gathered during discovery and included excerpts from depositions given by plaintiffs and defendants. The request for an extension was clearly considered a motion for a continuance by the trial court. At *270 the November 14 hearing, the trial court stated to plaintiffs' counsel:
The Court: ... I think you filed a request for a continuance, didn't you?
Mr. Walker: Yes, your Honor.
The Court: And I converted the request for a continuance ... you asked for an ex parte continuance and I had hand-written in that I would convert that to a Rule to Show Cause....
Under the provisions of La. C.C.P. art. 1601, a continuance may be granted in any case if there is good ground therefor. The trial court has great discretion in granting or denying a motion for a continuance under this provision; that discretion will not be disturbed on appeal in the absence of a clear abuse of discretion. Demopulos v. Jackson, 33,560 (La.App.2d Cir.06/21/00), 765 So.2d 480. Whether a trial court should grant or deny a continuance depends on the particular facts of each case. Some factors to consider are diligence, good faith, and reasonable grounds. Id. Fairness to both parties and the need for orderly administration of justice are proper considerations in deciding whether to grant or deny a continuance. Gilcrease v. Bacarisse, 26,318 (La.App.2d Cir.12/07/94), 647 So.2d 1219, writ denied, 95-0421 (La.03/30/95), 651 So.2d 845.
Under the circumstances of this case, we find that the trial court abused its discretion in not granting a continuance to allow plaintiffs a reasonable time to file counter affidavits, depositions, and other documents.
In the instant case, although defendants have an important interest in having this case resolved, there is no indication that the continuance was sought for purposes of delaying resolution of this matter. The summary judgment motions were served on plaintiffs' attorney on October 28 with a hearing date to be 17 days later, on November 14. Under the procedural rules, plaintiffs had only 13 days to file counter affidavits and other evidence to show that genuine questions of material fact existed. On November 12, plaintiffs formally asked the trial court for an extension/continuance.
Although the lawsuit had been pending almost a year and a half, it was not until September 12, 2002, that the IA investigation report was ordered to be produced to plaintiffs. In brief, defendants recognize that this IA report is essential to the resolution of this lawsuit. Thereafter, in a letter dated October 1, 2002, plaintiffs' counsel requested from defendants' attorney a date to take the deposition of Gerald Huddleston, an officer prominently mentioned in the IA report. The only response to this request was the filing of the motions for summary judgment. We further note that defendants supported their summary judgment motions with the IA report which included transcriptions of all the statements taken during that investigation.
Eight of plaintiffs' thirteen exhibits filed in this court are excerpts from depositions; out of the eight depositions, only three of the people deposed were not of parties to this action. These three depositions included only short excerpts of testimony from John Cox, John Jeter, and Alyssa Marlowe. Cox's deposition merely alluded to the allegation that Mike Halphen "liked to party" and offered speculation about rumors of him drinking alcohol and then driving. John Jeter's deposition simply referred to the unrelated misconduct of another police officer and the lack of disciplinary action being taken against that officer. Alyssa Marlowe's deposition discussed an allegation that Halphen had bought her a beer on one occasion, at which time she was under 21 years of age. As to these three exhibits, we agree with *271 defendants' brief "that (they) are, in fact, immaterial to a resolution of the legal questions presented by this case." The rest of plaintiffs' exhibits included a copy of the Internal Affairs report, which was also included within defendants' exhibits, two letters written by counsel for plaintiffs to the defense counsel, the trial court's written reasons for judgment, and the judgment itself.
The remaining five exhibits submitted by plaintiffs were excerpts from the depositions of the parties to this action. Complete statements from these parties had been submitted by defendants as part of the IA report. Additionally, defendants had submitted different excerpts from these same depositions in support of their motions for summary judgment.
Under these circumstances, the trial court clearly abused its discretion in denying the motion. Thus, because we review summary judgment rulings de novo, we will order that the trial court record be supplemented by plaintiffs' exhibits filed in this court.
Constructive Discharge, Freedom of Expression, and Louisiana Whistleblower Act
Ray and Patten contend that their respective resignation and retirement were not voluntary, but coerced. Therefore, they argue they were "constructively discharged" in retaliation for engaging in protected acts. We will discuss plaintiffs' constructive discharge, freedom of expression, and Louisiana "Whistle blower" claims.
To recover damages for constructive discharge, a plaintiff must prove that the employer intended to and deliberately created such intolerable working conditions that the employee was forced into involuntary resignation. (Emphasis added). Robinson v. Healthworks International, L.L.C., 36,802 (La.App.2d Cir.01/29/03), 837 So.2d 714, writ denied, 03-0965 (La.05/16/03), 843 So.2d 1120; Plummer v. Marriott Corp., 94-2025 (La. App. 4th Cir.04/26/95), 660 So.2d 843, writ denied, 95-1321 (La.09/15/95), 660 So.2d 460. Further, the trier-of-fact must find that the conditions were so severe that a reasonable person in the employee's shoes would have felt compelled to resign. Id. The burden is on the employee to prove constructive discharge. Plummer, supra; Boze v. Branstetter, 912 F.2d 801 (5th Cir.1990).
Under Louisiana's "Whistleblower Statute," an employer may not retaliate against its employees who advise an employer of violations of law. La. R.S. 23:967. This whistleblower statute provides:
A. An employer shall not take reprisal against an employee who in good faith, and after advising employer of the violation of law:
(1) Discloses or threatens to disclose a workplace act or practice that is in violation of state law.
(2) Provides information to or testifies before any public body conducting an investigation, hearing, or inquiry into any violation of law.
(3) Objects to or refuses to participate in an employment act or practice that is in violation of law.
* * *
C. For the purposes of this Section, the following terms shall have the definitions ascribed below:
(1) "Reprisal" includes firing, layoff, loss of benefits, or any discriminatory action the court finds was taken as a result of an action by the employee that is protected under Subsection A of this Section; however, nothing in this Section shall prohibit an employer from enforcing *272 an established employment policy, procedure, or practice or exempt an employee from compliance with such. (Emphasis added).
The whistleblower statute does not define "employer;" however, the term "employer" was precisely defined by Louisiana Employment Discrimination Law to require receipt of services by the employee in exchange for compensation to him. La. R.S. 23:302(2); Langley v. Pinkerton's Inc., 220 F.Supp.2d 575 (M.D.La.09/04/02). Specifically, "employer" is defined as "a person, association, legal or commercial entity, the state, or any state agency, board, commission, or political subdivision of the state receiving services from an employee and, in return, giving compensation of any kind to an employee." La. R.S. 23:302(2). (Emphasis added). Courts have interpreted Section 23:302(2)'s definition of "employer" to apply in cases where employment status is at issue. Jackson v. Xavier University of Louisiana, 2002 WL 1482756 (E.D.La.2002), citing Jones v. JCC Holding Co., 2001 WL 537001 (E.D.La.2001).
In determining whether an employment relationship exists in other contexts, jurisprudence of this state has uniformly held that the most important element to be considered is the right of control and supervision over an individual. Savoie v. Fireman's Fund Ins. Co., 347 So.2d. 188 (La.1977); Cassey v. Stewart, 31,437 (La. App.2d Cir.01/20/99), 727 So.2d 655, writ denied, 99-0811 (La.04/30/99), 743 So.2d 209; Fuller v. U.S. Aircraft Ins. Group, 530 So.2d 1282 (La.App. 2d Cir.1988), writ denied, 534 So.2d 444 (La.1988), cert. denied, 490 U.S. 1046, 109 S.Ct. 1954, 104 L.Ed.2d 424 (1989).
An employee of a public entity may not be discharged for exercising his First Amendment right to freedom of expression despite an at-will employment status. Cabrol v. Town of Youngsville, 106 F.3d 101 (5th Cir.1997); Thompson v. City of Starkville, Miss., 901 F.2d 456 (5th Cir.1990); Brawner v. City of Richardson, Tex., 855 F.2d 187 (5th Cir.1988); see also La. R.S. 42:1169. In order to prevail in a claim of retaliation, one must show that his speech was constitutionally protected, i.e., that it involved a matter of public concern; that his interest in commenting on the matters of public concern out-weighs the public employer's interest in promoting efficiency; and that his speech was a motivating or substantial factor in the termination decision. (Emphasis added). Cabrol, supra; Thompson, supra.
In light of jurisprudence and La. R.S. 23:302(2)'s definition of "employer," we agree with the trial court's finding that Halphen (as a Public Information Officer), Hall (as a city attorney), and Jones (as a Bossier City councilman) were not Ray and Patten's employers. Halphen, Hall, and Jones provided neither compensation nor benefits to plaintiffs. See Onyeanusi v. Times-Picayune Publishing Corp., 485 So.2d 622 (La.App. 4th Cir.1986). These three defendants had neither power of control nor power of dismissal over Ray or Patten. See Cassey, supra. Jones complained that plaintiffs were harassing him and the IA investigation ensued; Halphen provided the IA investigation with information concerning plaintiffs; and Hall gave Chief Dison a legal opinion that Ray and Patten should be fired. However, Jones, Halphen, and Hall had no control over the IA investigation or over any employee within the Bossier City Police Department. The record contains nothing to show that these parties did anything other than exercise their freedom of expression.
Unlike the other three defendants, Chief Dison and Bossier City clearly had the right of control and supervision over Ray and Patten. In exchange for the services *273 received, Bossier City provided compensation to these officers. See La. R.S. 23:302(2). Chief Dison had the power to employ or terminate them from the Bossier City Police Department. See Savoie, supra; Cassey supra. For these reasons, Chief Dison and Bossier City were Ray and Patten's "employer."
Plaintiffs were given an ultimatum and a minimum period of time to decide. Whether theirs was a "voluntary" decision is a genuine question of fact to be decided after evaluation of all the evidence. While it appears to have been a free choice made by Ray and Patten, there was also no real alternative. Plaintiffs claim "they were told that the decision to terminate had been made" prior to Chief Dison offering the choice. The motivation and intent of the parties are questions of credibility which should not be determined summarily.
According to Chief Dison's affidavit, his decision to provide plaintiffs with the option to voluntarily separate from the police department or be fired was made as a result of the IA investigation. The IA report includes a transcript of an interview by Captain Sproles of Officer Larry Hawkins, who stated that Ray approached him to set up Halphen for a DWI arrest. In this interview, Hawkins claimed that Ray told him that he would be able to "pretty well write (his) ticket to any place (he) wanted to go" within the Bossier City Police Department if Hawkins would arrange for Halphen's DWI arrest. Hawkins also stated that Ray informed him that Chief Dison was worried that Halphen would become the next police chief "unless somebody did something about it, and that getting arrested for DWI would keep him from becoming our next chief." Hawkins claimed that he was told to make up a story to legally justify a stop. Ray has specifically denied making such a statement to Hawkins.
The disclosure of misbehavior by public officials is a matter of public interest and, therefore, deserves constitutional protection. Thomas v. Harris County, 784 F.2d 648 (5th Cir.1986). The reporting of misconduct within a police department is speech addressing a matter of public concern. Brawner, supra. Even if the speech is not widely publicized, we find this to be the case. See Harrison v. Parker, 31,844 (La.App.2d Cir.05/05/99), 737 So.2d 160, writ denied, 99-1597 (La.09/17/99), 747 So.2d 565, in which this court found that a sheriff's department employee's reports of allegedly illegal or unethical conduct within the sheriff's office, namely using inmates to do personal work for or on behalf of deputy sheriffs, dealt with matters of public importance for purposes of the employee's wrongful discharge claim, alleging that he was retaliated against for exercising his First Amendment rights.
It is usually not a function of the trial court on a motion for summary judgment to weigh conflicting evidence of material fact; additionally, a motion for summary judgment is usually not appropriate for disposition of cases requiring judicial determination of subjective facts, such as motive, intent, good faith, or knowledge. La. C.C.P. art. 966; Harrison, supra.
Hawkins' interview evokes questions regarding the events preceding the adverse employment action. These questions go to the credibility of Ray, Patten, and Officer Hawkins. Credibility of witnesses is a determination for a fact-finder to make. Reasonable minds could differ as to the import of the evidence in this case and particularly whether plaintiffs' complaints within the police department concerning Jones and Halphen were merely talk or an attempt to set up Jones and Halphen for a *274 false DWI arrest. Such a decision requires credibility determinations and a weighing of the evidence. While the trial court correctly dismissed the freedom of expression claim against Hall, Halphen, and Jones, who were not plaintiffs' employer and who simply expressed their opinion about plaintiffs, there are genuine issues of material fact pertaining to the remaining defendants. This view is further supported by Captain Sproles' report. Captain Sproles concluded,
"I can find no evidence or testimony to show that Patten used this information to actually `set up' on Jones or Huckaby. I cannot find where any officer followed, watched, or asked anyone from another agency to stop Jones ... (or) where anyone from the Bossier City Police Department inquired into any information regarding Jones."
As to Halphen, Captain Sproles found that "there is also the question as to the alleged targeting of PIO Mike Halphen." Captain Sproles stated that this allegation surfaced when Halphen received information (about a set up) from an unidentified source which Captain Sproles could not "give total reliability to." Captain Sproles did not conclude that a criminal act had not been proven and recognized that credibility decisions had to be made.
The trial court erred in granting summary judgment in favor of Chief Dison and Bossier City on the issues of constructive discharge, freedom of expression, and the whistleblower statute. We emphasize that this court expresses no credibility opinion on these issues.
Equal Protection
Citing Village of Willowbrook v. Olech, 528 U.S. 562, 120 S.Ct. 1073, 145 L.Ed.2d 1060 (2000), Ray and Patten claim that although they are not in a protected class, "they have been subjected to class-of-one equal protection discrimination" because of differential treatment.
Our research reveals that Louisiana jurisprudence does not recognize an equal protection claim in the context of only a single member, or a class-of-one plaintiff. Nonetheless, a plaintiff has the right to pursue a federal claim in a state court. Spradlin v. Acadia-St. Landry Medical Foundation, 98-1977 (La.02/29/00), 758 So.2d 116. Although a federal claim in the context of a single member class is recognized, a plaintiff must show that he has been intentionally singled out and treated differently from others similarly situated and that there is no rational basis for the difference in treatment. See Village of Willowbrook, supra.
Plaintiffs have failed to produce any support that they can make the requisite showing that others who were similarly situated within the police department were treated differently than they were. Plaintiffs offered only Officer Jeter's deposition statement that another officer offered a cigarette to a juvenile, had a domestic quarrel, and was not disciplined. The trial court correctly granted summary judgment in favor of all of the defendants with regard to the equal protection claim.
Defamation
Ray and Patten have asserted a separate claim against Jones for defamation. They claim that Jones made three public defamatory statements against them after they filed this lawsuit.
One of the alleged defamatory statements made by Jones was made on March 23, 2001; he was quoted in The Times as referring to plaintiffs as "two rogue cops caught breaking the law." Jones was also quoted in Bossier Press Tribune on March 26, 2001, as stating, "[W]hat you have here are vigilante rogue cops hunting people *275 down. It doesn't get any dirtier than that." Finally, during an interview with a local television news reporter, Jones stated:
"Leadership is a contact sport. It's garbage like this that keeps people from participating in public service. These officers have a hard time following departmental procedure and also have trouble telling the truth."
The reference to Ray and Patten as "garbage" would be considered an exageration, or a hyperbole, as no one would literally consider them to be refuse. Likewise, references to plaintiffs as "rogue cops" could not reasonably be interpreted as stating an actual fact. These statements are merely the expressed subjective opinions of Jones. While such comments are likely upsetting to the subjects to which they refer, the United States Supreme Court has stated that "debate on public issues should be uninhibited, robust, and wide-open and that it may well include vehement, caustic, and sometimes unpleasantly sharp attacks on government and public officials." New York Times Co. v. Sullivan, 376 U.S. 254, 270, 84 S.Ct. 710, 721, 11 L.Ed.2d 686 (1964). We find that Jones was not attempting to assert objective facts about Ray and Patten; instead, he was stating his own personal comments about the two men. Therefore, Jones' speech was constitutionally protected.
The First Amendment freedoms afford, at the very least, a defense against defamation actions for expressions of opinion. Fitzgerald v. Tucker, 98-2313 (La.06/29/99), 737 So.2d 706; Mashburn v. Collin, 355 So.2d 879 (La.1977). A pure statement of opinion, which is based totally on the speaker's subjective view and which does not expressly state or imply the existence of underlying facts, usually will not be actionable in defamation. Bussie v. Lowenthal, 535 So.2d 378 (La.1988). That is because falsity is an indispensable element of any defamation claim, and a purely subjective statement can be neither true nor false. Id. The opinion may be ostensibly in the form of a factual statement if it is clear from the context that the speaker did not intend to assert another objective fact but only his personal comment on the facts which he had stated. (Emphasis added). Mashburn, supra. Another form of protected speech is hyperbole, which cannot reasonably be interpreted as stating actual fact. Greenbelt Cooperative Publishing, Ass'n v. Bresler, 398 U.S. 6,90 S.Ct. 1537, 26 L.Ed.2d 6 (1970); Baxter v. Scott, 37,092 (La.App.2d Cir.05/16/03), 847 So.2d 225.
A cause of action for defamation arises out of a violation of La. C.C. art. 2315. Fitzgerald, supra. Defamation involves the invasion of a person's interest in his or her reputation and good name. Id., Sassone v. Elder, 92-1856 (La.1993), 626 So.2d 345. In order to prevail in a defamation action, a plaintiff must prove four elements: (1) a false and defamatory statement concerning another; (2) an unprivileged publication to a third party; (3) fault (negligence or greater) on the part of the publisher; and (4) resulting injury. Fitzgerald, supra; Trentecosta v. Beck, 96-2388 (La.10/21/97), 703 So.2d 552; see also Cangelosi v. Schwegmann Bros. Giant Super Markets, 390 So.2d 196 (La. 1980).
However, when a public figure is the object of alleged defamatory words, the United States Supreme Court has held that the First Amendment limits the right of the public figure to recover damages for defamation. In New York Times Co., supra, the Supreme Court concluded that it is not enough for the public figure to prove that the statement sued upon is false. Because the First Amendment protects honest misstatements of fact that are *276 made regarding public figures, such plaintiffs must also prove that the statement was made with "actual malice."
A communication which contains an element of personal disgrace, dishonesty, or disrepute undoubtedly satisfies the definition of defamatory. Fitzgerald, supra; Trentecosta, supra. Nonetheless, not all defamatory statements are actionable. Rather, many statements are protected by the First Amendment's guarantee of freedom of speech. Id. Specifically, a statement of opinion relating to matters of public concern which does not contain a provably false factual connotation will receive full constitutional protection. Romero v. Thomson Newspapers (Wisconsin), Inc., 94-1105 (La.01/17/95), 648 So.2d 866, cert. denied, 515 U.S. 1131, 155 S.Ct. 2556, 132 L.Ed.2d 810 (1995); Milkovich v. Lorain Journal Co., 497 U.S. 1, 110 S.Ct. 2695, 111 L.Ed.2d 1 (1990). Speech on matters of public concern enjoys enhanced constitutional protection. Id.; Dun & Bradstreet, Inc., v. Greenmoss Builders, Inc., 472 U.S. 749, 105 S.Ct. 2939, 86 L.Ed.2d 593 (1985); Baxter, supra.
Plaintiffs urge that Jones' critical comments about them constituted actual malice because the statements were not based on any truthful foundation. In support of this assertion, they note that the conclusion reached by the IA investigation report was that "there was not a criminal violation."
Actual malice means that the defendant made the statement with knowledge that it was false, or with reckless disregard for the truth. New York Times Co., supra. To establish reckless disregard, the plaintiff must show that the false publication was made with a high degree of awareness of its probable falsity or that the defendant entertained serious doubts as to the truth of the publications. St. Amant v. Thompson, 390 U.S. 727, 88 S.Ct. 1323, 20 L.Ed.2d 262 (1968). Actual malice is not shown merely by evidence of ill will or "malice" in the ordinary sense of the word; nor is it to be inferred from evidence of personal spite, an intent to injure, or a bad motive. Harte-Hanks Communications, Inc. v. Connaughton, 491 U.S. 657, 109 S.Ct. 2678, 105 L.Ed.2d 562 (1989); Tarpley v. Colfax Chronicle, 94-2919 (La.02/17/95), 650 So.2d 738.
We note that the IA investigation confirmed that Ray and Patten were involved to some degree with discussing stopping Jones and Halphen if they were driving under the influence of alcohol.[5] Jones was *277 aware of this unfavorable information concerning Ray and Patten. We acknowledge that there had been an antagonistic relationship between plaintiffs, as officers of the Bossier City Police Union and Jones, as a City Councilman. However, ill will alone is insufficient to establish that there was actual malice. See HarteHanks Communications, Inc., supra; Tarpley, supra. Based upon the information that the IA report revealed and based upon what Jones had been told, there is absolutely no evidence to show that Jones felt that the statements he made were not true. Considering the fact that Jones was aware of the results of the IA investigation, which he had kindled to begin with, he had a truthful foundation upon which to base his comments. Ray and Patten have failed to make any showing of actual malice on the part of Jones. The trial court correctly granted summary judgment in favor of Jones regarding plaintiffs' defamation claim.
Exhaustion of Civil Service Remedies
Citing La. Const. Art. X, § 12, the City urges that Ray and Patten failed to exhaust state civil service review; therefore, it argues that plaintiffs waived their right to challenge the voluntariness of their respective resignation and retirement. We note that after Ray retired and Patten resigned, Ray demanded a hearing before the Bossier City Municipal Fire and Police Civil Service Board ("the Board"). He argued that he was constructively discharged from the police department. The Board rejected his complaint. Patten never sought any type of civil service review. While Ray could have appealed the Board's decision, he did not. Instead, he and Patten filed the instant action with the district court.
La. Const. Art. X, §§ 1-15, or "Part I," pertains to state and city civil service employees other than police officers. La. Const. Art. X, §§ 16-20, or "Part II," governs the police and fire civil service. Section 19 provides, in pertinent part:
Nothing in Part I of this Article authorizing cities or other political subdivisions... shall authorize the inclusion in a city civil service system of fireman and policeman in any municipality having a population greater than thirteen thousand but fewer than four hundred thousand and operating a regularly paid fire and municipal police department ... Such fireman and policeman are expressly excluded from any such system.
Further, Louisiana's Whistleblower Statute, La. R.S. 23:967, provides in Part:
B. An employee may commence a civil action in a district court where the violation occurred against any employer who engages in a practice prohibited by Subsection A of this Section. If the court finds the provisions of Subsection A of this Section have been violated, the plaintiff may recover from the employer damages, reasonable attorney fees, and court costs.
We are dealing with constitutionally protected activities. Therefore, we find that the State Civil Service Commission does not have exclusive jurisdiction and plaintiffs need not have first exhausted their claims before the Board prior to filing suit in district court. We also note that the proper procedural vehicle to raise the issue of failure to exhaust administrative remedies would have been via an exception of prematurity pursuant to La. C.C.P. art. 926 A(1). However, defendants failed to employ such procedure. Therefore, the City's claim regarding Ray and Patten's *278 failure to exhaust administrative remedies is without merit.
Conclusion
For the foregoing reasons, we AFFIRM the trial court's grant of summary judgment in favor of Michael Halphen, James Hall, and David Jones. We affirm the grant of summary judgment as to all defendants on the equal protection claim; however, we REVERSE the trial court's grant of summary judgment in favor of Chief Dison and the City of Bossier City on the other claims. Judgment of the trial court is AFFIRMED IN PART AND REVERSED IN PART. Costs are assessed equally between plaintiffs and the City of Bossier City.
PEATEROSS, J., concurs.
MOORE, J., dissents with written reasons.
DREW, J., dissents.
MOORE, J., dissenting.
I concur in the majority opinion insofar as it affirms the summary judgments in favor of James D. Hall, Michael Halphen, and David Jones. I also concur in the majority's dismissal of the plaintiffs' claims under the "Whistleblower" statute, La. R.S. 23:967, as well as their claims of equal protection violations, La. Const. Art. 1, § 3.
I respectfully dissent, however, from the reversal of the remainder of the summary judgment. Upon de novo review, I find no genuine issue of material fact to support the claims that the City of Bossier City and Daniel Dison violated the plaintiffs' freedom of expression or constructively discharged them. I also find that the plaintiffs failed to exhaust their civil service remedies. I would affirm the summary judgments in toto.
As a procedural matter, majority's expansive treatment of the appellate record is plainly wrong. A mere two days before the scheduled hearing on the motions for summary judgment, the plaintiffs filed a "Motion for Extension to Respond to Defendants' Summary Judgment Motions." In my view, the district court properly denied this motion as untimely under La. C.C.P. art. 966 and Rule 9.9(b), URDC. However, because of various factors to which the majority alludes, the district court gave plaintiffs' counsel an additional eight days (until November 22, 2002) to file an opposition memorandum but specified that no counter-affidavits would be admitted. When counsel filed their memorandum on November 22, they attached 15 additional exhibits. Many of these were depositions not already in the record by attachments to timely motions. On the defendants' motion, the district court struck these attachments.
Considering that the suit had been pending for 18 months, some 18 depositions had been taken, and the motion for summary judgment had been filed nearly a month before November 22, I would find that the district court did not abuse its discretion in striking these attachments.
In order to circumvent this clearly appropriate exercise of the district court's discretionary power, the majority revises the plaintiffs' motion for extension of time as a motion for continuance, but the plaintiffs never filed any such motion. The majority further posits that granting a continuance would have worked no hardship on the defense. While that may be a reasonable assumption, this court should not supply motions that were never filed and arguments that were never raised, or substitute its own reasons for an evidentiary ruling in place of those of the district court. In short, the district court did not err in its handling of the motion for extension *279 of time or in striking the 15 attachments that were filed belatedly.
Without these additional attachments, the summary judgment evidence properly before the court negates any genuine issue of material fact as to all the plaintiffs' claims. In support of their motion for summary judgment, the City and Chief Dison attached an Internal Affairs report prepared by Capt. Glen Sproles. The defendants also attached excerpts from the depositions of the plaintiffs, Chief Dison and Councilman Jones. This report, with its attachments, clearly shows that the plaintiffs' separations from the Bossier Police Department were voluntary; that the plaintiffs were found to be in violation the department's code of conduct; that they had grossly abused police power; and that they were given the opportunity either to resign or face severe and public disciplinary action. The fact that their options were unpleasant does not alter the fact that they resigned and that under the circumstances this was a voluntary decision on their part.
In my view, the City and Chief Dison successfully showed an absence of factual support for an essential element of the plaintiffs' claims. La. C.C.P. art. 966 C(2). The burden therefore shifted to the plaintiffs to produce some factual support sufficient to establish that they would be able to meet their burden of proof at trial. Harris v. Eckerd Corp., 35,135 (La.App. 2 Cir. 09/26/01), 796 So.2d 719. In my view, the plaintiffs utterly failed to meet this burden of production.
The majority hypothesizes that on a trial of the matter, the plaintiffs might be able to offer some evidence to contradict the findings of the Internal Affairs report, or that a jury might find the report to be unreliable. However, mere speculation that a jury might disbelieve the mover's witnesses is not sufficient grounds to defeat a properly supported motion. Babin v. Winn-Dixie La., 00-0078 (La.06/30/00), 764 So.2d 37; Allen v. State Farm Fire & Casualty Co., 36,377 (La.App. 2 Cir. 09/18/02), 828 So.2d 190, writ denied, 02-2577 (La.12/19/02), 833 So.2d 343. To reach a different conclusion from the district court requires us to indulge in mere speculation. Finally, a plaintiff may not rely on his own delinquency in conducting discovery as a basis for denying a properly supported motion for summary judgment. Demopulos v. Jackson, 33,560 (La.App. 2 Cir. 06/21/00), 765 So.2d 480, at fn. 4, and citations therein.
In short, the defendants' motions for summary judgment are fully and meticulously supported. They completely negate any genuine issues of material fact and expose the plaintiffs' claims for the specious allegations they are. I would affirm the summary judgments in toto, and I respectfully dissent from the majority's failure to do so.
NOTES
[1] Patten claimed that he was forced to resign and Ray was forced to take early retirement.
[2] Note, in addition to requesting service, appellees' counsel certified that he mailed a copy of all motions to plaintiffs' attorney on October 23.
[3] Dison retired and Halphen is currently the Chief of the Bossier City Police Department.
[4] Ray and Patten together asserted a claim for alleged violations of their right to procedural due process under La. Const., Art. I, § 2. The trial court dismissed the due process claim, and neither Ray nor Patten raised this issue on appeal.
[5] In his appellate brief, Jones states that the following information was revealed by the IA investigation.
(1) Union members were disgruntled over the absence of a $600 per month pay increase, and were angry with Jones.
(2) During the political turmoil over the police pay increase, Patten asked police officers where Jones "hung out."
(3) During this same period of time, Patten discussed Jones with John Lewis at an IHOP restaurant. Patten indicated to Lewis that the best way to handle Jones would be to get another law enforcement agency, such as the State Police, to stop Jones for DWI.
(4) Patten again discussed this same scenario with Lewis in the police department parking lot.
(5) At a union gathering, Patten spoke openly with others about "stopping (Jones) for drinking." In that gathering, there was discussion about where city council members lived and where Jones went to drink.
(6) Patten discussed stopping Jones on at least five occasions.
(7) Patten admitted that Ray gave him a note identifying Halphen's personal vehicle and that Ray told him when and where Halphen would be on a certain night.
(8) Ray contacted another police officer, Larry Hawkins, and advised him that Hawkins "would do well for himself" if he arrested Mike Halphen for DWI. Ray informed Hawkins when and where Halphen would be located, as well as a story to justify the stop; i.e., that Hawkins had been flagged down by someone in a Cadillac who allegedly had seen Halphen driving drunk.
| {
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FOR PUBLICATION
UNITED STATES COURT OF APPEALS
FOR THE NINTH CIRCUIT
MANUEL CAMPOS-HERNANDEZ, No. 14-70034
Petitioner,
Agency No.
v. A094-199-373
JEFFERSON B. SESSIONS III, Attorney
General, OPINION
Respondent.
On Petition for Review of an Order of the
Board of Immigration Appeals
Argued and Submitted February 15, 2018
Pasadena, California
Filed May 2, 2018
Before: Marsha S. Berzon and Jay S. Bybee, Circuit
Judges, and Sharon L. Gleason,* District Judge.
Opinion by Judge Berzon
*
The Honorable Sharon L. Gleason, United States District Judge for
the District of Alaska, sitting by designation.
2 CAMPOS-HERNANDEZ V. SESSIONS
SUMMARY**
Immigration
The panel denied Manuel Campos-Hernandez’s petition
for review of a decision of the Board of Immigration Appeals,
concluding that he was ineligible for special rule cancellation
of removal under the Nicaraguan Adjustment and Central
American Relief Act (NACARA).
To be eligible for cancellation of removal under
NACARA, an applicant who is inadmissible on certain
criminal grounds, like Campos-Hernandez, is subject to a
heightened physical presence requirement such that he must
establish that he “has been physically present in the United
States for a continuous period of not less than 10 years
immediately following the commission of an act, or the
assumption of a status, constituting a ground for removal.”
NACARA § 203(b); 8 C.F.R. § 1240.66(c)(2). The BIA
concluded that Campos-Hernandez’s 2008 conviction was a
ground of removal, and because ten years had not elapsed
between 2008 and the decision of the BIA, he was not eligible
for cancellation of removal under NACARA.
After briefing in this appeal, the BIA held, in Matter of
Castro-Lopez, 26 I. & N. Dec. 693 (BIA 2015), a precedential
opinion in a different immigration appeal, that continuous
presence for cancellation of removal under NACARA
“should be measured from the alien’s most recently incurred
ground of removal.”
**
This summary constitutes no part of the opinion of the court. It has
been prepared by court staff for the convenience of the reader.
CAMPOS-HERNANDEZ V. SESSIONS 3
The question before the panel in Campos-Hernandez’s
case was which act or status constituting a ground for
removal—the first, last, or any other—starts the clock for the
ten-year “heightened” physical presence requirement.
The panel first determined that, under Nat’l Cable &
Telecommc’ns Ass’n v. Brand X Internet Servs., 545 U.S. 967
(2005), the panel was not bound by this court’s contrary
interpretation of identical language in the now-superseded
suspension of deportation statute in Fong v. INS, 308 F.2d
191 (9th Cir. 1962), concluding that Fong did not hold that a
contrary interpretation was foreclosed.
Second, the panel deferred to Matter of Castro-Lopez. As
a preliminary matter, the panel concluded that Matter of
Castro-Lopez involved the interpretation of a statute, not a
regulation, because the regulation copies verbatim the
relevant statutory text from NACARA. The panel also
determined that NACARA § 203(b) was silent or ambiguous
with respect to the issue here. Further, the panel concluded
that the BIA’s interpretation was reasonable, noting that the
use of indefinite articles in NACARA § 203(b)—(i.e., “an
act,” “a status,” as opposed to “the act,” “the status”) grants
the words an indefinite or generalizing force. Thus, the panel
concluded that it is reasonable to interpret the requisite ten-
year period to immediately follow each disqualifying act or
status, rather than to follow a single particularized act or
status—the first one, as Campos-Hernandez would read the
statute.
The panel also observed that reading the continuous
physical presence requirement to run from the last act or
status, rather than the first, avoids consequences that would
frustrate the evident policy behind the requirement; under the
4 CAMPOS-HERNANDEZ V. SESSIONS
opposite reading, individuals most likely to continue
committing crimes, as evidenced by their very recent
behavior, would be eligible to stay in the country, but
individuals who had not committed any crime for eight or
nine years would not.
COUNSEL
Louis A. Gordon (argued), Law Offices of Louis A. Gordon,
Los Angeles, California; Edgardo Quintanilla, Quintanilla
Law Firm ALC, Sherman Oaks, California; for Petitioner.
Kohsei Ugumori (argued), Senior Litigation Counsel; Emily
Anne Radford, Assistant Director; Joyce R. Branda, Acting
Assistant Attorney General; Civil Division, United States
Department of Justice, Washington, D.C.; for Respondent.
CAMPOS-HERNANDEZ V. SESSIONS 5
OPINION
BERZON, Circuit Judge:
To qualify for special rule cancellation of removal under
the Nicaraguan Adjustment and Central American Relief Act
(NACARA),1 an undocumented immigrant must show he has
been “physically present in the United States for a continuous
period of not less than 10 years immediately following the
commission of an act, or the assumption of a status,
constituting a ground for removal.” NACARA § 203(b); see
8 C.F.R. § 1240.66(c)(2). When Manuel Campos-Hernandez
applied for NACARA special rule cancellation, the BIA
interpreted the physical presence requirement as running from
Campos-Hernandez’s most recent disqualifying conviction,
rather than his earliest, and so held him ineligible for
NACARA cancellation of removal. We conclude that the
BIA’s interpretation of NACARA is reasonable and is
therefore entitled to deference. Accordingly, we deny the
petition.
I
Campos-Hernandez, a citizen and native of El Salvador,
entered the United States in 1990 or 1991 without being
admitted or paroled after inspection by an immigration
officer. He is 41 years old and married to a U.S. citizen.
Since 2009, he has worked as a mechanic. Campos-
Hernandez was convicted of drug-related offenses in
California in 2003, 2005, and 2008.
1
Pub. L. No. 105-100, § 203, 111 Stat. 2160, 2196–2201 (1997).
6 CAMPOS-HERNANDEZ V. SESSIONS
In 2008, the Department of Homeland Security (DHS)
served Campos-Hernandez with a Notice to Appear (NTA) at
a removal hearing. The NTA alleged that Campos-
Hernandez arrived in the United States without being
admitted or paroled after inspection, and charged him with
removability both on that basis and on the basis of his drug
convictions.2 Campos-Hernandez admitted the allegations
against him and conceded his removability.
On February 10, 2012, Campos-Hernandez filed a
NACARA application. That same day, an immigration judge
(IJ) found that Campos-Hernandez was ineligible for
NACARA special rule cancellation of removal and denied his
application for relief. Specifically, the IJ determined that,
because the drug convictions rendering him inadmissible
occurred within the previous ten years, Campos-Hernandez
could not satisfy NACARA’s requirement of “10 years [of
continuous physical presence] immediately following the
commission of an act, or the assumption of a status
constituting a ground for removal.” 8 C.F.R. § 1240.66(c)(2).
The BIA dismissed Campos-Hernandez’s appeal in a non-
precedential, single-member opinion. The opinion held that
Campos-Hernandez’s 2008 conviction was “a ground for
removal” under 8 C.F.R. § 1240.66(c)(2), and because ten
years had not elapsed between 2008 and the decision of the
BIA, he was not eligible for cancellation of removal under
2
See 8 U.S.C. § 1182(a)(6)(A)(i) (“An alien present in the United
States without being admitted or paroled, or who arrives in the United
States at any time or place other than as designated by the Attorney
General, is inadmissible.”); id. § 1182(a)(2)(A)(i)(II) (“[A]ny alien
convicted of . . . a violation of . . . any law or regulation of a State, the
United States, or a foreign country relating to a controlled substance . . .
is inadmissible.”).
CAMPOS-HERNANDEZ V. SESSIONS 7
NACARA. Campos-Hernandez timely filed a petition for
review.
After the briefing of this appeal, a three-member panel of
the BIA held, in a precedential opinion in a different
immigration appeal, that “for purposes of special rule
cancellation of removal under the NACARA, . . . continuous
physical presence should be measured from the alien’s most
recently incurred ground of removal.” Matter of Castro-
Lopez, 26 I. & N. Dec. 693, 696 (BIA 2015) (emphasis
added). We ordered the parties to submit supplement briefing
addressing Matter of Castro-Lopez, and they did so.
II
A. Applicable law
NACARA was enacted in 1997 to provide immigration
benefits to nationals from certain Central American and
Eastern European countries, including El Salvador. See
NACARA § 203(b);3 8 C.F.R. § 1240.61(a); Barrios v.
Holder, 581 F.3d 849, 857 (9th Cir. 2009). In particular,
“[s]ection 203 of NACARA allows qualified individuals to
apply for special rule cancellation under the more lenient
standards that existed before the passage of [IIRIRA].”
Barrios, 581 F.3d at 857.
3
NACARA amended the Illegal Immigration Reform and Immigrant
Responsibility Act of 1996 (IIRIRA), Pub. L. No. 104-208, 110 Stat.
3009. IIRIRA had changed the terms previously used in immigration
statutes, replacing “deportation” with “removal” and the concomitant
remedy of “suspension of deportation” with “cancellation of removal.”
Ram v. INS, 243 F.3d 510, 513 (9th Cir. 2001).
8 CAMPOS-HERNANDEZ V. SESSIONS
Most applicants for cancellation of removal under
NACARA must establish physical presence in the United
States for “a continuous period of 7 years immediately
preceding” the filing of an application for cancellation of
removal. NACARA § 203(b); 8 C.F.R. § 1240.66(b)(2). An
applicant for cancellation of removal under NACARA who
is inadmissible under 8 U.S.C. § 1182(a)(2),4 however, is
subject to a heightened physical presence requirement. Such
an applicant, like Campos-Hernandez, must establish that he
“has been physically present in the United States for a
continuous period of not less than 10 years immediately
following the commission of an act, or the assumption of a
status, constituting a ground for removal.” NACARA
§ 203(b); 8 C.F.R. § 1240.66(c)(2).
“Agency regulations interpreting special rule
cancellation”—particularly the continuous physical presence
requirements—“closely track the text of . . . NACARA.”
Barrios, 581 F.3d at 857; see 8 C.F.R. § 1240.66(b)(2), (c)(2).
In turn, the language of NACARA’s continuous physical
presence requirements—both the “heightened” ten-year
requirement and the regular seven-year one—is copied from
an older statute governing suspension of deportation, a now-
superseded form of immigration relief.5 See 8 U.S.C. § 1254
4
As relevant here, that provision covers an applicant who has been
convicted of “a violation of . . . any law or regulation of a State, the
United States, or a foreign country relating to a controlled substance.”
8 U.S.C. § 1182(a)(2)(A)(i)(II). This heightened requirement also applies
to persons deportable under other provisions of the INA not pertinent here.
5
The statutory language governing the continuous physical presence
requirement dates back to at least the 1950s. See Immigration and
Nationality Act of 1952, Pub. L. No. 82-414, § 244(a)(5), 66 Stat. 163,
214–16 (codified at 8 U.S.C. § 1254(a)(5) (1952) (repealed) (entitling a
CAMPOS-HERNANDEZ V. SESSIONS 9
(1996) (repealed); Fong v. INS, 308 F.2d 191 (9th Cir. 1962)
(construing identical language from the now-superseded
suspension of deportation statute).
An agency’s formal interpretation of its governing
statutes may be entitled, when appropriate, to deference under
Chevron, U.S.A., Inc. v. Nat. Res. Def. Council, Inc., 467 U.S.
837 (1984). Chevron deference is appropriate when “it
appears that Congress delegated authority to the agency
generally to make rules carrying the force of law, and . . . the
agency interpretation claiming deference was promulgated in
the exercise of that authority.” United States v. Mead Corp.,
533 U.S. 218, 226–27 (2001); see Marmolejo-Campos v.
Holder, 558 F.3d 903, 908 (9th Cir. 2009) (en banc). When
applying Chevron, a court “is confronted with two questions.
First . . . is the question whether Congress has directly spoken
to the precise question at issue. If the intent of Congress is
clear, that is the end of the matter.” Chevron, 467 U.S. at
842. However, “if the statute is silent or ambiguous with
respect to the specific issue, the question for the court is
whether the agency’s answer is based on a permissible
construction of the statute.” Id. at 843. An agency’s
interpretation that conflicts with earlier binding authority of
this court is entitled to deference unless the court’s earlier
interpretation “follows from the unambiguous terms of the
statute and thus leaves no room for agency discretion.” Nat’l
Cable & Telecommc’ns Ass’n v. Brand X Internet Servs.,
545 U.S. 967, 982 (2005); see also Garfias-Rodriguez v.
Holder, 702 F.3d 504, 512–13 (9th Cir. 2012) (en banc).
person to apply for suspension of deportation if, among other things, he
“has been physically present in the United states for a continuous period
of not less than ten years immediately following the commission of an act,
or the assumption of a status, constituting a ground for deportation”).
10 CAMPOS-HERNANDEZ V. SESSIONS
B. Discussion
1. Conflicting authority and Brand X
Before determining whether the BIA’s interpretation in
Matter of Castro-Lopez merits deference, we confront a
threshold issue: whether we are bound by our contrary
interpretation of the now-superseded suspension of
deportation statute. See Fong, 308 F.2d 191. Fong addressed
a continuous physical presence provision identical to the one
we here examine.
In Fong, Louie King Fong’s eligibility for suspension of
deportation hinged, as does Campos-Hernandez’s, on whether
the ten-year physical presence requirement ran from when he
first became deportable in 1944, or from the last act or status
making him deportable, which occurred in 1953. Id. at 193.
If the former, Fong “ha[d] been physically present in the
United States for a continuous period of not less than ten
years immediately following . . . the assumption of a status
. . . constituting a ground for deportation.” Id. at 194 (quoting
8 U.S.C. § 1254(a) (1952)). If the latter, he had not. Finding
the provision “open to two possible constructions,” id., the
court likened the provision to a penal statute, and resolved the
ambiguity by strictly construing the statute in favor of Fong.
Id. at 194–95 (citing Barber v. Gonzales, 347 U.S. 637,
642–43 (1954)). Accordingly, the court held that Fong’s
residence in the United States, dating from his first deportable
act or status in 1944, satisfied the ten-year continuous
physical presence requirement, notwithstanding his later-
incurred grounds for deportation. Id. at 195–96.
NACARA—the statute we address today—is not the same
suspension of deportation statute construed in Fong. In
CAMPOS-HERNANDEZ V. SESSIONS 11
enacting NACARA, however, Congress purposely used
language identical to that in the suspension of deportation
statute, as it intended to preserve the remedy from that statute
for NACARA beneficiaries. See Munoz v. Ashcroft, 339 F.3d
950, 955 (9th Cir. 2003). For that reason, our interpretation
of the provision in Fong would arguably still bind us,
notwithstanding the formal non-identity of the two statutes,
but for the BIA’s recent precedential interpretation of the
provision in Matter of Castro-Lopez.
Fong does not, however, prevent us from deferring to
Matter of Castro-Lopez. “Only a judicial precedent holding
that the statute unambiguously forecloses the agency’s
interpretation, and therefore contains no gap for the agency to
fill, displaces a conflicting agency construction.” Brand X,
545 U.S. at 982–83. Fong expressly determined that the ten-
year physical presence requirement was “open to two possible
constructions.” Fong, 308 F.2d at 194; see id. at 195–96
(“[W]e will not assume that Congress meant to trench on
[Fong’s] freedom beyond that which is required by the
narrowest of several possible meanings of the words used.”)
(emphasis added) (quoting Fong Haw Tan v. Phelan,
333 U.S. 6, 10 (1948)). As Fong did not hold that the
Immigration and Nationality Act “unambiguously
foreclose[d]” a contrary interpretation, our decision in that
case may not “displace[] a conflicting agency construction”
otherwise entitled to deference. Brand X, 545 U.S. at 983.
2. Matter of Castro-Lopez
We next determine whether the BIA’s interpretation of
the ten-year continuous physical presence requirement in
Matter of Castro-Lopez is entitled to deference.
12 CAMPOS-HERNANDEZ V. SESSIONS
As a preliminary matter, we conclude that Matter of
Castro-Lopez involved the interpretation of a statute, not a
regulation. In Matter of Castro-Lopez, the BIA said that it
was interpreting 8 C.F.R. § 1240.66(c)(2), a regulation
implementing NACARA § 203(b), rather than § 203(b) itself.
See 26 I. & N. Dec. at 696 (citing Auer v. Robbins, 519 U.S.
452, 461 (1997)). In general, an agency’s interpretation of its
own ambiguous regulation is subject to “Auer deference.”
See Price v. Stevedoring Servs. of Am., Inc., 697 F.3d 820,
828–29 (9th Cir. 2012) (en banc). When, however, “the
underlying regulation at issue [does] ‘little more than restate
the terms of the statute itself[,]’ . . . the question [is] really
one of statutory interpretation.” Id. at 829 (quoting Gonzales
v. Oregon, 546 U.S. 243, 257 (2006)).
The language of 8 C.F.R. § 1240.66(c)(2) copies verbatim
the relevant statutory text of NACARA § 203(b).6 Rather
than specifying whether the ten-year period begins with the
first qualifying act or status or the last one, the regulation
“incorporates the very [gap] . . . the [agency] seeks to
clarify.” Christopher v. SmithKline Beecham Corp., 635 F.3d
383, 394 (9th Cir. 2011).
The language of § 1240.66(c)(2) thus “comes [directly]
from Congress, not the Attorney General,” so “the question
. . . is not the meaning of the regulation but the meaning of
the statute.” Gonzales, 546 U.S. at 257. The regulation’s
“parroting” of the statute, id., is all the more conspicuous
6
Compare NACARA § 203(b) (“[T]he alien . . . has been physically
present in the United States for a continuous period of not less than 10
years immediately following the commission of an act, or the assumption
of a status, constituting a ground for removal”), with 8 C.F.R.
§ 1240.66(c)(2) (same, less one comma).
CAMPOS-HERNANDEZ V. SESSIONS 13
given that NACARA § 203(b) itself borrowed the precise
language from statutes dating back at least to 1952. See
8 U.S.C. § 1254(a) (1952) (repealed). Accordingly, we assess
whether Matter of Castro-Lopez is a permissible
interpretation of the statutory text of NACARA § 203(b),
rather than the regulatory text of 8 C.F.R. § 1240.66(c)(2).
The BIA’s interpretation of the ten-year physical presence
requirement in Matter of Castro-Lopez merits deference
under Chevron. First, as noted above, § 203(b) of NACARA
is “silent or ambiguous with respect to” the issue presented
here: which act or status constituting a ground for
removal—the first, last, or any other—starts the clock for the
ten-year “heightened” physical presence requirement. Anaya-
Ortiz v. Holder, 594 F.3d 673, 677 (9th Cir. 2010) (quoting
Chevron, 467 U.S. at 842).7
Next, Matter of Castro-Lopez is a “published BIA case”
that constitutes “binding agency precedent on-point” that fills
the interpretive gap. See id. (quoting Park v. Holder,
572 F.3d 619, 623–24 (9th Cir.2009)); Matter of Castro-
Lopez, 26 I. & N. Dec. at 696.
Finally, the BIA’s interpretation of the ten-year physical
presence requirement is reasonable. See Garfias-Rodriguez,
702 F.3d at 513. The statute requires ten years’ continuous
physical presence immediately following “the commission of
7
See Fong, 308 F.2d at 194; Gagliano v. INS, 353 F.2d 922, 929 (2d
Cir. 1965) (concluding that the continuous physical presence requirement
was “somewhat ambiguous” and “allow[ed] for two possible
constructions”); Matter of Castro-Lopez, 26 I. & N. Dec. at 694 (“[W]e
find [the language] to be ambiguous. It does not address the situation
where there is more than one act or event that renders an alien removable,
as is the case with the respondent.”).
14 CAMPOS-HERNANDEZ V. SESSIONS
an act, or the assumption of a status, constituting a ground for
removal,” NACARA § 203(b) (emphasis added), not “the
act,” or “the status,” that constitutes a ground for removal.
The indefinite article grants the words “act” and “status” an
“indefinite or generalizing force,” rather than
“particulariz[ing]” them, Gale v. First Franklin Loan Servs.,
701 F.3d 1240, 1246 (9th Cir. 2012), as use of the definite
article would have, to denote a specific act or status
constituting a ground for removal. See also Black’s Law
Dictionary 1 (6th ed. 1990) (“The article ‘a’ is not necessarily
a singular term; it is often used in the sense of ‘any’ . . . .”).
It is thus reasonable to interpret the requisite ten-year period
to immediately follow each disqualifying act or status, rather
than to follow a single particularized act or status—the first
one, as Campos-Hernandez would read the statute.
Reading the continuous physical presence requirement to
run from the last act or status, rather than the first, avoids
consequences that would frustrate the evident policy behind
the requirement. For example, under the opposite reading, an
applicant who was convicted of a drug offense in 2000, but
not again until 2010, could thereafter accumulate any number
of disqualifying convictions and statuses while still remaining
eligible for cancellation of removal under NACARA. The
ten-year crime-free requirement would then serve a perverse
purpose, as the individuals most likely to continue
committing crimes, as evidenced by their very recent
behavior, would be eligible to stay in the country, but
individuals who had not committed any crime for eight or
nine years would not. Such a result would severely
undermine the “testing” or “qualifying” role of the physical
presence provision. Patsis v. INS, 337 F.2d 733, 740 (8th Cir.
1964) (Blackmun, J.); Matter of V-R-, 9 I. & N. Dec. 340, 344
CAMPOS-HERNANDEZ V. SESSIONS 15
(BIA 1961), rule reinstated by Matter of Wong, 13 I. & N.
Dec. 427 (BIA 1969).
Bolstering our conclusion, several circuits (and the BIA)
have interpreted the same phrase in the suspension of
deportation statute, 8 U.S.C. § 1254(a) (1952) (repealed), to
date from the last deportable offense or status. See, e.g.,
Patsis, 337 F.2d at 740–42; Matter of Wong, 13 I. & N. Dec.
at 430.8 Fong itself recognized that the BIA’s construction of
the phrase “might find support in logic,” 308 F.2d at 195,
even though it ultimately resolved the ambiguity in favor of
the petitioner.
We are mindful that NACARA was enacted to help
people “who had taken unusual risks in escaping from
oppressive governments,” and those “whose countries had
been profoundly ravaged by war.” Ram v. INS, 243 F.3d 510,
517 (9th Cir. 2001). But NACARA’s humanitarian purpose
does not override the BIA’s authority to interpret ambiguous
provisions of the statutes that govern it. The reasonableness
of the BIA’s interpretation, along with the weight of authority
supporting it, compel the conclusion that the BIA’s
interpretation is not “arbitrary, capricious, or manifestly
contrary to the statute.” Garcia v. Holder, 659 F.3d 1261,
1266 (9th Cir. 2011) (quoting Chevron, 467 U.S. at 844).
8
See also Gagliano, 353 F.2d at 929 (following Patsis); Bello v.
Gonzales, 152 F. App’x 146, 148 (3d Cir. 2005) (precedential but not
selected for publication) (“This Court has previously indicated, in
accordance with . . . the INS and the majority of courts to address the
issue, that the period of physical presence commences on the date of the
most recent acts constituting grounds for deportation.”); Richard D. Steel,
Steel on Immigration Law § 14:29 (2017) (“If more than one ground of
deportability is alleged, the ten years only begins to run from the last event
that gave rise to a ground of deportability.”).
16 CAMPOS-HERNANDEZ V. SESSIONS
We therefore defer to Matter of Castro-Lopez’s
interpretation of NACARA § 203(b) as requiring that the ten-
year continuous physical presence requirement for NACARA
applicants run from the most recent “commission of an act, or
. . . assumption of a status, constituting a ground for
removal.” Campos-Hernandez was convicted of a drug-
related offense in June 2008, rendering him inadmissible
under § 212(a)(2) of the INA, 8 U.S.C. § 1182(a)(2)(A)(i)(II).
Because he cannot establish that he has been “physically
present in the United States for . . . not less than 10 years
immediately following the commission of an act, or the
assumption of a status, constituting a ground for removal,” he
is not eligible for special rule cancellation of removal under
NACARA.
The petition is DENIED.
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United States Court of Appeals
FOR THE EIGHTH CIRCUIT
___________
No. 99-1173
___________
United States of America, *
*
Appellee, * Appeal from the United States
* District Court for the Western
v. * District of Missouri.
*
John J. Torre, * [UNPUBLISHED]
*
Appellant. *
___________
Submitted: September 16, 1999
Filed: September 22, 1999
___________
Before BEAM and FAGG, Circuit Judges, and BOGUE,* District Judge.
___________
PER CURIAM.
While in pursuit of a fleeing suspect, police entered a private home where they
detected a chemical odor and other signs of methamphetamine manufacture. After
securing a search warrant, the officers discovered a methamphetamine laboratory and
arrested the house’s occupants, including Charles J. Dunne, Kent E. Byrom, Steven C.
McDonald, Chad Schlag, and John J. Torre. Schlag died from methamphetamine
ingestion three hours after his arrest. Torre was later found guilty of attempt to
*
The Honorable Andrew W. Bogue, United States District Judge for the District
of South Dakota, sitting by designation.
manufacture methamphetamine and was sentenced to 312 months in prison. Torre
appeals his conviction and sentence. We affirm.
Torre first challenges the sufficiency of the evidence supporting his conviction.
We review the evidence in the light most favorable to the government and reverse only
if no reasonable jury could have found the defendant guilty. See United States v.
Wagner, 884 F.2d 1090, 1096 (8th Cir. 1989). Torre asserts he was not adequately
identified at trial. We disagree. Four witnesses and defense counsel identified Torre
and referred to him during the trial, and thus, the jury could infer Torre’s identity as the
person who committed the acts charged. See United States v. Capozzi, 883 F.2d 608,
617 (8th Cir. 1989). Torre also asserts the evidence failed to show he took a
substantial step toward manufacturing methamphetamine, a necessary element of
attempt to manufacture. Again, we disagree. Codefendant Dunne testified that during
the week before the arrests Torre contributed items, including acetone and equipment,
to the laboratory for use in manufacturing methamphetamine. Dunne also testified that
methamphetamine was made three or four times that week, and Torre was present in
the laboratory on one of those occasions. On the day of the arrests, Torre drove his
codefendants to six stores to purchase items used to make methamphetamine. Police
later found the items in the laboratory and a list of those items in Torre’s possession.
Given this evidence, we conclude a reasonable jury could find Torre took substantial
steps toward the manufacture of methamphetamine. See Wagner, 884 F.2d at 1096-97;
United States v. Mazzella, 768 F.2d 235, 239-40 (8th Cir. 1985).
Torre next claims Schlag’s death did not result from the use of drugs
manufactured during Torre’s involvement, so the minimum 20-year sentence required
by 21 U.S.C. § 841(b)(1)(A) and U.S.S.G. § 2D1.1(a)(2) is not applicable. The district
court found by a preponderance of the evidence that Torre intended to manufacture
methamphetamine, Torre’s efforts led to the production of methamphetamine, and the
methamphetamine that caused Schlag’s death was reasonably attributable to Torre’s
actions. These findings are not clearly erroneous. See United States v. Snoddy, 139
-2-
F.3d 1224, 1226-27 (8th Cir. 1998) (standard of review). We also reject Torre’s
argument that the district court should have used a higher standard of proof in making
those findings. See United States v. Alvarez, 168 F.3d 1084, 1088 (8th Cir. 1999).
Torre last contends the district court erroneously denied his motion to sequester
a witness. Again, we disagree. The district court properly declined to sequester the
case agent assisting the government. See United States v. Holmes, 594 F.2d 1167,
1172-73 (8th Cir. 1979); Fed. R. Evid. 615. We have also reviewed Torre’s pro se
arguments and conclude they are without merit.
We thus affirm Torre’s conviction and sentence.
A true copy.
Attest:
CLERK, U.S. COURT OF APPEALS, EIGHTH CIRCUIT.
-3-
| {
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United States Court of Appeals
FOR THE EIGHTH CIRCUIT
___________
No. 05-2504
___________
Andre K. Randall, *
*
Appellant, *
* Appeal from the United States
v. * District Court for the
* District of Minnesota.
Whitney I. LeBlanc, Warden, FMC *
Rochester; Jack Fox, Executive * [UNPUBLISHED]
Assistant, FMC Rochester; Jane Doe, *
(“Warden’s Secretary”), Secretary FMC *
Rochester; John Doe, (“Mr. Alcoser”), *
Chaplin, FMC Rochester; John Doe, *
(“The Captain”), Captain, FMC *
Rochester; John Doe, (“Mr. Parr”), *
Lieutenant, FMC Rochester; Stu *
Solmonson, Case Manager, FMC *
Rochester; Randy Preston, Staff, FMC *
Rochester; Daryl Kosiak, North Central *
Regional Counsel, Bureau of Prisons; *
and their successors, officers, servants, *
attorneys, agents, employers and those *
persons in active concert or *
participation with them, *
*
Appellees. *
___________
Submitted: November 1, 2005
Filed: November 4, 2005
___________
Before BYE, McMILLIAN, and RILEY, Circuit Judges.
___________
PER CURIAM.
Federal inmate Andre Randall (Randall) appeals the district court’s1 dismissal
of his petition for a writ of mandamus. Randall’s request for punitive damages fails
because the defendant federal prison officials–all of whom were sued in their official
capacities–are immune from liability for monetary damages in this case. See
Hagemeier v. Block, 806 F.2d 197, 202-03 (8th Cir. 1986) (sovereign immunity bars
claims against federal officials in their official capacities unless immunity is waived).
As for Randall’s request for injunctive relief, we affirm the dismissal on
mootness grounds because Randall has been released from federal custody. See 8th
Cir. R. 47A(a). We also deny his motion for appointment of counsel.
______________________________
1
The Honorable Richard H. Kyle, United States District Judge for the District
of Minnesota, adopting the report and recommendations of the Honorable Arthur J.
Boylan, United States Magistrate Judge for the District of Minnesota.
-2-
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478 N.E.2d 131 (1985)
Elmer C. YODER and Irene Yoder, Appellants (Defendants below),
v.
CROMWELL STATE BANK, Appellee (Plaintiff below).
No. 3-584A132.
Court of Appeals of Indiana, Third District.
May 23, 1985.
Rehearing Denied August 2, 1985.
*132 Jerome B. Van Orman, Fort Wayne, for appellants.
Stephen R. Snyder, Thomas J. Goeglein, Beckman, Lawson, Sandler, Snyder & Federoff, Syracuse, for appellee.
STATON, Presiding Judge.
Elmer and Irene Yoder appeal from summary judgment granted in favor of Cromwell State Bank (CSB) for $109,453.08 plus interest and attorney's fees in CSB's suit to recover on three checks. Yoder presented the three checks to CSB for deposit in the Yoder's joint account and the account was provisionally credited for a total of $123,766.00. The maker of the checks, Blue Mound Dairy, stopped payment and the payor bank, State Bank of Worthington, Worthington, Minnesota, returned the checks to CSB without making payment. CSB subsequently set off against the Yoder's account the sum of $14,312.92 and brought this action to recover the balance.
The Yoders claim summary judgment was improper and present twelve issues for review which we have consolidated and restated as follows:
Did the trial court err in finding that there were no genuine issues of material fact and that
I. CSB had given the Yoders effective notice of the dishonor of the checks (Yoders' issues 1 & 2);
II. CSB had a right of charge back against the Yoders for the amount of the provisional credit (Yoders' issues 3, 4, 5, 6, & 9);
III. CSB properly set-off a portion of its claim against the balance in the Yoders' account (Yoders' issue 10);
IV. The Yoders were jointly and severally liable for the amount of the provisional credit extended: (Yoders' issues 7, 8, & 11).
We affirm.
The Yoders argue strenuously that the existence of numerous issues of fact make the disposition of this case by summary judgment improper. They also argue that the trial court incorrectly applied the law to the facts. When this Court reviews a grant of summary judgment against such claims we must look at the pleadings, affidavits, depositions and testimony submitted in the proceedings below. Any doubt as to a fact or an inference to be drawn therefrom, is resolved in favor of the party opposing the motion for summary judgment. Poxon v. General Motors Acceptance Corp. (1980), Ind. App., 407 N.E.2d 1181, 1184. The movant has the burden of establishing that no genuine issue of material fact exists. Hurst v. Bd. of Com'rs of Pulaski Co. (1983), Ind. App., 446 N.E.2d 347, 349; however, the adverse party may not rest upon the mere allegations or denials of his pleading, but by affidavit or otherwise must set forth specific facts showing that there is a genuine issue for trial. Ind. Rules of Procedure, Trial Rule 56(E). In order to preclude summary judgment, a conflicting fact or inference must be decisive to the action or a relevant secondary issue. Jones v. City of Logansport (1982), Ind. App., 436 N.E.2d 1138, 1143.
I.
Notice
The parties do not dispute that on June 18, 1982 Elmer Yoder endorsed and delivered to CSB for deposit two checks totalling $88,320.00 drawn on the account of Blue Mound Dairy Farm, Inc. On June 21 Yoder deposited with CSB another check from Blue Mound Dairy for the sum of $35,446.00. Elmer and Irene Yoder's joint account was credited with a total of $123,766.00. The affidavit of Kent Cunningham, Executive Vice President of CSB, states that prior to acceptance of the checks by the payor bank, State Bank of Worthington, payment was stopped on the checks. Within twenty-four (24) hours after receipt of notice of the stop-payment order, Cunningham notified the Yoders of the dishonor and of the fact that CSB was revoking the provisional credit and charging back those sums against the Yoders' *133 account. The affidavit of Deloris L. Lohr, an officer of State Bank of Worthington, states that "State Bank of Worthington determined that a stop-payment order was effective" against each of the checks and that the checks were dishonored and returned within twenty-four (24) hours of receipt.
The Yoders' first contention is that the notice of dishonor by Cunningham was not sufficient. We point out that nothing in the pleadings or affidavits of the Yoders refutes the fact that they were, indeed, notified. They argue, instead, that the notice should have been written rather than oral.
This case is governed by the Uniform Commercial Code, specifically Chapter 4 which deals with bank deposits and collections. Ind. Code 26-1-4-101 et seq. (Burns Code Ed., 1974).
A bank has the right to charge-back a customer's account or demand a refund under IC XX-X-X-XXX(1) which provides:
"If a collecting bank has made provisional settlement with its customer for an item and itself fails by reason of dishonor, suspension of payments by a bank or otherwise to receive a settlement for the item which is or becomes final, the bank may revoke the settlement given by it, charge-back the amount of any credit given for the item to its customer's account or obtain refund from its customer whether or not it is able to return the item if by its midnight deadline or within a longer reasonable time after it learns the facts it returns the item or sends notification of the facts. These rights to revoke, charge-back and obtain refund terminate if and when a settlement for the item received by the bank is or becomes final (subsection (3) of section [26-1-]4-211 and subsections (2) and (3) of section [26-1-]4-213)."
(emphasis added). Chapter 4 further provides that "[t]o the extent that items within this article are also within the scope of article 3 ... they are subject to the provisions of [article 3]. In the event of conflict the provisions of [article 4] govern those of article 3... ." IC XX-X-X-XXX. Article 3, dealing with commercial paper, permits notice of dishonor to "... be given in any reasonable manner. It may be oral or written and in any terms which identify the instrument and state that it has been dishonored." IC XX-X-X-XXX(3). Applying 3-508 to article 4 pursuant to 4-102 would indicate that oral notice of the dishonor of the three checks deposited by Yoder is sufficient. The Yoders argue, however, that there is a conflict between the provisions because 4-212 grants the bank a right of charge-back if it "... sends notification of the facts." IC XX-X-X-XXX(1). Looking to the general definitional section of the code, we find "send" defined as follows:
"`Send' in connection with any writing or notice means to deposit in the mail or deliver for transmission by any other usual means of communication with postage or cost of transmission provided for and properly addressed and in the case of an instrument to an address specified thereon or otherwise agreed, or if there be none to any address reasonable under the circumstances. The receipt of any writing or notice within the time at which it would have arrived if properly sent has the effect of a proper sending."
IC XX-X-X-XXX(38). The Yoders maintain this language indicates a writing and when inserted in 4-212 requires that the bank must send a written notification of dishonor. Two cases cited by the Yoders do interpret this purported conflict and decide that notice under 4-212 must be written. Valley Bank & Trust Co. v. First Security Bank (1975), Utah, 538 P.2d 298; Available Iron & Metal Co. v. First Nat'l Bank (1977), 56 Ill. App.3d 516, 13 Ill.Dec. 940, 371 N.E.2d 1032. There is an apparent split in the Illinois Appellate Court, however, for we find that the later case of Salem National Bank v. Chapman (1978), 64 Ill. App.3d 625, 21 Ill.Dec. 414, 381 N.E.2d 741, held that oral notice was sufficient under 4-212 based upon 3-508(3). The court did not discuss the purported conflict between the provisions. 21 Ill.Dec. at 417, 381 N.E.2d at 744. A New York *134 court specifically rejected the "conflict" argument in Bank of Commerce v. DeSantis (1982), N.Y. Civ. Ct., 114 Misc.2d 941, 451 N.Y.S.2d 974 and followed Salem National Bank v. Chapman, supra, holding that 3-508 permits oral notice. Likewise in Laurel Bank & Trust Co. v. Sahadi (1975), 32 Conn. Supp. 172, 345 A.2d 53 the court found effective notice of dishonor where there was unrebutted testimony from the bank manager that he telephoned the customer on the day following the date the bank learned of dishonor. 345 A.2d at 55.
Indiana courts have not dealt with the precise issue of what notice is required under 4-212. In Hall v. Owen City State Bank (1977), 175 Ind. App. 150, 370 N.E.2d 918, construing the notice requirement under 9-504(3), dealing with disposition of collateral upon default, this Court considered the requirement that notification of a public sale "... shall be sent by the secured party to the debtor." IC XX-X-X-XXX(3). Noting the definition of "send" at 1-201(38), the court rejected the argument that only written notice would suffice.
"We feel that a rigid rule of law mandating a written notice in all cases conflicts with the general tenor of the UCC to reject strict procedural requirements and we would therefore read § 1-201(38) in conjunction with § 1-201(26) so as to impose upon the secured party the duty of taking reasonable steps to notify the debtor. The fact that the notice was oral instead of written should not invalidate that notice as a matter of law but should instead be one of the factors considered in deciding whether or not the notice was reasonable."
370 N.E.2d at 925. Hall is distinguishable because it deals with the secured transactions provisions of the U.C.C. rather than bank collections and deposits. The reasoning, however, is equally applicable to the case at bar in so far as it rejects a rigid requirement of written notice as being contrary to the general tenor of the U.C.C. We therefore reject the argument that 4-212 conflicts with 3-508 and follow the authorities which hold that a bank may "send" notice either orally or in writing and fulfill its duty under 4-212.
II.
Right of Charge-Back
A substantial portion of the Yoders' brief is devoted to the contention that there were genuine issues of material fact regarding CSB's right to charge-back the amount of the dishonored checks in the first place. The Yoders insist that factual questions concerning the processing, posting and dishonor procedures followed by the payor bank in Minnesota give rise to the inference that CSB's right of charge-back had terminated. We recall the provision of 4-212(1) which states that a collecting bank's rights to revoke, charge-back and obtain refund terminate if and when settlement for the item received by the bank is or becomes final. The Yoders' argument based on this provision proceeds as follows: if the payor bank, SBW, had completed its process of posting (4-109) before receiving the stop-payment orders on the three checks, then the stop-payment orders were too late because final payment is deemed to have already occurred. (4-213). If final payment had occurred when CSB's right to charge-back terminated (4-212(1)) and the Yoders were no longer liable for the amount of the dishonored checks. This line of argument misses the point. The State Bank of Worthington is not a party to this action; whether it followed proper procedures in deciding to dishonor the checks should not be the focus of inquiry in determining the propriety of CSB's claim against the Yoders. The operative facts are that CSB received notice that the items were dishonored by the payor bank and in turn notified the Yoders. The U.C.C. provides that a collecting bank acts as an agent on behalf of its customer who presents items for collection. IC XX-X-X-XXX(1). As such, the collecting bank must use ordinary care in
"(a) presenting an item or sending it for presentment; and
(b) sending notice of dishonor or non-ayment or returning an item other than *135 a documentary draft to the bank's transferor or directly to the depositary bank under subsection (2) of section [26-1-]4-212 after learning that the item has not been paid or accepted, as the case may be; and
* * * * * *
(2) A collecting bank taking proper action before its midnight deadline following receipt of an item, notice or payment acts seasonably; taking proper action within a reasonably longer time may be seasonable but the bank has the burden of so establishing.
(3) Subject to subsection (1)(a), a bank is not liable for the insolvency, neglect, misconduct, mistake or default of another bank or person or for loss or destruction of an item in transit or in the possession of others."
IC XX-X-X-XXX. Given the volume and speed of check processing it would be unrealistic to require the collecting bank to inquire and ascertain the grounds for and propriety of every item which is dishonored. The bank's duty of ordinary care extends to presenting or sending an item for collection and seasonably notifying the customer of any dishonor. The risk of non-payment remains with the customer and the collecting bank is held liable only for its own fault or non-compliance with the code. IC XX-X-X-XXX, Comment 1 (Burns Code Ed., 1974). The bank must be able to rely upon receipt of the items or notice of dishonor in order to act seasonably in notifying the customer and exercising its right of charge-back. We hold that the collecting bank, as agent for the customer, has no duty to inquire into the circumstances surrounding the dishonor before exercising its rights under the code.
A similar result was reached in Mercantile Bank & Trust Co. v. Hunter (1972), 31 Colo. App. 200, 501 P.2d 486 where the court said "the rule that a payor bank is `accountable' for an item [4-302] does not mean that there has been a final settlement which would preclude a depositary bank from charging the amount of the item back to its depositor. 4-213 does not provide that mere accountability of a payor for its check is a final settlement unless the check is actually paid by the payor." 501 P.2d at 488.
III.
Set-off
After CSB notified the Yoders that the checks had been dishonored and that it was revoking the provisional credit given for the checks, it waited until October 9, 1982 to actually set-off against the Yoders' account $14,312.92 in partial repayment of the total sum. At that time CSB notified the Yoders in writing that it was applying the balance of the account against one of the Blue Mound Dairy checks which it erroneously stated had been returned for insufficient funds. The Yoders argue that this action was not the prompt exercise of the bank's right of charge-back required by the code, citing West's Annotated Code, Section 26-1-4-212, Comment 3. Interestingly, the Comments cited by West are apparently from the official version of the U.C.C. The Indiana Comments included in the Burns Code Edition do not contain the prompt charge-back language. IC XX-X-X-XXX (Burns Code Ed. 1974). According to the Yoders mere notification of the charge-back without actually setting off any balance in the account does not amount to the prompt action contemplated by the Code. Moreover, the Yoders claim there are genuine issues of material fact regarding the balance in their account during the three and a half months before the bank set-off the fourteen thousand dollars. It is possible, they argue, that the bank could have exercised its right earlier and set-off the entire amount of the three checks. We must agree with CSB that the right to charge-back is not necessarily synonymous with the term set-off. The charge-back is the claim or lien against the customer's account, while the set-off is the actual reduction of the customer's account balance for part or all of the claim. In this case the bank charged back the amount of the dishonored checks and eventually satisfied part of the claim by setting off the amount *136 available in the Yoders' account. Since the bank notified the Yoders within twenty-four hours of the dishonor and charge-back, it acted within the requirements of 4-212; that it waited three and a half months to enforce the charge-back by setting off against the Yoders' account does not deprive CSB of the right to charge-back.
IV.
Joint and Several Liability
Finally, the Yoders insist that the trial court erred in holding Mrs. Yoder liable along with her husband for the unpaid amount of the provisional credit, plus pre-judgment interest. Mrs. Yoder denies any direct participation in the transaction involving the three checks. The checks were payable to Elmer Yoder, endorsed and deposited by him and Mrs. Yoder claims she wrote no checks on the proceeds.
It is undisputed that the three checks were deposited into the joint checking account of Elmer and Irene Yoder, and that the account was credited with $123,766.00, the sum of the checks. IC XX-X-X-XXX(1)(e) (Burns Code Ed. 1974) defines customer as "... any person having an account with a bank or for whom a bank has agreed to collect items... ." Irene Yoder was clearly a customer of CSB. Under IC XX-X-X-XXX(1) a bank has a right to charge-back its customer's account or obtain refund from its customer based upon the bank's failure to receive settlement for an item for which it has made provisional settlement with its customer. (Emphasis supplied). Mrs. Yoder received a provisional credit in her joint account of more than one hundred twenty thousand dollars. As a joint account holder she had at all times, the right under Indiana law to withdraw any sums in the account. See IC 32-4-1.5-8 and 32-4-1.5-9 (Burns Code Ed., 1974). The trial court correctly determined, therefore, that Irene Yoder had received consideration for checks, regardless of whether she actually participated in the transaction. It was her account in which the provisional credit had been made that was charged back when the checks were dishonored, and she remained liable for the amount of the charge-back when the set-off covered only a portion of the claim. Mrs. Yoder does not come within the ambit of the authorities she cites which relieve a non-participating co-signatory of liability for an overdraft where the co-signatory did not receive any of the funds. Mrs. Yoder received the provisional credit and was enriched by virtue of her ability to draw on those funds while they remained in her account. She was, therefore, liable upon dishonor of the checks and revocation of the provisional credit to refund to CSB the amount of the credit plus interest and expenses related to the item. IC XX-X-X-XXX(2) & (3).
Finding no genuine issue of material fact which would preclude summary judgment, the judgment of the trial court is affirmed.
HOFFMAN and GARRARD, JJ., concur.
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489 U.S. 1301
109 S.Ct. 1360
103 L.Ed.2d 802
BROTHERHOOD OF RAILROAD SIGNALMEN et al.v.SOUTHEASTERN PENNSYLVANIA TRANSPORTATION AUTHORITY.No. A-715.
Supreme Court of the United States
March 14, 1989
On application to vacate injunction.
Justice BRENNAN, Circuit Justice.
1
Applicants request me, as Circuit Justice, to enter an order "immediately dissolving" the injunction issued by the District Court for the Eastern District of Pennsylvania. I deny the application. In my view, applicants have not "established that there is a 'reasonable probability' that four Justices will consider the issue sufficiently meritorious to grant certiorari." Rostker v. Goldberg, 448 U.S. 1306, 1308, 101 S.Ct. 1, 2, 65 L.Ed.2d 1098 (1980) (Chambers Opinion).
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879 F.Supp. 473 (1995)
Mark Joseph BROSSO
v.
DEVICES FOR VASCULAR INTERVENTION, INC.
Civ. A. No. 94-6712.
United States District Court, E.D. Pennsylvania.
March 10, 1995.
*474 Sidney L. Gold, Lovitz & Gold, Brian L. Calistri, Weber, Goldstein, Greenberg & Gallagher, Philadelphia, PA, for plaintiff Mark Joseph Brosso.
Raymond A. Kresge, Stephen J. Sundheim, Pepper, Hamilton & Scheetz, Philadelphia, PA, for defendants Devices for Vascular Intervention, Inc., Eli Lilly and Co., Greg R. Patterson, Michael Kopp, Allan R. Will.
MEMORANDUM
DALZELL, District Judge.
Plaintiff Mark Joseph Brosso has brought this diversity action against his former employer, defendant Devices for Vascular Intervention, Inc. ("DVI"), alleging, in Count I of the complaint, that DVI terminated Brosso in retaliation for his failure to relinquish ownership in a medical device he designed. DVI has moved to dismiss this Count pursuant to Federal Rule of Civil Procedure 12(b)(6). We shall grant the motion.
I. Factual and Procedural Background
The following facts are taken from the complaint and are not disputed for the purposes of this motion. DVI employed Brosso, a Pennsylvania citizen, as a sales territory manager for Pennsylvania and neighboring states from January 2, 1990 until his termination on October 16, 1992.[1] Brosso was earning approximately $260,000 per year when he was fired. Brosso did not have an employment contract with DVI and it is not disputed that he was an at-will employee.
On March 22, 1992, Brosso informed Brian Farley, DVI's vice-president of research and development, that he had designed a mechanical thrombectomy catheter on his own time and with his own resources. About a month and a half later, Michael Kopp, an officer of DVI, allegedly threatened to terminate Brosso if he did not relinquish to DVI his interest in the catheter design. Brosso refused DVI's repeated demands to relinquish his ownership interest in the catheter design and was subsequently terminated.
Brosso commenced this action in the Court of Common Pleas of Philadelphia County, Pennsylvania, and defendants removed it to this Court based on our diversity jurisdiction. Brosso filed a four-count complaint against DVI, Eli Lilly & Co., and three DVI officers, Allan R. Will, Greg R. Patterson, and Michael Kopp, but the parties have stipulated to dismiss counts III and IV and all defendants, except DVI.[2]
In Count I, Brosso claims that his termination constitutes a wrongful discharge in violation of a public policy recognized by the Commonwealth of Pennsylvania, namely, his common law property right in the medical device and his property rights under the Article I, Section 8, Clause 8 and the Fifth and Fourteenth Amendments to United States Constitution. DVI, on the other hand, contends that the narrow exception to the at-will employment rule in Pennsylvania for violations of public policy does not include retaliation for refusal to relinquish an ownership interest in property. DVI has now moved to *475 dismiss Count I pursuant to Fed.R.Civ.P. 12(b)(6).[3]
II. Discussion
We have on two prior occasions discussed employment relationships and the existence of the tort of wrongful discharge in Pennsylvania,[4] albeit in slightly different contexts. See Kedra v. Nazareth Hosp., 868 F.Supp. 733, 736-37 (E.D.Pa.1994) (predicting that Pennsylvania Supreme Court would not recognize tort of wrongful discharge with specific intent to harm), and Melendez v. Horizon Cellular Tel. Co., 841 F.Supp. 687, 692-94 (E.D.Pa.1994) (same).
For over a century in Pennsylvania, an employer was free to discharge an at-will employee "with or without cause at pleasure". Henry v. Pittsburg & L.E.R.R., 139 Pa. 289, 297, 21 A. 157 (1891). In 1974, the Pennsylvania Supreme Court opened the door to wrongful discharge suits in Geary v. United States Steel Corp., 456 Pa. 171, 319 A.2d 174 (1974), by postulating in dictum that exceptions to the at-will rule may exist in theory for the torts of wrongful discharge with specific intent to harm and wrongful discharge in violation of public policy, although it did not find those exceptions applicable to the facts before it. Geary, 456 Pa. at 178-80 & 184-85, 319 A.2d at 177-78 & 180. While subsequent Pennsylvania Supreme Court opinions in Clay v. Advanced Computer Applications, Inc., 522 Pa. 86, 559 A.2d 917 (1989), and Paul v. Lankenau Hosp., 524 Pa. 90, 569 A.2d 346 (1990), have, in our view, eliminated the exception for wrongful discharge with specific intent to harm, see Melendez and Kedra, the exception for wrongful discharge in violation of public policy remains viable. See e.g., Rutherfoord v. Presbyterian-Univ. Hosp., 417 Pa.Super. 316, 329 n. 4, 612 A.2d 500, 506 n. 4 (1992) ("The public policy exception to the at-will doctrine of employment has been consistently recognized in Pennsylvania.").
While neither the Pennsylvania Supreme Court nor our Court of Appeals has ever defined the exact perimeter of the public policy exception in Pennsylvania, our Court of Appeals has attempted to "draw certain principles that govern what an employee must show to make out a claim for wrongful discharge under Pennsylvania's public policy exception to the principle of at-will employment". Clark v. Modern Group Ltd., 9 F.3d 321, 328 (3d Cir.1993).[5]
In Clark, an employer terminated its chief financial officer for his insistence on reporting automobile expense reimbursements as *476 taxable income on the company's tax records when the company contended that it did not need to do so. Clark claimed that the public policy exception to the at-will rule forbade termination of an employee who reasonably believed that his employer requested him to perform an unlawful act, even if it later turned out that the requested act was legal. The Third Circuit rejected this view. In describing the scope of the public policy exception to Pennsylvania's at-will employment rule, the Court of Appeals stated:
[A]n at-will employee invoking Pennsylvania's public policy exception must show his discharge offended a clear mandate of public policy by resulting from conduct on the part of the employee that is required by law or from the employee's refusal to engage in conduct prohibited by law. The public policy exception has been most frequently applied under Pennsylvania law when the discharge is a result of the employee's compliance with or refusal to violate the law. We see little evidence in the Pennsylvania cases to date that an alleged public interest will be recognized as a clear mandate of public policy in the absence of a legislative or constitutional endorsement in the form of a specific prohibition, requirement or privilege.
Absent a violation of law, it is difficult for an at-will employee seeking recovery for wrongful discharge to point to a common law, legislative or constitutional principle from which a clear public policy exception to Pennsylvania's doctrine of at-will employment could be inferred.
Clark, 9 F.3d at 328 (citations, footnote, ellipsis, indentation and brackets omitted).[6]
Clark and other cases[7] have stated that there have been only three reported Pennsylvania cases that have granted relief to an employee who was wrongfully discharged in violation of public policy. In Field v. Phil. Elec. Co., 388 Pa.Super. 400, 565 A.2d 1170 (1989), an employee of an electric utility stated a valid claim for wrongful discharge after his employer terminated him in retaliation for reporting safety violations to the Nuclear Regulatory Commission, as the law required. In Hunter v. Port Auth. of Allegheny County, 277 Pa.Super. 4, 419 A.2d 631 (1980), an applicant for a job as a bus driver was held to have been denied his state constitutional right to engage in one of the "common occupations of life" when his prospective employer refused to hire him because of a thirteen-year-old assault conviction, even though he had been unconditionally pardoned. In the third cited case of Reuther v. Fowler & Williams, Inc., 255 Pa.Super. 28, 386 A.2d 119 (1978), the Superior Court held that it was a violation of public policy for an employer to terminate an employee for serving on jury duty.
We have found a fourth Pennsylvania case in which an employee obtained relief on this theory, Kroen v. Bedway Security Agency, Inc., 430 Pa.Super. 83, 633 A.2d 628 (1993), where a building security officer's employer asked him to submit to a lie detector test. This building had been the site of a spate of recent thefts. The security officer refused and his employer relocated him and reduced his pay, constructively discharging him. The lower court entered summary judgment for the employer but the Superior Court reversed on appeal. Citing the Third Circuit's opinion in Perks v. Firestone Tire & Rubber Co., 611 F.2d 1363 (3d Cir.1979) that addressed the identical issue, the court held that "the discharge of an at-will employee for his refusal to submit to a polygraph test violates the public policy of this Commonwealth, and an action for wrongful discharge will lie." Id., 430 Pa.Super. at 93, 633 A.2d at 633.[8]
The Pennsylvania cases decided since Clark confirm that the public policy exception to the at-will employment rule in Pennsylvania is indeed still a narrow one. In Brozovich v. Dugo, ___ Pa.Cmwlth. ___, 651 A.2d 641 (1994), the Director of Parks and *477 Recreation for the Hampton Township and his employer reached a confidential severance settlement after the employee was arrested for driving under the influence of alcohol and accused of making unwanted sexual advances towards another Township employee. When the circumstances surrounding the employee's resignation were published in a local newspaper, the employee brought suit against the township alleging, inter alia, that he was terminated in violation of "a constitutionally protected fundamental right to his reputation". Id., 651 A.2d at 643. The Commonwealth Court upheld summary judgment for the defendant, concluding as a matter of law that the discharge did not violate any public policy because there were valid reasons for the termination.
Holewinski v. Children's Hosp. of Pittsburgh, 437 Pa.Super. 174, 649 A.2d 712 (1994) involved a claim against a private employer for the retaliatory discharge of a whistleblower. Noting that Pennsylvania's whistleblower statute applies only to public employees, the court dismissed the claim as "meritless" because it was "not based on an established public policy exception". Id., 649 A.2d at 715. See also, Perry v. Tioga County, 168 Pa.Cmwlth. 126, ___ & n. 8, 649 A.2d 186, 189 & n. 8 (1994) (noting that there is no general public policy protecting whistleblowers in the private sector).
Finally, an employee involved in an automobile accident and who was charged with, but never convicted of, possession of controlled substances, was terminated from his job as an equipment operator in Rank v. Township of Annville, 163 Pa.Cmwlth. 492, 641 A.2d 667 (1994). In upholding the dismissal of the suit, the Commonwealth Court distinguished Hunter and rejected the employee's contention that his termination violated the public policy that one is presumed innocent until proven guilty. Id., 163 Pa. Cmwlth. at 496-97, 641 A.2d at 669-70.
Emerging from this jurisprudence would seem to be the rule that, to uphold an action for wrongful termination in violation of public policy, a court must find a public policy that is "clear and specific". Borse, 963 F.2d at 617. Brosso relies on his common law property interest in the design of the catheter. Specifically, Brosso cites state and federal cases for the proposition that an employee has a common law property right in any subject matter of which he is the inventor, even if he created the invention during the course of his employment. Brosso also finds a public policy in the United States Constitution, particularly Article I, Section 8, Clause 8[9] and the Fifth[10] and Fourteenth[11] Amendments. We do not believe any of these federal authorities provide the sort of "clear and specific" public policy that would permit Brosso to recover.
We express no opinion on Brosso's conclusion that he indeed has a common law property interest in the mechanical thrombectomy catheter because it is irrelevant for the purposes of resolving this motion. Even if we accept Brosso's legal conclusion as true,[12] however, DVI asked Brosso, on his account of it, to relinquish his ownership in the catheter design; DVI did not ask him to abstain from action "that is required by law" or "to engage in conduct prohibited by law." Clark, 9 F.3d at 328. In short, we have not detected a clear mandate of public policy here that the Pennsylvania Supreme Court would recognize in a wrongful termination suit.
*478 The federal constitutional provisions that Brosso cites also do not support his claim. By its terms, Article I, Section 8, Clause 8 is a grant of power to Congress, not to any individual inventor. It has long been held that this constitutional provision authorizes Congress to enact the patent laws, but does not confer any rights by itself upon an individual. Graham v. John Deere Co. of Kansas City, 383 U.S. 1, 6, 86 S.Ct. 684, 688, 15 L.Ed.2d 545 (1966); Scott Paper Co. v. Marcalus Mfg. Co., Inc., 326 U.S. 249, 255, 66 S.Ct. 101, 104, 90 L.Ed. 47, reh'g denied, 326 U.S. 811, 66 S.Ct. 263, 90 L.Ed. 495 (1945). Notably, there is no suggestion here that Brosso ever patented his catheter design.
Similarly, Brosso's invocation of the Fifth and Fourteenth Amendments is unavailing because the protections of these Amendments are triggered by government action only. See, e.g., Nollan v. Cal. Coastal Comm'n, 483 U.S. 825, 831, 107 S.Ct. 3141, 3145, 97 L.Ed.2d 677 (1987) (Fifth Amendment); Rendell-Baker v. Kohn, 457 U.S. 830, 838, 102 S.Ct. 2764, 2770, 73 L.Ed.2d 418 (1982) (Fourteenth Amendment); Lugar v. Edmondson Oil Co., Inc., 457 U.S. 922, 937, 102 S.Ct. 2744, 2754, 73 L.Ed.2d 482 (1982) (Fourteenth Amendment); Penn Central Transp. Co. v. City of New York, 438 U.S. 104, 123-28, 98 S.Ct. 2646, 2659-61, 57 L.Ed.2d 631 (Fifth Amendment), reh'g denied, 439 U.S. 883, 99 S.Ct. 226, 58 L.Ed.2d 198 (1978). There is no dispute that DVI is a private actor. Thus, Brosso cannot rely on any of the constitutional provisions he cites as representing a "clear" mandate of Pennsylvania public policy that the Pennsylvania Supreme Court would recognize.
Because we find that DVI did not violate a clear mandate of Pennsylvania public policy, Brosso's claim for wrongful discharge in violation of public policy cannot stand. We shall therefore grant DVI's motion to dismiss for failure to state a claim upon which relief may be granted. An appropriate Order follows.
ORDER
AND NOW, this 10th day of March, 1995, upon consideration of defendant Devices for Vascular Intervention, Inc.'s motion to dismiss, and the response and reply thereto, and in accordance with the accompanying Memorandum, it is hereby ORDERED that:
1. The motion is GRANTED; and
2. Count I of the complaint is DISMISSED.
NOTES
[1] "Devices for Vascular Intervention, Inc. markets atherectomy catheter systems for the treatment of coronary vascular disease by the removal of atherosclerotic plaque. In the United States, sales are conducted by direct sales representatives." Eli Lilly & Co., December 31, 1993 SEC Filing 10-K, at 4. DVI is a wholly-owned subsidiary of defendant Eli Lilly & Co. and is incorporated, and has its principal place of business, in California. Complaint, ¶ 2.
[2] We approved that Stipulation on March 8, 1995.
[3] When considering a motion to dismiss under Federal Rule of Civil Procedure 12(b)(6), we must take all allegations contained in the complaint as true and construe them in a light most favorable to the plaintiff. H.J. Inc. v. Northwestern Bell Tel. Co., 492 U.S. 229, 249, 109 S.Ct. 2893, 2906, 106 L.Ed.2d 195 (1989); Rocks v. City of Phila., 868 F.2d 644, 645 (3d Cir.1989). We may, grant a motion to dismiss for failure to state a claim upon which relief can be granted only if "it appears beyond doubt that the plaintiff can prove no set of facts in support of his claim which would entitle him to relief." Conley v. Gibson, 355 U.S. 41, 45-46, 78 S.Ct. 99, 102, 2 L.Ed.2d 80 (1957); Frazier v. Southeastern Pa. Transp. Auth., 785 F.2d 65, 66 (3d Cir.1986).
[4] The parties agree, and we concur, that Pennsylvania law governs this case. In a diversity action, we employ the choice of law rules of the forum state, here Pennsylvania. Klaxon Co. v. Stentor Elec. Mfg. Co., 313 U.S. 487, 496, 61 S.Ct. 1020, 1021, 85 L.Ed. 1477 (1941); Carrick v. Zurich-American Ins. Group, 14 F.3d 907, 909 (3d Cir.1994). Under Pennsylvania's "hybrid approach" of combining Restatement (Second) methodology with "interest analysis", Carrick, 14 F.3d at 909 (citing Lacey v. Cessna Aircraft Co., 932 F.2d 170, 187 (3d Cir.1991)), we find that Pennsylvania's substantive law applies because Brosso performed most of his work here, lived here and was terminated here.
[5] The difficulty in determining the scope of the public policy exception to Pennsylvania's at-will employment rule arises from the perils of forecasting the position the supreme court of a state will take on an as-yet undecided issue, as we are required to do in every diversity action. Erie R.R. v. Tompkins, 304 U.S. 64, 78, 58 S.Ct. 817, 822, 82 L.Ed. 1188 (1938); see also, Dolores K. Sloviter, A Federal Judge Views Diversity Jurisdiction through the Lens of Federalism, 78 Va.L.Rev. 1671, 1675-81 (1992) ("[T]he state courts have found fault with a not insignificant number of past `Erie guesses' made by the Third Circuit and our district courts."). When there is scant guidance from a state's highest court, intermediate appellate decisions may suggest how the supreme court would might rule and "may constitute presumptive evidence of state law in appropriate circumstances." Borse v. Piece Goods Shop, Inc., 963 F.2d 611, 614 (3d Cir.1992).
[6] Surprisingly, neither party cited Clark, the Third Circuit's most recent pronouncement on Pennsylvania's public policy exception.
[7] See e.g., Holewinski v. Children's Hosp. of Pittsburgh, 437 Pa.Super. 174, 649 A.2d 712, 715 (1994), and Krajsa v. Keypunch, Inc., 424 Pa.Super. 230, 239, 622 A.2d 355, 359 (1993).
[8] Kroen was decided less than a month before Clark, which may explain why the case escaped the attention of the Clark panel.
[9] That clause reads:
[The Congress shall have Power] To promote the Progress of Science and useful Arts, by securing for limited Times to Authors and Inventors the exclusive Right to their respective Writings and Discoveries;
U.S. Const. art. I, § 8, cl. 8.
[10] Brosso relies upon the Takings Clause of the Fifth Amendment:
nor shall private property be taken for public use, without just compensation.
U.S. Const. amend. V.
[11] Brosso relies upon the Due Process Clause of the Fourteenth Amendment:
nor shall any State deprive any person of life, liberty, or property, without due process of law;
U.S. Const. amend. XIV, § 1.
[12] On a Rule 12(b)(6) motion, we need only accept as true the factual allegations of the complaint, not the legal conclusions that the plaintiff derives from those allegations. 5A Wright & Miller, Federal Practice and Procedure, § 1357 & n. 12-21.
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Case: 12-50920 Document: 00512173530 Page: 1 Date Filed: 03/13/2013
IN THE UNITED STATES COURT OF APPEALS
FOR THE FIFTH CIRCUIT United States Court of Appeals
Fifth Circuit
FILED
March 13, 2013
No. 12-50920
Summary Calendar Lyle W. Cayce
Clerk
LUIS ESPARZA,
Petitioner-Appellant
v.
UNITED STATES OF AMERICA; WARDEN, REEVES COUNTY DETENTION
CENTER III; BUREAU OF PRISONS; GEO GROUP,
Respondents-Appellees
Appeal from the United States District Court
for the Western District of Texas
USDC No. 4:11-CV-124
Before KING, CLEMENT, and HIGGINSON, Circuit Judges.
PER CURIAM:*
Luis Esparza, federal prisoner # 31213-013, an alien against whom the
Bureau of Immigration and Customs Enforcement has issued a detainer
subjecting him to immediate removal from the United States upon release from
Bureau of Prisons (BOP) custody, moves this court to proceed in forma pauperis
(IFP) to appeal the dismissal of his 28 U.S.C. § 2241 petition challenging the
BOP’s exclusion of him from rehabilitation programs and halfway houses. His
*
Pursuant to 5TH CIR. R. 47.5, the court has determined that this opinion should not
be published and is not precedent except under the limited circumstances set forth in 5TH CIR.
R. 47.5.4.
Case: 12-50920 Document: 00512173530 Page: 2 Date Filed: 03/13/2013
No. 12-50920
arguments are foreclosed by this court’s decision in Gallegos-Hernandez v.
United States, 688 F.3d 190, 192-93 (5th Cir.), cert. denied, 133 S. Ct. 561 (2012).
Accordingly, Esparza’s motion to proceed IFP is DENIED, and his appeal
is DISMISSED as frivolous. See 5TH CIR. R. 42.2.
2
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COURT OF APPEALS OF VIRGINIA
Present: Judges Elder, Annunziata and Senior Judge Duff
Argued at Alexandria, Virginia
SHARON A. HARVEY
v. Record No. 0524-95-4 MEMORANDUM OPINION * BY
JUDGE ROSEMARIE ANNUNZIATA
JAN VORIS HARVEY DECEMBER 29, 1995
FROM THE CIRCUIT COURT OF FAUQUIER COUNTY
William Shore Robertson, Judge
Julia S. Savage (Walker, Jones, Lawrence, Duggan &
Savage, P.C., on briefs), for appellant.
Linda I. Dodge for appellee.
Sharon A. Harvey ("wife") and Jan Voris Harvey ("husband")
were divorced by decree entered February 24, 1995. In her appeal
of the decree, wife contends the trial court abused its
discretion in failing to quantify her interest in pension
benefits paid to the husband during the pendency of the
proceedings, where a pendente lite decree ordered the husband
both to preserve marital assets and to pay support and
maintenance. We find no error and affirm the judgment of the
trial court.
The parties were married on June 25, 1966. During the
marriage, the husband was an active member of the United States
military, retiring as a Colonel in December 1988. The wife
worked at home, providing support for the husband's career. The
*
Pursuant to Code § 17-116.010 this opinion is not
designated for publication.
trial court concluded that the husband's military career was a
joint endeavor of the husband and wife.
The husband received his first pension payment around
January 1, 1989, just days before the wife filed for divorce. By
the end of that month, the court had entered a decree pendente
lite, restraining both parties from "disposing of any property
from his or her estate in order to preserve the respective
estates so that it may be forthcoming to meet any decree which
may be entered." The pendente lite decree also ordered the
husband to pay, "for support and maintenance . . . expenses
necessary for the maintenance and running of the household . . .
and other marital expenses customarily paid by him."
The evidence shows that, during the pendency of the
proceedings, the husband incurred numerous expenses to support
himself, the wife, and both their minor son and emancipated
daughters. The husband contends that he had to use his pension
payments to abide by the pendente lite decree's support order
because his new income alone was insufficient. The wife alleges
that the husband made many frivolous expenditures and that, in so
doing, he disposed of a marital asset, his pension, in
contravention of the pendente lite decree.
Following the equitable distribution hearing, the trial
court concluded that eighty percent of the husband's pension was
marital property of which the wife was entitled to one-half. To
determine the value of the wife's one-half share of the proceeds
- 2 -
which accrued during the pendency of the proceedings (roughly
1989-1993), the court was required to apply the value of those
proceeds as of the date of the November 1993 and February 1994
evidentiary hearings since neither party requested an alternate
valuation date. See Code § 20-107.3(A); Gottlieb v. Gottlieb, 19
Va. App. 77, 86, 448 S.E.2d 666, 672 (1994). By the date of
those hearings, the value of the husband's pension proceeds that
accrued during the 1989-1993 period was zero; the husband had
spent it all. However, the court found that the value of the
wife's share of those proceeds would have been $87,043 had the
husband not spent the funds. Thus, the court sought to determine
what amount of those proceeds the husband spent legitimately
pursuant to the pendente lite order to provide support and what
amount, if any, he improperly wasted or dissipated.
After reviewing substantial evidence seeking to establish or
discredit the propriety of the husband's expenses, the court
concluded that the evidence of waste was inconclusive. The court
expressed "reservations" about some of the husband's claimed
expenses, but it found that he had not "intentionally" dissipated
the pension. The court concluded that it should award the wife
something, but, since it was unable to determine which
expenditures where proper and which were not, the court entered
no award. The wife argues that this was error; we disagree.
Among the statutory factors the court must consider in
making a "fair and equitable monetary award" are the
- 3 -
contributions of the parties to the "care and maintenance" of
marital assets. See Code §§ 20-107.3(E)(2),(10). This Court has
concluded that the trial court may consider a party's dissipation
of marital assets under these sections when determining an
appropriate monetary award for the other party. See Stroop v.
Stroop, 10 Va. App. 611, 615, 394 S.E.2d 861, 863 (1990); Booth
v. Booth, 7 Va. App. 22, 28, 371 S.E.2d 569, 572 (1988). 1 Thus,
although the trial court was required under § 20-107.3(A) to
value the pension at the time of the hearing, it could still
consider the issue of waste when making a monetary award under
§ 20-107.3(E). Indeed, "[w]hen waste has occurred, the trial
court must include the wasted asset as marital property and must
consider the waste as a factor in determining the monetary
award." Booth, 7 Va. App. at 28-29, 371 S.E.2d at 573.
It is clear under Virginia law that not every conveyance of
marital property after the marriage breaks down is waste. See
Clements v. Clements, 10 Va. App. 580, 586, 397 S.E.2d 257, 261
(1990). Instead, dissipation occurs "where one spouse uses
marital property for his own benefit and for a purpose unrelated
to the marriage at a time when the marriage is undergoing an
irreconcilable breakdown." Id. (quoting Hellwig v. Hellwig, 100
Ill. App. 3d 452, 426 N.E.2d 1087 (1981)). The use of marital
assets for marital purposes is not waste. Decker v. Decker, 17
1
Booth addresses Code § 20-107.3(E)(11) which became
§ 20-107.3(E)(10) after § 20-107.3(E)(8) was repealed.
- 4 -
Va. App. 12, 19, 435 S.E.2d 407, 412 (1993). 2
The husband bore the burden of proving by a preponderance of
the evidence that he did not dissipate the pension. Clements, 10
Va. App. at 586, 397 S.E.2d at 261. Accordingly, the husband
produced evidence documenting his expenses, claiming that they
were for a proper purpose. The court found that the husband had
not "intentionally dissipated" the pension. While the court
expressed reservations about accepting the husband's claim that
all his expenditures were proper, the wife presented insufficient
rebuttal evidence to enable the court to segregate proper
expenditures from improper ones. Thus, the court was unable to
make an award to reflect what it deemed would have been the
wife's share of the husband's pension funds.
At the reconsideration hearing upon motion of the wife, the
court again asked her to demonstrate an amount, based on the
evidence, that would reflect the husband's obligation under the
pendente lite decree so that the court could determine what
portion of the husband's expenditures was waste and what amount,
if any, it should award the wife. The wife refused to address
the doctrine of waste, notwithstanding that, at the time of the
hearing, the value of the proceeds she sought was zero. Instead,
2
The pendente lite decree should be construed in accordance
with these principles. See Brown v. Commonwealth, 8 Va. App.
126, 133, 380 S.E.2d 8, 12 (1989) (describing presumption that
trial judges properly apply the law); Paul v. Paul, 214 Va. 651,
653, 203 S.E.2d 123, 125 (1974) (law in force at time property
settlement agreement was made determines rights and duties under
it).
- 5 -
she asked for her entire 40% share of the pension, contending
that its future value at the time of the separation was all that
was required to enable the court to make its award. The wife
also argued that, in any event, the evidence before the court was
sufficient for the court to make its determination and urged the
court to "pick" a number. The court properly declined to do so.
A review of the record discloses that the evidence was
insufficient to enable the court to identify funds which properly
belonged to the wife. Having failed to provide evidence
demonstrating the amount she should receive, the wife may not
benefit on appeal for her failure to produce evidence at trial.
See Bowers v. Bowers, 4 Va. App. 610, 617, 359 S.E.2d 546, 500
(1987). "The burden is always on the parties to present
sufficient evidence to provide the basis on which a proper
determination can be made, and the trial court in order to comply
. . . must have the evidence before it . . . to grant or deny a
monetary award." Id. (quoting Hodges v. Hodges, 2 Va. App. 508,
516, 347 S.E.2d 134, 139 (1986)). Moreover, a reviewing court
cannot remand an equitable distribution case where the parties
"had an adequate opportunity to introduce evidence but have
failed to do so." Id. (quoting In re Marriage of Smith, 114 Ill.
App. 3d 47, 54-55, 448 N.E.2d 545, 550 (1983)).
The judgment of the trial court is therefore affirmed.
Affirmed.
- 6 -
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571 So.2d 1174 (1990)
WINN-DIXIE OF MONTGOMERY, INC.
v.
Larry NOBLES.
Civ. 7741.
Court of Civil Appeals of Alabama.
October 31, 1990.
Rehearing Denied December 5, 1990.
N.T. Braswell III of Rushton, Stakely, Johnston, and Garrett, Montgomery, for appellant.
M. Wayne Sabel of Argo, Enslen, Holloway & Sabel, Montgomery, for appellee.
ROBERTSON, Judge.
This is a workmen's compensation case.
Plaintiff, Larry Nobles, suffered a heart attack while working for his employer, Winn-Dixie, of Montgomery, Inc. After Nobles filed his complaint seeking benefits, Winn-Dixie answered and denied that any benefits were due.
*1175 The case was tried, and the court entered its order awarding Nobles workmen's compensation benefits. Specifically, the court found that Nobles's injury resulted in his having a 35% permanent partial disability. The court later amended its original order to correct clerical errors in its calculations of Nobles's benefits.
Winn-Dixie then moved for a new trial, or, in the alternative, for the court to amend, alter, or vacate its judgment. The court denied Winn-Dixie's motion, and this appeal followed.
As one of its issues on appeal, Winn-Dixie asserts that the trial court erred in not finding a loss of ability to earn. We note, however, that after Winn-Dixie filed its notice of appeal, Nobles filed a Rule 60(a), Ala.R.Civ.P., motion with the trial court, which requested the court to correct its earlier judgment. Specifically, Nobles requested the court to correct its judgment so as to properly reflect that the court had found that Nobles suffered a 35% loss of ability to earn. The court did amend its order, based on the authority of Ohio Ferro-Alloys Corp. v. Whaley, 366 So.2d 287 (Ala.Civ.App.1979).
In Whaley, this court found that the trial court, in a similar fact situation, was empowered to clarify its judgment pursuant to Rule 60(a) and upheld the trial court's amendment of its order. Likewise, we hold that the trial court's amendment of its order in this case, to include the finding of loss of ability to earn, was proper.
In view of the above, the only issue remaining for this court's consideration is whether the trial court's award of permanent partial disability benefits is supported by the evidence. Winn-Dixie contends that because Nobles's post-injury wages equal his pre-injury wages for the same job, Nobles is not entitled to benefits.
It is an established rule of law that in situations where an employee's wages following a work-related accident are the same or higher than his pre-injury wages, a presumption will arise that no loss of earning capacity has occurred. Chrysler Motor Corp. v. Cole, 563 So.2d 1040 (Ala.Civ.App. 1990). This presumption may be rebutted, however, by other evidence which demonstrates incapacity or which explains why the higher wages are an unreliable basis for determining the employee's earning capacity. Chrysler.
Here, the evidence reflects that the employee is still driving a truck for Winn-Dixie for substantially the same wages. However, we reiterate that the workmen's compensation statute does not set forth a comparative wages test as the mechanism for determining the employee's ability to earn. Goodyear Tire & Rubber Co. v. Downey, 266 Ala. 344, 96 So.2d 278 (1957).
The record evidence indicates that although Nobles is still performing his same duties, he does so with pain and in violation of his doctor's instructions. Further, Nobles testified that he has attempted to secure other similar employment, but that upon informing potential employers of his heart attack he has been denied employment.
We find that this evidence rebuts the presumption of no loss of ability to earn. Consequently, the judgment of the trial court is due to be affirmed.
AFFIRMED.
INGRAM, P.J., and RUSSELL, J., concur.
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107 T.C. No. 13
UNITED STATES TAX COURT
ESTATE OF BESSIE I. MUELLER, DECEASED,
JOHN S. MUELLER, PERSONAL REPRESENTATIVE, Petitioner v.
COMMISSIONER OF INTERNAL REVENUE, Respondent
Docket No. 2733-90. Filed November 5, 1996.
R determined a deficiency in P's estate tax
liability. P claims that it is entitled to equitable
recoupment of previously paid income tax, the refund of
which is barred by the statute of limitations. In
Estate of Mueller v. Commissioner, 101 T.C. 551 (1993),
we held that we have jurisdiction to consider claims of
equitable recoupment.
As a result of our valuation of stock includable
in the estate, see Estate of Mueller v. Commissioner,
T.C. Memo. 1992-284, it is now apparent that there is
no deficiency in estate tax; rather, P is entitled to
recover an overpayment of estate tax, regardless of
equitable recoupment. Under these circumstances, any
application of equitable recoupment would increase the
amount that P is entitled to recover as an overpayment.
- 2 -
Held: Equitable recoupment is restricted to use
as a defense against an otherwise valid claim. For
purposes of equitable recoupment, the notice of
deficiency is considered to be R's claim for additional
estate tax. See Bull v. United States, 295 U.S. 247
(1935). Once it is determined that R has no valid
claim for additional tax, the defense of equitable
recoupment has no application. Equitable recoupment
cannot be used to increase the amount of an overpayment
that P is entitled to recover.
Stevan Uzelac, Michael A. Indenbaum, and Paul L. Winter,
for petitioner.
Thomas M. Rath and Trevor T. Wetherington, for respondent.
OPINION
RUWE, Judge:* Respondent determined a deficiency of
$1,985,624 in petitioner's Federal estate tax. Respondent's
deficiency determination was primarily based on her assertion
that the date-of-death value of shares of stock in the Mueller
Co. was $2,150 per share, as opposed to $1,505 per share as
reported on the estate tax return. The amount of the deficiency
determined by respondent was the result of this increase in value
and other adjustments not in issue, including respondent's
allowance of a credit for tax on prior transfers in the amount of
$1,152,649, that had not been claimed by petitioner on its estate
*
This case was reassigned to Judge Robert P. Ruwe by order
of the Chief Judge.
- 3 -
tax return. Petitioner petitioned this Court for a
redetermination.1
Petitioner subsequently filed an amended petition alleging
that "The Commissioner erred in determining said Deficiency by
disallowing recoupment against such [estate] tax amount for the
income tax paid by the Bessie I. Mueller Trust * * * on capital
gains realized from the post-death sale of * * * Mueller Company
common stock includable in the Decedent's gross estate." The
Bessie I. Mueller Administration Trust (the Trust) is the
residuary legatee of decedent's estate. After decedent's death,
the Trust sold shares of Mueller Co. stock that were included in
decedent's gross estate. On its income tax return, the Trust
reported gain on the sale using a basis of $1,500 per share.2
1
Decedent Bessie I. Mueller resided and was domiciled in
Port Huron, Michigan, at the time of her death, and her will was
admitted to probate by the Probate Court of St. Clair County,
Michigan. John S. Mueller, the personal representative in this
case of decedent's estate and one of the two trustees of the
Administration Trust, was a resident of Naples, Florida, when he
filed the petition in this case. The estate’s other personal
representative and the other trustee of the Administration Trust
is Milton W. Bush, Sr., an attorney who resides in Port Huron,
Michigan. The Michigan National Bank, which was engaged by the
two trustees as their agent upon the death of decedent, has its
principal corporate office in Michigan. Throughout the time
relevant to this case, the Administration Trust has been
administered in Michigan.
2
The record does not explain why the Trust used a basis that
was $5 per share less than the amount petitioner reported as the
fair market value of the shares in the estate tax return.
- 4 -
The Trust's basis in the stock is controlled by the value of the
stock at decedent's date of death. See sec. 1014(a)(1).3
In Estate of Mueller v. Commissioner, T.C. Memo. 1992-284
(Mueller I), we found that the date-of-death value of the Mueller
Co. stock was $1,700 per share, as opposed to $1,505 per share as
reported on petitioner's estate tax return or $2,150 as
determined by respondent in the notice of deficiency. As a
result, it is now clear that the Trust understated its basis and
overstated its gain on the sale of Mueller Co. stock and,
therefore, overpaid its income tax. However, the statute of
limitations bars refund of the Trust's overpayment of income tax.
Respondent moved to dismiss petitioner's claim for
recoupment on the ground that we lacked jurisdiction to consider
equitable recoupment. In Estate of Mueller v. Commissioner, 101
T.C. 551 (1993) (Mueller II), we held that this Court is
authorized to entertain the affirmative defense of equitable
recoupment in an action for redetermination of a deficiency and
denied respondent's jurisdictional motion. Id. at 561. However,
we made no findings with respect to whether petitioner satisfied
the requirements for applying equitable recoupment in this case.
It subsequently became clear that our opinion in Mueller I,
which increased decedent's taxable estate by less than the amount
3
Unless otherwise indicated, all section references are to
the Internal Revenue Code in effect for the taxable year in
issue, and all Rule references are to the Tax Court Rules of
Practice and Procedure.
- 5 -
determined in the notice of deficiency, combined with
respondent's allowance in the notice of deficiency of the credit
for tax on prior transfers, will result in a decision that there
is no deficiency in petitioner's estate tax.4 Indeed, petitioner
is entitled to recover an overpayment of its estate tax,
regardless of whether or not equitable recoupment applies in this
case.5
The threshold issue we must address is whether petitioner
may use equitable recoupment against respondent, where respondent
has no valid claim for additional estate tax against which
petitioner needs to defend.
Pursuant to the doctrine of equitable recoupment, "a party
litigating a tax claim in a timely proceeding may, in that
proceeding, seek recoupment of a related, and inconsistent, but
now time-barred tax claim relating to the same transaction."
United States v. Dalm, 494 U.S. 596, 608 (1990). Equitable
recoupment can be used as a defense by both taxpayers and the
Government. Stone v. White, 301 U.S. 532 (1937). While
recoupment claims are generally not barred by the statute of
4
This credit, which was not claimed on decedent's estate tax
return, was for property received by decedent from the estate of
her stepson Robert E. Mueller. Allowance of this previously
unclaimed credit was appropriate in determining the amount of the
deficiency. See sec. 6211.
5
Both parties agree that there is no estate tax deficiency
and that petitioner is entitled to a decision that it has
overpaid its estate tax, regardless of any effect that the
doctrine of equitable recoupment might have.
- 6 -
limitations if the main action is timely, use of recoupment based
on an otherwise time-barred claim is limited to defending against
the claim in the main action.6 Reiter v. Cooper, 507 U.S. 258,
264 (1993); United States v. Dalm, supra at 605; Stone v. White,
supra at 538-539; Bull v. United States, 295 U.S. 247, 262-263
(1935); United States v. Forma, 42 F.3d 759, 765 (2d Cir. 1994);7
In re Greenstreet, Inc., 209 F.2d 660, 663 (7th Cir. 1954).8
6
The term "main action" is used to denote the timely claim
as opposed to the time-barred claim upon which the recoupment
defense is based. See Reiter v. Cooper, 507 U.S. 258, 264
(1993); United States v. Dalm, 494 U.S. 596, 605 (1990); Stone v.
White, 301 U.S. 532, 539 (1937); Bull v. United States, 295 U.S.
247, 262 (1935); United States v. Forma, 42 F.3d 759, 765 (2d
Cir. 1994).
7
After reviewing cases involving recoupment, the Court of
Appeals for the Second Circuit stated:
All of these cases conclude that "a party sued by the
United States may recoup damages * * * so as to reduce
or defeat the government's claim * * * though no
affirmative judgment * * * can be rendered against the
United States." In re Greenstreet, 209 F.2d at 663.
[United States v. Forma, supra at 765.]
8
With respect to the limited defensive nature of recoupment,
the Court of Appeals for the Seventh Circuit stated:
the government concedes that a party sued by the United
States may recoup damages arising out of the same
transaction, or where authorized, set off other claims,
so as to reduce or defeat the government's claim. That
this is a correct conception of the law is apparent
from United States v. United States Fidelity & Guaranty
Co., 309 U.S. 506, at page 511 * * *; Bull v. United
States, 295 U.S. 247, at page 262 * * *; United States
v. Ringgold, 8 Pet. 150, 163-164 * * *, though no
affirmative judgment over and above the amount of its
(continued...)
- 7 -
Petitioner acknowledges that equitable recoupment is limited
to defensive use. However, petitioner argues that it should be
allowed to use equitable recoupment to defend against the
additional tax that would have been due as a result of our
valuation of decedent's stock, assuming that respondent had not
allowed the credit for prior transfers in the notice of
deficiency. Petitioner would have us apply recoupment against a
hypothetical tax liability on a transaction-by-transaction basis,
regardless of whether there was a valid claim for additional tax
liability against which to defend. On brief, petitioner
describes this as an issue of first impression.
Respondent takes the position that equitable recoupment can
be used by a taxpayer only as a defensive measure to reduce or
eliminate a taxpayer's actual liability for additional tax.
Respondent argues that once it is clear that the taxpayer has no
additional tax liability, there is no valid claim against which
to defend. Respondent contends that to allow equitable
recoupment of time-barred taxes to increase the overpayment that
is already due petitioner is the same as permitting petitioner
affirmatively to collect the time-barred overpayment of tax.
Respondent's position finds support in Mueller II where we
stated:
8
(...continued)
claim can be rendered against the United States, United
States v. Shaw, 309 U.S. 495 * * * [In re Greenstreet,
Inc., 209 F.2d 660, 663 (7th Cir. 1954).]
- 8 -
the party asserting equitable recoupment may not
affirmatively collect the time-barred underpayment or
overpayment of tax. Equitable recoupment "operates
only to reduce a taxpayer's timely claim for a refund
or to reduce the government's timely claim of
deficiency". O'Brien v. United States, 766 F.2d 1038,
1049 (7th Cir. 1985). [Estate of Mueller v.
Commissioner, 101 T.C. at 552.]
The opinion in O'Brien v. United States, 766 F.2d 1038, 1049 (7th
Cir. 1985), also supports respondent's position that equitable
recoupment may be used only as a defense against the additional
tax that would otherwise be due:
Recoupment * * * will permit a taxpayer to recoup an
erroneously paid tax, the refund of which is time-
barred, against a timely and correctly asserted
deficiency by the government. The doctrine thus
operates only to reduce * * * the government's timely
claim of deficiency; it does not allow the collection
of the barred tax itself. In summary, the doctrine
requires some validly asserted deficiency or refund
against which the asserting party desires to recoup a
time-barred refund or deficiency.
* * * * * * *
Attempts by taxpayers to utilize the doctrine to
revive an untimely affirmative refund claim, as opposed
to offset a timely government claim of deficiency with
a barred claim of the taxpayer, have been uniformly
rejected. * * * [Id. at 1049; citation omitted.]
Likewise, in Brigham v. United States, 200 Ct. Cl. 68, 80-81, 470
F.2d 571, 577 (1972), the court explained the function of
equitable recoupment as follows:
When its benefits are sought by the taxpayer, the
function of the doctrine is to allow the taxpayer to
- 9 -
reduce the amount of a deficiency recoverable by the
Government by the amount of an otherwise barred
overpayment of the taxpayer. * * *
Petitioner correctly points out that none of these cases,
nor any others relied upon by respondent, specifically address
the situation that confronts us; i.e., whether equitable
recoupment applies where, in the main action, the Court finds
that there is an increase in a taxable item, but because of
another adjustment in the main action, which is in the taxpayer's
favor (the allowance of the credit for prior transfers), there is
no additional tax owed to the Government. Further examination of
the origin and nature of equitable recoupment is, therefore,
appropriate.
The doctrine of equitable recoupment in tax cases was first
articulated in Bull v. United States, supra. The Commissioner
had determined a deficiency in estate tax, which the estate paid.
Thereafter, the Commissioner inconsistently determined that there
was a deficiency in the income tax liability of the estate based
on the same item. The taxpayer paid the income tax deficiency
and brought suit for refund. It was ultimately determined that
the additional income tax liability, as determined by the
Commissioner, was correct, but that the additional estate tax
liability determined by the Commissioner based on the same item,
was incorrect. The problem was that the additional estate tax
- 10 -
had already been paid, and the statute of limitations barred any
refund of the estate tax.
While no refund action could be brought for recovery of the
estate tax, the Supreme Court recognized that if the taxpayer had
been defending against a lawsuit by the Government for the
additional income tax, the taxpayer would have been permitted, by
the doctrine of recoupment,9 to raise time-barred claims arising
out of the same transaction as a defense to the Government's
suit. But the taxpayer had filed the refund suit and was the
plaintiff. The Government had already collected the disputed
income tax and was seeking no further relief against which the
taxpayer had to defend. The Supreme Court, nevertheless,
recognized that it was the Government that had initiated the
controversy by making its income tax deficiency determination and
that the taxpayer, although technically the plaintiff, was, in
reality, defending against the Government's determination.10 The
Supreme Court therefore fashioned the doctrine of equitable
recoupment to allow the taxpayer to defend against the
9
Recoupment has been described as "the setting off against
asserted liability of a counterclaim arising out of the same
transaction. Recoupment claims are generally not barred by a
statute of limitations so long as the main action is timely."
Reiter v. Cooper, 507 U.S. at 264.
10
See United States v. Dalm, 494 U.S. at 605, stating that
in Bull v. United States, supra, "the proceeding between the
executor and the Government was in substance an attempt by the
Government to recover a debt from the estate."
- 11 -
Government's claim for additional taxes. The Supreme Court
explained this as follows:
If the claim for income tax deficiency had been the
subject of a suit [by the Government], any counter
demand for recoupment of the overpayment of estate tax
could have been asserted by way of defense and credit
obtained notwithstanding the statute of limitations had
barred an independent suit against the Government
therefor. This is because recoupment is in the nature
of a defense arising out of some feature of the
transaction upon which the plaintiff's action is
grounded. Such a defense is never barred by the
statute of limitations so long as the main action
itself is timely.
The circumstance that both claims, the one for
estate tax and the other for income tax, were
prosecuted to judgment and execution in summary form
does not obscure the fact that in substance the
proceedings were actions to collect debts alleged to be
due the United States. It is immaterial that in the
second case, owing to the summary nature of the remedy,
the taxpayer was required to pay the tax and afterwards
seek refundment. This procedural requirement does not
obliterate his substantial right to rely on his cross-
demand for credit of the amount which if the United
States had sued him for income tax he could have
recouped against his liability on that score. [Bull v.
United States, 295 U.S. at 262-263; fn. ref. omitted.]
In Bull v. United States, supra, and United States v. Dalm,
494 U.S. at 602-605, the Supreme Court made it clear that the
purpose of "equitable recoupment" was to replicate the role that
"recoupment" would have played had the Government actually
brought suit to collect the additional tax. It is instructive
then to look at how recoupment would have applied if the
Government had brought suit to collect the additional estate tax
liability that it claimed as a deficiency in the instant case.
- 12 -
The Government would have brought suit in the District Court
against the taxpayer for the amount of additional estate tax that
it claimed--$1,985,624. Assuming that the District Court found a
$1,700 per share value for the stock, as opposed to the $2,150
alleged by the Government, there would be a judgment that the
taxpayer owed no tax debt to the Government.11 As a result, the
Government would totally lose its claim as plaintiff. Once the
Government's claim for additional tax was shown to be meritless,
the purely defensive use of recoupment would not be available to
allow the taxpayer to recover any portion of the time-barred
overpayment of income tax. To allow recoupment in this situation
would go beyond its exclusively defensive nature and beyond the
District Court's jurisdiction.12
In the instant case, as in Bull v. United States, supra, the
Government's claim for additional tax is embodied in its
deficiency determination. However, as previously explained, when
the stock is valued at $1,700 per share, there is no additional
tax due. As a result, the Government does not have a valid claim
11
The combination of increasing the taxable estate and
allowing the credit for prior transfers would produce the same
result that we arrive at here--petitioner has no additional
estate tax liability; rather, petitioner has overpaid its estate
tax and would be entitled to a refund.
12
No suit or counterclaim can be brought against the United
States where the subject of the suit or counterclaim is barred by
the statute of limitations. This bar is jurisdictional in
nature. A narrow exception is the availability of recoupment as
a defense against an action brought by the United States. United
States v. Dalm, supra at 608.
- 13 -
for a tax debt, and there is no liability against which equitable
recoupment can be used to defend.13
In Stone v. White, 301 U.S. 532 (1937), the Supreme Court
allowed the Government to use equitable recoupment to defend
against an income tax refund suit brought by a trustee. The
Court ultimately held that the trustee had overpaid income tax
and that the income in issue should have been taxed to the
trust's beneficiary. However, the statute of limitations barred
assessment against the beneficiary. The tax on the beneficiary
would have exceeded the amount of tax paid by the trust. The
Government raised the equitable recoupment defense. The trust
argued that the statute of limitations barred assessment against
the beneficiary and that the beneficiary's tax should not be
considered. The Supreme Court allowed the equitable recoupment
defense, stating:
13
Equitable recoupment has been restricted to defending
against an otherwise valid claim or cause of action. The
Government's claim or cause of action here is its assertion that
petitioner is liable for additional estate tax. "In federal tax
litigation one's total income tax liability for each taxable year
constitutes a single, unified cause of action, regardless of the
variety of contested issues and points that may bear on the final
computation." Finley v. United States, 612 F.2d 166, 170 (5th
Cir. 1980)(citing Commissioner v. Sunnen, 333 U.S. 591, 598
(1948)). The same reasoning applies to the estate tax. There is
no distinction conceptually between the nature of a cause of
action arising from estate taxes on the one hand and one arising
from a single year's income tax on the other. Estate of Hunt v.
United States, 309 F.2d 146, 148 (5th Cir. 1962); see also
Huddleston v. Commissioner, 100 T.C. 17, 25 (1993).
- 14 -
The statutory bar to the right of action for the
collection of the tax does not prevent reliance upon a
defense which is not a set-off or a counterclaim, but
is an equitable reason, growing out of the
circumstances of the erroneous payment, why petitioners
ought not to recover.
Here the defense is not a counter demand on
petitioners, but a denial of their equitable right to
undo a payment which, though effected by an erroneous
procedure, has resulted in no unjust enrichment to the
government, and in no injury to petitioners or their
beneficiary. The government, by retaining the tax paid
by the trustees, is not reviving a stale claim. Its
defense, which inheres in the cause of action, is
comparable to an equitable recoupment or diminution of
petitioners' right to recover. "Such a defense is
never barred by the statute of limitations so long as
the main action itself is timely." Bull v. United
States, 295 U.S. 247, 262 * * * [Id. at 538-539.]
Even though the uncollected tax from the time-barred year
exceeded the tax in the main action before the Court, the
Government did not affirmatively recover the excess. To have
done so would have allowed equitable recoupment to be used for
more than defensive purposes.
In Rothensies v. Electric Storage Battery Co., 329 U.S. 296,
301-303 (1946), the Supreme Court indicated that it was unwilling
to expand the doctrine of equitable recoupment beyond its
established parameters, because to have done so would have
infringed upon the statute of limitations.14 Petitioner's
14
In Rothensies v. Electric Storage Battery Co., 329 U.S.
296, 301 (1946), the Supreme Court stressed the importance of a
statute of limitations, stating:
(continued...)
- 15 -
position would also infringe upon the statute of limitations by
allowing petitioner affirmatively to recover time-barred
overpayments. Nevertheless, petitioner asks us to expand the
application of equitable recoupment beyond what any court has
ever done. In the final analysis, we agree with the following
observation of the Court of Claims:
If the doctrine of recoupment were a flexible one,
susceptible of expansion, it might well be applied in
the instant case. But the teaching of Rothensies is
that it is not a flexible doctrine, but a doctrine
strictly limited, and limited for good reason. [Ford
v. United States, 149 Ct. Cl. 558, 569, 276 F.2d 17, 23
(1960).]
14
(...continued)
It probably would be all but intolerable, at least
Congress has regarded it as ill-advised, to have an
income tax system under which there never would come a
day of final settlement and which required both the
taxpayer and the Government to stand ready forever and
a day to produce vouchers, prove events, establish
values and recall details of all that goes into an
income tax contest. Hence, a statute of limitation is
an almost indispensable element of fairness as well as
of practical administration of an income tax policy.
We have had recent occasion to point out the reason and
the character of such limitation statutes. "Statutes
of limitation * * * are designed to promote justice by
preventing surprises through the revival of claims that
have been allowed to slumber until evidence has been
lost, memories have faded, and witnesses have
disappeared. The theory is that even if one has a just
claim it is unjust not to put the adversary on notice
to defend within the period of limitation and that the
right to be free of stale claims in time comes to
prevail over the right to prosecute them." Order of
Railroad Telegraphers v. Railway Express Agency, 321
U.S. 342, 348-9. * * *
- 16 -
Use of equitable recoupment is limited to defending against
a valid claim. It allows an otherwise time-barred tax claim
arising out of the same transaction to be used as a defense or
credit against any additional tax ultimately found to exist in
the main action.15 If all or part of the Government's claim for
additional tax is sustained, equitable recoupment can be used to
reduce or eliminate it. However, once equitable recoupment of
the time-barred tax overpayment completely eliminates the
additional tax liability in the main action, equitable recoupment
has served its restricted defensive purpose.16 Equitable
recoupment cannot be used affirmatively to recover a tax
overpayment, the refund of which is barred by the statute of
limitations.
Where the Government claims that the taxpayer owes
additional tax and the court finds that there is no additional
tax due to the Government, there is nothing left to defend
against.17 The additional estate tax liability that would have
15
See United States v. Dalm, 494 U.S. at 605.
16
See United States v. Timber Access Indus. Co., 54 F.R.D.
36 (D. Or. 1971). The defendant was entitled to an affirmative
recovery against the Government on a separate counterclaim;
however, recoupment against the Government was restricted to the
amount that the Government was entitled to recover in the main
cause of action initiated by the Government.
17
See Evans Trust v. United States, 199 Ct. Cl. 98, 106, 462
F.2d 521, 526 (1972), stating:
(continued...)
- 17 -
resulted from our valuation of the stock in decedent's estate was
less than the credit that respondent correctly allowed in the
notice of deficiency. As a result, respondent has no valid claim
for additional tax. Respondent's claim for additional tax has
been totally defeated, and petitioner is entitled to a decision
that there is no deficiency and that it overpaid its estate tax.
Any use of equitable recoupment at this point would not be
defensive.
We hold that petitioner is not entitled to use equitable
recoupment affirmatively to increase the amount of an overpayment
it is entitled to recover. It follows that equitable recoupment
has no application in this case. As a result of our disposition,
we express no opinion regarding whether any of the other
requirements for equitable recoupment have been satisfied.
An appropriate order will
be issued.
Reviewed by the Court.
COHEN, CHABOT, SWIFT, JACOBS, GERBER, WRIGHT, PARR, WHALEN,
CHIECHI, FOLEY, and VASQUEZ, JJ., agree with this majority
opinion.
17
(...continued)
Furthermore, since the Government's asserted deficiency
was settled by a determination that no deficiency
existed, plaintiff is attempting to use recoupment not
in its traditional form as a defense to an asserted
deficiency, but as an independent ground for reopening
years now closed by the statute of limitations.
- 18 -
CHABOT, J., concurring: I join in the majority opinion and
the interpretation that the “claim” in the instant case, against
which equitable recoupment is sought to lie, is respondent’s
claim that there is a deficiency in estate tax.
The dissenters maintain that the claim against which
equitable recoupment is sought to lie is only respondent’s claim
that, because of the revaluation of the Mueller Co. stock, the
estate tax liability is greater than it otherwise would be.
Judge Beghe’s dissenting opinion, infra pp. 77-81, relies on
Hemmings v. Commissioner, 104 T.C. 221 (1995), for the
proposition “that the credit for previously paid taxes is not
part of the same claim or cause of action as that attributable to
the date of death value of the shares.” Dissenting op. p. 79
(Beghe, J.). However, as explained in Hemmings v. Commissioner,
104 T.C. at 233-235, it appears that the only situation where the
issues of the unclaimed credit and the stock value could be
litigated in separate actions would be where the taxpayer first
proceeds in a refund forum on one of the issues and the
Commissioner then raises the other issue in a later notice of
deficiency. Also, with exceptions not relevant in the instant
case, in deficiency proceedings in the Tax Court, the different
issues are merged into a single cause of action and neither side
is permitted to bring a separate suit “in any court” once a
decision on liability for “estate tax in respect of the taxable
- 19 -
estate of the same decedent” has become final. Sec. 6512(a);
Hemmings v. Commissioner, 104 T.C. at 226, 232-233. Indeed, even
in the other forums, the taxpayer apparently is barred from
bringing a second suit for the same tax even if that second suit
is based on a different issue. Hemmings v. Commissioner, 104
T.C. at 233-234. Thus, Hemmings does not support the dissent’s
contentions as to what is respondent’s claim in the instant case,
against which equitable recoupment is sought to lie.
Because the majority opinion’s analysis, in combination with
Mueller I, appears to dispose of the instant case, failure to
respond to the other considerations dealt with in Judge Beghe’s
dissent, is not to be taken as acceptance of, or disagreement
with, the views Judge Beghe expresses as to the many hurdles
petitioner must overcome in order to succeed in the highly
technical realm of equitable recoupment.
COHEN, PARR, and RUWE, JJ., agree with this concurring
opinion.
- 20 -
WELLS, J., dissenting: I respectfully disagree with the
majority's overly restrictive view of the applicability of the
doctrine of equitable recoupment. I agree with Judge Beghe that
all of the conditions for application of the doctrine have been
met. I, however, want to focus my disagreement on what I believe
is the majority's mistaken notion that the application of the
doctrine of equitable recoupment in the instant case is offensive
rather than defensive simply because the amount of an unrelated
overpayment of tax resulting from the estate's failure to claim a
credit for tax on prior transfers exceeds the amount of
additional estate tax due by reason of the increased valuation of
the shares in issue.
I believe that, once an equitable recoupment claim is
properly raised by a taxpayer in defense of an asserted
deficiency, the mere fact that the Commissioner's partial victory
fails to produce a deficiency should not prevent the Court from
allowing the equitable recoupment claim. If respondent had been
totally sustained on the deficiency, or even if the increase in
the valuation of the shares of stock in issue had been great
enough to create an overall deficiency in estate tax, I think the
majority would concede (assuming that they would agree that the
other requirements are met) that the recoupment claimed would be
allowed. The application of the doctrine should be governed
solely by matters relating to the shares, and not upon the
fortuity of unrelated circumstances, i.e. the convergence of (1)
- 21 -
respondent's concession in the notice of deficiency of the credit
for tax on prior transfers that petitioner had failed to claim on
the estate tax return with (2) the valuation of the shares at an
amount that resulted in an overpayment rather than a deficiency.
The relevant circumstances may be briefly summarized. For
estate tax purposes, the estate valued the shares in issue at
$1,505 each. Shortly after decedent's death, the Administration
Trust sold those shares for $2,150 each, computing the gain
realized on the sale using a basis of $1,500 per share, which was
approximately the value claimed for estate tax purposes.
Respondent determined that each share was worth $2,150. In
Estate of Mueller v. Commissioner, T.C. Memo. 1992-284, we found
the value of each share to be $1,700 for estate tax purposes.
Accordingly, the estate underpaid its estate tax by $957,099 as a
result of the undervaluation. However, because the Trust used
$1,500 as the basis of the shares to compute the gain on the
sale, the Trust paid $265,999 more in income tax on the sale of
the shares than it would have if the proper basis of $1,700 per
share had been used. The period of limitations for claiming a
refund of that overpayment of income tax had expired. In the
notice, respondent allowed the estate a $1,152,649 credit for tax
on prior transfers to which it was entitled but had not claimed
on its estate tax return. The credit was completely unrelated to
the issue of the valuation of the shares. If we had sustained
respondent's valuation of the shares, a deficiency would have
- 22 -
been due from the estate even considering the overpayment
attributable to the allowance of the credit. As it turned out,
the additional estate tax attributable to the revaluation of the
shares was less than the overpayment resulting from the estate's
failure to claim the credit on its return, and the estate is
therefore due a refund.
Petitioner argues that it should be allowed to recoup
against the additional estate tax attributable to the revaluation
of the shares ($957,099) the amount of income tax overpaid on
their sale ($265,999). The majority would allow equitable
recoupment only if there were an overall deficiency in tax after
taking into account all issues in the case (other than the
equitable recoupment claim). I agree with Judge Beghe that the
recoupment claim should be allowed so long as it did not exceed
the additional tax due as a result of the increased valuation of
the shares; i.e. recoupment should be applied to correct the
error on a transactional basis, not just on the basis of whether
some amount is finally determined to be owed to the party who
received the windfall.
Recoupment has been characterized as a counterclaim or
defense against asserted liability relating to the same
transaction, item, or event upon which the main action is
grounded. Reiter v. Cooper, 507 U.S. 258, 264 (1993); United
States v. Dalm, 494 U.S. 596, 605 n.5, 608 (1990); Bull v. United
States, 295 U.S. 247, 262 (1935). The doctrine is designed to
- 23 -
prevent unjust enrichment of either the taxpayer or the
Government. Stone v. White, 301 U.S. 532, 537-539 (1937); Bull
v. United States, supra at 260-261. While admittedly no case has
squarely considered the issue presented by the instant case,
recoupment has always been applied on an item-by-item or
transaction-by-transaction basis, and the circumstances
surrounding unrelated items or transactions have not been deemed
relevant to the application of the doctrine. Rothensies v.
Electric Storage Battery Co., 329 U.S. 296, 299 (1946)
(recoupment "has never been thought to allow one transaction to
be offset against another, but only to permit a transaction which
is made the subject of suit by a plaintiff to be examined in all
its aspects, and judgment to be rendered that does justice in
view of the one transaction as a whole" (emphasis supplied)).
Consequently, I believe the majority's limitation on the
application of the doctrine is inconsistent with its nature and
the policy underlying it. As there is no issue as to the
entitlement to the credit, the "main action" in the instant case
is not the entire liability of the estate for tax, but rather the
additional estate tax claimed with respect to the shares.
I believe that the majority overstates its case regarding
the defensive use of equitable recoupment, in that the cases
relied on by the majority do not go as far as the majority would
have them go. The rejection of equitable recoupment as an
offensive weapon by the Supreme Court in United States v. Dalm,
- 24 -
supra, does not require the result reached by the majority. If
petitioner had paid the full deficiency determined by respondent
and sued for a refund, the reach of Dalm would not have precluded
the right of petitioner to obtain a refund of the income tax
attributable to the sale of the shares even if the refund forum
court had reduced the estate tax valuation of the shares as we
have done in the instant case. The only limitation imposed by
Dalm would have been to preclude petitioner from increasing the
amount of its claimed refund by any amount attributable to the
claimed overpayment of income tax. Similarly, Bull v. United
States, supra, does not require the result the majority reaches
because that case did not involve an unrelated claim for refund,
and therefore the majority's hypothetical construction of the
Government's claim were it to sue for the deficiency determined
mistakenly emphasizes the taxpayer's overall liability as the
determinative factor in deciding whether to apply the doctrine.
Accordingly, I would hold that, to the extent that
petitioner's recoupment claim does not exceed the amount of the
additional tax sought by respondent with respect to the shares of
stock, the use of the doctrine is purely defensive and does not
enable petitioner to affirmatively recover on a time-barred
claim. I therefore respectfully dissent.
COLVIN, BEGHE, and GALE, JJ., agree with this dissent.
- 25 -
HALPERN, J. dissenting: I join in section 7, Overpayment
Status, of Judge Beghe’s separate opinion and dissent for the
reasons stated therein.
- 26 -
BEGHE, J., dissenting: I respectfully dissent. I believe
this case satisfies all requirements for equitable recoupment.
In particular, petitioner's overpayment posture, which results
from a completely unrelated, fortuitous issue, should not prevent
recoupment.
The majority has created a new rule about offensive use of
equitable recoupment that unnecessarily perpetuates unjust
enrichment of the Government, thwarts the fundamental purposes of
equitable recoupment, and seems likely to prevent equitable
recoupment in other cases where justice may even more clearly
require it.
I have no disagreement with the facts recited by the
majority opinion; the facts on the recoupment issue were almost
completely stipulated by the parties. However, I provide a
supplemental statement of the procedural and factual background,
both to aid understanding of the overpayment issue and to lay the
foundations for my conclusions on the other issues. Bearing in
mind equitable recoupment's objective of promoting one-stop
shopping,1 I think petitioner is now entitled to see a reasoned
opinion charting the path to the destination I would reach.
After summarizing the background, I address all the other
issues before dealing, infra pp. 69-97, with the overpayment
issue; my rejoinder to the majority opinion begins infra p. 72.
1
Mueller v. Commissioner, 101 T.C. 551, 563-564 (1993)
(Halpern, J., concurring).
- 27 -
Contents
Background . . . . . . . . . . . . . . . . . . . . . . . . 27
Discussion . . . . . . . . . . . . . . . . . . . . . . . . 37
1. Refund Time-Barred . . . . . . . . . . . . . . . . . . 39
2. Single Transaction . . . . . . . . . . . . . . . . . . 42
3. Inconsistent Treatment . . . . . . . . . . . . . . . . 60
4. Identity of Interest . . . . . . . . . . . . . . . . . 63
5. Statutory Mitigation . . . . . . . . . . . . . . . . . 65
6. Other Equitable Considerations . . . . . . . . . . . . 68
7. Overpayment Status . . . . . . . . . . . . . . . . . . 69
i. Code sections are no obstacle
to recoupment . . . . . . . . . . . . . . .. . 71
ii. Recoupment's defensive nature and
the unrelated overpayment don't
bar recoupment . . . . . . . . . . . . . . . . 72
iii. Barring recoupment would be inconsistent
with tax precedent . . . . . . . . . . . . . . 84
iv. Barring recoupment would be inconsistent
with other precedent . . . . . . . . . . . . . 88
Conclusion . . . . . . . . . . . . . . . . . . . . . . . . 98
Background
In Estate of Mueller v. Commissioner, T.C. Memo. 1992-284
(Mueller I), we redetermined the increased value of shares of the
Mueller Co. included in the gross estate of Bessie I. Mueller
(decedent). In Estate of Mueller v. Commissioner, 101 T.C. 551
(1993) (Mueller II), we held that this Court is authorized to
apply equitable recoupment and therefore denied respondent’s
motion to dismiss for lack of jurisdiction those paragraphs of
petitioner’s amended petition asserting its right to equitable
recoupment. Petitioner’s claim for equitable recoupment would
reduce the additional estate tax arising from an increase in the
estate tax value of the shares by the amount of a time-barred
- 28 -
overpayment of income tax made by the Bessie I. Mueller
Administration Trust (the Administration Trust). This income tax
overpayment was attributable to the overstated gain the
Administration Trust reported on the sale of the shares because
it failed to take into account the step-up in basis resulting
from respondent’s estate tax determination, as modified by our
holding in Mueller I, and then failed to file a timely refund
claim. It thus remained for us to decide whether to apply
equitable recoupment in this case.
When decedent, Bessie I. Mueller, died on March 24, 1986,
her gross estate included 8,924 shares of common stock of Mueller
Co. (the shares).2 Petitioner’s Federal estate tax return,
timely filed on December 23, 1986, reported the date-of-death
fair market value of the shares as $13,430,620, or $1,505 per
share. The total value of decedent’s gross estate reported on
the estate tax return was $14,623,510.
By statutory notice of deficiency issued on November 24,
1989, respondent determined that the date-of-death fair market
value of the shares was $19,186,600, or $2,150 per share. As a
result of this increase in value and other adjustments not in
issue, including respondent's allowance of a credit for tax on
prior transfers, in the amount of $1,152,649, that had not been
2
See majority op. p.3 note 1 for a summary of the places of
residence of decedent and her personal representatives and the
trustees of the Administration Trust.
- 29 -
claimed on the Federal estate tax return, respondent determined a
deficiency of $1,985,624 in petitioner’s Federal estate tax.
Petitioner petitioned this Court for a redetermination.
In Mueller I, we found that the date-of-death value of the
shares was $15,170,800, or $1,700 per share. Our revaluation,
standing alone, would result in an increase in Federal estate tax
of $957,099, computed at the top marginal estate tax rate of 55
percent in effect during 1986, prior to allowance of additional
credits for State death taxes and for tax on prior transfers and
a small reduction in the unified credit.
The Administration Trust is a revocable inter vivos trust
established by decedent3 and is the residuary legatee of her
probate estate.4 Under Article IV of the trust instrument, the
Administration Trust is obliged to pay all death taxes, but
Article III of the second codicil to decedent's will directs that
all death taxes be first paid out of decedent's probate estate as
3
The beneficiaries of the Trust are three subtrusts: The
first for the benefit of decedent’s niece Mary M. Hanson and
decedent’s friend Jean Ehlinger and the two other subtrusts known
as the Bessie I. Mueller Irrevocable Trusts A and B for the
benefit of decedent’s grandchildren: Justin R. Mueller, Anne E.
Mueller, and Heidi M. Mueller.
4
The noncharitable legatees of decedent’s estate are
decedent’s sons John S. Mueller and James F. Mueller; decedent’s
two granddaughters by son John, Anne E. Mueller and Heidi M.
Mueller; Bessie I. Mueller Irrevocable Trusts A (f/b/o grandson
Justin R. Mueller) and B (f/b/o granddaughters Anne E. Mueller
and Heidi M. Mueller); the Bessie I. Mueller Administration
Trust; decedent’s niece Mary M. Hanson; friend Jean M. Ehlinger;
decedent’s nephew William E. Pearson; and friend Harriet Suggs.
- 30 -
an expense of administration and that none of such taxes be
apportioned between or among the recipients of her property.
Since the probate assets were only sufficient to pay
approximately 5 percent of the death taxes, the trustees of the
Administration Trust advanced the funds for full payment of death
taxes, including the tax liability shown on petitioner's estate
tax return. The parties in interest thereafter petitioned the
probate court for an apportionment order; the ground of the
petition was the apparent conflict in the death tax payment
provisions of decedent’s will and the Administration Trust, and
the requirements of the Michigan Uniform Estate Tax Apportionment
Act, Mich. Comp. Laws secs. 720.11-720.21 (1979). The probate
court's order held the Administration Trust responsible for 71.9
percent of the Federal estate tax liability already paid.5 The
probate court's order concludes that the apportionment will be
subject to adjustment, following review by the tax authorities,
in accordance with the same methodology used to effectuate the
apportionment of the original payment. The Administration Trust
will be reimbursed for payment of some additional estate tax
5
The recipients of property in the decedent’s gross estate
participating in the apportionment of death taxes were:
Administration Trust 71.9%
Decedent’s Estate 3.4%
James F. Mueller 10.6%
John S. Mueller 10.6%
E. B. Mueller Insurance Trust 3.0%
Decedent’s Condo (sic in
stipulation) 0.5%
- 31 -
arising from our determination of the increased date-of-death
fair market value of the shares. However, any such reimbursement
will not disturb or reduce the estate tax paid by the Trust with
respect to the shares owned by it that were included in the gross
estate, and with respect to which it overpaid income tax when it
sold the shares. Under the apportionment order of the probate
court, any recoupment allowed would relate solely to estate tax
that the Administration Trust has paid on the inclusion in the
gross estate of shares owned by and appointed to it. Any
adjustment through recoupment would benefit solely the
Administration Trust (and, through it, its three beneficiary
subtrusts and their beneficiaries).
On decedent’s date of death, the Administration Trust owned
5,150 of the 8,924 shares included in her gross estate. The
Administration Trust received an additional 1,500 shares from the
Ebert B. Mueller Marital Trust, pursuant to decedent’s exercise
of a testamentary general power of appointment.6 Consequently,
as of the date of death, the Administration Trust owned 6,650
shares of Mueller Co., all of which were included in decedent’s
gross estate.7 On May 30, 1986, 67 days after decedent died, the
6
Decedent also exercised the same testamentary power to
appoint 1,000 shares from the same Ebert B. Mueller Marital Trust
to each of her sons, John S. Mueller and James F. Mueller.
7
The gross estate also included the 2,000 shares appointed
to the two sons under the testamentary general power of
appointment, as well as 274 shares owned by the Ebert B. Mueller
(continued...)
- 32 -
Administration Trust (along with all other owners of shares in
Mueller Co.) sold all its shares for $2,150 per share.8
On April 15, 1987, the Administration Trust filed its
fiduciary income tax return (Form 1041) for the taxable year 1986
reporting $4,572,500 of capital gain on the sale of all 6,650
shares owned by it, and paid $912,378 in Federal income tax on
the gain. The Administration Trust computed its capital gain
using a date-of-death fair market value basis of $1,462 per share
under section 1014(a)(1).
On November 16, 1987, 11 months after petitioner had filed
its Federal estate tax return reporting the fair market value of
the shares at $1,505 per share, the Administration Trust filed an
amended fiduciary income tax return recomputing the gain, using a
basis of $1,500 per share, rather than $1,462. The “amended
return”, as it was labeled, stated: “Taxpayer erroneously used
the wrong basis for the shares of Mueller Company which were sold
7
(...continued)
Life Insurance Trust. The apportionment of Federal estate tax to
the sons, as set forth in note 5 supra, is attributable primarily
to their receipt of shares pursuant to decedent's exercise of the
power of appointment in their favor.
8
The actual sale of the 1,500 shares acquired by the
Administration Trust upon decedent’s death was in fact carried
out by the Comerica Bank as Trustee of the Ebert B. Mueller
Marital Trust, but it was on behalf of the new owner, the
Administration Trust. The gain realized upon the sale of the
1,500 shares was treated as distributable net income of the
Administration Trust, and the Administration Trust included the
gain realized on the sale of the 1,500 shares in its taxable
income for 1986.
- 33 -
during the year. The amended return reflects the correct tax
basis of $1,500 per share. There were no other changes.” Other
than the return itself and the statement attached thereto, no
written or oral communication to the Internal Revenue Service
preceded or accompanied the filing of the amended return. On
February 15, 1988, respondent responded to the amended return by
refunding $50,001, plus interest, to the Administration Trust.
Respondent has never issued a statutory notice of deficiency to
the Administration Trust or otherwise determined a deficiency in
its Federal income tax for the taxable year 1986. The
Administration Trust is not a party to this proceeding.
On or about September 10, 1990, the Administration Trust
filed a second amended fiduciary income tax return claiming an
$862,377 refund of the income tax it had paid on the capital gain
from the sale of the 6,650 shares. This amended return was filed
3 years and 5 months after the Administration Trust had
originally filed its Federal income tax return and paid the
income tax for the taxable year 1986. This was less than 3 years
after the Administration Trust had filed its first amended 1986
income tax return, almost 1 year after respondent had issued the
statutory notice to petitioner, and 7 months after petitioner had
filed its petition. The Administration Trust’s second amended
return bore the designation “Amended Return - Correction” and
claimed that, in computing the gain on the sale of the shares, it
had used a fair market value basis that was $650 lower than the
- 34 -
fair market value respondent used in determining the amount
includable in decedent’s gross estate and that the claim was
being filed to protect the Administration Trust’s rights pending
the outcome of this Tax Court proceeding to redetermine the date-
of-death fair market value of the shares. On April 22, 1991,
respondent disallowed the Administration Trust’s claim for refund
of 1986 income tax on the ground that the claim had not been
timely filed within the 3-year statutory limitation period.
Not considering any other issues, the income tax that would
have been reported by the Administration Trust from the gain on
the sale of the 6,650 shares, using a sales price of $2,150 and a
cost or other basis of $1,700 per share, would have been
approximately $596,378. Not considering any other issues, the
difference between the amount of income tax actually paid by the
Administration Trust on the gain from the sale of 6,650 shares
(approximately $862,377) and the amount of such tax that would
have been reported due using a basis of $1,700 per share
(approximately $596,378) would have been approximately $265,999.
Based on our decision that the fair market value of the shares
was $1,700 per share at the time of decedent’s death, her gross
estate is increased by $1,740,180 (8,924 shares X $195 per share)
over the amount shown on the Federal estate tax return, and this
increase results in the increase of $957,099 in Federal estate
tax liability previously described.
- 35 -
Not considering any other adjustments, once one takes into
account both our Mueller I opinion on the date-of-death fair
market value of the shares and respondent's allowance of the
credit for tax on prior transfers not claimed on the Federal
estate tax return,9 the parties agree that there is no deficiency
in petitioner’s estate tax; petitioner is in an estate tax
overpayment posture, whether or not equitable recoupment applies
in this case. This is because the credit for previously taxed
property that petitioner failed to claim on its estate tax return
and that respondent has allowed (and all agree, properly so)
exceeds the amount of the tentative deficiency resulting from our
valuation of the shares. And this will be true irrespective of
whether the credit for State death taxes ultimately allowable is
the amount claimed on the estate tax return as filed or the
larger credit that the parties agree would be allowed as a result
of the increase in the tentative deficiency resulting from our
valuation of the shares:10
Credit for previously taxed property . . . . . $1,152,649
Less: Agreed reduction in unified
credit . . . . . . . . . . . . . . 6,000
Deficiency attributable to
9
This credit was for property received by decedent from the
estate of Robert E. Mueller, her stepson.
10
It's not clear from the parties' stipulation on this point
whether they've taken into account the partially offsetting
reduction in the credit for State death taxes that would result
from the reduction in estate tax liability arising from the
application of equitable recoupment. The answer to this question
would have no effect on the outcome.
- 36 -
redetermination of value of shares
at $1,700 per share . . . . . . 957,099 963,099
Minimum overpayment prior to recoupment . . . . 189,550
Plus: Maximum increase in credit for State
death taxes . . . . . . . . . . . . . . 278,428
Maximum overpayment prior to recoupment . . . . 467,978
Plus: Claimed recoupment . . . . . . . . . . . 265,999
Maximum overpayment with recoupment . . . . . . 733,977
Petitioner’s amended petition, filed April 22, 1991,
asserted two affirmative partial defenses against respondent’s
estate tax deficiency determination: First, that although the
Administration Trust’s September 10, 1990, claim for refund was
barred by the statute of limitations, respondent erred by not
applying equitable recoupment to reduce petitioner’s estate tax
deficiency by the Administration Trust’s 1986 income tax
overpayment caused by its use of a basis for the shares that was
too low; and, second, that respondent erred in not applying the
statutory mitigation provisions to allow the Administration Trust
to file a timely claim for refund to recover the amount of the
related overpayment. Issue was joined on both the equitable
recoupment and statutory mitigation defenses when respondent
denied these allegations in her amended answer.
After we issued our opinion on the valuation issue, Mueller
I, respondent moved, on the ground that the Tax Court lacked
jurisdiction to grant equitable recoupment relief, to dismiss
those paragraphs of the amended petition asserting the partial
defense of equitable recoupment. In response, we issued Mueller
II, holding that this Court has authority to apply equitable
- 37 -
recoupment, and denied respondent's motion. We reserved the
issue of petitioner’s entitlement to equitable recoupment relief
for further proceedings, and this case has been tried, submitted,
and briefed for the Court's opinion on the issue of equitable
recoupment.
Subsequent to the filing of the amended petition, the
parties presented no arguments on the issue of statutory
mitigation. It only arose, in a preliminary skirmish that led
nowhere, in Respondent’s Request for Admissions and Petitioner’s
Answer to Respondent’s Request for Admissions.
Discussion
The doctrine of sovereign immunity persists as a
jurisdictional limitation on suits against the United States,
FDIC v. Meyer, 510 U.S. 471, ___, 114 S. Ct. 996, 1000 (1994);
United States v. Dalm, 494 U.S. 596, 608 (1990); United States v.
Forma, 42 F.3d 759, 763 (2d Cir. 1994), and jurisdictional
limitations based on sovereign immunity apply equally to
counterclaims against the Government, United States v. Forma,
supra at 764. Case law, however, has developed a significant
limitation to the general bar of sovereign immunity against
counterclaims: Despite sovereign immunity, a defendant may,
without statutory authority, recoup on a counterclaim that would
otherwise be barred by the statute of limitations an amount not
in excess of the principal claim. Id. (citing United States v.
United States Fidelity & Guaranty Co., 309 U.S. 506, 511 (1940)).
- 38 -
In the tax area, where the taxpayer in a refund suit or a
proceeding in this Court is put in the position of the
"plaintiff", the Supreme Court has applied the general doctrine
of recoupment, in the specific form of equitable recoupment, in
Bull v. United States, 295 U.S. 247 (1935). See also United
States v. Dalm, supra at 605-606 n.5; Rothensies v. Electric
Storage Battery Co., 329 U.S. 296 (1946); Stone v. White, 301
U.S. 532 (1937). Under the equitable recoupment doctrine,
taxpayers in Federal tax proceedings may raise recoupment as an
affirmative defense, rather than as a counterclaim. United
States v. Dalm, supra at 607; Commissioner v. Gooch Milling &
Elevator Co., 320 U.S. 418, 420-421 (1943); Mueller II, 101 T.C.
at 560. The Government is also entitled to raise this defense,
Stone v. White, supra, so that either side may assert it, in
certain limited circumstances, to remove the bar of the expired
statutory limitation period in order to prevent inequitable
windfalls to either taxpayers or the Government. Those limited
circumstances are that otherwise such a windfall would result
from inconsistent tax treatment of a single transaction, item,
or event affecting the same taxpayer or a sufficiently related
taxpayer. United States v. Dalm, supra at 605-606 n.5.
Equitable recoupment thus requires, and I address in turn:
(1) That the refund or deficiency for which recoupment is sought
by way of offset be barred by time; (2) that the time-barred
offset arise out of the same transaction, item, or taxable event
- 39 -
as the overpayment or deficiency before the Court; (3) that such
transaction, item, or taxable event have been inconsistently
subjected to two taxes; and (4) that there be sufficient identity
of interest between the person or persons subject to the two
taxes.11 Although recoupment may further require (5) that the
situation not be one to which the mitigation provisions, sections
1311 through 1314, apply, respondent has waived that argument in
this case. I then consider (6) any additional equitable factors
and, finally, (7) the effect of the presence of the estate tax
overpayment, the issue on which the majority have chosen to
dispose of this case.
1. Refund Time-Barred
Not until September 10, 1990, did the Administration Trust
file the claim for refund of its April 15, 1987, payment of
income tax that is now at issue. That claim would appear to be
barred by section 6511(a), which requires that such a claim be
made within 3 years from the time the return was filed, and the
return was filed on the same date that the payment was made,
April 15, 1987.12
11
United States v. Dalm, 494 U.S. 596, 608 (1990), makes
clear the further requirement, not in issue in this case, that
there be a basis for jurisdiction in the case independent of
equitable recoupment. In this case, the statutory notice and
petition are clearly valid and were timely filed, and
consequently we have independent jurisdiction over the deficiency
originally determined by respondent (and the overpayment that we
must now determine).
12
Because the expiration of this 3-year period occurred
(continued...)
- 40 -
Petitioner has suggested, although not on brief, that the
Administration Trust’s refund claim was a timely amendment of the
timely filed amended return of November 16, 1987. Petitioner
refused respondent’s request to admit that the second amended
return was not a timely claim for refund. Respondent has argued
that petitioner’s refusal to stipulate that the second refund
claim is barred constitutes a failure to establish an essential
element of its claim for equitable recoupment and is sufficient
ground for denying petitioner the relief it seeks. To the
contrary, I would regard it as sufficient that we can satisfy
ourselves that the claim is barred. I don't believe that
petitioner needs to concede the point for the purposes of this
proceeding.
The essential question on this point is whether the original
amended return of November 16, 1987, gave respondent sufficient
notice of the tax overpayment now sought through equitable
recoupment and sufficient information to enable respondent to
investigate the claim. United States v. Andrews, 302 U.S. 517,
524 (1938) ("a claim which demands relief upon one asserted fact
situation, and asks an investigation of the elements appropriate
to the requested relief, cannot be amended to discard that basis
and invoke action requiring examination of other matters not
12
(...continued)
later than the expiration of the 2-year period after the payment
of the tax, that alternative date need not be considered. Sec.
6511(a) directs us to use the later date.
- 41 -
germane to the first claim"); United States v. Memphis Cotton Oil
Co., 288 U.S. 62, 72 (1933); United States v. Felt & Tarrant
Manufacturing Co., 283 U.S. 269, 272-273 (1931); In re Ryan, 64
F.3d 1516, 1520-1521 (11th Cir. 1995); United States v. Forma, 42
F.3d at 767 n.13; American Radiator & Standard Sanitary Corp. v.
United States, 162 Ct. Cl. 106, 318 F.2d 915, 920-922 (1963);
secs. 301.6402-2, 301.6402-3, Proced. & Admin. Regs. Under the
variance doctrine, taxpayers are obliged in their refund claims
to identify the assets at issue and to state why they were
treated improperly. It is not enough to state a related claim.
The policy ground for not allowing time-barred claims that
impermissibly vary from timely claims is that the Commissioner
lacks the time and resources to perform extensive investigations
into the precise reasons and facts supporting every taxpayer’s
claim for refund. Charter Co. v. United States, 971 F.2d 1576,
1579-1580 (11th Cir. 1992); cf. Angelus Milling Co. v.
Commissioner, 325 U.S. 293, 297-298 (1945).
Whether the grounds for the Administration Trust’s second
refund claim of September 10, 1990, vary impermissibly from the
grounds for the amended return filed on November 16, 1987, need
not detain us--although I incline to believe they do so vary.
Respondent's acceptance and allowance of the Administration
Trust's 1987 claim provides sufficient basis for the conclusion
that its 1990 refund claim is time-barred. See, e.g., Union
Pacific R.R. Co. v. United States, 182 Ct. Cl. 103, 389 F.2d 437,
- 42 -
447 (1968) (fully paid refund claim can't be revived by belated
amendment after expiration of the period of limitations on the
original claim). The variance doctrine is based on a requirement
that respondent have sufficient notice of taxpayers' claims, and,
in the facts and circumstances of this case, I would conclude
that respondent did not have such sufficient notice of the 1990
claim within the statutory time limits. Cf. United States v.
Memphis Cotton Oil Co., 288 U.S. 62, 72 (1933) (suggestion that
if amendments to informal claim had been made after it had been
rejected on merits, they would have been too late); Lefrak v.
United States, 1996 WL 420308 (S.D.N.Y., July 26, 1996)
(imperfect claim that has been rejected cannot be perfected by a
later, time-barred claim lacking the defect).
2. Single Transaction
For the doctrine of equitable recoupment to apply, a single
transaction, item, or event must have been taxed twice
inconsistently. United States v. Dalm, 494 U.S. at 608
(construing Bull v. United States, supra, and Stone v. White,
supra).
Although the “single transaction” requirement was mentioned
in passing in Bull v. United States, 295 U.S. at 261, it was the
stated ground for decision in Rothensies v. Electric Storage
Battery Co., 329 U.S. at 300. In that case, the taxpayer in 1935
obtained a refund of excise taxes paid for the years 1922 through
1926 that turned out not to have been due. Refunds of the type
- 43 -
of excise taxes paid could not be obtained for the earlier years
1919 through 1921 because those years were already time-barred.
The Commissioner then determined that the excise tax refund for
the years 1922 through 1926 should be included in the taxpayer's
gross income in 1935, the year of receipt. The taxpayer paid
under protest and brought a refund suit, arguing that the refund
was not taxable income and, in the alternative, that the income
tax should be reduced by equitable recoupment on account of the
time-barred overpaid excise taxes for the earlier years 1919
through 1921 for which it had been denied a refund. In District
Court, the taxpayer lost on the income inclusion issue, but won
on the recoupment issue. Electric Storage Battery Co. v.
Rothensies, 57 F. Supp. 731 (E.D. Pa. 1944). The Court of
Appeals for the Third Circuit affirmed, holding that the
interpretation of “transaction” should be informed by the
"concepts of fairness" basic to the doctrine of recoupment, so
that all the doctrine required was a "logical connection" between
the main claim and the recoupment claim. Electric Storage
Battery Co. v. Rothensies, 152 F.2d 521, 524 (3d Cir. 1945). In
reversing on the equitable recoupment issue, the Supreme Court
rejected the Third Circuit’s reasoning. The Supreme Court
insisted that the equitable recoupment doctrine required that a
single transaction constitute both the taxable event claimed upon
and the one considered in recoupment and held that the single
- 44 -
transaction requirement had not been satisfied. Rothensies v.
Electric Storage Battery Co., 329 U.S. 296, 299 (1946).
What must be emphasized is that actually there was no
logical connection--much less a causal relationship--between the
time-barred excise tax refunds for 1919-21 and the inclusion in
taxable income for 1935 of the excise taxes paid for 1922-26.
Considering each year as a separate cause of action, cf.
Commissioner v. Sunnen, 333 U.S. 591, 598 (1948), there was no
transactional nexus whatsoever between the time-barred excise
taxes paid in 1919-21 and the excise taxes paid in 1922-26 that
the taxpayer recovered and was required to include in income in
1935. All the time-barred and the recovered excise taxes had in
common was the coincidence of the same general subject matter.
Since Rothensies v. Electric Storage Battery Co., supra,
the Supreme Court has not revisited the single-transaction
requirement of equitable recoupment except in dicta in United
States v. Dalm, supra at 605 n.5, where it did say that in
Rothensies v. Electric Storage Battery Co. it had emphasized that
the condition that must be satisfied is that "the Government has
taxed a single transaction, item, or taxable event”. The
inclusion of “item” in this phrase is significant for our case.
Although the income and estate taxes in this case were arguably
imposed on different taxable events (the estate tax was imposed
on the transfer of the shares on decedent’s death, whereas the
income tax was imposed upon the gain from the sale of the shares
- 45 -
67 days thereafter), they were imposed on the same item (the same
shares of stock), in the sense that the date-of-death value of
the shares was a necessary element in determining the amount of
the liability for both taxes. Whether they were imposed on the
same “transaction” can be debated, and is addressed below.
In the absence of any decision by the Supreme Court on the
subject since Rothensies v. Electric Storage Battery Co., supra,
the interpretation and application of the single-transaction
requirement has largely been left to the lower courts, resulting
in two lines of conflicting authority.
The two cases on which petitioner largely relies are United
States v. Bowcut, 287 F.2d 654 (9th Cir. 1961) and United States
v. Herring, 240 F.2d 225 (4th Cir. 1957). Both these cases, like
the case at hand, concerned the estate tax and the income tax,
and the two taxes had not been imposed on the same taxable event.
Nevertheless, in both cases the single-transaction requirement of
equitable recoupment was held to be satisfied, and equitable
recoupment was applied in the taxpayers’ favor. In each case,
after a death, estate tax was paid and thereafter the Government
sought additional income tax from the estate for income not
reported during the decedent's lifetime. After paying the income
tax, the estate sued for refund of income tax on the ground that
it was entitled to equitable recoupment of the overpayment of
then time-barred estate tax resulting from the estate's failure
to claim the increased income tax liability as a debt in
- 46 -
determining the taxable estate. In Herring, the Court of Appeals
found that, although the case might differ from Bull, in
practical effect both of the Government’s claims grew out of the
same transaction and were asserted against the same assets in the
hands of the executor. United States v. Herring, 240 F.2d at
228. The court in Herring distinguished Rothensies v. Electric
Storage Battery Co., supra, on the ground that the two sets of
transactions there had been so very remote from each other that
the claims for which recoupment was sought were long dead. Id.
at 227. In Bowcut, the District Court reached the same result on
the basis of Herring. Bowcut v. United States, 175 F. Supp. 218,
221-222 (D. Mont. 1959), affd. 207 F.2d 654 (9th Cir. 1961). The
Court of Appeals did not consider the single-transaction issue,
as the Government appealed primarily on other grounds, lack of
clean hands and laches, which the Court of Appeals rejected as
grounds for denying equitable recoupment, United States v.
Bowcut, 287 F.2d at 656-657 & n.1. The Commissioner acceded to
these decisions in Rev. Rul. 71-56, 1971-1 C.B. 404,13 which like
them concerns the application of a barred overpayment of Federal
estate tax against outstanding assessments of income tax owed by
a decedent for years preceding death and provides for
administrative allowance of equitable recoupment in that
situation.
13
Revoking Rev. Rul. 55-226, 1955-1 C.B. 469.
- 47 -
Despite the statement of administrative position in Rev.
Rul. 71-56, supra, respondent has chosen, in the case at hand, to
hang her hat on contrary decisions of the old Court of Claims.
In Wilmington Trust Co. v. United States, 221 Ct. Cl. 686, 610
F.2d 703 (1979), in two consolidated cases, the Commissioner
assessed income tax deficiencies against the taxpayers after
their deaths, and the executors deducted the income taxes paid as
claims against the decedents’ gross estates. In the subsequent
refund suits to recover the income tax payments, the Commissioner
sought, through equitable recoupment of the time-barred estate
tax deficiencies, to reduce the refunds. In both cases, the
trial judges, citing Herring v. United States, supra, Bowcut v.
United States, supra, and Rev. Rul. 71-56, found that the single-
transaction requirement had been satisfied, and recommended
decision for the Government. Wilmington Trust Co. v. United
States, 43 AFTR 2d 79-801, 79-1 USTC par. 9223 (Ct. Cl. Trial
Div. 1979); McMullan v. United States, 42 AFTR 2d 78-5723, 78-2
USTC par. 9656 (Ct. Cl. Trial Div. 1978). The Court of Claims
reversed and remanded both cases, stating that it was obliged by
Rothensies v. Electric Storage Battery Co., 329 U.S. 296 (1946),
to give the single-transaction requirement a narrow, inflexible
interpretation. Wilmington Trust Co. v. United States, 610 F.2d
at 713. In these consolidated cases, unlike Herring and Bowcut--
and unlike the case at hand--it was the Government that was
seeking equitable recoupment.
- 48 -
In applying the single-transaction test so restrictively,
the Court of Claims relied on its earlier opinion in Ford v.
United States, 149 Ct. Cl. 558, 276 F.2d 17 (1960), whose facts
were closer to our case. Taxpayers had received shares of stock
in 1939 from their father’s estate, which had reported the shares
at an estate tax value of approximately $11,900. On audit of the
estate tax return, there had been an upward adjustment to
$23,715, which the estate accepted. In 1947, taxpayers sold the
shares, reported a date-of-death income tax basis of $165,800,
and claimed refund of an overpayment on this ground. The Court
of Claims determined the date-of-death value to be $165,000.
Neither taxpayers nor the Government adverted to whether the
Government might be entitled to recoupment of the time-barred
underpaid estate tax against the income tax refund. The Court of
Claims on its own initiative considered the issue, and, by a 3-2
vote, held that the Government was not entitled to recoupment
because the facts were not identical to those in Bull v. United
States, supra, and Stone v. White, supra. The Court of Claims
said that Rothensies v. Electric Storage Battery Co., 329 U.S.
296 (1946), held that the doctrine of equitable recoupment was
not flexible, but strictly limited, and limited for the good
reason that if the doctrine were broadened there would never come
a day of final settlement in the income tax system. Ford v.
United States, 276 F.2d at 23. The Court of Claims did not cite
United States v. Herring and United States v. Bowcut, and Rev.
- 49 -
Rul. 71-56 had not yet been issued. In Ford, as in Wilmington
Trust, but not as in Herring, Bowcut, or the case at hand, it was
the Government's claim to equitable recoupment that was denied.
When the Court of Claims later decided Wilmington Trust, it
was already committed to its prematurely expressed and ill-
considered view in the Ford case. I agree with petitioner that
Herring and Bowcut reflect the preferable view. To deny that
there is a single transaction for equitable recoupment purposes
in the Herring-Bowcut situation wouldn't serve the purposes of
statutes of limitation. Requiring only that the connection
between the two taxable events be causally automatic (as in
Herring-Bowcut and in our case) serves to avoid the kind of
staleness that the Supreme Court feared in Rothensies v. Electric
Storage Battery Co., supra. This requirement of at least
automatic causality also helps to ensure that the Commissioner
and the taxpayer aren't obliged to perform extensive additional
investigation and recordkeeping; the concept of final repose
isn't overwhelmingly important where the claim of one party may
only be inchoate or not even exist until there has been a
determination on the open claim, at which time the former claim
may already be barred. To rely on the need for final repose as
barring equitable recoupment in this situation would make a
mockery of the concept of repose.14
14
Academic commentators have almost invariably supported
Herring-Bowcut against the Court of Claims. See Andrews, Modern-
(continued...)
- 50 -
The Courts of Appeals have lined up on both sides. In Boyle
v. United States, 355 F.2d 233 (3d Cir. 1965), revg. and
remanding 232 F. Supp. 543 (D.N.J. 1964), after the decedent died
leaving shares of preferred stock, dividend arrearages were added
to their value, and estate tax was paid accordingly. The
distributees, on receiving those dividends, listed them as
nontaxable for income tax purposes, and the Commissioner
determined income tax deficiencies. The distributees paid the
income tax deficiencies and brought a refund suit. The District
Court denied them equitable recoupment against the then time-
barred estate tax, holding that the single-transaction test of
Rothensies v. Electric Storage Battery Co. was not satisfied.
Boyle v. United States, 232 F. Supp. at 549-550. The Court of
Appeals reversed, Boyle v. United States, 355 F.2d at 236,
holding that there had been double taxation of a single item, the
same fund, which sufficed to satisfy the requirements of Bull v.
United States, and that treatment of the same fund as both corpus
and income provided the necessary inconsistency of treatment.
Id. at 235. The Court of Appeals distinguished Rothensies v.
Electric Storage Battery Co. on the ground that the lapse of so
much time there made it more distant from the case before the
14
(...continued)
Day Equitable Recoupment and the “Two-Tax Effect”: Avoidance of
the Statutes of Limitation in Federal Tax Controversies, 28 Ariz.
L. Rev. 595, 630-650 (1986); Willis, Some Limits of Equitable
Recoupment, Tax Mitigation, and Res Judicata: Reflections
Prompted by Chertkof v. United States, 38 Tax Law. 625, 642-645
(1985).
- 51 -
Court than Bull. Id. at 236-237. Respondent attempts to
distinguish Boyle from our case on the ground that what was at
issue in Boyle was whether the second tax should have been paid
at all on the transaction, not whether it was overpaid. However,
the Court of Appeals doesn't seem to have relied on that fact,
and I don't see the distinction as dispositive. Thus, Boyle
supports Herring-Bowcut, and petitioner’s view of the single-
transaction issue in this case.
In O’Brien v. United States, 766 F.2d 1038 (7th Cir. 1985),
revg. 582 F. Supp. 203 (C.D. Ill. 1984), the District Court held
squarely that the single-transaction requirement is satisfied
where the issue is inconsistency in establishing fair market
value of the same property for the purpose of determining the
gross estate and the basis of the property (the situation in the
case at hand), and the Court of Appeals for the Seventh Circuit
appears to have agreed. Respondent correctly points out that any
statement of the Court of Appeals to that effect was dictum, as
that Court reversed the District Court’s decision to apply
equitable recoupment, on a ground not relevant to our case (later
confirmed by Dalm), that equitable recoupment requires an
independent basis for jurisdiction. O’Brien v. United States,
766 F.2d at 1049. But the Court of Appeals did say, even if in
dictum, that the single-transaction test of Rothensies v.
Electric Storage Battery Co., supra, “appears to be satisfied on
- 52 -
these facts if we adopt the reasoning of the Third Circuit in
Boyle.” Id. at 1050 n.16.
After the O’Brien decedent had died, his estate paid estate
tax on stock in his estate at one value. Then, after the estate
sold the stock, it paid income tax using that same value as its
basis. The Commissioner then determined a higher value for
estate tax purposes, and a stipulated decision was entered in
this Court resolving the estate tax dispute using a higher value.
One of decedent’s heirs and children then sued for a refund of
overpaid income tax, on which the period of limitations had
expired, arguing that the basis used for the stock should have
been higher and using equitable recoupment as the ground for the
suit. The District Court agreed, finding that the single-
transaction requirement of Rothensies v. Electric Storage Battery
Co. had been satisfied.15 O’Brien v. United States, 582 F. Supp.
at 205-206. Like the Court of Appeals in Boyle, the District
Court in O’Brien relied on Bull, finding it closer to its case
than Rothensies v. Electric Storage Battery Co. The District
Court distinguished Rothensies v. Electric Storage Battery Co. on
the ground that in that case the Government had not taken
inconsistent positions, the dispute having been precipitated by
15
The taxpayer also argued for the refund under the
statutory mitigation provisions, secs. 1311-1314, and the
District Court also bought this argument, O’Brien v. United
States, 582 F. Supp. 203, 206-207 (C.D. Ill. 1984), under
Chertkof v. United States, 676 F.2d 984 (4th Cir. 1982). The
Court of Appeals also reversed this conclusion.
- 53 -
the plaintiff’s successful, but belated, challenge of the
legality of the excise tax. O’Brien v. United States, 582 F.
Supp. at 206. The District Court distinguished Ford v. United
States, supra, finding it not in point for reasons that it does
not make very clear and finding the case before it
indistinguishable from Bull. Id. Although the Court of Appeals
was somewhat guarded in its language, it does not seem to have
disagreed. It reversed solely because of the lack of an
independent basis for jurisdiction, the period of limitations
having expired on the income tax refund claim that was the
subject of the taxpayer's lawsuit. O’Brien v. United States, 766
F.2d at 1048-1051. Even if the reversal of the District Court on
this ground caused what the Court of Appeals said about the
single-transaction issue to be dictum, all this supports
petitioner’s view of the issue in our case, which is similar to
the facts in O’Brien.
Respondent asserts that Minskoff v. United States, 349 F.
Supp. 1146 (S.D.N.Y. 1972), affd. per curiam 490 F.2d 1283 (2d
Cir. 1974), supports her view of the single-transaction
requirement. In that case, an estate brought a refund action
against the Government for recovery of estate tax on the
decedent’s interest in a corporation; the Government had
collected income tax in 1961 on the proceeds from the decedent’s
sale of his interest in the corporation in 1949, prior to his
death in 1950 (at trial, the Government was successful in proving
- 54 -
that the decedent had sold his interest prior to his death). As
in Herring and Bowcut, the refund suit was ostensibly for
overpaid income tax (which was not yet time-barred) but in fact
was grounded on equitable recoupment of the earlier, time-barred
overpaid estate tax. Equitable recoupment was denied.
Respondent interprets this case to mean that, to satisfy the
single-transaction requirement, not only must two taxes have been
imposed, but they must have been imposed on a single transaction
on inconsistent legal theories. However, although both the
District Court and the Court of Appeals cited Rothensies v.
Electric Storage Battery Co., supra, failure to satisfy the
single-transaction test was not clearly the basis of their
refusal to allow equitable recoupment. Actually, it was quite
proper for the Government to impose both taxes on the amount in
question, and there was therefore no proper basis for
recoupment.16 Indeed, the District Court did say that Bull only
allows recoupment where the imposition of two taxes rests on
inconsistent theories, as opposed to inconsistent factual
determinations, Minskoff v. United States, 349 F. Supp. at 1149,
and the Court of Appeals affirmed on that ground, 490 F.2d at
1285. If the opinions in Minskoff were right on this point,
petitioner in the case at hand would lose, as the inconsistency
in tax treatment rests on a factual issue, the value of the
16
See Tierney, Equitable Recoupment Revisited: The Scope of
the Doctrine in Federal Tax Cases after United States v. Dalm, 80
Ky. L.J. 95, 100 n.15 (1992).
- 55 -
stock. However, the Minskoff courts are unpersuasive in
distinguishing Bull on this fact-law distinction: The issue of
whether the amounts in Bull were income or part of the gross
estate was a mixed question of fact and law. Similarly, the
issue in Dalm was the factual one of whether the payments had
been gifts or income for services,17 and everything indicates
that, had it not been for the lack of an independent basis for
jurisdiction, Mrs. Dalm would have won her suit.18 No other
decision decides whether or not to apply equitable recoupment on
the basis of this distinction. I conclude that the Minskoff case
does not clearly use failure to satisfy the single-transaction
requirement to justify its refusal to apply equitable recoupment,
is wrong in its fact-law distinction, and is in any event clearly
distinguishable from our case.19
17
See Commissioner v. Duberstein, 363 U.S. 278, 289-290
(1960).
18
In United States v. Dalm, 867 F.2d 305 (6th Cir. 1989),
revd. 494 U.S. 596 (1990), the Sixth Circuit found all the
requirements for equitable recoupment to be met except for the
one, different factual issue of whether the Tax Court settlement
already took account of the overpaid gift tax and remanded to the
District Court to determine that issue. In reversing on the
jurisdictional issue, the majority of the Supreme Court expressed
no misgivings about the factual basis of the inconsistent tax
treatment and indeed suggested that, had it not been for the
jurisdictional issue, Mrs. Dalm could have had her refund: “Our
holding today does not leave taxpayers in Dalm’s position
powerless to invoke the doctrine of equitable recoupment.”
United States v. Dalm, 494 U.S. at 610.
19
The District Court in Minskoff v. United States, 349 F.
Supp. 1146 (S.D.N.Y. 1972), affd. per curiam 490 F.2d 1283 (2d
Cir. 1974), advanced alternative grounds for its correct result,
(continued...)
- 56 -
The Court of Claims view was applied under somewhat
different circumstances in Estate of Mann v. United States, 552
F. Supp. 1132 (N.D. Tex. 1982), affd. 731 F.2d 267 (5th Cir.
1984), a case cited by neither party. There, after a holding
that a decedent’s estate was entitled to an income tax refund on
the ground that a bad debt had been a business debt, the
Government’s equitable recoupment claim, based on the ground that
the estate should have paid estate tax on the refund claim, was
denied. As the District Court observed, because refund suits
19
(...continued)
and one of these may have been correct. The first and arguably
correct one of these alternative grounds was that the estate had
not proved that there was any factual inconsistency, still less
its actual amount. Id. at 1150. The Court of Appeals, although
it felt no need to decide the case on any but the first ground
(fact as opposed to law), approved the District Court’s reasoning
about the estate’s failure of proof in a footnote, Minskoff v.
United States, 490 F.2d at 1285 n.1, and on this basis
distinguished Boyle v. United States, 355 F.2d 233 (3d Cir.
1965), where the sum at issue could not have been earned both
before and after the death of the decedent. (The District Court
had felt that Boyle was inconsistent with Rothensies v. Electric
Storage Battery Co., 329 U.S. 296 (1946), and had therefore
refused to follow Boyle v. United States, supra. Minskoff v.
United States, 349 F. Supp. at 1150 n.3.) With respect to this
issue of proof, our case resembles Boyle, rather than Minskoff:
Different valuations of a stock at the same time are inconsistent
on their face, and there is no need for petitioner to prove
anything on this score.
The District Court’s other alternative ground was that
equities weren't on the side of the taxpayer, who had failed to
report as income capital gain that clearly should have been
reported, and that therefore the doctrine of equitable
recoupment, being in the nature of an equitable defense, could
not be invoked by a party lacking clean hands. Id. at 1150. As
we shall see infra pp. 68-69, this is an aberrant view that
courts generally don't follow, which may no longer be
respondent's view, and which is incorrect. The Court of Appeals
was silent on this issue in Minskoff.
- 57 -
based on the deduction of worthless business debts are allowed
for 7 years, under section 6511(d)(1), and because the issues
posed by the two claims would require substantially different
proof, to allow recoupment in this situation would seriously
undermine the statute of limitations. Estate of Mann v. United
States, 552 F. Supp. at 1141. However, the District Court also
clearly expressed its preference for the reasoning of the Court
of Claims over Herring and Bowcut, Estate of Mann v. United
States, 552 F. Supp. at 1137-1140, and the Court of Appeals for
the Fifth Circuit affirmed, on the basis of Rothensies v.
Electric Storage Battery Co., Estate of Mann v. United States,
731 F.2d at 279. Estate of Mann clearly lines up with the Court
of Claims on the single-transaction issue, but it can be
distinguished from our case. On balance, I regard the later
cases as neither strengthening nor weakening my conclusion that
Herring and Bowcut represent the preferable view of the law.20
Respondent tries to distinguish the case at hand from
Herring, Bowcut, and Rev. Rul. 71-56, on the ground that in
20
Our recent decision in Estate of Bartels v. Commissioner,
106 T.C. 430 (1996), furnishes additional implicit support for
United States v. Herring, 240 F.2d 225 (4th Cir. 1957), and
United States v. Bowcut, 287 F.2d 654 (9th Cir. 1961), as opposed
to the contrary cases. In that case, which presented the
Herring-Bowcut situation, respondent, consistently with the view
announced in Rev. Rul. 71-56, 1971-1 C.B. 404, didn't even raise
the single-transaction requirement as an objection to our
allowance of the taxpayer's equitable recoupment claim. Estate
of Bartels v. Commissioner, at 433 n.4. We therefore found the
single-transaction requirement not to be an obstacle to
permitting equitable recoupment.
- 58 -
Herring-Bowcut, both the main action and the recoupment claim
are occasioned solely by deficiencies, whereas here that
characterization was available only for the proceeding before us
prior to issuance of our opinion in Mueller I. However, here
both the proceeding before us and the recoupment claim are
occasioned solely by inconsistent valuations of the same shares
of stock. There may not be a single taxable event here, but that
is really true in Herring-Bowcut as well. One can also speak of
our situation as a single transaction, decedent’s death, which
occasions the need to value the shares, both to determine the
gross estate for estate tax purposes and the step-up in basis for
income tax purposes. There is, moreover, the same fund, which
can be considered the same item. Cf. Estate of Vitt v. United
States, 706 F.2d 871, 875 (8th Cir. 1983) (taxation of same tract
of property and inclusion of identical part of value of that
property in two instances of imposition of estate tax sufficient
to satisfy single-transaction requirement); United States v. Gulf
Oil Corp., 485 F.2d 331, 333 (3d Cir. 1973) (taxation of same
fund all that is required); Boyle v. United States, 355 F.2d at
236 (taxation of identical “definite fund” all that is required).
This differences between the situation in Rothensies v.
Electric Storage Battery Co., on the one hand, and the Herring-
Bowcut-Wilmington Trust Co.-Bartels and the Ford-O'Brien-Mueller
situations, on the other, and the similarities of the latter two
sets of situations, are striking. In Rothensies v. Electric
- 59 -
Storage Battery Co. there is no causal connection between the
main claim and the barred claim sought to be recouped (actually
set-off). In the latter two sets of situations, there is a
causal connection. In Herring-Bowcut-Bartels, the determination
and payment of an income tax deficiency gave rise to a time-
barred estate tax overpayment, which was allowed to be recouped
against that deficiency; in Wilmington Trust, the Court of
Claims, improperly, I believe, refused to allow the Government to
recoup time-barred estate tax deficiencies against the taxpayer
estates' recoveries of income tax refunds that generated those
deficiencies. Similarly, in our case, as in Ford and O'Brien,
the increase in the value of the shares for estate tax purposes
generated an estate tax deficiency and a correlative time-barred
income tax overpayment with respect to the same shares. In our
case the causal connection is clear; in Rothensies v. Electric
Storage Battery Co. there is no such connection.21
Moreover, in another significant respect, the situation in
the case at hand is further removed from the Rothensies v.
Electric Storage Battery Co. situation than Herring and Bowcut:
Here, all the events happened within the same calendar year,
21
The excursus in the text further sharpens the point of my
observation in Fort Howard Corp. v. Commissioner, 103 T.C. 345,
377 n.2 (1994) (Beghe, J., dissenting), that for tax purposes the
connections that are important are not so much the logical
connections arrived at by reference to the laws of thought and
correct syllogistic reasoning as the "logic of events" that has
to do with cause and effect relationships and necessary
connections or outcomes.
- 60 -
within 67 days of each other.22 In addition, the dicta of the
Court of Appeals in O’Brien (and the decision of the District
Court in that case) find the single-transaction requirement
satisfied in a situation that is still closer to the case at hand
than the Herring-Bowcut situation.
Finally, in Mueller II, we decided, having been prompted to
do so by United States v. Dalm, supra, that we are authorized to
apply equitable recoupment. Dalm wrought a change in the legal
landscape that not only led us to change our own view of our
authority, but did so in a way that undercuts the broad rationale
of the narrow interpretation of the single-transaction
requirement urged in Rothensies v. Electric Storage Battery Co.,
supra. In deciding that case, the Supreme Court stated
emphatically that an important reason for keeping equitable
recoupment narrowly confined was its fear that otherwise too many
tax cases would be diverted from the Tax Court to the District
Courts. In Rothensies v. Electric Storage Battery Co., supra,
the Supreme Court also expressed concern that allowing, through
broadly interpreted equitable recoupment, wholesale reexamination
of other years would undermine the whole single-year income tax
system. In view of the limitations imposed by my view of the
requirements for equitable recoupment, including the single-
transaction requirement, the Supreme Court’s expression of
22
Cf. Willis, Some Limits of Equitable Recoupment, Tax
Mitigation, and Res Judicata: Reflections Prompted by Chertkof
v. United States, 38 Tax Law. at 640-641.
- 61 -
concern is not reasonably implicated. My approach is merely
lenient enough to admit the Herring-Bowcut situation and this
case. In Rothensies v. Electric Storage Battery Co., supra, the
taxpayer was trying to resurrect claims that were 20 years old,
whereas in our case only 67 days within the same calendar year
separate the two taxable events. Cf. O’Brien v. United States,
766 F.2d at 1051 n.17 (much to be said for liberally construing
single-transaction and identity-of-interest requirements for
equitable recoupment, but not for relaxing rule against reopening
closed tax years); Aetna Cas. & Sur. Co. v. Tax Appeals, 633
N.Y.S.2d 226, 228 (N.Y. App. Div. 1995) (equitable recoupment
allowed so long as taxpayer’s counterclaim covers same tax period
as Government’s claim, so that overpayment can be considered part
of same “transaction”, (citing National Cash Register Co. v.
Joseph, 86 N.E.2d 561, 562 (N.Y. 1949))).
According to Brown v. Secretary of Army, 78 F.3d 645, 650
(D.C. Cir. 1996), the rationale for narrow interpretation of
waivers of sovereign immunity is the risk of imposing
unanticipated and potentially excessive liabilities on the fisc.
The liability imposed on the fisc by interpreting the single-
transaction requirement in the way I would do here is strictly
limited and can't be regarded as excessive.
I would therefore hold, in the circumstances of this case,
where not only has the same fund been subjected to inconsistent
double taxation by reason of the decedent's death, but the
- 62 -
taxable events occurred within the same calendar year, and within
67 days of each other, that the single-transaction, item, or
event requirement of equitable recoupment has been satisfied.
3. Inconsistent Treatment
Respondent, in denying the Administration Trust’s second
refund claim made in 1990, treated the same shares inconsistently
with respondent’s statutory notice to petitioner determining an
estate tax deficiency based on a different valuation of those
shares at the same time, the time of decedent’s death. It
follows from my conclusion in the preceding section that this
case satisfies the single-transaction requirement that respondent
has subjected the same item to inconsistent tax treatment. Thus,
the inconsistent-treatment requirement is met.23
23
I'm aware that it's not necessarily inconsistent that the
same fund should be subjected to both income and gift tax, as the
Code sections having to do with those two taxes are not construed
in pari materia. Farid-Es-Sultaneh v. Commissioner, 160 F.2d 812
(2d Cir. 1947), revg. 6 T.C. 652 (1946). That does not, however,
gainsay a real inconsistency in our case, because both tax
results depend upon the same matter of fact, the fair market
value of the same shares at decedent’s death. It would be
inconsistent to hold those shares to have had one value for
estate tax purposes and another for income tax purposes. There
is a presumption that the estate tax value of an asset is correct
and applies also to determine income tax basis. Hess v. United
States, 210 Ct. Cl. 483, 537 F.2d 457, 463 (1976); Swift v.
Wheatley, 538 F.2d 1009, 1010 (3d Cir. 1976); Levin v. United
States, 373 F.2d 434, 438 (1st Cir. 1967); Williams v.
Commissioner, 44 F.2d 467, 469 (8th Cir. 1930), affg. 15 B.T.A.
227 (1929); Feldman v. Commissioner, T.C. Memo. 1968-19; sec.
1.1014-3(a), Income Tax Regs.; Rev. Rul. 54-97, 1954-1 C.B. 113.
- 63 -
4. Identity of Interest
In Stone v. White, 301 U.S. 532 (1937), the Supreme Court
permitted the Government to recoup its time-barred deficiency
claim against the sole beneficiary of a trust to reduce a timely
refund claim brought by the trustees of the same trust. Thus,
the Government’s claim against one taxpayer could be raised as a
defense to a claim brought by another taxpayer, so long as the
two taxpayers had an “identity in interest”. Id. at 537.
Later cases have followed Stone v. White, supra, in finding
identity of interest between legally different parties because
their interests did in fact coincide. Estate of Vitt v. United
States, 706 F.2d 871 (8th Cir. 1983) (husband’s estate and wife’s
estate); Boyle v. United States, 355 F.2d 233 (3d Cir. 1965)
(estate and all the beneficiaries of the estate); United States
v. Bowcut, 287 F.2d 654 (9th Cir. 1961) (decedent and his
estate); United States v. Herring, 240 F.2d 225 (4th Cir. 1957)
(same); Hufbauer v. United States, 297 F. Supp. 247 (S.D. Cal.
1968) (taxpayer and wholly owned corporation); see also O'Brien
v. United States, 766 F.2d 1038, 1050-1051 (7th Cir. 1985)
(dicta; one of three principal heirs). But see Kramer v. United
States, 186 Ct. Cl. 684, 406 F.2d 1363 (1969) (life tenant
annuitant and decedent's estate); Lockheed Sanders, Inc. v.
United States, 862 F. Supp. 677, 681-682 (D.N.H. 1994) (parent
corporation and subsidiary not qualified as member of affiliated
group).
- 64 -
Respondent argues that petitioner and the Administration
Trust don't satisfy the identity-of-interest requirement because:
(1) The Administration Trust, far from being the only beneficiary
of decedent’s estate, is not even a beneficiary; (2) petitioner’s
recoupment claim will inure to the benefit of all beneficiaries
of the Administration Trust, and petitioner hasn't met the burden
of showing an identity of interest between the Administration
Trust and the estate; (3) the Administration Trust has been and
will be reimbursed for part of its payment of decedent’s estate
taxes by the other parties in interest to whom some portion of
the Federal estate tax liability will be apportioned; (4) some of
the Administration Trust’s beneficiaries aren't beneficiaries of
the estate; and (5) the case law supports denying rather than
affirming that the requirement is satisfied.
These arguments don't seem to me to have force. Although
the Michigan Uniform Estate Tax Apportionment Act provides that,
unless the will otherwise provides, death taxes shall be
apportioned in proportion to the value of the interest that each
person has in the estate, Mich. Comp. Laws sec. 720.12 (1979), it
also contains several provisions for equitable apportionment,
Mich. Comp. Laws secs. 720.13(b), 720.15(d), 720.16 (1979). The
aim of this statute is to ensure an equitable allocation of the
burden of the tax among those actually affected by that burden.
In re Estate of Roe, 426 N.W.2d 797, 799-800 (Mich. Ct. App.
1988).
- 65 -
I would find that any adjustment through recoupment will
solely benefit the Administration Trust (and, through it, its
beneficiary subtrusts and their beneficiaries). Even though,
because of the reimbursements under probate court order, the
Administration Trust has been responsible for only 71.9 percent
of the estate tax that has been paid so far, I believe the
probate court would apportion any reduction in estate tax arising
from allowance of recoupment so that it would inure solely to the
benefit of the Administration Trust. The Administration Trust
paid all its income tax on the sale of its shares, including the
overpaid portion. There is thus an absolute identity of
interest. The situation seems to me to be quite analogous to
that of Stone v. White, so that any distinction based on the
existence of different legal entities would be purely artificial.
I would conclude that the identity-of-interest requirement
is satisfied.
5. Statutory Mitigation
Congress in 1938 enacted the mitigation provisions now
contained in sections 1311 through 1314 as a supplement to
equitable recoupment and other court-created correctives to the
injustices resulting from inconsistent treatment of related items
for Federal tax purposes. S. Rept. 1567, 75th Cong., 3d Sess. 48
(1938), 1939-1 C.B. (Part 2) 779, 815.24 If the complicated
24
"The Federal courts in many somewhat similar tax cases
(continued...)
- 66 -
requirements of these provisions are satisfied, then either a
taxpayer or the Government (depending on which has suffered from
the inconsistency) can obtain redress, regardless of the bar of a
statute of limitations. If the result of the required adjustment
is a tax deficiency, then it will be assessed and collected in
the same way as any other deficiency. If the result is a tax
overpayment, then the taxpayer must file a claim for refund,
unless the Government refunds it without the filing of a formal
claim. If the claim is denied or is not acted on in 6 months,
the taxpayer may then sue for a refund. Secs. 6532(a)(1),
7422(a).
The Administration Trust here applied for an income tax
refund, which was denied. Thereafter, petitioner in this case
raised mitigation as one of the affirmative defenses in its
amended petition, treating respondent's denial of its refund
claim as the final determination that would bring the mitigation
provisions into play. Respondent did not move to strike this
defense. Nevertheless, because petitioner failed to argue
24
(...continued)
have sought to prevent inequitable results by applying principles
variously designated as estoppel, quasi estoppel, recoupment, and
set-off. For various reasons, mostly technical, these judicial
efforts can not extend to all problems of this type. Legislation
has long been needed to supplement the equitable principles
applied by the courts and to check the growing volume of
litigation by taking the profit out of inconsistency, whether
exhibited by taxpayers or revenue officials and whether
fortuitous or by design.” S. Rept. 1567, 75th Cong., 3d Sess. 48
(1938), 1939-1 C.B. (Part 2) 779, 815; emphasis added.
- 67 -
mitigation further at trial or on brief, I would deem petitioner
to have waived this defense, insofar as its ability to assert it
in this proceeding is concerned.
That might not be the end of the matter. The mitigation
provisions may have a preemptive effect on petitioner’s right to
equitable recoupment. Compare, e.g., Brigham v. United States,
200 Ct. Cl. 68, 470 F.2d 571, 577 (1972) with First Natl. Bank of
Omaha v. United States, 565 F.2d 507, 512, 518 (8th Cir. 1977).
However, respondent has not argued that equitable recoupment is
unavailable to petitioner because mitigation preempts it, nor did
petitioner argue that there is no preemption. Under the
circumstances, I would hold that respondent has waived the
preemption argument.25 Consequently, the mitigation provisions
25
In light of the regulation stating that statutory
mitigation is only available for inconsistencies involving solely
the income tax, sec. 1311(a)-2(b), Income Tax Regs., and Chevron,
U.S.A., Inc. v. Natural Resources Defense Council, Inc., 467 U.S.
837 (1984), which requires us to defer to that regulation if it
is reasonable, see Reno v. Koray, 515 U.S. ___, ___, 115 S. Ct.
2021, 2023 (1995) (Chevron deference owed to interpretive rules),
it would be unnecessary to decide whether, in the absence of the
regulation and Chevron, Chertkof v. United States, 676 F.2d 984,
987-992 (4th Cir. 1992), was correct in holding that statutory
mitigation is also available to correct inconsistencies in
application of estate tax and income tax. The weight of
authority is to the contrary, see Hall v. United States, 975 F.2d
722 (10th Cir. 1992) (windfall profits tax); Ketteman Trust v.
Commissioner, 86 T.C. 91, 110 (1986) (gift tax); Provident Natl.
Bank v. United States, 507 F. Supp. 1197 (E.D. Pa. 1981) (estate
tax); see also, Willis, Correction of Errors Via Mitigation and
Equitable Recoupment: Some People Still Do Not Understand, 52
Tax Notes 1421 (Sept. 16, 1991); Willis, Some Limits of Equitable
Recoupment, Tax Mitigation, and Res Judicata: Some Reflections
Prompted by Chertkof v. United States, 38 Tax Law. 625 (1985).
- 68 -
do not prevent the application of equitable recoupment in this
case.
6. Other Equitable Considerations
Respondent raised arguments that application of equitable
recoupment to petitioner was blocked by other considerations:
(1) Lack of clean hands, largely because of considerations having
to do with trial tactics that are essentially irrelevant; and (2)
lack of diligence or laches, because the Administration Trust had
more than 4 months following issuance of the estate tax statutory
notice in which it could have filed a timely protective claim for
an income tax refund. On brief, however, respondent has
essentially conceded these issues and admitted that, where the
proper circumstances for the application of equitable recoupment
are present, such equitable considerations won't prevent its
application. All that remains in respondent’s briefs of the
original arguments about other equitable factors are trace
references to their factual bases and what appears to be an
argument in the alternative: “if the Court believes that other
factors should be taken into account,” then respondent suggests
we take into account the Administration Trust’s lack of diligence
and failure to provide some necessary information during
discovery and at and after trial.
Petitioner argues in detail against respondent’s specific
charges, but only after initially arguing that respondent’s
concession that such equitable considerations shouldn't be taken
- 69 -
into account in determining the availability of recoupment moots
the specifics of respondent’s charges. Because I would agree
with petitioner that respondent’s concession settles the issue,
it's unnecessary to address respondent’s charges.26 I would
therefore decide that neither of these considerations prevents
the application of equitable recoupment in petitioner's favor.
7. Overpayment Status
Petitioner's overpayment status is attributable to two
functionally unrelated factors: respondent's uncontested
allowance of credit for tax on prior transfers under section
2013, and our redetermination of the value of the shares in an
amount which, although greater than the value reported on the
estate tax return, is substantially less than the value
determined in respondent's statutory notice.
If petitioner had filed the estate tax return claiming the
previously taxed property credit to which it is clearly entitled,
26
There is substantial authority that equitable factors
can't block equitable recoupment, Bull v. United States, 295 U.S.
247 (1935); Fisher v. United States, 80 F.3d 1576, 1581 (Fed.
Cir. 1996); Lovett v. United States, 81 F.3d 143, 145 (Fed. Cir.
1996); United States v. Bowcut, 287 F.2d at 656-657; Dysart v.
United States, 169 Ct. Cl. 276, 340 F.2d 624, 628-630 (1965);
Holzer v. United States, 250 F. Supp. 875, 878 (E.D. Wis. 1966),
affd. per curiam 367 F.2d 822 (7th Cir. 1966); see also
McConnell, The Doctrine of Recoupment in Federal Taxation, 28 Va.
L. Rev. 577, 579 (1942) (recoupment not entirely equitable in
origin or nature). But see Fairley v. United States, 901 F.2d
691, 694 n.4 (8th Cir. 1990); Wilmington Trust Co. v. United
States, 610 F.2d at 714-715; Davis v. United States, 40 AFTR 2d
77-6189, at 77-6192, 77-1 USTC par. 13,195, at 87,274 (N.D. Tex.
1977); Minskoff v. United States, 349 F. Supp. at 1150.
- 70 -
we wouldn't even be discussing this issue. Petitioner would have
paid estate tax in an amount that was $1,152,649 less than the
amount that accompanied the return as prepared and filed, and
respondent would have determined an estate tax deficiency in
excess of $3 million rather than the one slightly less than $2
million in the statutory notice that was actually sent.27 As a
result of our valuation redetermination of the value of the
shares at $1,700 per share in Mueller I, there would be an estate
tax deficiency of $957,099, against which there would be
recoupment of $265,999, resulting in a reduced deficiency on the
order of $691,100.
Petitioner hasn't attempted to explain why it failed to
claim the previously taxed property credit on the estate tax
return, but whether petitioner has a valid excuse should have no
bearing on the outcome. As indicated supra p. 68, laches and
lack of diligence don't adversely affect a taxpayer's right to
recoupment. For purposes of recoupment, petitioner shouldn't be
disadvantaged by its initial oversight in failing to claim a
credit that respondent acknowledges petitioner's clearly entitled
to. To allow respondent to take advantage of petitioner's
oversight would perpetuate in another guise the unjust enrichment
that equitable recoupment is designed to prevent.
27
For the purpose of this discussion, changes in other
credits can be and are ignored. See background statement, supra
pp. 35-36.
- 71 -
i. Code sections are no obstacle to recoupment
Section 6214(a) grants this Court “jurisdiction to
redetermine the correct amount of a deficiency”. Deficiency, as
defined in section 6211, depends generally on the relationship
between the amount of the tax imposed on the taxpayer and the
amount the taxpayer showed as the tax on the tax return. In
Mueller II, when the parties argued the case on the assumption
that petitioner would have a deficiency, respondent argued that
these sections did not authorize us to use equitable recoupment
to adjust petitioner's deficiency. We decided in Mueller II
that, even if petitioner should have a deficiency, we have
authority to apply equitable recoupment. We recently reaffirmed
that conclusion in Estate of Bartels v. Commissioner, 106 T.C.
430 (1996).
There is less restriction on our overpayment jurisdiction
under section 6512(b). Although section 6512(b)(1) does require
that the overpayment have been made by “the taxpayer”, and the
Administration Trust is not the same as petitioner, the identity
of interest that I would find, and the fact that the
Administration Trust has paid and is responsible for the estate
tax on transfers of the shares held by and appointed to it,
satisfy this requirement, given the nature and purposes of
equitable recoupment.
Moreover, the requirements of section 6512(b)(3), which sets
time limits on any credit or refund, and whose restrictions
- 72 -
section 6512(b)(1) incorporates, have been satisfied so as to
allow the refund of the overpayment in this case. Because the
statutory notice in this case was mailed within 3 years of the
Administration Trust's overpayments of both income tax and estate
tax, section 6512(b)(3)(B) has been satisfied.
ii. Recoupment's defensive nature and the unrelated
overpayment don't bar recoupment
Respondent argues and the majority conclude that
petitioner’s overpayment status prevents us from applying
equitable recoupment. They've been beguiled by the notion that
allowing equitable recoupment when there's already a net
overpayment would increase the overpayment, and that this would
be the same as allowing an affirmative recovery of time-barred
taxes that recoupment can't provide. As we've said, Mueller II,
101 T.C. at 552, and as United States v. Dalm, 494 U.S. 596
(1990), clearly establishes, a taxpayer asserting equitable
recoupment may not affirmatively collect the time-barred
overpayment of tax, but may only use equitable recoupment to
reduce the Government’s timely determination of a deficiency.
Respondent and the majority (majority op. p. 8) cite for
their conclusion Brigham v. United States, 200 Ct. Cl. 68, 470
F.2d 571 (1972). There, the taxpayers were seeking refunds of
ordinary income tax paid in barred years that, it turned out
under a later Supreme Court case, had been erroneously paid,
because the underlying transaction should have been treated as an
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installment sale resulting in capital gains. The Commissioner
acquiesced and allowed the taxpayers a refund for 1962 but not
for earlier, barred years. The taxpayers then sued for refunds
of their overpayments for those earlier years, under the
alternative theories of mitigation and equitable recoupment. The
Court of Claims denied mitigation on the ground that the
Commissioner had not actively maintained inconsistent positions.
The Court of Claims then denied equitable recoupment, primarily
because it believed that mitigation, within its area of
applicability, preempts equitable recoupment, but also on the
alternative ground that equitable recoupment can only be used to
reduce the amount of deficiencies recoverable by the Government
in later years, and there were no such deficiencies, just time-
barred earlier years. Brigham v. United States, 470 F.2d at
577.28
Brigham’s language might, in isolation, like some language
in Mueller II, 101 T.C. at 552, be extended to support
respondent’s view, but petitioner persuasively argues that such
an extension would make no sense. Under respondent’s view, this
28
"When its benefits are sought by the taxpayer, the
function of the doctrine [of equitable recoupment] is to allow
the taxpayer to reduce the amount of a deficiency recoverable by
the Government by the amount of an otherwise barred overpayment
of the taxpayer. * * * Here no such situation exists. * * *
Rather, the plaintiffs are attempting an extension of the
doctrine of equitable recoupment to the case of a refund of taxes
for an otherwise barred year." Brigham v. United States, 200 Ct.
Cl. 68, 470 F.2d 571, 577 (1972).
- 74 -
Court’s jurisdiction to apply equitable recoupment would
evaporate if and when it turned out that the petitioner was in an
overpayment status, which might well not be known until we were
about to enter a decision after a Rule 155 computation in a
multi-issue case. To tie the requirement that the assertion of
equitable recoupment be defensive to a taxpayer’s total position,
rather than to the single transaction to which equitable
recoupment would attach, would be a radical departure from the
history of recoupment. Recoupment arose as an equitable rule of
joinder that permitted adjudication in one suit of two claims,
both arising out of the same transaction, that otherwise had to
be brought separately under the common law forms of action. In
re Davidovich, 901 F.2d 1533, 1537 (10th Cir. 1990). Hence, when
recoupment was imported into the tax law by the Supreme Court in
Bull v. United States, 295 U.S. 247 (1935), the Court did require
that both claims arise out of the same transaction and that the
recoupment claim be defensive, but it did not require that the
taxpayer have a deficiency. Bull v. United States, 295 U.S. at
262. Indeed, the Court could not have done so; in Bull v. United
States, supra, as in all later refund cases where taxpayers
obtained equitable recoupment, the taxpayers had overpaid. The
fact that the amount that they claimed in recoupment did not
exceed the amount claimed by the Government from the same
transaction sufficed to render their claim defensive. The
language in Brigham v. United States, supra, on which respondent
- 75 -
relies means no more than that equitable recoupment is only
available against a deficiency determined by respondent, whether
or not it turns out to exceed any recoupment sought.29
The foundations, such as they are, of the majority opinion
lie in its footnotes 13 and 14. Footnote 13 provides the
majority's rationale for refusing to decide whether petitioner is
in a deficiency posture and thus to refuse to apply recoupment
before taking into account the credit for tax on prior transfers.
Footnote 14 asserts a policy reason for this refusal.
The cases cited in footnote 1330 can be made to stand for
the proposition that, for purposes of res judicata with respect
to whether a taxpayer in a new action can raise new tax issues
29
In any event, the language of Brigham v. United States,
supra, on which respondent rely is dictum. The taxpayers in the
cases consolidated in Brigham were seeking to use equitable
recoupment (as well as mitigation) to recover time-barred income
tax overpaid. The Court of Claims, having denied mitigation,
went on to deny equitable recoupment, first on the ground that
mitigation preempted equitable recoupment within its area of
applicability. It then went on to observe that the taxpayers
were not seeking to reduce deficiencies in later years, which it
was conceded did not exist, but rather to extend equitable
recoupment to a refund of taxes in an otherwise barred year.
There was no independent basis for jurisdiction. The language is
best taken as a somewhat less clear expression of the doctrine
expressed much more clearly in United States v. Dalm, supra. The
same is true of similar language in Evans Trust v. United States,
199, Ct. Cl. 98, 462 F.2d 521, 526 (1972), quoted by the majority
(majority op. p. 16), which is to be properly interpreted in the
same way as the language of Brigham.
30
Commissioner v. Sunnen, 333 U.S. 591, 598 (1948); Finley
v. United States, 612 F.2d 166, 170 (5th Cir. 1980); Estate of
Hunt v. United States, 309 F.2d 146, 148 (5th Cir. 1962);
Huddleston v. Commissioner, 100 T.C. 17, 25 (1993).
- 76 -
with respect to a tax year or estate concerning which there has
already been a final court decision, all issues having to do with
the same tax, the same taxpayer, and the same tax year (or same
estate) are part of one undivided claim. However, the fact that
two issues are part of the same claim or cause of action for one
purpose doesn't mean they must be deemed to be such for any and
all other purposes. Olympia Hotels Corp. v. Johnson Wax Dev.
Corp., 908 F.2d 1363 (7th Cir. 1990).
The language in Commissioner v. Sunnen, 333 U.S. 591, 598
(1948),31 appears to imply more than the other cases cited in
footnote 13. However, this language is pure dictum: the Supreme
Court in Sunnen was denying that res judicata blocked Government
litigation of the same tax issue that had been previously decided
for earlier tax years, not asserting a res judicata effect with
respect to the same year. The holding of Sunnen was
significantly limited in Montana v. United States, 440 U.S. 147,
161 (1979).32 Sunnen now only stands for the proposition that
31
"Income taxes are levied on an annual basis. Each year is
the origin of a new liability and of a separate cause of action.
Thus, if a claim of liability or non-liability relating to a
particular tax year is litigated, a judgment on the merits is res
judicata as to any subsequent proceeding involving the same claim
and the same tax year." [Commissioner v. Sunnen, 333 U.S. 591,
598 (1948).]
32
The issue in Montana v. United States, 440 U.S. 147, 161
(1979), was whether a Government contractor, which had filed
suit at the direction of the United States in Montana courts
against the constitutionality of a Montana tax, had lost his case
in the Montana Supreme Court, and then abandoned its appeal to
(continued...)
- 77 -
res judicata doesn't prevent the Government from litigating the
same tax issue for different years if the law has changed since
the prior lawsuit. Cf. Greene v. United States, 79 F.3d 1348,
1352 (2d Cir. 1996); Kamilche Co. v. United States, 53 F.3d 1059,
1061 n.2 (9th Cir. 1995); ITT Corp. v. United States, 963 F.2d
561, 564 (2d Cir. 1992); Blair v. Taxation Div. Director, 9 N.J.
Tax 345, 352-353 & n.7 (N.J. Tax Ct. 1987), affd. 543 A.2d 99
(N.J. Super. Ct. 1988). Since the Supreme Court spoke its dictum
about the annual nature of the income tax in aid of its
conclusion that res judicata didn't prevent new litigation of the
same issue for later years, query how much of that dictum the
Supreme Court would repeat today, in view of its change of view
on that conclusion (different year no longer implies different
claim or cause of action).
This Court decided, in Hemmings v. Commissioner, 104 T.C.
221 (1995), that a final judgment in District Court in a refund
suit didn't prevent respondent from issuing a statutory notice
for the same year on a different issue and this Court from
32
(...continued)
the United States Supreme Court, was prevented by res judicata
from filing a new suit, again at the direction of the United
States and now in United States District Court, against the
constitutionality of the same tax, with respect to different
payments under it. As Commissioner v. Sunnen, supra, had
previously been interpreted, res judicata would not have
prevented suit. However, in Montana v. United States, the United
States Supreme Court emphasized other language in Commissioner v.
Sunnen, supra, about how the law had changed since the previous
decision in deciding that res judicata prevented this new suit.
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refusing to grant partial summary judgment to the taxpayers on
the basis of res judicata. Although it's settled law that the
requirements for claim preclusion are: (1) identical parties
(met); (2) court of competent jurisdiction (presumably met); (3)
final judgment on merits (met); and (4) identical cause of
action, United States v. Shanbaum, 10 F.3d 305 (5th Cir. 1994),
we decided in Hemmings that the Government was only prevented
from litigating in a new suit after a concluded refund suit all
its compulsory counterclaims and such permissive counterclaims as
are actually litigated. Hemmings v. Commissioner, 104 T.C. at
234. What this means is that this Court has held that it's not
always and for all purposes that all tax issues having to do with
the same taxpayer and the same tax year are parts of one
indivisible claim or cause of action.
In Hemmings v. Commissioner, 104 T.C. at 234-235, we cited a
number of cases holding or stating that unrelated tax claims by
the Government having to do with the same tax year or same estate
are not compulsory counterclaims in a refund suit by the taxpayer
in District Court. See, e.g., Gustin v. IRS, 876 F.2d 485, 490
n.1 (5th Cir. 1989) (wrong to dismiss for lack of jurisdiction
Government's counterclaim in refund suit, because that
counterclaim is not compulsory); Caleshu v. United States, 570
F.2d 711, 713-714 (8th Cir. 1978) (pending refund suit in
District Court does not prevent collection action to reduce
unpaid assessments to judgment in different District Court);
- 79 -
Pfeiffer Co. v. United States, 518 F.2d 124, 128-130 (8th Cir.
1975) (pending refund suit in District Court does not render
statutory notice and resulting deficiency assessment invalid);
Bar L Ranch v. Phinney, 400 F.2d 90, 92 (5th Cir. 1968) (pending
refund suit in District Court does not render statutory notice
and resulting deficiency assessment invalid); Florida v. United
States, 285 F.2d 596, 602-604 (8th Cir. 1960) (pending refund
suits in District Court do not prevent Government action in
different District Court to enforce payment of taxes). Most of
these cases cite dictum to the same effect in Flora v. United
States, 362 U.S. 145, 166 (1960).33 If these counterclaims are
not compulsory and thus can be the basis of a separate action,
tax cases can be split, at least for some purposes.
33
"Moreover, if [the taxpayer] decides to remain in the
District Court, the Government may--but seemingly is not required
to--bring a counterclaim; and if it does, the taxpayer has the
burden of proof." [Flora v. United States, 362 U.S. 145, 166
(1960); fn. ref. omitted.]
With respect to Flora v. United States, supra, it's
interesting to observe that that case's central holding, that
refund suits can only be brought when taxes have been paid in
full, was, like Rothensies v. Electric Storage Battery Co., 329
U.S. 296 (1946), largely motivated by the desire not to divert
large numbers of tax cases from this Court to the district
courts. Flora v. United States, 362 U.S. at 175-176. After
United States v. Dalm, supra, and Mueller II, we won't divert tax
cases to the district courts if we refrain from holding that the
credit for prior taxes is part of the same claim or cause of
action for the purpose of permitting equitable recoupment any
more than we'll divert them by refusing to allow a narrow reading
of the single-transaction issue (the issue in Rothensies v.
Electric Storage Battery Co., supra) to block equitable
recoupment. See infra pp. 42-60 discussing the single-
transaction issue.
- 80 -
Our issue here, whether the credit for prior taxes is part
of the same claim for the issue of blocking equitable recoupment,
is clearly less closely related to the issue of Finley v. United
States, 612 F.2d 166 (5th Cir. 1980), and Estate of Hunt v.
United States, 309 F.2d 146 (5th Cir. 1962) (whether the new
issue is part of the same claim for the purpose of preventing the
plaintiff taxpayer from separately litigating the new issue) than
the issue of Hemmings v. Commissioner, supra (whether the new
issue is part of the same claim for the purpose of preventing the
defendant Government from separately raising the new issue
through a statutory notice and then continuing to litigate it in
the Tax Court). Hemmings v. Commissioner, supra, being closer to
our case, furnishes ground for confining recoupment to the same
transaction and not impeding it with the overpayment arising from
allowance of the credit for taxes on prior transfers, a
completely unrelated issue.
The language of Bull v. United States, supra, quoted by the
majority suggests that for our equitable recoupment issue we
should look to Hemmings v. Commissioner, supra, not to Finley and
Hunt: Defenses that the taxpayer could have asserted if the
Government had brought suit for the tax are to be allowed
taxpayers in suits that they bring. Bull v. United States, 295
U.S. at 263. If the United States had sued petitioner in this
case for the estate tax deficiency, the estate wouldn't have had
to raise the credit for prior taxes as a defense or counterclaim.
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Since it doesn't spring from the same transaction as the estate
tax claim, it wouldn't have had to be raised as a compulsory
counterclaim. Fed. R. Civ. P. 13. Thus, petitioner could have
raised recoupment as a defense in such a suit and, in the absence
of any claims about the credit, would have been entitled to
recoupment. Thereafter, the estate could have brought a separate
suit for the credit for prior taxes. It's highly significant
that this is the test that was applied in Hemmings: The
Government's claim was allowed in the second action because in
the first action the claim would have been a permissive, not a
compulsory, counterclaim. Hemmings v. Commissioner, 104 T.C. at
232, 234-235.34
I conclude, for the purposes of applying equitable
recoupment, that the cases cited in the majority's footnote 13
are inapposite and that the credit for previously paid taxes is
not part of the same claim or cause of action as that
attributable to the date of death value of the shares.
The majority's footnote 14 quotes at length a passage in
Rothensies v. Electric Storage Battery Co., 329 U.S. 296, 301
34
The majority posits a different hypothetical case
(majority op. pp. 11-12) in which the credit for prior death
taxes is known and figures as an issue. But it assumes that a
court would take that credit into account when deciding whether
equitable recoupment is being used defensively and should
therefore be allowed. In so assuming, the majority begs the
question. There's no case law on point, and we can't be certain
what such a court would decide. We're therefore free to decide
which is the preferable rule, both for this hypothetical and for
the case at hand (the issue is the same for both).
- 82 -
(1946), that emphasizes the importance and desirability of
maintaining a statute of limitations in the income tax area. As
I've already observed, supra pp. 49, 58-59, the purposes
underlying statutes of limitations--preventing stale litigation
and protecting repose--don't apply when the timely claim that
initiates a lawsuit is subjected to an otherwise time-barred
defensive claim that arose out of the same transaction, item, or
event. Indeed, those purposes are repugnant to disallowance of
such a defense, since such a limitation would encourage delay in
the bringing of some claims until a defense is time-barred.
United States v. Western Pac. R.R., 352 U.S. 59, 72 (1956).
In any event, Rothensies v. Electric Storage Battery Co.
(like Ford v. United States, 149 Ct. Cl. 558, 276 F.2d 17 (1960),
which the majority also cites and quotes in this connection,
majority op. p. 15), stands not just for limiting equitable
recoupment, but for limiting it through a narrow interpretation
of the single-transaction requirement.35 To limit equitable
recoupment in the way that those two cases do is more defensible
than to limit it in the way that the majority does here. There's
a connection between the defensive purpose of equitable
recoupment and the single-transaction requirement.
Recoupment is allowed to circumvent such bars as statutes of
limitations, sovereign immunity, and bankruptcy because it would
35
The two cases are discussed at length, supra pp. 42-44,
47-52, in the section on the single-transaction requirement.
- 83 -
be unjust to allow one party to benefit from some aspects of a
transaction when another party can't derive the benefits of other
aspects of that same transaction merely because of the presence
of some procedural bar. Reiter v. Cooper, 507 U.S. 258, 265 n.2
(1993); Rothensies v. Electric Storage Battery Co., 329 U.S. at
299; In re Peterson Distrib., Inc., 82 F.3d 956, 961 (10th Cir.
1996); In re B & L Oil Co., 782 F.2d 155, 159 (10th Cir. 1986)
(cited approvingly for extent to which recoupment is available in
bankruptcy in Reiter v. Cooper, 507 U.S. at 265 n.2 ); In re
Centergas, Inc., 172 Bankr. 844, 849 (Bankr. N.D. Tex. 1994). To
the extent that the object of inconsistent taxation was not a
part of the same transaction, to that extent justice requires
less insistently that it be treated consistently, and this is
what explains the single-transaction requirement. There is no
such connection between the rationale of equitable recoupment and
the majority's expansive interpretation of the requirement that
recoupment be defensive. Rather, the majority's reasoning
prevents justice from being rendered in view of the one
transaction as a whole and thereby thwarts the purpose of
equitable recoupment, not only in this case but probably in
future cases where such a result would be even more clearly
unjust.
- 84 -
iii. Barring recoupment would be inconsistent with tax
precedent
Respondent and the majority would now have us believe that
in tax cases Bull v. United States, supra, only eliminates to a
very limited extent the requirement that equitable recoupment be
defensive. Of course, under Bull v. United States, supra, and
later recoupment tax cases, a taxpayer can't gain any greater
credit from the Government under equitable recoupment than the
Government seeks from him (just as the Government can't gain any
greater credit than the taxpayer seeks from the Government). But
the majority and I part company on their conclusion that
equitable recoupment in favor of the taxpayer is further limited
in that it can't, in combination with any other unrelated claims
of the taxpayer, lead to any affirmative recovery by the
taxpayer. Bull v. United States, supra, by allowing recoupment
where the recouping party was technically the plaintiff,
liberalized the requirement that recoupment could only be used
defensively. It did so to prevent unjust enrichment of the
Government. For the Government to retain both the estate tax and
the income tax on the same fund was held to amount in law to a
fraud on the taxpayer's rights and to be against morality and
conscience. In limiting Bull v. United States, supra, as the
majority have done, they are thereby perpetuating unjust
enrichment in the case at hand.
- 85 -
The question is really one of the order of application: If
we consider the adjustment that would result from recoupment as
occurring before the allowance of credit for tax on prior
transfers, then that adjustment doesn't cause affirmative
recovery, which would only result later; rather, it merely
cancels, in part, the Government's claim arising from the same
transaction, item, or event. Only if we consider the adjustment
from recoupment as occurring after the allowance of the credit
for tax on prior transfers would it cause affirmative recovery.
We aren't obliged to take that view of it, and the policy
considerations argue strongly against so taking it.
So long as petitioner is entitled to some unrelated credit,
however small, there would, under respondent's reasoning, be some
redetermined increased valuation of the shares at which
petitioner would cease to be entitled to any more than partial
recoupment, and another, lower but still increased, valuation at
which petitioner would cease to be entitled to any recoupment at
all. The same would be true of any refund actions that might
have occurred if the estate had paid the deficiency determined by
respondent and then sued for a refund. Under respondent's and
the majority's approach, any limitation on recoupment might only
become clear upon final disposition of a multi-issue case. And
this limitation on equitable recoupment would result from the
- 86 -
altogether fortuitous existence of some unrelated credit or other
adjustments, in this case the credit for tax on prior transfers.
Let me take another cut at what it means to say that the
defense of equitable recoupment can't be used offensively, like a
counterclaim, to generate an overpayment. Suppose we didn't have
the previously taxed property credit problem. Suppose also that
the estate had reported the value of the shares at $1,500 per
share and there was no estate tax audit and the period of
limitations expired on the assessment of an estate tax deficiency
and the filing of an estate tax claim for refund. The
Administration Trust, which reported its gain on the sale of the
shares using the date-of-death value basis of $1,500 per share,
then files an income tax claim for refund just before the period
of limitations expires, contending that it should have used a
basis of $1,700 per share, and sues for the refund. The
Government answers with a denial, but also asserts equitable
recoupment. The District Court upholds the $1,700 date-of-death
value, which means that the estate is entitled to an income tax
refund of approximately $266,000. The Government says that means
there is a time-barred deficiency in estate tax of approximately
$957,000. Allowing recoupment means that the $266,000 refund
claim is wiped out, but the statute of limitations bars the
Government from collecting the balance of the estate tax
deficiency of $691,000.
- 87 -
If we were to allow an increase in the overpayment in our
case, we would not breach the bar of the statute of limitations
in the way the District Court would be doing if it allowed the
Government to recover the balance of the deficiency in my
hypothetical. The Government is already indebted to the taxpayer
in our case for the amount of the unclaimed previously taxed
property credit of more than $1 million ($1,152,649), and,
because the Government has conceded that amount in the statutory
notice, there's no statutory bar on the taxpayer's recovering it
as an overpayment in this case.
If this Court had upheld in full the estate's reporting
position on the value of the shares at $1,505 per share, we would
have jurisdiction to determine an overpayment in the full amount
of $1,152,649, and to enter a decision in favor of the taxpayer
in that amount. There is and would be no statute of limitations
bar to our determining an overpayment in that full amount. All
I'm proposing that we do now is reduce the smaller deficiency
that arises from valuing the shares at $1,700 per share by the
amount of the recoupment in order to compute the amount of the
reduction of the overpayment that the taxpayer is already
otherwise entitled to, and that's already in the picture as part
of this case. To do so would not impair the sovereign immunity
bar of the statute of limitations.
- 88 -
Nothing in Bull v. United States, supra, indicates that we
need consider anything other than the single transaction at issue
when we set out to determine whether recoupment is being used
defensively, and there is plenty of other authority to the effect
that we should only consider that single transaction. As the
Supreme Court said in Rothensies v. Electric Storage Battery Co.,
329 U.S. 296, 299 (1946):
Equitable recoupment has never been thought to allow
one transaction to be offset against another, but only
to permit a transaction which is made the subject of
suit by a plaintiff to be examined in all its aspects,
and judgment to be rendered that does justice in view
of the one transaction as a whole.
That sentence was cited at a critical point in United States v.
Dalm, 494 U.S. at 611, to support the Supreme Court's central
holding that equitable recoupment requires an independent basis
for jurisdiction. By limiting recoupment as respondent wants,
the majority, to that extent, are failing to do justice in view
of the one transaction as a whole.
iv. Barring recoupment would be inconsistent with other
precedent
In Reiter v. Cooper, 507 U.S. 258, 265 (1993), a bankruptcy
case and the Supreme Court's latest pronouncement on recoupment,
the Supreme Court reaffirmed Bull v. United States, 295 U.S. 247
(1935),36 and cited it for the proposition that recoupment claims
36
Equitable recoupment entered bankruptcy law under the
(continued...)
- 89 -
are not barred by statutes of limitations so long as the main
action is timely, and said that a bankruptcy defendant can meet a
plaintiff-debtor's claim with a counterclaim arising out of the
same transaction, "at least to the extent that the defendant
merely seeks recoupment." Reiter v. Cooper, 507 U.S. 258, 113
S. Ct. at 1218 & n.2. The Supreme Court went on to say that this
did not result in preferential treatment of the creditor
asserting recoupment, inasmuch as recoupment merely permits a
determination of the just and proper liability on the main issue.
Id. at 1218-1219 n.2. To take account of anything other than the
same transaction in determining the amount of recoupment would be
inconsistent with this argument, and indeed the Supreme Court
made absolutely no mention of a further, unrelated amount owing
to the plaintiff-debtor.37
36
(...continued)
authority of Bull v. United States, 295 U.S. 247 (1935). In re
Monongahela Rye Liquors, Inc., 141 F.2d 864, 869 (3d Cir. 1944).
As in the tax area, recoupment is used in bankruptcy cases to
prevent unjust enrichment. A debtor should not benefit from
post-petition sales to a creditor under a contract without the
burden of repaying the creditor's pre-petition overpayments under
the same contract. In re Peterson Distrib., Inc., 82 F.3d 956,
961 (10th Cir. 1996); In re B & L Oil Co., 782 F.2d 155, 159
(10th Cir. 1986) (cited with approval for extent to which
recoupment is available in bankruptcy in Reiter v. Cooper, 507
U.S. 258, 265 n.2 (1993)). The prevention of unjust enrichment
thought of in these terms is the real reason for the single-
transaction requirement, both in bankruptcy, where it is also
enforced, and in the tax area.
37
This additional amount is disclosed in the opinion of the
(continued...)
- 90 -
In Reiter v. Cooper, supra, the unrelated claim was properly
ignored by the Supreme Court, because it couldn't have affected
the outcome. In In re Greenstreet, Inc., 209 F.2d 660 (7th Cir.
1954), a claim that the Court of Appeals for the Seventh Circuit
chose to regard as unrelated was very much before the Court,
which refused to allow that claim to have any effect on the
amount of recoupment allowed. Instead, the claim belonging to
the same transaction to which the recoupment counterclaim also
belonged alone determined the extent to which recoupment was
allowed. That is to say, only the single transaction was
considered.
In In re Greenstreet, Inc., supra, the Government filed
claim, in the bankruptcy proceedings of a manufacturer of Army
clothing, for $302,500, the purchase price of property that it
had furnished to the debtor for the manufacture of such clothing,
and for an additional $68,279.72 damages for the bankrupt's
failure to complete the contract. The bankruptcy trustee in turn
filed counterclaims amounting to $155,593.49, asserting certain
liens and unsecured money demands against the property and the
Government's general claim. The District Court held that it had
37
(...continued)
Bankruptcy Court in this case. In re Carolina Motor Express, 84
Bankr. 979, 981, 991 (Bankr. W.D.N.C. 1988). The Supreme Court
only mentioned the debts owing under the main issue. Reiter v.
Cooper, 507 U.S. 258, 113 S. Ct. at 1217.
- 91 -
jurisdiction over all the counterclaims, and the Government
appealed this holding. The parties agreed that the counterclaims
could cancel the Government's general claim for damages of
$68,279.72. The issue in dispute was whether the counterclaims
could also be asserted against the Government's claim for the
reclamation of its property, so that the whole of the
counterclaims could have effect. The Court of Appeals found that
they could not be asserted to that extent, since the Government
had not waived its sovereign immunity to that extent. In
holding, in effect, that the property claim did not involve the
same transaction, the Court of Appeals gave a particularly narrow
reading of the single-transaction requirement, especially for a
bankruptcy case. That issue would almost certainly be decided
differently today,38 so that there would be no question of
38
Cf. In re Pullman Constr. Indus., Inc., 142 Bankr. 280
(Bankr. N.D. Ill. 1992) (questioning In re Greenstreet, Inc., 209
F.2d 660 (7th Cir. 1954), on the basis of later Seventh Circuit
decisions about the single-transaction issue, making the test for
deciding whether sovereign immunity is waived with respect to a
counterclaim whether the counterclaim is a compulsory
counterclaim to the claim in question, and holding on that basis
that sovereign immunity had been waived with respect to the
counterclaim), affd. sub nom. United States v. Pullman Constr.
Indus., Inc., 153 Bankr. 539 (N.D. Ill. 1993), appeal dismissed
sub nom. Pullman Constr. Indus., Inc. v. United States, 23 F.3d
1166 (7th Cir. 1994). Query whether if there has been such a
liberalization of the single-transaction requirement for
equitable recoupment in bankruptcy, there should not be a similar
liberalization in the tax area, and whether the post-Rothensies
v. Electric Storage Battery Co. cases cited in the discussion of
the single-transaction requirement do not demonstrate precisely
(continued...)
- 92 -
limiting the recoupment. However, it is not Greenstreet's
treatment of the single-transaction issue that makes it
significant for the case at hand. Rather, In re Greenstreet,
Inc. is a striking example of a refusal by a court to look beyond
the single transaction in deciding what effect to give to
recoupment as a defense. It is with this in mind that we should
look at the language in In re Greenstreet, Inc. quoted by the
majority (majority op. p. 6 n.8) against my view of the
overpayment issue. There would have been no affirmative recovery
by the debtor if all its counterclaims had been allowed, provided
that one looks beyond the single transaction. After all, the
Government's claims in total substantially outweighed the
counterclaims. In saying that there could be no affirmative
recovery through recoupment, the Court of Appeals for the Seventh
Circuit was clearly thinking of affirmative recovery with respect
to the single transaction.
It should further be noted that the Supreme Court in Reiter
v. Cooper, supra, said that it basically made no difference
whether recoupment was a defense or a counterclaim (according to
the Supreme Court, it was in fact a counterclaim in the context
of that case, but the defendants' characterization of it as a
defense was inconsequential, and the plaintiff's argument that,
38
(...continued)
such a development.
- 93 -
since it was a counterclaim, it could not be raised as a defense
was denied). Reiter v. Cooper, 507 U.S. at 263; cf. FDIC v.
Hulsey, 22 F.3d 1472, 1487 (10th Cir. 1994) (claims in recoupment
are compulsory counterclaims under Fed. R. Civ. P. 13(a)). This
suggests that it is a mistake to insist too much on recoupment's
defensive nature in the case at hand.39
Faced with the issue of whether recoupment is subject to the
limitations on setoff in the Bankruptcy Code, a later bankruptcy
court decided, on the basis of Reiter v. Cooper, that recoupment
was not so limited. It said further, by way of distinguishing
the two: "recoupment speaks not simply to the net amount due from
one party to the other computed by subtracting one claim from the
other, but rather to the amount of the plaintiff's claim alone on
a particular contract, transaction or event." In re Izaguirre,
39
In deciding in Reiter v. Cooper, supra, that it made no
difference whether the recoupment was considered a counterclaim
or defense, the Supreme Court cited 5 Wright & Miller, Federal
Practice & Procedure, sec. 1275 (2d ed. 1990), according to which
it is not clear whether setoffs and recoupments should be viewed
as defenses or counterclaims. Reiter v. Cooper, 507 U.S. at 263.
In In re Izaguirre, 166 Bankr. 484, 493 (Bankr. N.D. Ga.
1994), a bankruptcy court cited the reference in Reiter v. Cooper
to Wright & Miller to conclude: "Although recoupment may be
viewed as an offset to the extent it is viewed as a counterclaim,
recoupment has a chameleon-like quality that also permits it to
be viewed simply as a defense."
In agreement that Reiter v. Cooper minimizes the importance
of the distinction between defenses and counterclaims with
respect to recoupment is Consolidated Rail Corp. v. Primary
Indus. Corp., 868 F. Supp. 566 (S.D.N.Y. 1994).
- 94 -
166 Bankr. 484, 493 (Bankr. N.D. Ga. 1994). To the same effect,
outside bankruptcy, see such cases as United States v. Tsosie, 92
F.3d 1037, , (10th Cir. 1996) (Indian land case); FDIC v.
Hulsey, 22 F.3d 1472, 1487-1488 (10th Cir. 1994) (secured loan
agreement); Frederick v. United States, 386 F.2d 481, 488 (5th
Cir. 1967) (suit on a note); Shipping Corp. of India, Ltd. v.
Pan-Am. Seafood, Inc., 583 F. Supp. 1555, 1557 (S.D.N.Y. 1984)
(admiralty); United States v. Timber Access Indus. Co., 54 F.R.D.
36 (D. Or. 1971) (logging contract).
United States v. Timber Access Indus. Co., supra, is close
to the point but not on all fours with our overpayment issue.
The United States, as trustee for an Indian tribe, sued the
defendant logger, asserting breaches of a logging contract, for
$47,561.06. The defendant counterclaimed under the same
contract, alleging that the Government owed it $109,870.85, and
argued that, although it could not have full recovery on the
counterclaim, it was entitled to a credit of $47,561.06 as
recoupment and, beyond that, affirmative recovery of $10,000
under the Tucker Act, 28 U.S.C. sec. 1346(a)(2) (1994)($10,000
being the jurisdictional limit on Tucker Act claims in the
District Court40). The Government argued that sovereign immunity
40
There is no such monetary limitation on contractual claims
against the United States in the Court of Federal Claims, 28
U.S.C. sec. 1491 (1994), and the District Court in United States
(continued...)
- 95 -
barred any affirmative recovery by the defendant. The District
Court agreed with the defendant and allowed an affirmative
recovery to the extent of $10,000. However, it denied other,
permissive counterclaims sought to be brought by the logger's
surety, but only on the ground that these counterclaims were
brought against the United States not in its capacity as trustee
for the Indian tribes, but in its own capacity, so that they were
unauthorized under Fed. R. Civ. P. 13, because sovereign immunity
operated with respect to these other counterclaims.
The fact that no statute-of-limitations problem figures in
United States v. Timber Access Indus. Co., supra, does not
distinguish it from our case: There, the doctrine of recoupment
was needed to support the defendant's main counterclaim against
the Government's claim of sovereign immunity, whereas in our case
recoupment is needed to support petitioner's defense against the
bar of the statute of limitations. The fact that the defendant
in United States v. Timber Access Indus. Co., supra, could still,
after the decision in the case, bring suit in the Court of Claims
for the balance of its counterclaim means that to limit
40
(...continued)
v. Timber Access Indus. Co., 54 F.R.D. 36 (D. Or. 1971), left
open the possibility that the defendant logger could recover the
balance of its counterclaim in the Court of Claims (as it was
then called), 54 F.R.D. at 38-39. The District Court held that
allowing the $10,000 recovery in the District Court would not be
the prohibited splitting of the cause of action.
- 96 -
recoupment there didn't eliminate all opportunity for the
defendant to obtain complete justice with respect to the
transaction in issue, whereas barring recoupment in our case
would amount to denying complete justice. To allow an
affirmative recovery arising from the same transaction to bar or
limit recoupment (as the District Court in United States v.
Timber Access Indus. Co., supra, refused to do) does less
violence to the idea of doing complete justice with respect to
the one transaction than would allowing an unrelated affirmative
recovery (like that in our case with respect to the previously
taxed property credit) to have such a limiting effect. Thus,
there was more reason in United States v. Timber Access Indus.
Co., supra, than there is in our case to limit recoupment by the
amount of the affirmative recovery, and nevertheless the District
Court didn't do so. United States v. Timber Access Indus. Co.,
supra, which is cited and discussed at some length in 6 Wright et
al., Federal Practice & Procedure, sec. 1427, at 197-198 n.8 (2d
ed. 1990), illustrates the point that another affirmative
recovery with its own independent jurisdictional basis, even when
it arises from the same transaction from which a recoupment
defense or counterclaim arises, does not bar or limit recoupment.
It is appropriate to use these non-tax cases, and most
especially Reiter v. Cooper, in the tax area. Reiter v. Cooper
not only cited Bull v. United States at a crucial point in its
- 97 -
argument, 507 U.S. at 265. It also used several recoupment cases
outside both bankruptcy and tax to support the proposition that
there is a "general principle of recoupment", which has force in
the absence of explicit Congressional prohibition, id.; cf.
United States v. Dewey Freight Sys., Inc., 31 F.3d 620, 623 (8th
Cir. 1994). Standard jurisdictional principles typically operate
in the same fashion in tax as in all other areas of the law.
United States v. Forma, 42 F.3d at 766 (citing United States v.
Dalm, 494 U.S. at 608-611).
So long as the recoupment claim is only allowed to offset
the Government’s claim from the transaction in issue, and not to
exceed any amount determined to be owing to the Government that
also arises from that transaction, all sensible requirements are
met. The statement of the Court of Appeals for the Second
Circuit in a tax case that, despite sovereign immunity, a
defendant may, without statutory authority, recoup on a
counterclaim an amount equal to the principal claim, United
States v. Forma, 42 F.3d at 764 (citing United States v. United
States Fidelity & Guaranty Co., 309 U.S. 506, 511 (1940)),
supports my view.41
41
United States v. Forma, 42 F.3d 759, 767-768 & n. 11 (2d
Cir. 1994), did not involve equitable recoupment, although that
doctrine is discussed briefly. Rather, it involved an unrelated
time-barred counterclaim by taxpayers in a suit where the United
States originally sought to reduce tax assessments relating to
(continued...)
- 98 -
Conclusion
In sum, in the circumstances of this case, equitable
recoupment properly would only be allowed as an offset against
(and only up to the amount of) the deficiency as we would have
redetermined it in the absence of the previously taxed property
credit. The previously unclaimed credit that respondent allowed
has no bearing on the issue arising out of the date-of-death
valuation of the shares, and should also be paid to petitioner.
Thus, petitioner should be paid in the end the amount
a = c - (d - r)
(d $ r),
where a is the amount of the overpayment to be paid, c is the
credit for the tax on prior transfers that respondent allowed in
the statutory notice, d is the deficiency as we would have
redetermined it if the credit had been claimed on the estate tax
return or paid administratively, and r is the offset to that
41
(...continued)
the same years to judgment and then voluntarily agreed to the
dismissal of its claims. The Court of Appeals held that there
was no basis for jurisdiction over the counterclaim and therefore
remanded the case to the District Court with a direction to
dismiss the counterclaim. In the discussion of equitable
recoupment, which the parties agreed was not available to the
taxpayers in the case, there is mention that the single-
transaction requirement was not satisfied. There is, however, no
mention of any no-affirmative-recovery requirement, in the
discussion of either equitable recoupment or the counterclaims.
- 99 -
deficiency resulting from our application of equitable
recoupment, which can't exceed the amount of that deficiency.
I would find that respondent's overpayment argument doesn't
prevent the application of equitable recoupment. This would
allow us to consider all the other issues, on which I would also
find in favor of petitioner. Consequently, I would apply
equitable recoupment in favor of petitioner.
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961 F.2d 1581
Ibarra-Olmedov.U.S.***
NO. 90-6072
United States Court of Appeals,Eleventh Circuit.
Apr 27, 1992
1
Appeal From: S.D.Fla.
2
AFFIRMED.
*
Fed.R.App.P. 34(a); 11th Cir.R. 34-3
**
Local Rule 36 case
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UNPUBLISHED
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
No. 11-6845
UNITED STATES OF AMERICA,
Plaintiff – Appellee,
v.
RICARDO ARCE,
Defendant - Appellant.
Appeal from the United States District Court for the Eastern
District of North Carolina, at Raleigh. Terrence W. Boyle,
District Judge. (5:08-cr-00111-BO-1; 5:10-cv-00078-BO)
Submitted: November 15, 2011 Decided: November 17, 2011
Before NIEMEYER and KEENAN, Circuit Judges, and HAMILTON, Senior
Circuit Judge.
Dismissed by unpublished per curiam opinion.
Ricardo Arce, Appellant Pro Se. Jennifer P. May-Parker,
Assistant United States Attorney, Seth Morgan Wood, OFFICE OF
THE UNITED STATES ATTORNEY, Raleigh, North Carolina, for
Appellee.
Unpublished opinions are not binding precedent in this circuit.
PER CURIAM:
Ricardo Arce seeks to appeal the district court’s
order denying his Fed. R. Civ. P. 60(b) motion. * The order is
not appealable unless a circuit justice or judge issues a
certificate of appealability. 28 U.S.C. § 2253(c)(1)(B) (2006).
A certificate of appealability will not issue absent “a
substantial showing of the denial of a constitutional right.”
28 U.S.C. § 2253(c)(2) (2006). When the district court denies
relief on the merits, a prisoner satisfies this standard by
demonstrating that reasonable jurists would find that the
district court’s assessment of the constitutional claims is
debatable or wrong. Slack v. McDaniel, 529 U.S. 473, 484
(2000); see Miller-El v. Cockrell, 537 U.S. 322, 336-38 (2003).
When the district court denies relief on procedural grounds, the
prisoner must demonstrate both that the dispositive procedural
ruling is debatable, and that the motion states a debatable
claim of the denial of a constitutional right. Slack, 529 U.S.
at 484-85. We have independently reviewed the record and
conclude that Arce has not made the requisite showing.
Accordingly, we deny a certificate of appealability and dismiss
the appeal.
*
Because the Rule 60(b) motion directly attacked Arce’s sentence, it
was, in essence, an unauthorized and successive 28 U.S.C.A. § 2255 (West
Supp. 2011) motion over which the district court lacked jurisdiction. See
United States v. Winestock, 340 F.3d 200, 206 (4th Cir. 2003).
Additionally, we construe Arce’s notice of appeal and
informal brief as an application to file a second or successive
§ 2255 motion. Winestock, 340 F.3d at 208. In order to obtain
authorization to file a successive § 2255 motion, a prisoner
must assert claims based on either: (1) newly discovered
evidence, not previously discoverable by due diligence, that
would be sufficient to establish by clear and convincing
evidence that, but for constitutional error, no reasonable
factfinder would have found the movant guilty of the offense; or
(2) a new rule of constitutional law, previously unavailable,
made retroactive by the Supreme Court to cases on collateral
review. 28 U.S.C.A. § 2255(h) (West Supp. 2011). Arce’s claims
do not satisfy either of these criteria. Therefore, we deny
authorization to file a successive § 2255 motion.
We dispense with oral argument because the facts and
legal contentions are adequately presented in the materials
before the court and argument would not aid the decisional
process.
DISMISSED
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686 N.E.2d 33 (1997)
292 Ill. App.3d 329
226 Ill.Dec. 684
Belen KLING, Plaintiff-Appellant,
v.
John D. LANDRY, Defendant-Appellee.
No. 2-97-0059.
Appellate Court of Illinois, Second District.
October 10, 1997.
*35 T. Patrick Rice, T. Patrick Rice and Associates, P.C., Wheaton, for Belen Kling.
Diane K. Landry, Western Springs, for John D. Landry.
Presiding Justice GEIGER delivered the opinion of the court:
The plaintiff, Belen Kling, appeals from the December 31, 1996, order of the circuit court of Du Page County dismissing her four-count complaint alleging legal malpractice, breach of fiduciary duty, negligence, and intentional battery. In her complaint, the plaintiff alleges that the defendant, John Landry, coerced her into having sexual relations with him while he represented her in two separate legal proceedings. The trial court dismissed the plaintiff's action pursuant to section 2615 of the Code of Civil Procedure (the Code) (735 ILCS 5/2615 (West 1996)) for failure to state a claim on which relief could be granted. We affirm in part, reverse in part, and remand.
On June 8, 1995, the plaintiff filed her original complaint. On three separate occasions thereafter, the defendant filed motions to dismiss the plaintiff's complaint pursuant to section 2615 of the Code (735 ILCS 5/2615 (West 1996)). On each such occasion, the trial court dismissed the plaintiff's complaint but granted the plaintiff leave to *36 replead. On October 30, 1996, the plaintiff filed her third amended complaint.
The factual allegations contained in the third amended complaint (hereinafter complaint) are as follows. On or about January 22, 1991, the defendant agreed to represent the plaintiff in a dissolution of marriage suit proceeding in the circuit court of Du Page County (In re Marriage of Kling, No. 90D2865 (Cir. Ct. Du Page Co.)). The primary disputes at issue in the dissolution proceeding were the distribution of marital property and maintenance. The trial of the case was scheduled to proceed on May 1, 1991.
The complaint alleges that, on the evening of April 30, 1991, the defendant visited the plaintiff's residence in order to prepare for the upcoming trial. While in the plaintiff's home, the defendant allegedly threw the plaintiff on her bed and initiated sexual intercourse with her. The plaintiff alleges that she submitted to the defendant's demands for sexual intercourse because she was afraid that if she refused the defendant would not represent her at trial. The case did not proceed to trial, as the parties subsequently settled all property distribution and maintenance issues. On May 16, 1991, a final judgment for dissolution of marriage was entered by the circuit court.
The complaint further alleges that, in the spring of 1992, the defendant agreed to represent the plaintiff in her attempt to seek a modification of the dissolution order entered by the circuit court of Cook County in the plaintiff's first divorce (Shoblaske v. Shoblaske, No. 84D21908 (Cir. Ct. Cook Co.)). On October 13, 1992, the defendant filed a postdissolution petition for modification of judgment, requesting that plaintiff be granted custody of her minor son, Aaron. The plaintiff paid the defendant $1,500 for his legal services in the postdissolution proceeding.
Attached to the judgment of dissolution entered in cause No. 84D21908 was a psychological evaluation of the plaintiff performed by the Center for Families in Conflict of the Isaac Ray Center, Inc. This evaluation indicated that the plaintiff suffered from severe psychopathology, including bizarre thought patterns, poor impulse control, affective lability, and possible hallucinations. The plaintiff's complaint alleges that, because of the defendant's knowledge of this report, he knew or should have known that the plaintiff suffered from mental impairments which could affect her ability to make reasonable decisions and judgments during the course of his representation.
The complaint further alleges that, on June 11, 1993, the defendant telephoned the plaintiff and advised her that they needed to prepare for a court appearance scheduled for June 17, 1993. On June 16, 1993, the defendant met with the plaintiff at her home. At this time, the defendant allegedly removed the plaintiff's clothing, pushed her onto a rug in her kitchen, and initiated sexual intercourse. In August 1993, the plaintiff terminated the defendant's representation of her. The plaintiff alleges that the petition for modification of judgment prepared by the defendant was frivolous and had no basis in fact or law.
As noted above, the plaintiff's complaint consists of four counts. Count I of the complaint is predicated upon legal malpractice and alleges that the defendant improperly utilized his position as the plaintiff's attorney to obtain sexual intercourse with her even though she was mentally impaired. Count I also alleges that the defendant breached his duty of care by filing a "meritless" postdissolution petition for modification. Count II of the complaint is predicated upon breach of fiduciary duty and contains the same allegations as count I. Count III is predicated upon common-law negligence and alleges that the defendant breached his duty of care by encouraging the plaintiff to submit to sexual intercourse even though he knew of her impaired mental condition. Count IV is predicated upon intentional battery and alleges that the defendant's acts of sexual intercourse were without permission and provocation.
On November 19, 1996, the defendant filed a motion to dismiss the plaintiff's complaint pursuant to section 2615 of the Code (735 ILCS 5/2615 (West 1996)). On December 31, 1996, following a hearing, the trial court *37 granted the motion in its entirety and dismissed the plaintiff's complaint with prejudice. In reliance on Suppressed v. Suppressed, 206 Ill.App.3d 918, 924, 151 Ill.Dec. 830, 565 N.E.2d 101 (1990), the trial court dismissed counts I and II on the basis that they failed to state a cause of action upon which relief could be granted. The trial court dismissed counts III and IV on the basis that they pleaded insufficient facts to state causes of action for negligence and intentional battery. The plaintiff filed a timely notice of appeal.
Because the plaintiff's complaint was dismissed pursuant to a section 2615 motion, the question before this court is whether her claims set forth a cause of action upon which relief could be granted. Burdinie v. Village of Glendale Heights, 139 Ill.2d 501, 505, 152 Ill.Dec. 121, 565 N.E.2d 654 (1990), overruled on other grounds in McCuen v. Peoria Park District, 163 Ill.2d 125, 130, 205 Ill.Dec. 487, 643 N.E.2d 778 (1994). Since the question is one of law, our review is de novo. T & S Signs, Inc. v. Village of Wadsworth, 261 Ill.App.3d 1080, 1084, 199 Ill.Dec. 467, 634 N.E.2d 306 (1994). In conducting that review, we are required to take all well-pleaded facts in the complaint as true and draw reasonable inferences from those facts which are favorable to the plaintiff. Ziemba v. Mierzwa, 142 Ill.2d 42, 46-47, 153 Ill.Dec. 259, 566 N.E.2d 1365 (1991). An action should not be dismissed on the pleadings unless it is apparent that no set of facts can be proved that would entitle the plaintiff to recover. Illinois Graphics Co. v. Nickum, 159 Ill.2d 469, 488, 203 Ill.Dec. 463, 639 N.E.2d 1282 (1994). With these principles in mind, we turn to a consideration of each of the counts in the plaintiff's complaint.
As noted above, count I of the complaint is predicated upon legal malpractice. Illinois law is clear that an attorney is liable to his client for damages only when he fails to exercise a reasonable degree of care and skill, and the law distinguishes between negligence and mere errors of judgment. Spivack, Shulman & Goldman v. Foremost Liquor Store, Inc., 124 Ill.App.3d 676, 683, 80 Ill.Dec. 388, 465 N.E.2d 500 (1984). To state a cause of action for legal malpractice, a plaintiff must plead: (1) that the attorney owed the plaintiff a duty of care arising from an attorney-client relationship; (2) that the defendant breached that duty; and (3) that as a proximate result, the plaintiff suffered actual damages. Howard v. Druckemiller, 238 Ill.App.3d 937, 941, 183 Ill.Dec. 148, 611 N.E.2d 1 (1992).
Although the subject of attorney-client sexual relations has been the subject of much recent debate within the legal community, our research has uncovered only one Illinois case addressing whether such conduct constitutes legal malpractice. See Suppressed v. Suppressed, 206 Ill.App.3d 918, 151 Ill.Dec. 830, 565 N.E.2d 101 (1990). In Suppressed, the plaintiff alleged that her attorney "psychologically coerced or seduced her into having sexual relations with him at the same time that he was to be representing her in a divorce action." Suppressed, 206 Ill.App.3d at 920, 151 Ill.Dec. 830, 565 N.E.2d 101. As in the instant case, the plaintiff asserted that she submitted to these sexual demands out of fear that her attorney would not adequately represent her interests. Suppressed, 206 Ill. App.3d at 921, 151 Ill.Dec. 830, 565 N.E.2d 101. The Illinois Appellate Court, First District, held that such allegations did not state a claim for legal malpractice because the alleged breach of duty was not sufficiently linked to the attorney's legal representation. Suppressed, 206 Ill.App.3d at 924, 151 Ill. Dec. 830, 565 N.E.2d 101. The court explained its reasoning as follows:
"In the present case, the only charge against defendant that alleges a breach of his legal duty to his client is the allegation that defendant's relationship with plaintiff created a `potential conflict of interest.' While this may be true, we also note that plaintiff did not charge that an actual conflict of interest existed or that she was harmed in her legal action by such a conflict.
* * * For this reason we do not believe that the higher standard of care required of a fiduciary should extend to an attorney's personal relationships with his clients, unless there is tangible evidence that the attorney actually made his professional services contingent upon the sexual *38 involvement or that his legal representation of the client was, in fact, adversely affected." Suppressed, 206 Ill.App.3d at 924-25, 151 Ill.Dec. 830, 565 N.E.2d 101.
The court further stated that, even if it were to assume that the attorney breached his duty of care by engaging in sexual relations with a client, the dismissal of the complaint was still appropriate as the plaintiff had failed to allege any actual damages stemming from a loss suffered in her underlying dissolution action. Suppressed, 206 Ill. App.3d at 925, 151 Ill.Dec. 830, 565 N.E.2d 101. The court noted that the plaintiff's marriage was later dissolved and that the divorce agreement was apparently satisfactory to her. Suppressed, 206 Ill.App.3d at 925, 151 Ill.Dec. 830, 565 N.E.2d 101. The court held that the plaintiff's mental distress, absent any quantifiable injury stemming from her attorney's legal representation, was insufficient to support an action for legal malpractice. Suppressed, 206 Ill.App.3d at 925, 151 Ill.Dec. 830, 565 N.E.2d 101.
Although this court has not had occasion to consider this issue, we are persuaded by the foregoing discussion. To establish a cause of action for legal malpractice, a plaintiff is obligated to demonstrate that the attorney has breached his duty to provide adequate legal representation and that, as a result, the plaintiff has suffered actual damages. Howard, 238 Ill.App.3d at 941, 183 Ill.Dec. 148, 611 N.E.2d 1. Therefore, we find that, for purposes of a legal malpractice action, the existence of an attorney-client sexual relationship is only relevant to the extent that it has an adverse effect on the quality of the legal representation. Suppressed, 206 Ill.App.3d at 924-25, 151 Ill.Dec. 830, 565 N.E.2d 101. Although such a relationship may submit an attorney to discipline under the rules of professional responsibility or to liability pursuant to another cause of action, we hold that the mere existence of a sexual relationship is not sufficient to state a cause of action for legal malpractice. See Suppressed, 206 Ill.App.3d at 924-25, 151 Ill.Dec. 830, 565 N.E.2d 101.
In the instant case, the plaintiff alleges that the defendant coerced her into submitting to his sexual demands on two occasions. The first occasion occurred during the defendant's representation in the plaintiff's dissolution proceeding in Du Page County (No. 90D2865). As in Suppressed, we note that the plaintiff has not pleaded that her attorney failed to adequately protect her legal interests in the proceeding. The plaintiff's marriage was eventually dissolved, and the dissolution agreement was apparently satisfactory to her. As the plaintiff did not claim that her legal position in the proceedings was harmed so as to result in actual damages, we hold that such allegations do not support a claim for legal malpractice.
The second alleged sexual contact between the plaintiff and the defendant occurred during the defendant's representation in the plaintiff's postdissolution petition filed in Cook County (No. 84D21908). In addition to the allegations of sexual intercourse, however, the plaintiff also alleges that the modification petition filed by the defendant was without merit. The plaintiff therefore alleges that the defendant breached his duty to provide adequate legal representation by filing a frivolous pleading. As a result of this conduct, the plaintiff contends that she has suffered actual damages of $1,500, which represents the cost of the defendant's legal services.
A more careful review of the plaintiff's complaint, however, reveals that her allegation that the modification petition was "without merit" is conclusory. A pleader is obligated to set out ultimate facts that support the cause of action, and legal conclusions unsupported by allegations of specific facts are insufficient. Estate of Johnson v. Condell Memorial Hospital, 119 Ill.2d 496, 509-10, 117 Ill.Dec. 47, 520 N.E.2d 37 (1988). An actionable wrong cannot be made out merely by characterizing acts as having been wrongfully done. Adkins v. Sarah Bush Lincoln Health Center, 129 Ill.2d 497, 520, 136 Ill.Dec. 47, 544 N.E.2d 733 (1989).
We note that the plaintiff herein has failed to allege any facts explaining why she contends the petition was frivolous or inadequately prepared. Additionally, the plaintiff has failed to append a copy of the petition for modification or a copy of the circuit court's *39 order denying the petition. As the plaintiff has failed to plead any facts supporting her conclusion that the modification petition was "without merit," the trial court properly dismissed this count. See Estate of Johnson, 119 Ill.2d at 510, 117 Ill.Dec. 47, 520 N.E.2d 37.
In count II of her complaint, the plaintiff alleged breach of fiduciary duty. As noted by the plaintiff, a fiduciary relationship exists between an attorney and his client as a matter of law. In re Imming, 131 Ill.2d 239, 252-53, 137 Ill.Dec. 62, 545 N.E.2d 715 (1989). Once established, the attorney-client relationship gives rise to certain duties owed by the attorney to the client without regard to the specific terms of any contract of engagement. Among the fiduciary duties imposed upon an attorney are those of fidelity, honesty, and good faith in both the discharge of contractual obligations to, and professional dealings with, a client. Metrick v. Chatz, 266 Ill.App.3d 649, 656, 203 Ill.Dec. 159, 639 N.E.2d 198 (1994). When in the course of his professional dealings with a client, an attorney places his personal interest above the interest of the client, the attorney is in breach of his fiduciary duty by reason of the conflict. In re Rosin, 118 Ill.2d 365, 381, 113 Ill.Dec. 276, 515 N.E.2d 85 (1987). The breach of fiduciary duty by an attorney gives rise to an action on behalf of the client for proximately resulting damages. Bauer v. Hubbard, 228 Ill.App.3d 780, 785, 170 Ill.Dec. 680, 593 N.E.2d 569 (1992). An action for the breach of fiduciary duty is not a tort; rather, it is governed by the substantive law of contracts. Kinzer v. City of Chicago, 128 Ill.2d 437, 445, 132 Ill.Dec. 410, 539 N.E.2d 1216 (1989).
Our research has uncovered only one Illinois case considering whether an attorney breaches his fiduciary obligations by coercing his client to engage in sexual relations during the course of the representation. See Doe v. Roe, 289 Ill.App.3d 116, 224 Ill.Dec. 325, 681 N.E.2d 640 (1997). In that case, the plaintiff submitted to her divorce attorney's sexual advances out of fear that he would discontinue or compromise his representation of her. Doe, 289 Ill.App.3d at 121, 224 Ill.Dec. 325, 681 N.E.2d 640. After the plaintiff's husband became aware of the relationship, the attorney failed to seek the payment of the plaintiff's legal fees from her former husband as allowed pursuant to section 508 of the Illinois Marriage and Dissolution of Marriage Act (750 ILCS 5/508 (West 1996)). Doe, 289 Ill.App.3d at 121, 224 Ill.Dec. 325, 681 N.E.2d 640. The attorney subsequently obtained a $2,500 judgment against the plaintiff, representing his unpaid attorney fees. Doe, 289 Ill.App.3d at 122, 224 Ill.Dec. 325, 681 N.E.2d 640. At the attorney's suggestion, the plaintiff agreed to continue their sexual relationship in order to be released from the payment of the judgement. Doe, 289 Ill.App.3d at 122, 224 Ill.Dec. 325, 681 N.E.2d 640.
The Doe court held that these allegations set forth sufficient facts to state a cause of action for the breach of fiduciary duty. Doe, 289 Ill.App.3d at 130-31, 224 Ill.Dec. 325, 681 N.E.2d 640. The court noted that the attorney declined to pursue the plaintiff's right to seek reimbursement of attorney fees out of fear of personal embarrassment and potential professional discipline; therefore, the attorney had placed his own personal interests above the interests of his client. Doe, 289 Ill.App.3d at 123, 224 Ill.Dec. 325, 681 N.E.2d 640. The court concluded that the plaintiff was entitled to seek the recovery of her attorney fees, as well as damages for her emotional distress, commenting:
"We believe the plaintiff has pled sufficient facts to support the conclusion that the defendant used his position as the plaintiff's attorney and his knowledge of her dependence upon him to gain sexual favors, thus breaching his fiduciary duty. Additionally, the plaintiff's complaint also contains facts from which it can be inferred that, at the time the defendant engaged in sexual relations with the plaintiff, he should have known of her dependence upon him and the emotional distress that could result from such behavior. In sum, we find that the plaintiff has pled sufficient facts to enable her to pursue damages for mental distress in her breach of fiduciary duty claim." Doe, 289 Ill.App.3d at 130-31, 224 Ill.Dec. 325, 681 N.E.2d 640.
We agree that an attorney breaches his fiduciary duty to his client by *40 exploiting his position as an attorney to gain sexual favors. We believe that such a breach arises where the attorney: (1) makes his legal representation contingent upon sexual involvement; (2) compromises the client's legal interests as a result of the sexual involvement; or (3) uses information, obtained in the course of representing a client which suggests that the client might be unusually vulnerable to a suggestion of sexual involvement, to seduce the client. Doe, 289 Ill. App.3d at 129, 224 Ill.Dec. 325, 681 N.E.2d 640. We caution, however, that sexual intercourse between two consenting adults is not, of itself, actionable conduct. Hertel v. Sullivan, 261 Ill.App.3d 156, 160, 198 Ill.Dec. 574, 633 N.E.2d 36 (1994). Moreover, we note that the nature of the attorney-client relationship is to provide legal services rather than to improve a client's mental or emotional well-being. See Suppressed, 206 Ill. App.3d at 923-24, 151 Ill.Dec. 830, 565 N.E.2d 101.
In the instant case, unlike Doe, there have been no allegations that the defendant made his legal representation contingent upon the plaintiff's sexual involvement or that he compromised the plaintiff's legal interests as a result of the sexual involvement. Although the plaintiff contends that the modification petition filed by the defendant was without merit, we have already found that these allegations are unsupported conclusions of law. Finally, although the plaintiff contends that the defendant was aware of the plaintiff's "severe psychopathology" as a result of the psychological evaluation attached to the judgement of dissolution in cause No. 84D21908, we note that the first sexual encounter between the plaintiff and defendant occurred well before the defendant obtained this report. Moreover, the complaint does not specifically allege that the defendant used the information contained in the psychological evaluation in order to seduce the plaintiff. For all of these reasons, we find that the facts alleged herein are distinguishable from Doe and that they do not rise to the level of a breach of fiduciary duty. Accordingly, we hold that the trial court did not err in dismissing count II of the plaintiff's complaint.
Count III of the plaintiff's complaint purports to be predicated upon common-law negligence. The count alleges that the defendant had a duty to exercise ordinary care for the safety of the plaintiff and that he breached this duty by encouraging her to engage in sexual intercourse with him even though he knew she was mentally impaired. The trial court dismissed this count, finding that it failed to allege sufficient facts to state a cause of action. We agree. The plaintiff fails to offer any authority for the propriety of such a cause of action, nor are we aware of the existence of any such authority. Moreover, we fail to see how the defendant breached his duty of ordinary care towards the plaintiff by engaging in sexual intercourse with her. See Hertel, 261 Ill.App.3d at 160, 198 Ill.Dec. 574, 633 N.E.2d 36. We therefore conclude that the trial court properly dismissed count III of the plaintiff's complaint.
Count IV of the plaintiff's complaint alleges an action for the intentional tort of battery. The complaint specifically alleges that "the conduct of the defendant on June 16, 1993, constituted a battery upon the plaintiff, in that the touching was without permission and provocation." The trial court dismissed this count pursuant to section 2615 of the Code, finding that it failed to allege sufficient facts to state a cause of action. Specifically, the trial court found that these allegations failed to respond to the defendant's demand for a bill of particulars filed on March 28, 1996. In a previous dismissal order, the trial court had instructed the plaintiff to amend her complaint in a manner that was responsive to the defendant's demand for a bill of particulars. In dismissing the plaintiff's third amended complaint, the trial court commented:
"And Count IV, I respectfully submit that you did not follow the request that I made of providing sufficient detail so as to meet the requirements of the demand for the Bill of Particulars."
Initially, we note that the dismissal of a plaintiff's complaint with prejudice as a sanction for the failure to provide a bill of particulars is not permitted by section 2607 of the Code (735 ILCS 5/2607 (West *41 1996)). Bejda v. SGL Industries, Inc., 82 Ill.2d 322, 329, 45 Ill.Dec. 113, 412 N.E.2d 464 (1980). That section provides:
"If the pleader does not file and serve a bill of particulars within 28 days of the demand, or if the bill of particulars delivered is insufficient, the court may, on motion and in its discretion, strike the pleading, allow further time to furnish the bill of particulars or require a more particular bill to be filed and served." 735 ILCS 5/2607(b) (West 1996).
Under this section, the most severe sanction authorized is the striking of the pleading to which the bill of particulars relates. Bejda, 82 Ill.2d at 328, 45 Ill.Dec. 113, 412 N.E.2d 464. A dismissal of a complaint with prejudice cannot be equated with the striking of a pleading and is not permitted under this section. Bejda, 82 Ill.2d at 328-29, 45 Ill. Dec. 113, 412 N.E.2d 464.
Although the trial court's dismissal of the plaintiff's action is not authorized by section 2607 of the Code, the dismissal could nonetheless be upheld as within the court's inherent authority to control its business. Bejda, 82 Ill.2d at 329, 45 Ill.Dec. 113, 412 N.E.2d 464. A plaintiff's failure to take any action as ordered by the trial court evidences want of prosecution by that party, and the trial court may dismiss a suit for the failure of the complainant to prosecute it with due diligence. Bejda, 82 Ill.2d at 329, 45 Ill.Dec. 113, 412 N.E.2d 464. It has therefore been recognized by our supreme court that the failure to file a bill of particulars in disobedience of a trial court's order may be a ground for dismissal with prejudice. Bejda, 82 Ill.2d at 329, 45 Ill.Dec. 113, 412 N.E.2d 464.
Notwithstanding the general authority of the trial court to dismiss an action, we conclude that the dismissal of count IV was not proper. See Bejda, 82 Ill.2d at 330, 45 Ill.Dec. 113, 412 N.E.2d 464. In order to state a cause of action for intentional battery, a plaintiff must allege a willful touching of another person without the consent of the person who is touched. Pechan v. DynaPro, Inc., 251 Ill.App.3d 1072, 1084, 190 Ill.Dec. 698, 622 N.E.2d 108 (1993). An action for battery does not depend on the hostile intent of the defendant, but on the absence of the plaintiff's consent to the contact. Pechan, 251 Ill.App.3d at 1084, 190 Ill.Dec. 698, 622 N.E.2d 108. Our review of count IV reveals that the plaintiff has alleged that, on June 16, 1993, the defendant removed her clothing, pushed her onto a kitchen rug, and initiated sexual intercourse. Further, although the plaintiff does not specifically allege that such conduct was "without her consent," she nonetheless alleges that the conduct was "without permission and provocation." We conclude that such allegations state sufficient facts to allege an action for intentional battery. See Pechan, 251 Ill.App.3d at 1084, 190 Ill.Dec. 698, 622 N.E.2d 108.
While it is true that the plaintiff did not respond to the defendant's demand for a bill of particulars, the information that the defendant requested in his demand exceeded the ultimate factual elements that the plaintiff is obligated to plead. Specifically, the defendant sought information relating to the specific content of the plaintiff's psychiatric reports; the date when the defendant obtained such reports; the date or dates of the alleged conversations between the defendant and the plaintiff's psychiatrists; the name of the psychological condition from which the plaintiff suffered at the time in question; the nature of the outward symptoms of the plaintiff's "severe psychopathology" at the time in question; and why the plaintiff's psychological condition prevented her from giving knowing consent to the act.
Although such information may be pertinent and relevant during the subsequent litigation and trial of this count, the information is beyond the plaintiff's burden of initial pleading and is more appropriately obtained during discovery. See generally Bejda, 82 Ill.2d at 330, 45 Ill.Dec. 113, 412 N.E.2d 464. The plaintiff is only obligated to plead those ultimate facts necessary to state a cause of action and to inform the defendant of the nature of the claim brought against him. Adkins, 129 Ill.2d at 518, 136 Ill.Dec. 47, 544 N.E.2d 733. The pleader is not required to set out his evidence; only ultimate facts to be proved should be alleged, and not evidentiary facts tending to prove ultimate facts. Stinson v. Physicians Immediate *42 Care, Ltd., 269 Ill.App.3d 659, 662, 207 Ill.Dec. 96, 646 N.E.2d 930 (1995). As noted above, we believe that the plaintiff herein pleaded sufficient ultimate facts to state a cause of action for intentional battery. We therefore conclude that the trial court erred in dismissing count IV and remand the cause for further proceedings as to that count.
For the foregoing reasons, the judgment of the circuit court of Du Page County is affirmed in part and reversed in part, and the cause is remanded for further proceedings consistent with this opinion.
Affirmed in part and reversed in part; cause remanded.
INGLIS and BOWMAN, JJ., concur.
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Order filed May 23, 2016
In The
Fourteenth Court of Appeals
____________
NO. 14-15-00629-CV
____________
HAVEN CHAPEL UNITED METHODIST CHURCH, Appellant
V.
WILLIAM MICHAEL LEEBRON II, ET AL., Appellee
On Appeal from the 149th District Court
Brazoria County, Texas
Trial Court Cause No. 62845-A
ORDER
The clerk’s record was filed September 14, 2015. Our review has determined
that a relevant item has been omitted from the clerk's record. See Tex. R. App. P.
34.5(c). The record does not contain the order granting Brazoria County's no-
evidence motion for summary judgment signed March 30, 2015.
The Brazoria County District Clerk is directed to file a supplemental clerk’s
record on or before May 31, 2016, containing the order granting Brazoria County's
no-evidence motion for summary judgment signed March 30, 2015.
If the omitted item is not part of the case file, the district clerk is directed to
file a supplemental clerk’s record containing a certified statement that the omitted
item is not a part of the case file.
PER CURIAM
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930 N.E.2d 411 (2010)
236 Ill.2d 515
PEOPLE
v.
COOKSON.
No. 108716.
Supreme Court of Illinois.
March 1, 2010.
Disposition of Petition for Leave to Appeal[*] Denied.
NOTES
[*] For Cumulative Leave to Appeal Tables see preliminary pages of advance sheets and Annual Illinois Cumulative Leave to Appeal Table.
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997 A.2d 232 (2010)
202 N.J. 345
STATE
v.
RODRIGUEZ.
Supreme Court of New Jersey.
June 21, 2010.
Petition for Certification Denied.
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"pile_set_name": "FreeLaw"
} |
111 F.3d 390
UNITED STATES of America, Plaintiff-Appellee,v.Rogers Julian KIRK, Defendant-Appellant.
No. 96-50510
Summary Calendar.
United States Court of Appeals,Fifth Circuit.
April 17, 1997.
Richard L. Durbin, Jr., Asst. U.S. Atty., Joan E.T. Stearns, San Antonio, TX, for Plaintiff-Appellee.
Edwin Gerald Morris, Morris & Florey, Austin, TX, for Defendant-Appellant.
Appeal from the United States District Court for the Western District of Texas.
Before JOHNSON, WIENER and DENNIS, Circuit Judges.
JOHNSON, Circuit Judge:
1
Rogers Julian Kirk appeals his conviction for possession of a firearm as a convicted felon in violation of 18 U.S.C. § 922(g). Kirk asserts two points of error on appeal. First, he complains that the district court erred in overruling his motion to suppress evidence unlawfully discovered. Second, Kirk contends that the district court erred in assigning a Sentencing Guideline base offense level (BOL) of twenty because his prior conviction for indecency with a child is not "a crime of violence." Finding no merit in either argument, we affirm.
I. Factual and Procedural History
2
On November 4, 1994, the Caldwell County Sheriff's Department (CCSD) arrested Kirk for an outstanding parole violation and for false identification to a police officer. When the police arrested him, Kirk was living in a 1974 MCI bus parked in Lockhart State Park outside of Lockhart, Texas. Following the arrest, the police impounded the bus, and Inspector Scott with the Department of Public Safety (DPS) and Deputy Hay with CCSD began an inventory search of the interior. While searching the vehicle, Scott came across what appeared to be pornographic photographs of young boys. The Government further asserts that during the inventory search, James Blanton, another CCSD officer, discovered a firearm in an exterior luggage carrier. This weapon is the subject of Kirk's present conviction. The inventory search was never completed because after discovering the allegedly pornographic material, Scott and Hay terminated the inventory search to obtain a search warrant.
3
On September 5, 1995, a federal grand jury indicted Kirk for possession of a firearm as a convicted felon, 18 U.S.C. § 922(g)(1); possession of a firearm as a fugitive from justice, § 924(a)(2); and possession of a stolen firearm, 18 U.S.C. §§ 922(j), 924(a)(2). Kirk filed a motion to suppress evidence challenging the admissibility of the firearm that officer Blanton discovered. The district court denied the motion. Kirk subsequently pleaded guilty to possession of a firearm as a convicted felon, but specifically reserved his right to appeal the denial of the motion to suppress.
4
In sentencing Kirk, the district court assigned a BOL of twenty pursuant to Sentencing Guideline section 2K2.1(a)(4)(A). This section states that a defendant's BOL is twenty "if the defendant had one prior felony conviction of ... a crime of violence." U.S. SENTENCING GUIDELINES MANUAL *392s 2K2.1(a)(4)(A) (1995). The district court found that Kirk had a prior felony conviction of indecency with a child and that this crime constituted a crime of violence as defined by the Sentencing Guidelines. See id. § 4B1.2(1). Kirk objected to the assignment of a BOL of twenty, asserting that indecency with a child was not a crime of violence.1 In overruling Kirk's objection, the district court found that indecency with a child was "certainly violent, violent to the victim, violent to the [mores] of our society, nonviolent to nobody."
5
After considering other pertinent factors,2 the district court set Kirk's total offense level at nineteen. The probation officer determined in the presentence report (PSR) that Kirk had twelve criminal history points, placing Kirk in a criminal history category of V. But pursuant to Sentencing Guideline section 4A1.3, the district court increased Kirk's criminal history category to VI because category V did not adequately reflect the seriousness of Kirk's past criminal conduct. Using a total offense level of 19 and a criminal history category of VI, the district court sentenced Kirk to seventy-eight months of imprisonment, the maximum allowed by the Sentencing Guidelines. See id. at ch. 5, pt. A. Kirk now appeals the denial of his motion to suppress evidence and his sentence.
II. Discussion
A. Suppression of Evidence
6
Kirk filed a motion to suppress the firearm discovered by Blanton. His primary complaint was that Blanton's search of the exterior of the bus was not in accordance with strict police procedures for conducting an inventory search. Thus, Kirk contends, the discovery of the weapon was not pursuant to a valid inventory search. The district court, however, declined to rule on the constitutionality of the search, instead finding that the inevitable discovery exception applied. The court reasoned that even if Blanton's search was inappropriate, Scott and Hay had commenced a proper inventory search and inevitably would have discovered the firearm.
7
In order for the inevitable discovery exception to apply, the Government must demonstrate, by a preponderance of the evidence, both "(1) a reasonable probability that the contested evidence would have been discovered by lawful means in the absence of police misconduct and (2) that the Government was actively pursuing a 'substantial alternate line of investigation at the time of the constitutional violation.' " United States v. Lamas, 930 F.2d 1099, 1102 (5th Cir.1991) (quoting United States v. Cherry, 759 F.2d 1196, 1205-06 (5th Cir.1985)). Kirk challenges the district court's finding that the Government was actively pursuing a substantial line of alternate investigation at the time that Blanton discovered the pistol.
8
Blanton testified that he arrived at the crime scene around 5:00 or 6:00 p.m. and commenced his inventory search of the bus around 9:00 p.m. Kirk, however, claims that Blanton could not have discovered the gun around 9:00 p.m. Rather, Kirk asserts that Blanton discovered the firearm when he first arrived at the scene, prior to Scott and Hay beginning the inventory search. He bases this belief on (1) Blanton's testimony that the firearm was found prior to the discovery of the alleged pornographic pictures, (2) Scott's testimony that the pictures were found early on in the inventory search, and (3) Scott's testimony that the inventory search began shortly after he arrived at the park around 6:30 p.m., instead of 9:00 p.m. as Blanton testified. Furthermore, Kirk reasons that Blanton would not have proceeded to search the exterior of the bus after Scott and Hay had assumed tight control over the inventory search of the bus. Thus, Kirk reaches the conclusion that Blanton must have discovered the firearm somewhere around 5:00 p.m. or 6:00 p.m., prior to Scott and Hay starting the inventory search.
9
When reviewing a motion to suppress based on live testimony, we must accept a district court's findings of fact unless clearly erroneous or influenced by an incorrect view of the law. See United States v. Foy, 28 F.3d 464, 474 (5th Cir.1994); United States v. Laury, 985 F.2d 1293, 1314 (5th Cir.1993). Furthermore, we must view the evidence in a light most favorable to the party that prevailed below. See id. The Government submitted evidence at the suppression hearing showing that at the time Blanton discovered the weapon (1) the decision to impound and inventory the bus had already been made and (2) the inventory of the interior of the vehicle was underway. Hay, who initiated the inventory search with Scott, testified that he arrived at the park around 7:30 or 8:00 p.m. and that the inventory search started approximately an hour after he arrived. Mike Masur, an employee of the Texas Parks and Wildlife Department who was assisting in the search, corroborated Hay's testimony and testified that the search began at approximately 9:00 p.m. Viewing this evidence in a light most favorable to the Government, it was not clearly erroneous for the district court to find that the Government was actively pursuing a substantial alternate line of investigation at the time Blanton discovered the weapon. The district court, therefore, did not err in denying Kirk's motion to suppress.
B. Sentencing Guidelines
10
In Kirk's second point of error, he challenges the district court's assignment of a BOL of twenty. We must uphold Kirk's sentence unless it was imposed in violation of the law, resulted from an erroneous application of the Sentencing Guidelines, or was an unreasonable departure from the range authorized by the guidelines. See, e.g., 18 U.S.C. § 3742(e); United States v. Guadardo, 40 F.3d 102, 103 (5th Cir.1994); United States v. Ford, 996 F.2d 83, 85 (5th Cir.1993). Challenges to a district court's interpretation of the Sentencing Guidelines are reviewed de novo while challenges to a district court's findings of fact made in the course of applying the sentencing guidelines are reviewed for clear error. See id.
11
A defendant convicted of violating 18 U.S.C. § 922(g), possession of a firearm as a convicted felon, is sentenced pursuant to Sentencing Guideline section 2K2.1. Section 2K2.1(a)(4)(A) assigns a BOL of twenty to a defendant with one prior felony conviction of a crime of violence. Although this section does not specifically state which crimes are considered crimes of violence, the commentary to section 2K2.1 expressly incorporates the definition of a crime of violence set out in Sentencing Guideline section 4B1.2. See U.S.S.G.M. § 2K2.1 cmt. 5.
12
Section 4B1.2(1) states that a crime of violence is an offense punishable by imprisonment for a term exceeding one year that
13
(i) has as an element the use, attempted use, or threatened use of physical force against the person of another, or
14
(ii) is burglary of a dwelling, arson, or extortion, involves use of explosives, or otherwise involves conduct that presents a serious potential risk of physical injury to another.
15
Id. § 4B1.2(1). Kirk claims that his prior conviction for two counts of indecency with a child does not constitute a crime of violence as defined by this section of the Sentencing Guidelines.
16
Kirk was convicted of violating both subsection (a)(1) and (a)(2) of Texas Penal Code section 21.11. Section 21.11(a) provides:
17
(a) A person commits an offense if, with a child younger than 17 years and not his spouse, whether the child is of the same or opposite sex, he:
18
(1) engages in sexual contact with the child; or
19
(2) exposes his anus or any part of his genitals, knowing the child is present, with intent to arouse or gratify the sexual desire of any person.
20
TEX. PENAL CODE ANN . § 21.11(a) (Vernon 1994).3 The Texas Penal Code further defines sexual contact as "any touching of the anus, breast, or any part of the genitals of another person with intent to arouse or gratify the sexual desire of any person." Id. § 21.01(2). The district court considered these two counts as one prior felony conviction for purposes of establishing the BOL. See U.S.S.G.M. § 4A1.2(a)(2). However, because the nature of the two offenses for which Kirk was convicted of are different, (i.e., one offense involves sexual contact and the other does not), we review each offense separately.
21
We begin by determining whether Kirk's conviction under Texas Penal Code section 21.11(a)(1), sexual indecency with a child involving sexual contact, is a crime of violence. Section 4B1.2(1)(i) of the Sentencing Guidelines is inapplicable because physical force is not an element of the crime of indecency with a child. See TEX. PENAL CODE ANN. § 21.11(a)(1). Thus, the focus in this case is whether Kirk's conviction for indecency with a child involving sexual contact involved conduct that "present[ed] a serious potential risk of physical injury to another." U.S.S.G.M. § 4B1.2(1)(ii).
22
Although this court has not expressly ruled on whether indecency with a child involving sexual contact is a crime of violence pursuant to Sentencing Guideline section 4B1.2, we have found that for purposes of 18 U.S.C. § 16, indecency with a child involving sexual contact is a crime of violence. See United States v. Velazquez-Overa, 100 F.3d 418 (5th Cir.1996).4 In Velazquez-Overa, we noted that crimes of this type are generally perpetrated by adults who are not only bigger and stronger than the children they abuse, but who also have the ability to coerce these children as an adult authority figure, adding immensely to the dangerous circumstances under which this type of crime is committed. See id. at 422. At the heart of the Velazquez-Overa opinion "is the belief 'that when an older person attempts to sexually touch a child under the age of fourteen, there is always a substantial risk that physical force will be used to ensure the child's compliance.' " Id. (quoting United States v. Reyes-Castro, 13 F.3d 377 (10th Cir.1993)).
23
We realize that the definition of crime of violence as stated in 18 U.S.C. § 16 is not identical to the definition in section 4B1.2 of the Sentencing Guidelines.5 While § 16 refers to the risk of physical force, section 4B1.2 refers to the risk of physical injury. Nonetheless, the definitions are substantially similar. Therefore, the reasoning employed in § 16 cases is persuasive authority for the conclusion reached today. Cf. Velazquez-Overa, 100 F.3d at 421 n. 4 (stating that the Ninth Circuit's analysis in United States v. Wood, 52 F.3d 272 (9th Cir.1995), while interpreting crimes of violence pursuant to section 4B1.2, supported the conclusion that indecency with a child was a crime of violence under 18 U.S.C. § 16). Indeed, in situations in which there is a substantial risk that physical force against a person will be used, a serious potential risk of physical injury may also exist.
24
In Wood, the Ninth Circuit held that pursuant to Sentencing Guideline section 4B1.2 indecent liberties with a minor was a crime of violence.6 52 F.3d at 272. In 1985, Wood had pleaded guilty in state court to taking indecent liberties with a minor and was convicted for molesting a four year old little girl. See id. at 273. In concluding that Wood's conviction was a crime of violence, the Ninth Circuit reasoned that "there is a serious risk of physical harm just in the very nature of the offense. Such conduct is inherently violent because the threat of violence is implicit in the size, age and authority position of the adult dealing with a ... child." Id. at 274 (quoting district court). The court held without hesitation that an offense of indecent liberties with a child younger than four presents a "serious potential risk of physical injury to another" and was a crime of violence as defined by section 4B1.2.
25
In the present case, the PSR stated that Kirk has been convicted of sexual indecency with a child involving sexual contact.7 The facts indicated that Kirk's victim was only eight years old. Furthermore, it was shown that Kirk had lured this child to a secluded area of a local park by deceiving and coercing the child. The little boy, unaware of the grave danger posed by Kirk, befriended him. Taking advantage of his position as an adult authority figure and the innocent nature of this child, Kirk sexually abused him.
26
Although the record does not indicate that any actual physical injury resulted, physical injury is not the test. The fact that a serious potential risk of physical injury exists is sufficient. As in this situation, when children are physically inferior to and trusting of adults, a potentially dangerous situation exists. Anytime an eight-year-old child is molested by an adult there is a significant risk that physical injury will result. When one couples a mature adult's inherent authority over a helpless young child with the implicit threat that his superior physical strength poses, the risk of physical injury is clear and unequivocal.
27
We therefore hold that Kirk's conviction of indecency with a child involving sexual contact under Texas Penal Code section 21.11(a)(1) is a crime of violence as defined by section 4B1.2 of the United States Sentencing Guidelines.8 Because we have determined that Kirk's violation of section 21.11(a)(1) is a crime of violence sufficient to uphold the district court's assignment of a BOL of twenty, we decline to decide whether Kirk's conviction under Texas Penal Code section 21.11(a)(2), sexual indecency with a child not involving sexual contact, was also a crime of violence.
III. Conclusion
28
For the reasons stated above, we hold that the district court properly denied Kirk's motion to suppress evidence and correctly found that Kirk's conviction for indecency with a child involving sexual contact was a crime of violence pursuant to Sentencing Guideline section 4B1.2.
29
AFFIRMED.
1
Kirk claims that if the district court had not classified his prior conviction as a crime of violence, he would have received a BOL of fourteen, thereby resulting in a reduced sentence
2
Two points were added pursuant to Sentencing Guideline section 2K2.1(b)(4) because the firearm was stolen. However, four points were subtracted because Kirk demonstrated an acceptance of personal responsibility for his criminal conduct and because he assisted the authorities in investigating and prosecuting his own misconduct. See U.S.S.G.M. § 3E1.1(a)-(b)
3
Although Kirk was not convicted under the 1994 statute, the portions of the statute that applied to Kirk when he was convicted are identical to the current version
4
Other circuits, also interpreting 18 U.S.C. § 16, have reached similar conclusions. See United States v. Reyes-Castro, 13 F.3d 377 (10th Cir.1993) (holding that attempted sexual abuse of a child in violation of Utah state law is a crime of violence); United States v. Rodriguez, 979 F.2d 138 (8th Cir.1992) (holding that lascivious acts with a child in violation of Iowa state law is a crime of violence)
5
Section 16 states that a crime of violence means
(a) an offense that has an element the use, attempted use, or threatened use of physical force against the person or property of another, or
(b) any other offense that is a felony and that, by its nature, involves a substantial risk that physical force against the person or property of another may be used.
18 U.S.C. § 16.
6
The Washington state law stated that
(1) A person is guilty of indecent liberties when he knowingly causes another person who is not his spouse to have sexual contact with him or another:
(a) By forcible compulsion; or
(b) When the other person is less than 14 years of age.
....
(2) For purposes of this section, "sexual contact" means any touching of the sexual or other intimate parts of a person done for the purpose of gratifying the sexual desire of either party.
Wood, 52 F.3d at 274 (quoting former WASH. REV.CODE § 9A44.100 (1985)).
7
Kirk complains for the first time on appeal that the district court improperly relied on the PSR to determine that his conviction for indecency with a child was crime of violence. Because Kirk failed to object to this at the district court level we will only review the district court's actions for plain error. See United States v. Guerrero, 5 F.3d 868, 870 (5th Cir.1993). "Plain error is so obvious that [this court's] failure to notice it would seriously affect the fairness, integrity, or public reputation of [the] judicial proceeding." United States v. Hoster, 988 F.2d 1374, 1380 (5th Cir.1993). More specifically, we will uphold sentencing adjustments if "the record as a whole demonstrates that the adjustments did not result in miscarriage of justice." United States v. Pattan, 931 F.2d 1035, 1043 (5th Cir.1991). In the present case, we conclude that the district court's reliance on the PSR in characterizing Kirk's prior conviction as a crime of violence was not plain error. See United States v. Jackson, 22 F.3d 583, 585 (5th Cir.1994) (stating that a district court could review the description of a conviction in a PSR to determine whether it was a crime of violence)
8
We note that in Velazquez-Overa this court held that sexual indecency with a child in violation of Texas Penal Code 21.11(a)(1) was per se a crime of violence. Importantly, under 18 U.S.C. § 16, we were compelled to apply a categorical approach in determining crimes of violence. See Velazquez-Overa, 100 F.3d at 420. The Sentencing Guidelines, however, do not require such a categorical approach. See Jackson, 22 F.3d at 585. Because we determine that the specific conduct Kirk was convicted of was a crime of violence we decline to rule on whether a violation of Texas Penal Code section 21.11(a)(1) could be per se a crime of violence under Sentencing Guideline section 4B1.2. Whether a conviction for sexual indecency with a child is always a crime of violence under Sentencing Guideline section 4B1.2 presents difficult questions. For example, a nineteen year old individual that engaged in consensual sexual contact with a sixteen year old may have violated section 21.11(a)(1). Yet, we cannot say that a serious potential for physical injury necessarily exists in this scenario. We are aware that under Texas law a person under the age of seventeen is legally unable to consent to sexual contact. However, factually they can consent thereby resulting in nonviolent sexual contact. Importantly, the circumstances surrounding sexual contact between two teenagers are far different from those surrounding sexual contact between a young child and a much older adult. Thus, while sexual indecency with a child is under many circumstances a crime of violence as defined by section 4B1.2, we recognize that situations may exist where a potential risk of physical injury is not present when Texas Penal Code section 21.11(a)(1) is violated. See generally Id. at 585
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TEXAS COURT OF APPEALS, THIRD DISTRICT, AT AUSTIN
NO. 03-06-00240-CV
Robert Langguth and Claudia L. Langguth, Appellants
v.
JAT Enterprises, Ltd. and William K. Neils, Appellees
FROM THE DISTRICT COURT OF TRAVIS COUNTY, 53RD JUDICIAL DISTRICT
NO. D-1-GN-03-000093, HONORABLE DARLENE BYRNE, JUDGE PRESIDING
M E M O R A N D U M O P I N I O N
After purchasing the McNeil Car Wash and Lube from appellees JAT Enterprises,
Ltd. and William K. Neils, appellants Robert and Claudia L. Langguth sued appellees for
common law and statutory fraud, see Tex. Bus. & Com. Code Ann. § 27.01 (West 2002), and
violations of the Texas Deceptive Trade Practices-Consumer Protection Act. See id. §§ 17.41-.63
(West 2002 & Supp. 2006). The trial court granted summary judgment in favor of appellees. On
appeal, the Langguths argue that the trial court improperly granted summary judgment because: (1)
there was sufficient evidence to create a material fact issue on whether the Langguths relied on
financial statements provided by appellees; and (2) the Langguths produced more than a scintilla of
evidence to support each of the elements of their fraudulent inducement claim. For the reasons
discussed below, we affirm the trial court's judgment.
FACTS AND PROCEDURAL BACKGROUND
William K. Neils is the president of the corporate general partner of JAT Enterprises,
Ltd. JAT operated the McNeil Car Wash and Lube located in Austin. In March 2001, real estate
broker Jim Krebs contacted Neils regarding a potential sale of the business. Krebs informed Neils
that he knew of several people who might be interested in purchasing the car wash and lube and
asked for permission to try and sell it. Neils agreed.
Thereafter, Krebs encountered Robert Langguth at a commercial real estate brokers
meeting. Krebs told Langguth about the McNeil Car Wash and Lube, and Langguth requested
financial information so that he could analyze the business for the possibility of purchasing it. Krebs
sent nine pages of information about McNeil Car Wash and Lube to Langguth's real estate agent,
Barry S. Winkle. Included in this information were three income statements: one for the year
ending December 31, 2000; one for the three-month period ending March 31, 2001; and one for the
three-month period ending June 30, 2001. Also included was information regarding another car
wash that was offered for sale through Krebs and a summary page from an internet marketing
service regarding McNeil Car Wash and Lube. Printed at the bottom of the summary page was the
following statement:
This information has been secured from sources we believe to be reliable, but we
make no representation or warranties, express or implied, as to the accuracy of the
information. All references to age, sq. footage, income, and expenses are
approximate. Buyers should conduct their own independent investigations and rely
only on those results.
In November 2001, Krebs faxed the Langguths another income statement provided by appellees for
the three-month period ending September 30, 2001.
The parties entered into a real estate contract for the Langguths to purchase the
McNeil Car Wash and Lube for $1.4 million in December 2001. (1) Section 11 of the contract states:
11. PROPERTY CONDITION. Other than provided herein, seller hereby
disclaims, and purchaser hereby waives, any and all warranties of any nature
regarding the property. Seller has not made and does not make any representations,
warranties or covenants of any kind or character whatsoever, whether express or
implied, with respect to: the income, expenses, profit, losses or other aspects of the
operation of the property; the square footage of the property; the quality or condition
of the property; the suitability or safety of the property for any activities and uses
which purchaser may conduct thereon; compliance by seller and/or the property with
any laws, rules, ordinances, or regulations of any applicable governmental authority,
including subdivision and zoning ordinances and building codes; or the habitability,
merchantability, or fitness of the property for a particular purpose. . . . [T]he
provisions contained in this paragraph shall survive delivery of the deed. Purchaser
shall accept the property "as is", "where is", and with all faults. Purchaser shall make
its own independent inspection of all aspects of the property and shall have no
recourse whatsoever against seller in the event of discovery of any defects of any
kind, latent or patent. (2)
Section 11 continues:
The Warranty Deed by which Seller conveys title to the Purchaser shall
contain appropriate "as is" language, similar to the language above. The Warranty
Deed will also provide that Seller's limitation of warranties and Purchaser's waiver
of warranties shall survive closing.
The contract also provided Langguth with a 45-day period in which to conduct his
investigation and inspection of the property. In relevant part, section 6 of the contract states:
6. FEASIBILITY PERIOD. For a period of forty five (45) days after the
Effective Date (the "Feasibility Period"), Purchaser shall have the right of
investigation and inspection of the Property to determine whether or not Purchaser
desires to proceed with the purchase of the Property. . . . If Purchaser determines, in
Purchaser's sole judgment and discretion, that the Property is not suitable for
Purchaser's intended use, Purchaser shall give Seller written notice of such fact on
or before the end of the Feasibility Period. Within five days of receipt of such
written notice, Seller shall instruct the Escrow Agent to refund the Escrow Deposit
to Purchaser, and both parties shall be released from all further obligations under this
Contract.
After the 45-day due diligence period expired, the parties agreed to extend the closing to allow
Langguth more time to obtain financing.
The record reflects that, prior to signing this contract, Langguth had extensive
experience buying and selling real estate and businesses. Langguth had acquired other real property
under terms similar to those provided in the contract at issue here. He had previously purchased
ongoing businesses, including a book store and a homebuilding company. The record also reflects
that Langguth had experience assessing the value of business operations and analyzing business
financial statements. Langguth further represented to Krebs that he was a businessman who had
bought and sold many companies.
It is undisputed that Langguth was represented by competent and able counsel
throughout the transaction. After appellees proposed the initial form of the contract, Langguth and
his attorney reviewed the draft and requested several changes, all of which were incorporated into
the final contract. Langguth agreed that the final executed contract "contained everything in it" that
Langguth and his attorney wanted.
Eight months after closing, the Langguths sued appellees asserting claims of
common law and statutory fraud and DTPA violations. Appellees moved for summary judgment
on the ground that the Langguths failed to establish a genuine issue of material fact because they
were barred as a matter of law from relying on any representations made by appellees prior to
December 14, 2001, based on the express disclaimer of reliance in the contract. See Tex. R. Civ. P.
166a(c). Appellees also moved for a no-evidence summary judgment on the ground that the
Langguths provided no evidence to support three elements of their fraudulent inducement claim. See
Tex. R. Civ. P. 166a(i). The trial court granted both of appellees' motions for summary judgment.
ANALYSIS
In two issues, the Langguths appeal the trial court's grant of summary judgment in
favor of appellees. (3) First, the Langguths assert that the trial court erred in granting appellees' motion
for summary judgment because there was a material issue of fact on whether the Langguths relied
on appellees' representations. Second, the Langguths assert that the trial court erred in granting
appellees' no-evidence motion for summary judgment because the Langguths produced sufficient
evidence to create a genuine issue of material fact on the challenged elements of their fraudulent
inducement claim.
Standard of Review
We review the trial court's decision to grant summary judgment de novo. Valence
Operating Co. v. Dorsett, 164 S.W.3d 656, 661 (Tex. 2005). Appellees moved for summary
judgment on both no-evidence and rule 166a(c) summary judgment grounds; however, because we
conclude that appellees satisfied the burden for summary judgment under rule 166a(c), we discuss
only that standard of review. To prevail on a summary judgment motion, the movant must
demonstrate that there are no genuine issues of material fact and that it is entitled to judgment as a
matter of law. Tex. R. Civ. P. 166a(c); American Tobacco Co. v. Grinnell, 951 S.W.2d 420, 425
(Tex. 1997). In deciding whether there is a disputed material fact issue precluding
summary judgment, we must take evidence favorable to the nonmovant as true, indulge every
reasonable inference in favor of the nonmovant, and resolve any doubts in the nonmovant's favor.
Cathey v. Booth, 900 S.W.2d 339, 341 (Tex. 1995); Nixon v. Mr. Prop. Mgmt. Co., 690 S.W.2d
546, 548-49 (Tex. 1985).
Reliance
In their first issue, the Langguths contend that the trial court erred in granting
summary judgment because there was a genuine issue of material fact regarding whether the
Langguths relied on appellees' representations made prior to entering the contract. Appellees
counter that the Langguths agreed to purchase the car wash and lube "as is" and expressly
disclaimed reliance on any representations made by appellees prior to signing the contract on
December 14, 2001.
As a general rule, Texas law provides that an "as is" agreement negates the causation
essential to recovery on claims of DTPA violations, fraud, and negligence. See Prudential Ins. Co.
of Am. v. Jefferson Assocs., 896 S.W.2d 156, 161-62 (Tex. 1995). However, "[a] buyer is not bound
by an agreement to purchase something 'as is' that he is induced to make because of a fraudulent
representation or concealment of information by the seller." Id. at 162. To determine whether an
"as is" agreement is enforceable, a reviewing court must consider "the nature of the transaction and
the totality of the circumstances surrounding the agreement." Id. Where an "as is" clause is included
as an important part of the basis of the bargain and not as an incidental or "boiler-plate" provision,
and the contract is entered into by parties of relatively equal bargaining power, a buyer's declaration
and agreement that he is not relying on representations of the seller should be upheld. Id.
An important principle of Texas contract law allows a party to disclaim reliance on
representations. Schlumberger Tech. Corp. v. Swanson, 959 S.W.2d 171, 179 (Tex. 1997).
Moreover, even in the face of a fraudulent inducement claim, courts will uphold such a disclaimer
where the party's intent is clear and specific. Id.
In this case, the Langguths contend that they agreed to purchase the McNeil Car Wash
and Lube only after they were induced by misrepresentations about the average monthly revenue and
income of the business. As part of the contract, however, the Langguths expressly disclaimed
reliance on any representations made by appellees prior to signing the contract. We must examine
the contract and the circumstances surrounding its formation to determine whether this disclaimer
is binding. See id. at 180. We conclude that the well-established rules of contract interpretation
govern whether the Langguths "gave the requisite clear and unequivocal expression of intent
necessary to disclaim reliance on these specific representations" by the appellees. See id. at 179.
Here, as in Schlumberger, both parties to the agreement were sophisticated business
persons and possessed relatively equal bargaining power. The record reflects that Mr. Langguth had
extensive experience buying and selling real estate. He had previously purchased commercial real
estate as well as ongoing commercial businesses. Mr. Langguth had experience evaluating business
financial statements and assessing the value of business operations, and the summary judgment
evidence shows that he had purchased real estate under terms similar to those at issue here. The
Langguths were represented by counsel throughout the transaction, and all of the Langguths'
requested changes were incorporated into the final contract.
Section 6 of the contract provided the Langguths with an opportunity to conduct
their own due diligence investigation before becoming bound to complete the purchase. Had the
Langguths been dissatisfied within the due diligence period, the contract allowed them to walk
away without any obligation to appellees. The record reflects that, although they requested an
extension of the due diligence period, the Langguths ultimately agreed to complete the purchase
without the extension.
In section 11 of the contract, the Langguths expressly acknowledged and agreed that
"seller has not made and does not make any representations, warranties or covenants of any kind or
character whatsoever, whether express or implied, with respect to: the income, expenses,
profit, losses or other aspects of the operation of the property." The Langguths further agreed in
section 11 that they would rely exclusively on their own investigation and assessment of the
purchase: "Purchaser shall make its own independent inspection of all aspects of the property and
shall have no recourse whatsoever against seller in the event of discovery of any defects of any
kind, latent or patent." (4)
By the inclusion of the clear language of this section in the final contract, we conclude
the Langguths unequivocally disclaimed reliance upon any representations by appellees regarding
the income and revenue of the car wash and lube. The record reflects that the Langguths could have
requested appellees to modify this contract provision. Although the Langguths did request changes
to the contract, they did not request modification of this provision.
Because courts are to assume that the parties intended every contractual provision to
have some meaning, we must presume that, by their inclusion of section 11, the parties contemplated
that the Langguths would not rely upon any representations made by appellees regarding the
income and revenue of the car wash and lube. See id. at 180. Although we recognize that such a
disclaimer will not always bar a claim of fraudulent inducement with respect to the disclaimer
itself, we conclude that, on this record, the disclaimer of reliance in section 11 conclusively
negates as a matter of law the element of reliance on representations about the income and revenue
of the car wash and lube needed to support the Langguths' claim of fraudulent inducement. See id.
at 181. Accordingly, we overrule the Langguths' first issue, and we conclude that the trial court
properly granted appellees' motion for summary judgment under rule 166a(c). Because we conclude
the trial court properly granted summary judgment under rule 166a(c), we do not reach the
Langguths' second issue.
CONCLUSION
Having overruled the Langguths' issue on appeal, we affirm the judgment of the
trial court.
__________________________________________
Jan P. Patterson, Justice
Before Chief Justice Law, Justices Patterson and Puryear
Affirmed
Filed: February 6, 2007
1. The record reflects that only Robert Langguth, and not Claudia, signed the purchase
contract.
2. In the original contract, this paragraph of section 11 was typed in all capitalized letters.
3. The Langguths appeal only from the trial court's grant of summary judgment on their fraud
claims. They do not appeal the grant of summary judgment on their claim alleging DTPA violations.
4. In the original contract, these two quoted provisions of section 11 were typed in all
capitalized letters.
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821 F.2d 45
Lionel AUBIN, et al., Plaintiffs, Appellees,v.Stanley FUDALA, etc., Defendant, Appellant.
No. 87-1036.
United States Court of Appeals,First Circuit.
Argued May 7, 1987.Decided June 22, 1987.
Robert A. Casassa with whom Theodore Wadleigh and Wadleigh, Starr, Peters, Dunn & Chiesa, Manchester, N.H., were on brief, for defendant, appellant.
Gary L. Casinghino with whom William H. Craig and Craig & Wenners, P.A., Manchester, N.H., were on brief, for plaintiffs, appellees.
Before BOWNES and BREYER, Circuit Judges, and CAFFREY,* Senior District Judge.
BREYER, Circuit Judge.
1
This case is before us for the third time. In Aubin v. Fudala, 782 F.2d 280 (1st Cir.1983) (Aubin I ), we upheld jury verdicts awarding plaintiff Lionel Aubin $300,000 in a state tort action and $500 in a related federal civil rights action. Both claims arose out of a New Year's Eve, 1979, incident in which defendant, police officer Stanley Fudala, mistook Aubin for a burglar and shot him in the shoulder. Then, in Aubin v. Fudala, 782 F.2d 287 (1st Cir.1986) (Aubin II ), we vacated the district court's award of $146.34 in attorney's fees under the Civil Rights Attorney's Fees Awards Act of 1976, 42 U.S.C. Sec. 1988. The district court had calculated attorney's fees by discounting the "lodestar"--the hours attorneys worked on the litigation times a reasonable hourly rate--by the ratio of the damages awarded in the civil rights claim ($500) to the total damages awarded ($300,500). We held that this mechanical discounting was inappropriate, especially in light of the Supreme Court's holding in Hensley v. Eckerhart, 461 U.S. 424, 435, 103 S.Ct. 1933, 76 L.Ed.2d 40 (1983), that a plaintiff is entitled to fees under Sec. 1988 for hours worked not only on successful civil rights claims, but also on other claims involving a "common core of facts" or "related legal theories." We therefore remanded the case to the district court and instructed it to determine whether an appropriate "interconnection" exists among Lionel Aubin's state tort action, his successful federal civil rights claim, and various other claims brought by Lionel Aubin and members of his family as a result of the 1979 incident.
2
On remand, the district judge determined that "there is clearly interconnection of the various claims." (A. 113.) He expressed his opinion that the jury awarded a large sum in the state tort action and only a nominal amount in the federal civil rights action not because the state claim was stronger, but because "juries are generally more familiar with negligence concepts, and given alternative routes to recovery they generally choose to follow the more familiar path." (A. 113 n. 1.) Accordingly, the district judge made no generalized discount of the lodestar to account for unsatisfactory "results obtained." Hensley v. Eckerhart, 461 U.S. at 434, 103 S.Ct. at 1940. He did, however, examine each attorney's time sheets and disallowed hours that he determined to be either redundant or extraneous and reduced, in some cases, the requested hourly rate. All told, the district judge awarded $88,888.75 out of a requested $115,231.70 in attorney's fees.
3
Defendant Fudala appeals from this award. He argues, first, that the district court failed to consider the "results obtained" in plaintiff's federal civil rights actions and to adjust the lodestar according to plaintiff's "level of success" in those actions. Hensley v. Eckerhart, 461 U.S. at 434, 103 S.Ct. at 1940. As we have already noted, however, the district court explicitly concluded that there was an "interconnection" among the various claims litigated by plaintiff's attorneys. Such an interconnection suggests that the state tort claim and the basic federal civil rights claim involved a "common core of facts" or were based on "related legal theories." Id. at 435, 103 S.Ct. at 1940. Because plaintiff achieved substantial success on his tort claim, the district judge could properly conclude that the "results obtained" justified awarding a generous fee under the civil rights act.
4
Appellant argues that the district judge should have spelled out more explicitly his reasoning in concluding that there was an "interconnection" among the various claims. And, having found such an interconnection to exist, he should have explained more pointedly why a total award of $300,500 was a "level of success" that warranted nearly $89,000 in attorney's fees. See Hensley v. Eckerhart, 461 U.S. at 437, 103 S.Ct. at 1941 ("[T]he district court should make clear that it has considered the relationship between the amount of the fee awarded and the results obtained."). We think, however, that given the familiarity with the facts of this case that is shared by the parties, the district judge, and this court, an extensive discussion was not legally required. All of the lawsuits arose out of a short series of interactions between the Aubins and a few policemen on New Year's Eve, 1979. We have described those facts and their relationship to the various claims in Aubin I. In Aubin II, we assumed that the claims might be so interconnected as to justify an award, under Hensley, of fees for time spent on all claims. The district court has simply confirmed that assumption. And, the size of the negligence award--$300,000--demonstrates that these interrelated claims achieved a substantial "level of success."
5
Second, appellant argues that the district court should have reduced the fee award to account for time spent by Aubin's lawyers in preparing clearly unsuccessful claims (for example, the state and civil rights claims of Lionel's brother Normand), in defending appeals brought by other defendants, and in duplicating other attorneys' efforts. Given the factual interrelationship of all the claims, however, we do not believe that the district court abused its discretion in choosing not to require further parsing detail on the attorneys' time sheets. It might not have been practical for the lawyers to allocate each hour among the several factually related legal claims. See City of Riverside v. Rivera, --- U.S. ----, 106 S.Ct. 2686, 2692 n. 4, 91 L.Ed.2d 466 (1986) (plurality opinion) ("[W]hile it is true that some of the disputed time records do not identify the precise claims worked on at the time, we find this lapse unimportant, in light of the District Court's finding that all of respondents' claims were interrelated."). Nor can we find legal fault with the district court's examination of the time sheets or its determinations about which hours were duplicative or not fairly charged to appellant. "We reemphasize that the district court has discretion in determining the amount of a fee award." Hensley v. Eckerhart, 461 U.S. at 437, 103 S.Ct. at 1941. And, we shall "accord deference to the exercise of that discretion." Grendel's Den v. Larkin, 749 F.2d 945, 950 (1st Cir.1984).
6
We stress that the district court has broad authority to determine the proper fee and to require a practical level of time sheet precision. The district court has greater familiarity with the litigation than do we. And, it is important not to encourage "frequent appellate review of what essentially are factual matters." Hensley v. Eckerhart, 461 U.S. at 437, 103 S.Ct. at 1941. "A request for attorney's fees should not result in a second major litigation." Id. As the eighth circuit stated in Moore v. City of Des Moines, 766 F.2d 343, 346 (8th Cir.1985):
7
Our concern centers on the large number of cases on our docket alleging an abuse of the district court's discretion which are based simply on the amount of an attorneys' fee award. Such appeals often lack substance and hinder the prompt disposition of more meritorious appeals. The dockets of all federal courts are overcrowded. We suggest to the bar and to individual counsel that as officers of the court, lawyers have a responsibility in limiting litigation over attorneys' fees.
8
In sum, we affirm the district court's award of attorney's fees based on its finding of an "interconnection" among the various claims tried below. We conclude as well that the district court did not abuse its discretion in calculating the precise award. And, because we do not wish to see appellee's award further reduced by the cost of endlessly litigating the issue of attorney's fees, we hold that Lionel Aubin is entitled to reasonable costs and attorney's fees incurred in successfully defending this appeal. Accord Coalition for Basic Human Needs v. King, 691 F.2d 597, 603 (1st Cir.1982); Lund v. Affleck, 587 F.2d 75, 77 (1st Cir.1978).
9
Affirmed and remanded for an award of attorney's fees and costs.
*
Of the District of Massachusetts, sitting by designation
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197 B.R. 459 (1996)
In re Joseph TESTA and Serafina Testa, Debtors.
Simon KONOVER and Stroudsburg Commercial Associates, Limited Partnership, Plaintiffs,
v.
Joseph TESTA and Serafina Testa, Defendants.
Bankruptcy No. 5-94-00410. Adversary No. 5-95-00495A.
United States Bankruptcy Court, M.D. Pennsylvania.
April 15, 1996.
*460 Joseph G. Murray, Wilkes-Barre, PA, for Debtors/Defendants.
Therese Ann Hardiman, Pocono Pines, PA, for Plaintiffs.
Charles DeHart, III, Chapter 13 Trustee, Hummelstown, PA.
OPINION AND ORDER
JOHN J. THOMAS, Bankruptcy Judge.
The current procedural posture of the above-captioned adversary and bankruptcy case brings before this court Debtors' Objections to the Proofs of Claim filed by Simon Konover and Stroudsburg Commercial Associates Limited Partnership, (hereinafter "Claimants"), the Claimants' written Objections to the Debtors' Objections, and a Motion to Dismiss the above removed adversary to X-XX-XXXXX, which was initially commenced in the Court of Common Pleas of Monroe County, Pennsylvania to case No. 1995-01219.
The facts are as follows. The Debtors and Claimants entered into a written commercial lease for space at the Jamesway Plaza Shopping Center located in Stroudsburg, Monroe County, Pennsylvania in 1991. Following an alleged default of certain of the lease provisions in 1992, a confession of judgment was filed for both the payment of rent and possession of the property. This matter was subsequently resolved and the Debtors remained in possession. Thereafter, the Debtors once again allegedly defaulted in their obligations under the terms of the lease and a Judgment in Confession of Judgment for Money and a Judgment in Confession of Judgment for Possession was filed on February 14, 1994 in the Court of Common Pleas of Monroe County. A Writ of Possession was thereafter issued on February 14, 1994 and was executed on by the Monroe County Sheriff's Office that same month. The Debtors then filed a Motion to Open and/or Strike the Confessions of Judgment for Possession and Rent and obtained a Rule Returnable with a stay of the proceedings on March 1, 1994. Before a hearing was held on the Motion to Strike or Open, the Debtors filed a Chapter 13 petition under the United States Bankruptcy Code on March 28, 1994. On July 7, 1994, Claimants filed a proof of claim in the amount of Fourteen Thousand Five Hundred Seventy-Five Dollars and Five Cents ($14,575.05). On July 25, 1994, this court entered an Order confirming Debtors' Chapter 13 Plan. The official record includes the filing of a document titled "Schedule of Distribution" reflecting a date of preparation of November 3, 1994. The date of approval of the document was either November 10, 1994 or November 18, 1994 (the date is somewhat illegible). This document also is not an original document but is a copy without an original signature. The Schedule of Distribution was filed with the court on December 2, 1994. In May of 1995, Debtors filed an action against Claimants and other named Defendants in the Court of Common Pleas of Monroe County which action was earlier referred to as the removed action to this court. The Debtors filed an objection to Claimants' proof of claim on June 26, 1995.
Based upon this procedural history, the Claimants' objections raised three issues which can be summarized as follows: whether the Debtors' post-confirmation objections to Claimants' proof of claim are untimely and barred under the provisions of 11 U.S.C. § 1327; whether the objections should be advanced before the Court of Common Pleas under the pending Motion to Open and/or Strike; and whether the Debtors' May 1, 1995 post-bankruptcy removed state court action should be dismissed because the claims have already been instituted by the Debtors against the Claimants in two prior actions.
TIMELINESS OF OBJECTIONS TO PROOFS OF CLAIM
The Creditors, Simon Konover and Stroudsburg Commercial Associates Limited Partnership, argue that the objections filed by the Debtors to their proofs of claim are untimely. Their reasoning is as follows. The Debtors filed bankruptcy on March 28, 1994. On April 28, 1994, the Debtors filed their Chapter 13 Plan. Since the terms of that Plan are important to this decision, it is attached as an exhibit and made a part hereof. (Exhibit "A" attached hereto.) The Claimants filed a proof of claim in this case *461 on July 7, 1994 in the amount of Fourteen Thousand Five Hundred Seventy-Five and 05/100 Dollars ($14,575.05) claiming unsecured status. Subsequently, a similar claim was filed October 20, 1994 by the Claimants for the same amounts again alleging unsecured status. On July 25, 1994, this court issued an Order confirming the Chapter 13 Plan. Subsequent to that date and on June 23, 1995, the Debtors filed objections to the proofs of claim of the Claimants.
The Claimants maintain that it's just too late to file objections to their claims citing various authority for that proposition. That authority is best exemplified by In re Simmons, 765 F.2d 547 (5th Cir.1985). That case stands for the proposition that ". . . because no objection was filed before confirmation of . . . [a] . . . Chapter 13 plan, [a creditor's] claim should have been deemed an allowed secured claim for purposes of confirmation." Id. at p. 554.
Indeed, there are cogent reasons why a creditors claim should generally be dealt with prior to confirmation. This is especially true if that creditor has filed a secured claim since the court typically is concerned with whether an allowed secured claim is adequately provided for by the plan under 11 U.S.C. § 1325(a)(5). Nevertheless, Federal Rule of Bankruptcy Procedure 3007 addresses objections to claims but sets no deadline to file same. A learned treatise addressing this concern argued against the utilization of a deadline under certain circumstances.
However, when confirmation of a plan does not purport to treat a specific creditor in a way such that its rights are determined and when determination of allowed claims is not necessary to a determination of whether the plan meets the standards of confirmation, confirmation is not an appropriate deadline for objection. 8 Collier on Bankruptcy, ¶ 3007.03 at p. 3007-10.
Claimants argue that ". . . the Debtors proposed a plan which purported to pay these Claimants for the amount of their timely filed claim." Claimants', Simon Konover and Stroudsburg Commercial Associates Limited Partnership, Brief in Support of Written Objections to Debtors' Objection to Proof of Claim and Motion to Dismiss Debtors' Civil Action, filed November 30, 1995 at page 14. As a review of the Plan annexed hereto will demonstrate, Debtors have not agreed to pay any unsecured claims except those that have been timely and accurately filed. Timeliness is an easy enough factor to consider while reference to the accuracy of a proof of claim implies an opportunity to object to that claim and litigate it fully. There can be no other implication of such statement.
Our circuit has been instructive in implying that a paragraph in a plan should not be read standing alone but must be read in conjunction with all the other provisions of a plan. In re Lewis, 875 F.2d 53, 55 (3rd Cir.1989). In the Debtors' Plan, the Debtors were forthright in committing ". . . any award presented in their civil action against Konover Management Corp. which the Debtors have valued in the schedules at approximately $40,000.00" to the pool of funds to be distributed to unsecured creditors. It is inconceivable that this could have any other meaning other than that the Debtors would prosecute a civil lawsuit against Konover and remit any proceeds of that lawsuit to the Trustee for distribution to creditors.
For the Claimants to imply that confirmation of this Plan barred the Debtors from prosecuting that lawsuit is not only indefensible, but borders on being disingenuous.
The Claimants raise a further argument in support of their position. That argument is set forth as follows:
In the instant case, it is clear that not only did the Debtors fail to object prior to the confirmation of their plan, they also failed to object to the Schedule of Distribution, which is a part of their confirmed plan, despite having received clear notice of this Schedule and of the requirement to timely file their objections. Thus, the confirmed plan's schedule of distribution, which included the amount to be distributed to these Claimants, was approved without objection by these Debtors. As such, Section 1327 will preclude the instant objections. Claimants', Simon Konover and Stroudsburg Commercial Associates Limited Partnership, Brief in Support of Written *462 Objections to Debtors' Objection to Proof of Claim and Motion to Dismiss Debtors' Civil Action, filed November 30, 1995 at page 15.
The "Schedule of Distribution", alluded to in Claimants' argument, is an item provided for by Paragraph 3021-1(a) of the Bankruptcy Practice Order and Forms for the Northern Tier of the Middle District of Pennsylvania (the Practice Order has been adopted by this Division in lieu of local rules). That paragraph reads as follows:
¶ 3021-1 (a) Distribution Under Chapter 13 Plans. Following confirmation of the chapter 13 plan and expiration of the deadline for filing proofs of claim, the debtor shall review all proofs of claim filed with the clerk and shall file objections to claims where appropriate. Thereafter, but before any distribution under the plan, the trustee will prepare and file a proposed schedule of distribution identifying those claims of record which are entitled to receive a distribution in accordance with the confirmed plan.
Initially it should be noted that our local Practice Order appears to suggest that objections should be filed after plan confirmation. Thereafter, a proposed schedule of distribution is to be filed by the Chapter 13 Trustee. Nothing in ¶ 3021-1(a) provides that the proposed schedule of distribution need be noticed or submitted to the court for approval.
Document # 9 filed in this case on December 2, 1994 is entitled "Schedule of Distribution" and it appears to be a conformed copy of a document originally executed by Charles J. DeHart, III, Standing Chapter 13 Trustee, on or about November 10, 1994 or November 18, 1994. It further includes a proposal to distribute the sum of Fourteen Thousand Five Hundred Seventy-Five and 05/100 Dollars ($14,575.05) to the Claimants over the life of the Plan.
Notwithstanding the approval date of November 10, 1994 or November 18, 1994, the following statement appears on the bottom of this document.
ANYONE OBJECTING TO THIS SCHEDULE SHOULD FORWARD CORRESPONDENCE TO THE TRUSTEE'S OFFICE WITHIN 10 DAYS FROM THE DATE BELOW.
DATE PREPARED: November 3, 1994.
Assuming "correspondence" had to be forwarded to the Trustee within 10 days from November 3, 1994, the necessary objections would have had to be received by the Trustee no later than three days after the Trustee probably mailed it, a virtual impossibility. Moreover, there's no indication on this record that it was ever circulated to any party in interest.
Overall, the document appears to be meaningless except that it may offer some justification for any distribution the Trustee may effect, depending on who received prior service of this schedule.
We conclude that the objections to the claims are timely filed.
RES JUDICATA/COLLATERAL ESTOPPEL
The core requirements of collateral estoppel as provided by the Third Circuit in the case of In re Braen, 900 F.2d 621 (3rd Cir.1990), citing Matter of Ross, 602 F.2d 604 (3rd Cir.1979) quoting Haize v. Hanover Insurance Co., 536 F.2d 576 (3rd Cir.1976) are as follows: "(1) the issue sought to be precluded must be the same as that involved in the prior action; (2) that issue must have been actually litigated; (3) it must have been determined by a valid and final judgment; and (4) the determination must have been essential to the prior judgment." This court finds that the requirements of collateral estoppel have not been met.
For res judicata to apply, there must be (1) a final judgment on the merits in a prior suit; (2) involving the same parties or their privies; and (3) the present suit must be based on the same cause of action. U.S. v. Athlone Industries, 746 F.2d 977, 983 (3rd Cir.1984).
An adjudication of a petition to open a judgment may be enough to bar a subsequent lawsuit under the provisions of res judicata and collateral estoppel. Hopewell Estates, Inc. v. Kent, et al., 435 Pa.Super. *463 471, 646 A.2d 1192 (1994); Duquesne Light Company v. Pittsburgh Railways Company, 413 Pa. 1, 194 A.2d 319 (1963); and Romah v. Romah, et al., 411 Pa.Super. 12, 600 A.2d 978 (1991). In the Duquesne Light Company case, the Pennsylvania Supreme Court held that when a party has an opportunity to raise potential defenses to a confession of judgment but fails to do so in a first petition to open, then those issues are barred by the doctrine of res judicata in a subsequent second petition.
What was common to all the above quoted cases was that there was a final determination on all the motions or petitions to strike judgment. The instant case presents an important distinction. There was no hearing held on the Debtors' Petition to Strike and/or Open the Confession of Judgment. Additionally, that proceeding itself was stayed by the filing of the bankruptcy. Under both the requirements of collateral estoppel and res judicata, there is no valid or final judgment entered in the state court proceeding. Moreover, the cause of action removed from the state court does not have an identity of parties in that the action was not only against the above Claimants but also against Tuscarora Wayne Insurance Co. Any issue essential for the prior determination was not actually litigated in the confession of judgment and therefore there was no determination made on any issue essential to the prior judgment.
The removed action is based upon alleged defaults under the terms of the lease and an alleged failure to provide the business premises as promised. Debtors also assert that their property was damaged and that they lost profits. The court has determined to treat the removed state court action as a counterclaim to the proof of claim filed by the Claimants and will consolidate those matters and proceed as if this matter was initiated as an adversary proceeding in this bankruptcy court. See Federal Rule of Bankruptcy Procedure 3007. As to the pending Motion to Strike and/or Open the Judgment in the state court, that matter was stayed by the filing of the bankruptcy and there is no prejudice to any of the parties to that litigation by the continued stay of that action.
Our Order is attached.
ORDER
For the reasons indicated in the attached Opinion, the Motion of Simon Konover and Stroudsburg Commercial Associates, Limited Partnership, to Dismiss adversary number X-XX-XXXXXA as well as their objections to the Debtors' claims objections are denied.
The claims litigation between the parties as well as the above-captioned adversary are consolidated for disposition. A pre-trial on the consolidated matter is hereby scheduled for Wednesday, May 22, 1996 at 10:00 o'clock A.M. in Courtroom No. 1, Federal Building, 197 South Main Street, Wilkes-Barre, Pennsylvania.
EXHIBIT A
IN THE UNITED STATES BANKRUPTCY COURT FOR THE MIDDLE DISTRICT OF PENNSYLVANIA
In re: Joseph A. Testa and Serafina G. Testa, Debtors
CHAPTER 13
No. 5-94-00410
CHAPTER 13 PLAN
COMES NOW, the Debtors, Joseph Testa and Serafina Testa and file this chapter 13 plan and request that it be confirmed:
1. PAYMENTS TO THE TRUSTEE. No payments shall be made to the chapter 13 trustee on a monthly basis. As assets of the Debtors are sold by the Debtors, the Debtors shall make lump sum payments to the trustee to pay 100% of all allowed claims.
2. CLASSIFICATION OF CLAIM. This Plan classifies claims as follows: priority, secured and unsecured claims.
3. PRIORITY CLAIMS. The following priority claims shall be paid in full through the Plan:
Joseph G. Murray, Esquire $1,350.00
No payments shall be made to non-priority claims until priority claims are paid in full.
4. SECURED CLAIMS: There are no secured claims.
*464 5. LIQUIDATION OF ASSETS: The Debtors propose to sell the assets listed in the Debtors Schedule B as restaurant equipment and fixtures within six (6) months from the date of confirmation. The Debtors have listed the value of the equipment and fixtures at approximately $35,000.00. The Debtors will also commit any award presented in their civil action against Konover Management Corp. which the Debtors have valued in the schedules at approximately $40,000.00.
6. UNSECURED CLAIMS: Creditors holding unsecured, nonpriority claims shall be paid in full through the plan in the amount of $33,000.00. The trustee shall pay only those creditors who have filed a timely and accurate Proof of Claim.
7. COMPENSATION TO THE TRUSTEE. The Chapter 13 trustee will receive compensation through the Plan in the amount of 10% of monies paid out to creditors.
/s/ Joseph Testa
Joseph Testa
/s/ Serafina Testa
Serafina Testa
Dated: April 25, 1994
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493 F.2d 1406
Limbackv.Weinberger
73-2233
UNITED STATES COURT OF APPEALS Sixth Circuit
3/12/74
1
W.D.Mich.
AFFIRMED
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UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLUMBIA
___________________________________
)
UNITED STATES OF AMERICA )
)
v. ) Criminal No. 05-0452 (PLF)
)
GERRY D. MATHEWS, )
)
Defendant. )
___________________________________ )
MEMORANDUM OPINION AND ORDER
Pending before the Court is the parties’ Consent Motion to Modify August 15,
2011 Court Order as to Wage Garnishment and Monthly Restitution (“Consent Motion”), which
was filed on March 16, 2015 [Dkt. No. 66]. As the title of the Consent Motion indicates, the
parties seem to be conflating two distinct things: the wage garnishment that was imposed upon
garnishee A.P. Mathews Heating & Air Conditioning by the Court’s August 15, 2011
Disposition Order [Dkt. No. 27]; and Ms. Mathews’ obligation to pay restitution as ordered in
this Court’s Judgment of June 20, 2006 in her criminal case (“Judgment”) [Dkt. No. 12]. As
such, the Consent Motion leaves it unclear whether, going forward, A.P. Mathews bears an
obligation to pay garnished wages of $150 per month to the Clerk of the Court, or whether,
instead, the only ongoing payment obligation is one that falls personally on Ms. Mathews.
See Consent Motion ¶ 9(c). Similarly, it is not clear whether the wage garnishment arrearages
accrued from October 2014 to February 18, 2015, which the parties intend to reduce to $150.00
per month nunc pro tunc, are to be paid in one lump sum by A.P. Mathews or by Ms. Mathews
herself. See id. ¶ 9(a) and (b).
The Consent Motion also confuses the difference between a condition of
Supervised Release placed on Ms. Mathews in June 2006 — which required her to pay restitution
at a rate of $100 per month or at a rate to be established by the Probation Office — and the
restitution order included in the Court’s judgment that obligates her to pay a total of
$312,260.09. Compare Judgment at 3 (setting forth conditions of Supervised Release), with id.
at 4 (restitution order). As the Court emphasized during the recent hearing held in open court on
February 18, 2015, the $100-per-month condition of Ms. Mathews’ Supervised Release in no
way absolved her of an obligation to pay the full amount of restitution. And, given the
expiration of Ms. Mathews’ term of Supervised Release, it is up to the Department of Justice to
determine how it intends to pursue full payment of that obligation. 1
If the parties mean to request that this Court set a payment schedule as an element
of the restitution order by modifying the Judgment in this case, see 18 U.S.C. § 3664(k), they
ought to make that request clear. Alternatively, if Paragraph 9(c) of their Consent Motion is
intended to modify A.P. Mathews’ payment obligation under the Court’s August 15, 2011
Disposition Order, then the parties must make that intention clear by disentangling it from any
discussion of a “monthly restitution payment.”
With that said, the Court approves of the parties’ agreement, represented in
Paragraph 6 of the Consent Motion, regarding A.P. Mathews’ duty to pay wage garnishment
arrearages in the amount of $10,175.00, funds now held by sub-garnishee SunTrust Bank.
Accordingly, the Court will enter the parties’ accompanying Consent Judgment and Disposition
Order [Dkt. No. 67] by separate order this same day.
1
As a part of that effort and as discussed in open court on February 18, 2015,
counsel will explore prior to the next hearing on May 7, 2015, how best to obtain the money in
Ms. Mathews’ 401(k) account and other monies owed to her by her former employer and the
victim in this case, Fried Frank.
2
For the foregoing reasons, therefore, it is hereby
ORDERED that the parties’ Consent Motion to Modify August 15, 2011 Court
Order as to Wage Garnishment and Monthly Restitution [Dkt. No. 66] is GRANTED in part and
DENIED in part; it is
FURTHER ORDERED that the Consent Motion is granted with respect to
Paragraph 6, and denied in all other respects without prejudice to the parties’ filing a revised
consent motion or motions — one relating to garnishment and the other to restitution —
addressing the concerns raised by the Court; and it is
FURTHER ORDERED that the parties shall file their revised consent motion or
motions on or before April 27, 2015.
SO ORDERED.
/s/________________________
PAUL L. FRIEDMAN
United States District Judge
DATE: April 10, 2015
3
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904 F.2d 46
Unpublished DispositionNOTICE: Federal Circuit Local Rule 47.8(b) states that opinions and orders which are designated as not citable as precedent shall not be employed or cited as precedent. This does not preclude assertion of issues of claim preclusion, issue preclusion, judicial estoppel, law of the case or the like based on a decision of the Court rendered in a nonprecedential opinion or order.IN re David M. ALLGEIER.
No. 90-1072.
United States Court of Appeals, Federal Circuit.
May 18, 1990.
Judgment
PER CURIAM.
1
Before PAULINE NEWMAN and MICHEL, Circuit Judges, and SAMUEL CONTI, Senior District Judge*.
2
AFFIRMED. See Fed.Cir.R. 36.
*
The Honorable Samuel Conti, United States District Court for the Northern District of California, sitting by designation pursuant to 28 U.S.C. Sec. 293(a)
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731 S.W.2d 198 (1987)
292 Ark. 487
Linda L. HARGIS, Appellant,
v.
Freddie W. HARGIS, Appellee.
No. 87-10.
Supreme Court of Arkansas.
June 22, 1987.
Pearson, Woodruff & Evans by C. Thomas Pearson, Jr., and Pat A. Jackson, Fayetteville, for appellant.
Everett & Gladwin, by John C. Everett, Prairie Grove, for appellee.
DUDLEY, Justice.
This is an appeal from the denial of a motion to set aside a divorce decree. Appellant, Linda Hargis, and appellee, Freddie Hargis, both domiciliaries of the State of Arkansas, were married on January 31, 1986. During their one and one-half months of married life, they lived in Madison County. On March 13, 1986, they separated and the appellant moved back to her native Benton County. On March 31, 1986, *199 appellee, Freddie Hargis, still a resident of Madison County, filed a complaint for divorce in Washington County. On May 7, 1986, an instrument executed by appellant, Linda Hargis, was filed in the Chancery Court of Washington County. It was styled "Waiver of Service and Venue and Entry of Appearance." The instrument "expressly waives venue in this action." On June 30, 1986, the decree of divorce was entered.
On August 18, within ninety days after the decree was entered, appellant filed a motion pursuant to ARCP Rule 60(b) to set aside the decree. In her motion she alleged that appellee had never lived in Washington County; that she signed the waiver of venue under duress and without counsel; that appellee had defrauded her by telling her after a reconciliation that he would not use the waiver and would not file for divorce when, in fact, he had already done so. In the motion she did not allege that she had a valid defense to the complaint for divorce and, upon a hearing, did not make a prima facie showing of such a defense. The trial court denied her motion to set aside the divorce decree. We affirm.
ARCP Rule 60(d), and its predecessor statute, Ark.Stat.Ann. § 29-509 (Repl. 1962), provides that, on collateral attack, judgments will not be vacated unless a meritorious defense is alleged and proved. In H.G. Pugh & Co. v. Martin, 164 Ark. 423, 262 S.W. 308 (1924), we even said this was a "doctrine of this court." For a case, almost identical to the one at bar, in which we affirmed the trial court in dismissing a motion to set aside a judgment, see Burnett v. Burnett, 254 Ark. 507, 494 S.W.2d 482 (1973). Here, the appellant neither alleged nor made a prima facie showing of a valid defense, thus, the decree of the lower court must be affirmed.
Though not expressly argued, the appellant, in effect, contends that Rule 60(d) is not applicable since the decree is void ab initio for lack of jurisdiction. We need not decide whether the Rule 60(d) requirement is applicable when a judgment or decree is void because the decree in this case is not void. (However, we note that in interpreting the predecessor statute we held that the requirement must be met even when fraud was practiced. Quigley v. Hammond, 104 Ark. 449, 148 S.W. 275 (1912)).
In Bachman v. Bachman, 274 Ark. 23 621 S.W.2d 701 (1981), we pointed out that there are two separate residency statutes in our divorce laws. One, Ark.Stat.Ann. § 34-1208 (Repl.1962) deals with the necessity of residing in this State for a designated period of time before a court of this State can acquire jurisdiction. Residency in that statute is the equivalent of domicile in its more restrictive sense. Ark.Stat. Ann. § 34-1208.1 (Repl.1962). The other residency statute, Ark.Stat.Ann. § 34-1204 (Supp.1985), deals with venue. The part of the venue statute which is applicable to this case provides that "the proceedings shall be in the county where the complainant resides...." Ark.Stat.Ann. § 34-1204 (Supp.1985).
In Gland-o-Lac Co. v. Creekmore, Judge, 230 Ark. 919, 924, 327 S.W.2d 558, 561 (1959), we explained the difference between jurisdiction and venue as follows:
[V]enue mean[s] the place, that is the county or district wherein a cause is to be tried; and jurisdiction mean[s], not the place of trial, but the power of the court to hear and determine a cause, including the power to enforce its judgment.
A more concise definition of the two terms is:
Jurisdiction deals with the authority of a court to exercise judicial power. Venue deals with the place where that power should be exercised.
M. Green, Basic Civil Procedure 51 (1972).
Judge Newbern has written:
An action brought in the proper county is one in which the venue is said to be properly laid. The venue concept should have to do with nothing but choosing among courts of two or more places in which jurisdiction of the subject matter and jurisdiction of the defendant or defendants exist. *200 D. Newbern, Ark. Civil Prac. and Proc., § 6-1 (1985).
Jurisdiction cannot be conferred upon a court by consent or waiver when the court would otherwise have no jurisdiction of the subject matter of the action. Arkansas Association of County Judges v. Green, 232 Ark. 438, 338 S.W.2d 672 (1960). However, the venue of an action may be waived. Waterman v. Jim Walter Corp., 245 Ark. 218, 431 S.W.2d 748 (1968). For example, in Arkansas State Racing Comm'n v. Southland Racing Corp., 226 Ark. 995, 295 S.W.2d 617 (1956), we said "the settled rule is that an objection to venue is waived by a defendant who enters his appearance...."
In this case the statute requiring residency in the State, or domicile, was clearly satisfied. The courts of this State had the authority to exercise judicial power over the res of the marriage. The suit was not filed in the county of proper venue, but the appellant expressly entered her appearance and waived venue. Since venue can be waived, the Chancery Court of Washington County could exercise its power, and the decree was not void.
Appellant points out that we have used the term "jurisdiction" in a number of cases when we were discussing the "venue" statute. We acknowledge we have, at times, inartfully used the terms. For example, in McLaughlin v. McLaughlin, 193 Ark. 207, 99 S.W.2d 571 (1936), we labeled "venue" as "jurisdiction," but even though we transposed the terms in that case, we would still reach the same result that we previously reached on that direct appeal.
Affirmed.
HAYS and GLAZE, JJ., dissent.
GLAZE, Justice, dissenting.
Neither appellant nor appellee has ever been a resident of Washington County even though appellee alleged he was in his complaint. Because I believe extrinsic fraud occurred in appellant's obtaining the divorce, I cannot agree that venue existed in the Washington County Chancery Court, much less that it could be waived. See Murphy v. Murphy, 200 Ark. 458, 140 S.W.2d 416 (1940). I would reverse and dismiss.
HAYS, J., joins in this dissent.
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341 U.S. 58 (1951)
UNITED STATES
v.
WILLIAMS ET AL.
No. 134.
Supreme Court of United States.
Argued January 8, 1951.
Decided April 23, 1951.
APPEAL FROM THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF FLORIDA.
*59 Philip Elman argued the cause for the United States. With him on the brief were Solicitor General Perlman, Assistant Attorney General McInerney, Robert S. Erdahl and Philip R. Monahan.
Ernest E. Roberts and John D. Marsh argued the cause for appellees. Bart A. Riley was on the brief for Williams, Mr. Roberts for Yuhas, and Mr. Marsh for Ford et al., appellees.
MR. JUSTICE REED delivered the opinion of the Court.
The United States appeals from an order of the United States District Court for the Southern District of Florida dismissing an indictment against the appellees here. 18 U. S. C. § 3731. That indictment, 18 U. S. C. § 1621, charged each appellee with the crime of perjury while testifying in a prior criminal trial. The former trial was on charges of using "third degree" methods to force confessions from prisoners.
In that prior trial, six defendantsthe four appellees and two others not here involvedwere prosecuted under an indictment, four counts of which charged them, 18 *60 U. S. C. (1946 ed.) § 51, now 18 U. S. C. § 241, with conspiring "to injure, oppress, threaten, and intimidate [under color of state law, four citizens of the United States] in the free exercise and enjoyment of the rights and privileges secured . . . and protected by the Fourteenth Amendment. . . ."[1]
The other four counts of the indictment, 18 U. S. C. (1946 ed.) § 52, now 18 U. S. C. § 242, charged that Williams, Bombaci, Ford, and another not here involved, as police officers acting under state laws, committed substantive crimes by subjecting four persons to deprivation of certain "of the rights, privileges and immunities secured. . . and protected by the Fourteenth Amendment,"[2] and that Yuhas and another wilfully aided and abetted in the commission of these substantive offenses.
In the prior trial, during which this indictment charges perjury was committed, Williams was found guilty by a jury of the substantive offenses. His conviction is affirmed today. See No. 365, Williams v. United States, post, p. 97. The jury found Bombaci and Ford not guilty of these offenses and Yuhas not guilty of aiding and abetting in the commission of these offenses. However, the jury was unable to agree on a verdict as to the four counts which charged conspiracy. Later a new indictment *61 was presented which framed once again the conspiracy charges, and this time the appellees in this case were found guilty. The perjury charges now before us are not based on the proceedings in the second conspiracy trial. On appeal from the conviction in the second trial, and before the trial for perjury, the Court of Appeals quashed the conspiracy indictment and reversed. So far as here important, the basis for the reversal was that § 241 did not apply to the general rights extended to all persons by the Fourteenth Amendment. 179 F. 2d 644, 648. This Court, today, affirms the Court of Appeals. No. 26, United States v. Williams, decided today, post, p. 70.
In dismissing the indictment in the case now before us, the District Court held, 93 F. Supp. 922, that since Williams had been convicted in the first trial of the substantive counts based upon his beating certain victims, to convict Williams of perjury for testifying that he had not beaten the victimswhich is the gist of the perjury indictment against Williamswould constitute double jeopardy.
The District Court further reasoned that the jury's finding that Yuhas, Ford and Bombaci had not been guilty of the substantive offenses in the first trial, was a determination of their innocence "whether as principals or accessories," and therefore none of the three could be found guilty of the charge made by the perjury indictment: testifying falsely that they had not seen or observed Williams beating the victims.
Finally, the District Court reasoned that since the later indictment which repeated the conspiracy charges had been quashed on appeal, there was no jurisdiction to try the defendants on the conspiracy counts in the first criminal trial, and therefore the perjury counts based on the conspiracy counts in the prior case were bad.
The United States in its appeal urges that the District Court erred in all three grounds for quashing the perjury *62 indictment. The federal perjury statute, 18 U. S. C. § 1621, reads as follows:
"Whoever, having taken an oath before a competent tribunal, officer, or person, in any case in which a law of the United States authorizes an oath to be administered, that he will testify, declare, depose, or certify truly, or that any written testimony, declaration, deposition, or certificate by him subscribed, is true, willfully and contrary to such oath states or subscribes any material matter which he does not believe to be true, is guilty of perjury, and shall, except as otherwise expressly provided by law, be fined not more than $2,000 or imprisoned not more than five years, or both."
Its terms cover parties as well as other witnesses. If any incident or judgment of a former trial bars a prosecution for perjury under § 1621, that effect must be imported into the perjury trial by a legal rule distinct from the statute.
I. Former Jeopardy.The conviction of Williams, at a former trial, for beating certain victims is not former or double jeopardy. Obviously perjury at a former trial is not the same offense as the substantive offense, under 18 U. S. C. § 242, of depriving a person of constitutional rights under color of law. "It is only an identity of offenses which is fatal." Pinkerton v. United States, 328 U. S. 640, 644, and cases cited. The trial court does not cite any authority for a contrary position, and appellees concede that the ground for dismissal cannot be sustained. It would be no service to the administration of justice to enlarge the conception of former jeopardy to afford a defendant immunity from prosecution for perjury while giving testimony in his own defense. Appellees' brief treats Williams' conviction as grounds for estoppel or res judicata.
*63 II. Res Judicata.Though former jeopardy by trial for the substantive crimes is not available as a defense against this perjury indictment, it could be that acquittal on the substantive charges would operate "to conclude those matters in issue which the verdict determined though the offenses be different." Sealfon v. United States, 332 U. S. 575, 578.
Petitioner in the Sealfon case was acquitted of a conspiracy charge of defrauding the United States of its governmental function of conserving and rationing sugar. One item of evidence was a letter to an alleged co-conspirator said to furnish a basis for getting sugar illegally. On another indictment for uttering false invoices for the same sugar involved in the conspiracy, Sealfon moved to quash on the ground of res judicata. The motion was denied and Sealfon was convicted. The test of the soundness of the motion was whether the "verdict in the conspiracy trial was a determination favorable to petitioner of the facts essential to conviction of the substantive offense." P. 578. We thought the acquittal of conspiracy determined that Sealfon did not conspire with Greenberg, the only alleged co-conspirator. Admittedly Sealfon wrote a certain letter. "As we read the records of the two trials, petitioner could be convicted of either offense only on proof that he wrote the letter pursuant to an agreement with Greenberg." P. 580. The core of the two cases was the same. As the first trial cleared him of sending the letter pursuant to a corrupt agreement, that fact was res judicata. A like basis for res judicata does not exist here.
Ford and Bombaci were acquitted in the former trial on all counts charging substantive crimes. Yuhas was charged and acquitted of aiding and abetting. We shall assume with the District Court that Ford and Bombaci were acquitted also of that charge. 18 U. S. C. § 2 (a). In essence the first prosecution was for arrest and abuse *64 through beatings by police officers Williams, Ford and Bombaci, acting under the laws of Florida, with Yuhas aiding and abetting. The perjury charged in this present indictment, allegedly committed at that former trial in which all except Williams were acquitted of the substantive offenses, is that the three acquitted men testified falsely that they had not seen Williams abuse the prisoner. The trial court thought that "Whether they had seen or observed Williams beat the victims was a part and parcel of the charge against them in the substantive counts" of abuse and aiding and abetting the abuse. Ehrlich v. United States, 145 F. 2d 693, was cited.[3] 93 F. Supp. 922.
We do not think the facts bring any of these defendants within the protection of res judicata, as recently expounded in Sealfon. Aiding and abetting means to assist the perpetrator of the crime.[4] The substantive former *65 charge against appellees here was abuse of a prisoner by police officers under color of state law. An acquittal of such a crime or of aiding and abetting was certainly not a determination that Ford, Bombaci or Yuhas did not see Williams assaulting the prisoners.
III. The counts in this indictment which charge that perjury was committed in the first conspiracy trial rely on the same facts to prove the perjury as are detailed above to support the counts of the indictment which charge perjury in the trial of the substantive counts. The trial court in the present case dismissed the counts for perjury committed in the first trial of the conspiracy charge for a different reason than it gave for dismissal of the other perjury counts. In the first trial no verdict was reached by the jury on the conspiracy counts. The trial court in this case, however, relying upon the determination of the Fifth Circuit in the second conspiracy trial, Williams v. United States, 179 F. 2d 644 (now affirmed here, No. 26, United States v. Williams, post, p. 70, decided today), ruled that the former conspiracy indictment did not state an offense, and consequently perjury could not have been committed. The court said it reached this conclusion because the court that tried the conspiracy indictment had "no jurisdiction." Evidently, the trial court was led to this conclusion by the requirement of the perjury statute, 18 U. S. C. § 1621, that there must be a "competent tribunal" before a false statement is perjurious.
The charge in the conspiracy counts that the appellees, police officers and others, conspired to abuse a prisoner in their hands was based on 18 U. S. C. § 241. The District Court had jurisdiction of offenses against the laws of *66 the United States. 18 U. S. C. § 3231.[5] Hence, it had jurisdiction of the subject matter, to wit, an alleged violation of a federal conspiracy statute, and, of course, of the persons charged. This made the trial take place before "a competent tribunal": a court authorized to render judgment on the indictment. The circumstance that ultimately it is determined on appeal that the indictment is defective does not affect the jurisdiction of the trial court to determine the case presented by the indictment.
This was held as to a civil proceeding in Bell v. Hood, 327 U. S. 678. In that case, a suit in a federal district court for damages against federal officers for violation of plaintiff's rights to due process in arrest and freedom from unreasonable search and seizure under the Fourth and Fifth Amendments was held to give the district court jurisdiction sufficient to call for judgment on the merits, even though that judgment should dismiss the complaint for failure to state a cause of action. P. 682. "Jurisdiction is the power to decide a justiciable controversy, and includes questions of law as well as of fact." Binderup v. Pathe Exchange, 263 U. S. 291, 305. Even the unconstitutionality of the statute under which the proceeding is brought does not oust a court of jurisdiction. Chicot County District v. Baxter State Bank, 308 U. S. 371, 376. See also Stoll v. Gottlieb, 305 U. S. 165; M'Cormick v. Sullivant, 10 Wheat. 192.
It is true that there are certain essential facts that must exist to give any power to a court. Noble v. Union River Logging R. Co., 147 U. S. 165, 173. As the existence of those facts are so plainly necessary, e. g. process, examples of decisions are rare. Absence of such facts makes the *67 proceedings a nullity. Such a case was Kalb v. Feuerstein, 308 U. S. 433. We there held that the Federal Government, in the exercise of its plenary power over bankruptcy, had ousted state courts of all independent power over farmer bankrupts. Therefore any subsequent orders in the state courts were void. Pp. 440-444. In a criminal case we have said that a person convicted by a court without jurisdiction over the place of the crime could be released from restraint by habeas corpus where there were exceptional circumstances such as a conflict of jurisdiction between the state and the Federal Government. Bowen v. Johnston, 306 U. S. 19, 27. The kind of judicial controversies presented for adjudication in the cases cited above in this paragraph were not cognizable by the respective courts. It is absence of such basic facts of jurisdiction that has led courts to say that false testimony in the proceedings is not punishable as perjury. Where perjury charges arise from alleged false statements by the defendant in former trials, whether in that former trial he was also a defendant or only a witness, the same distinctions appear. Where the court of the first trial had no jurisdiction of the kind of judicial controversies presented for adjudication, a number of courts have held that false testimony in those proceedings is not punishable as perjury.[6] So in a case where the court had general jurisdiction of the kind of prosecution, larceny less than felony, but not of the particular proceeding, larceny as a felony, there was no perjury. Johnson v. State, 58 Ga. 397. But where the court in the trial where the alleged perjury occurred had jurisdiction to render judgment on the merits in those proceedings, defects developed dehors the record[7] or in the procedure, sufficient to invalidate any *68 judgment on review,[8] do not make a subsequent conviction for perjury in the former trial impossible.
One can find inconsistent and indeed conflicting rulings among the cases, even from the same jurisdictions, perhaps attributable to the use of the word "jurisdiction" in the heterogeneous situations that occur. The line is narrow and often wavering between errors in the proceedings and lack of jurisdiction. Wharton, Criminal Law (12th ed.), § 1538. Here, however, we have a federal statute enacted in an effort to keep the course of justice free from the pollution of perjury. We have a court empowered to take cognizance of the crime of perjury and decide the issues under that statute. The effect of the alleged false testimony could not result in a miscarriage of justice in this case but the federal statute against perjury is not directed so much at its effects as at its perpetration; at the probable wrong done the administration of justice by false testimony. That statute has led federal courts to uphold charges of perjury despite arguments that the federal court at the trial affected by the perjury could not enter a valid judgment due to lack of diversity jurisdiction,[9] or due to the unconstitutionality of the statute out of which the perjury proceedings arose.[10]
Where a federal court has power, as here, to proceed to a determination on the merits, that is jurisdiction of the proceedings. The District Court has such jurisdiction.[11] Though the trial court or an appellate court may *69 conclude that the statute is wholly unconstitutional, or that the facts stated in the indictment do not constitute a crime or are not proven, it has proceeded with jurisdiction and false testimony before it under oath is perjury.
Reversed.
MR. JUSTICE BLACK and MR. JUSTICE FRANKFURTER dissent.
NOTES
[1] The indictment specified the following "rights and privileges":
". . . the right and privilege not to be deprived of liberty without due process of law, the right and privilege to be secure in his person while in the custody of the State of Florida, the right and privilege not to be subjected to punishment without due process of law, the right and privilege to be immune, while in the custody of persons acting under color of the laws of the State of Florida, from illegal assault and battery by any person exercising the authority of said State, and the right and privilege to be tried by due process of law and if found guilty to be sentenced and punished in accordance with the laws of the State of Florida; . . . ."
[2] The specific "rights and privileges" are the same as those listed in note 1.
[3] In the Ehrlich case an acquittal of a charge of violation of the Price Control Act, 50 U. S. C. App. § 901 et seq., by collecting more than the sale bills for meat showed was held to bar a perjury charge that Ehrlich had sworn falsely that he had not received any payment for any sale at a price in excess of that shown on the sales slips. It was held that the plea in bar of the second prosecution was good on the ground that the allegedly perjurious words were the basis of the former crime charged and therefore the acquittal barred the perjury prosecution.
A number of other cases are cited in appellees' brief. They support the rule that an acquittal on facts essential to conviction on the subsequent charge bars a later prosecution. None deal with the situation of Williams who was convicted on the prior trial of abuse under 18 U. S. C. § 242. He can, of course, claim no bar against prosecution on a theory of estoppel since the facts in the former trial, if applicable to the subsequent one, were found against him. The cases are: United States v. De Angelo, 138 F. 2d 466; United States v. Butler, 38 F. 498; Chitwood v. United States, 178 F. 442; Allen v. United States, 194 F. 664; Youngblood v. United States, 266 F. 795; Kuskulis v. United States, 37 F. 2d 241.
[4] To be present at a crime is not evidence of guilt as an aider or abettor. Hicks v. United States, 150 U. S. 442, 447, 450. Cf. United States v. Di Re, 332 U. S. 581, 587; 12 A. L. R. 279. The instructions at the trial of the substantive crimes followed this rule. E. g., "I can't make it too emphatic to you, gentlemen, that mere presence when a crime is committed is, of course, not sufficient to render one guilty as aider or abettor."
[5] "The district courts of the United States shall have original jurisdiction, exclusive of the courts of the States, of all offenses against the laws of the United States.
"Nothing in this title shall be held to take away or impair the jurisdiction of the courts of the several States under the laws thereof."
[6] E. g., Collins v. State, 78 Ala. 433; Paine's Case, Yel. 111, 80 Eng. Rep. 76 [1792].
[7] 82 A. L. R. 1138.
[8] 82 A. L. R. 1137.
[9] West v. United States, 258 F. 413, 416.
[10] Boehm v. United States, 123 F. 2d 791, 809. Cf. Kay v. United States, 303 U. S. 1, 6; Howat v. Kansas, 258 U. S. 181, 186, 189; Blair v. United States, 250 U. S. 273; United States v. United Mine Workers, 330 U. S. 258, 289-295.
[11] The validity of § 241 has been repeatedly upheld. E. g., United States v. Mosley, 238 U. S. 383, 386; Logan v. United States, 144 U. S. 263, 293; Ex parte Yarbrough, 110 U. S. 651, 667.
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NOTICE: NOT FOR OFFICIAL PUBLICATION.
UNDER ARIZONA RULE OF THE SUPREME COURT 111(c), THIS DECISION IS NOT PRECEDENTIAL
AND MAY BE CITED ONLY AS AUTHORIZED BY RULE.
IN THE
ARIZONA COURT OF APPEALS
DIVISION ONE
MANUEL T., Appellant,
v.
DEPARTMENT OF CHILD SAFETY, M.A., B.A., Appellees.
No. 1 CA-JV 18-0200
FILED 12-4-2018
Appeal from the Superior Court in Maricopa County
No. JD30722
The Honorable Cari A. Harrison, Judge
AFFIRMED
COUNSEL
Law Office of H. Clark Jones L.L.C., Mesa
By H. Clark Jones
Counsel for Appellant
Arizona Attorney General’s Office, Tucson
By Laura J. Huff
Counsel for Appellee Department of Child Safety
MANUEL T. v. DCS, et al.
Decision of the Court
MEMORANDUM DECISION
Presiding Judge Kenton D. Jones delivered the decision of the Court, in
which Vice Chief Judge Peter B. Swann and Judge David W. Weinzweig
joined.
J O N E S, Judge:
¶1 Manuel T. (Father) appeals the juvenile court’s order
terminating his parental rights to M.A. and B.A. (the Children), arguing the
Department of Child Safety (DCS) failed to prove the statutory grounds for
severance by clear and convincing evidence and that severance was in the
Children’s best interests by a preponderance of the evidence. For the
following reasons, we affirm.
FACTS AND PROCEDURAL HISTORY
¶2 In June 2015, DCS received a report that B.A. had been
sexually abused.1 During the subsequent investigation, all four of Father’s
daughters, then ages fourteen, twelve, nine, and four, disclosed sexual
abuse by family members. DCS identified a general lack of supervision and
“pattern of the children residing with family/friends and [being] harmed
while in their care” and removed the sisters from their parents’ care. DCS
filed a petition alleging all four girls were dependent as to Father and their
mother (Mother) on the grounds of neglect. Although Father contested the
allegations of the petition, he did not appear for trial, and the juvenile court
adjudicated the Children dependent and adopted a case plan of family
reunification.2
1 “[W]e view the evidence and reasonable inferences to be drawn from
it in the light most favorable to sustaining the court’s decision.” Jordan C.
v. Ariz. Dep’t of Econ. Sec., 223 Ariz. 86, 93, ¶ 18 (App. 2009) (citing Jesus M.
v. Ariz. Dep’t of Econ. Sec., 203 Ariz. 278, 282, ¶ 13 (App. 2002)).
2 The four sisters were also adjudicated dependent as to Mother in
October 2015. Mother’s parental rights to the Children were terminated in
May 2018, and her appeal was dismissed after her counsel avowed he had
identified no non-frivolous issues for this Court’s review. At the time of
2
MANUEL T. v. DCS, et al.
Decision of the Court
¶3 Father was referred for supervised visitation, parent aide
services, individual counseling with an emphasis on domestic violence and
anger management, and transportation assistance — services he initially
declined. Father eventually engaged in counseling in May 2016. He only
began visiting the Children regularly in September 2016 — more than a year
after their removal. Father successfully completed parent aide services in
December 2016 but became irate and violent when the oldest daughter
refused to attend visitation. Father would also cancel visitation altogether
if the oldest daughter was not available to assist him in parenting the
younger children. Accordingly, DCS reduced the frequency of visitation
and recommended he continue with individual counseling.
¶4 DCS also expressed concern regarding Father’s ability to
maintain stable employment and obtain appropriate housing. In January
2017, DCS referred Father to a specialist, who provided him with
community resources for housing assistance and helped him complete an
application for Section 8 housing. In May, DCS advised Father it could
assist him with a housing subsidy if he provided appropriate
documentation. However, Father did not obtain the necessary information.
Father’s Section 8 housing application was also denied because it was
incomplete. He did not reapply or otherwise follow up with DCS or the
specialist.
¶5 After missing scheduled appointments in June and
November 2016, Father finally underwent a psychological evaluation in
May 2017. At the evaluation, Father reported he could and would parent
the Children but for his lack of suitable housing. But the psychologist found
Father was making no effort to address this issue, choosing instead to blame
DCS for not simply providing him a place to live. She also identified
“numerous other barriers to parenting,” including undetermined sexual
maladjustment allegations, possible substance abuse, personality
disturbances related to repressed anger and hostility, and a lack of effort
that reflected “an indirect expression of his acknowledgment that single
parenting is overwhelming for him at his age and under his circumstances.”
The psychologist concluded that any child in Father’s care remained at risk
for further neglect and Father’s prognosis for becoming a minimally
adequate parent in the foreseeable future was poor given his lack of
accountability and insight into the circumstances.
our review, the Children’s two older sisters remained in out-of-home care
but refused to consent to a change in case plan to severance and adoption.
3
MANUEL T. v. DCS, et al.
Decision of the Court
¶6 The same psychologist performed a bonding assessment the
following August. She found the four sisters highly bonded to each other
and Father and suggested it would not be in their best interests to be
separated. Although these findings were consistent with reports of positive
interaction at visitation, Father’s participation in rehabilitative services
waned as he struggled with physical ailments and eventually underwent
back surgery requiring a lengthy recovery period. Additionally, despite
being advised housing was a significant barrier to reunification, Father
refused to secure appropriate housing unless and until the Children were
returned to his care.
¶7 By November 2017, Father had ceased all contact with DCS
and stopped participating in services, except for visitation. The juvenile
court changed the case plan to severance and adoption in December. DCS
immediately moved to terminate Father’s parental rights, alleging
severance was warranted based upon the time the Children had been in
out-of-home care. One month before trial, Father became irate in the
hallway after a court hearing when the DCS case manager suggested
specific anger management counseling.
¶8 At trial, the DCS case manager acknowledged Father’s partial
participation in services but identified unresolved concerns regarding
Father’s lack of stable employment and housing, anger issues, and failure
to recognize or understand why the Children were placed in out-of-home
care. Like the psychologist, the case manager believed Father would not be
able to parent in the foreseeable future because he was not prioritizing
reunification tasks. Notably, the case manager did not believe the Children
were safe in Father’s care, notwithstanding the housing issue, and believed,
in the absence of any apparent behavioral changes, “the older children will
continue to parent the younger children.” She testified the Children were
adoptable and in an adoptive placement who was willing to facilitate
continued contact between the Children and their older sisters. She also
acknowledged that even though separating the sisters was not ideal, it was
nonetheless in the Children’s best interests to pursue a plan that would give
them an opportunity for stability and permanency, rather than leaving
them “to linger in the foster care system.”
¶9 Father testified he believed he could provide for the Children
financially and would obtain appropriate housing “immediately” after they
were returned to his care. He denied any domestic violence or anger issues
and expressed concern regarding the Children being separated from their
older sisters.
4
MANUEL T. v. DCS, et al.
Decision of the Court
¶10 After taking the matter under advisement, the juvenile court
found DCS proved by clear and convincing evidence that it had made
diligent efforts to provide appropriate reunification services but
termination of Father’s parental rights was warranted because he had been
unable to remedy the circumstances causing the Children to be in an out-
of-home placement for longer than the statutory period and there was a
substantial likelihood he would be unable to parent in the near future. See
Ariz. Rev. Stat. (A.R.S.) § 8-533(B)(8)(c).3 The court also found severance
was in the Children’s best interests and entered an order terminating
Father’s parental rights. Father timely appealed. We have jurisdiction
pursuant to A.R.S. §§ 8-235(A), 12-120.21(A)(1), -2101(A)(1), and Arizona
Rule of Procedure for the Juvenile Court 103(A).
DISCUSSION
I. DCS Proved the Grounds for Severance by Clear and Convincing
Evidence.
¶11 Father argues the juvenile court erred in concluding DCS
proved the statutory grounds for severance by clear and convincing
evidence. Specifically, Father contends insufficient evidence supports the
court’s findings that: (1) DCS made reasonable efforts to assist Father in
obtaining appropriate housing for the Children, which he characterizes as
the “main obstacle to reunification,” and (2) Father’s housing at the time of
trial was not suitable for the Children. We defer to the court’s factual
findings, including those regarding DCS’s diligence in providing services,
so long as they are supported by substantial evidence. See Lashonda M. v.
Ariz. Dep’t of Econ. Sec., 210 Ariz. 77, 81-82, ¶¶ 13, 16 (App. 2005) (citations
omitted); Jesus M., 203 Ariz. at 280, ¶ 4 (citing Michael J. v. Ariz. Dep’t of Econ.
Sec., 196 Ariz. 246, 250, ¶ 20 (2000), and Jennifer B. v. Ariz. Dep’t of Econ. Sec.,
189 Ariz. 553, 555 (App. 1997)).
¶12 Substantial evidence supports the juvenile court’s findings
here. Father himself testified he could easily obtain and afford suitable
housing and would do so “immediately” if the Children were returned to
his care. Father also testified the Children could not live with him in the
hotel room he currently occupied. Although DCS cannot prove termination
is warranted without first making reasonable efforts to preserve the family,
it cannot force a parent to take advantage of the services offered or perform
required reunification tasks. See Yvonne L. v. Ariz. Dep’t of Econ. Sec., 227
3 Absent material changes from the relevant date, we cite the current
version of rules and statutes.
5
MANUEL T. v. DCS, et al.
Decision of the Court
Ariz. 415, 422, 423, ¶¶ 27, 34 (App. 2011) (citing Maricopa Cty. Juv. Action
No. JS-501904, 180 Ariz. 348, 353 (App. 1994)). The record supports the
court’s finding that it was not a lack of services, but a lack of will, that kept
Father from obtaining appropriate housing. We find no error.
¶13 Father does not dispute the remaining findings in the juvenile
court’s order or argue they are insufficient to warrant termination.
Accordingly, the court did not err in concluding DCS proved severance was
warranted based upon his failure to remedy the circumstances causing the
Children to be in out-of-home care for the statutory period.
II. DCS Proved Severance was in the Children’s Best Interests by a
Preponderance of the Evidence.
¶14 Father argues the juvenile court erred in concluding
severance was in the Children’s best interests because it would also sever
their legal relationship with their older sisters, with whom they share a
significant bond. We review the best interests finding for an abuse of
discretion and will reverse only if “as a matter of law, no reasonable fact-
finder could have found the evidence satisfied the applicable burden of
proof.” See Titus S. v. DCS, 244 Ariz. 365, 369, ¶ 15 (App. 2018) (citing Mary
Lou C. v. Ariz. Dep’t of Econ. Sec., 207 Ariz. 43, 47, ¶ 8 (App. 2004), and Denise
R. v. Ariz. Dep’t of Econ. Sec., 221 Ariz. 92, 94-95, ¶¶ 9-10 (App. 2009)).
¶15 The existence of a bond between biological family members,
“although a factor to consider, is not dispositive in addressing best
interests.” Dominique M. v. DCS, 240 Ariz. 96, 98, ¶ 12 (App. 2016) (citing
Bennigno R. v. Ariz. Dep’t of Econ. Sec., 233 Ariz. 345, 351, ¶ 30 (App. 2013)).
Rather, the court must consider all relevant facts and determine, on a case-
by-case basis, whether a preponderance of the evidence supports a finding
that the children “would derive an affirmative benefit from termination or
incur a detriment by continuing in the relationship.” Ariz. Dep’t of Econ. Sec.
v. Oscar O., 209 Ariz. 332, 334, ¶ 6 (App. 2004); accord Demetrius L. v. Joshlynn
F., 239 Ariz. 1, 4, ¶ 16 (2016). The benefit to the children, particularly when
severance is sought based upon the length of time in an out-of-home
placement, is the opportunity for permanency in lieu of remaining
indefinitely in a situation where “parents maintain parental rights but
refuse to assume parental responsibilities.” Oscar O., 209 Ariz. at 337, ¶ 16
(quoting Maricopa Cty. Juv. Action No. JS-6520, 157 Ariz. 238, 243 (App.
1988)). The juvenile court may also consider whether the presence of a
statutory ground for severance will have a negative effect upon the
children. Bennigno R., 233 Ariz. at 350, ¶ 23 (quoting Maricopa Cty. Juv.
Action No. JS-6831, 155 Ariz. 556, 559 (App. 1988)).
6
MANUEL T. v. DCS, et al.
Decision of the Court
¶16 The juvenile court here noted the Children had been in an out-
of-home placement for nearly three years and, despite this lengthy period,
Father had yet to show he was willing or able to parent them. Although
Father faults the court for “not giv[ing] much weight” to the Children’s
bond with their sisters, we do not reweigh evidence on appeal; “[a] juvenile
court as the trier of fact in a termination proceeding is in the best position
to weigh the evidence, observe the parties, judge the credibility of
witnesses, and resolve disputed facts.” Oscar O., 209 Ariz. at 334, ¶ 4 (citing
Jesus M., 203 Ariz. at 280, ¶ 4). Moreover, the record reflects the court
carefully considered “[the] risk of the four girls not being able to continue
a sibling relationship,” but ultimately determined it was not in the
Children’s best interests “to remain in the foster care system in order to
prioritize their sibling relationships.” Instead, the court found the Children
would benefit from the opportunity to be adopted into a permanent, stable,
and safe home with a placement who had been, and was committed to
continue, facilitating sibling contact. The record supports these
conclusions, and we find no abuse of discretion.
CONCLUSION
¶17 The juvenile court’s order terminating Father’s parental rights
to the Children is affirmed.
AMY M. WOOD • Clerk of the Court
FILED: AA
7
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530 F.2d 964
Kaiserv.General Motors Corporation (Pontiac MotorDivision)
75-1805
UNITED STATES COURT OF APPEALS Third Circuit
2/11/76
E.D.Pa., 396 F.Supp. 33
AFFIRMED
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119 P.3d 181 (2005)
2005-NMCA-100
STATE of New Mexico, Plaintiff-Appellant,
v.
Fermin SILAGO, Defendant-Appellee.
No. 24,854.
Court of Appeals of New Mexico.
June 27, 2005.
*182 Patricia A. Madrid, Attorney General, Anita Carlson, Assistant Attorney General, Santa Fe, NM, for Appellant.
John Bigelow, Chief Public Defender, Santa Fe, NM, Meg Bailey, Assistant Appellate Defender, Albuquerque, NM, for Appellee.
OPINION
FRY, Judge.
{1} In this case we clarify our case law concerning the relation back of blood alcohol concentration (BAC) levels in DWI cases. See State v. Christmas, 2002-NMCA-020, 131 N.M. 591, 40 P.3d 1035; State v. Martinez, 2002-NMCA-043, 132 N.M. 101, 45 P.3d 41; State v. Baldwin, 2001-NMCA-063, 130 N.M. 705, 30 P.3d 394 (collectively referred to in this opinion as "the BAC nexus cases"). The trial court denied the State's motion in limine seeking admission of expert testimony on retrograde extrapolation, reasoning that our case law does not permit such testimony where the blood or breath sample is taken more than two hours after the time of driving, the BAC is under the statutory limit, and there is no behavior evidence of intoxication. We reverse the trial court's ruling because it reflects a misinterpretation of law and remand for a new hearing on the State's motion in limine.
BACKGROUND
{2} As a result of an automobile accident, Defendant was charged with homicide by *183 motor vehicle, three counts of great bodily harm by motor vehicle, and aggravated DWI. At the scene of the accident, which occurred at about 5:45 a.m., Defendant told an investigating officer that he had consumed alcohol, but that he had stopped drinking at midnight. The officer administered two field sobriety tests, which Defendant passed. Before the officer could administer a third test, Defendant complained of pain. Medical personnel transported Defendant to a hospital where an officer sought Defendant's permission to obtain a blood sample. When Defendant refused, officers obtained a search warrant, and hospital personnel finally drew Defendant's blood at 12:05 p.m., six hours and twenty minutes after the accident. Another blood sample was taken at 1:09 p.m.
{3} Prior to trial, the State filed a motion in limine seeking the trial court's advance ruling on the admissibility of certain exhibits and testimony, including expert testimony "[r]egarding blood-alcohol concentration and extrapolation of previous levels." At the hearing on the motion, the State intended to make an offer of proof regarding the expert's testimony, but after the court and counsel discussed the BAC nexus cases, the State asked for another hearing in order to permit the expert to testify in person. The court agreed.
{4} At the next hearing, the State called Ruth Luthi, a forensic toxicologist with the Scientific Laboratories Division (SLD), who explained that retrograde extrapolation is used to calculate a given BAC back to a prior time using generally accepted rates of alcohol burn-off. Assuming that Defendant had stopped drinking at midnight, that Defendant stopped driving at 5:45 a.m., and that Defendant's BAC six hours after driving was 0.02, Luthi testified that she was very comfortable giving an opinion as to the likely BAC range for Defendant at the time he was driving. Over Defendant's objection, the trial court accepted Luthi as an expert in retrograde extrapolation. Defense counsel waived cross-examination, and Luthi left the witness stand.
{5} At this point, the prosecutor thought the trial court had ruled that Luthi would be allowed to testify at trial. However, the court stated that it had not heard enough evidence on which to decide "whether in this case with these facts" extrapolation evidence could go before the jury. The prosecutor stated that he thought Luthi had already testified about the facts in the case as they pertained to extrapolation, but that if the court wanted more evidence, he would like to recall Luthi to the stand.
{6} Although defense counsel initially voiced no objection to the recall of Luthi, the trial court asked, "Procedurally, is there a mechanism available that allows me to put her back on without it being error on behalf of the defense?" There ensued a colloquy between the court and the prosecutor as to whether Luthi had actually testified about the result of retrograde extrapolation in this case under these facts. The prosecutor again offered to put Luthi back on the stand, and this time defense counsel objected. Without ruling on the objection, the trial court told the prosecutor to call his next witness.
{7} The prosecutor said he was calling Officer Mace to testify about Defendant's whereabouts between the scene of the accident and the blood draw, which was an issue raised by the trial court in the course of the hearing. But before Mace could take the stand, the trial court and the prosecutor engaged in another colloquy about whether the results of Defendant's blood tests were in evidence. The prosecutor then called Mace and attempted to get the lab report of Defendant's first blood test into evidence through Mace. When the court sustained defense counsel's hearsay objection to the lab report, the prosecutor again asked to recall Luthi, this time to lay a foundation for admission of the lab report.
{8} Again, the trial court stated that it was "not familiar with the mechanism that allows a witness once [sic] concluded testimony to be recalled" and asked the prosecutor for case law supporting such a recall. The prosecutor responded that recalling a witness is customary when new matters come up and noted that Luthi would again be subject to cross-examination if she were recalled. Ultimately, the court ruled that it would not *184 allow the State to recall Luthi because the court was "not familiar" with the "ability to bring the witness back when it is directly in a dispositive motion and not in a rebuttal setting." However, the trial court permitted the State to question Luthi in order to preserve its objection to the trial court's ruling on appeal.
{9} Luthi testified that she is the head of SLD's implied consent section, and consequently, she is the custodian of all blood samples and BAC reports that come in. She identified the lab report and testified that it appeared to be properly filled out. The report showed a BAC of 0.02. Luthi stated that, assuming that Defendant's drinking stopped around midnight, that the accident occurred between 5:45 and 6:00 a.m., and that Defendant's BAC at 12:05 p.m. was 0.02, retrograde extrapolation would lead to the conclusion that Defendant's BAC at the time of driving was between 0.08 and 0.14.
{10} The trial court then stated its ruling on the State's motion in limine. In the court's view, by seeking admission of Luthi's extrapolation testimony, the State was asking for an expansion of the perimeters of the BAC nexus cases so that a six-hour delay in testing would be acceptable. The trial court further noted that, unlike the circumstances in the BAC nexus cases, Defendant's BAC tested below the statutory limit and Defendant passed his field sobriety tests. Based on these facts and the case law, the trial court concluded that "the law does not allow Luthi to testify."
{11} On appeal, the State argues the trial court erred in (1) excluding Luthi's testimony on retrograde extrapolation, (2) refusing to make a pretrial ruling on the admissibility of Luthi's testimony regarding impairment, (3) denying the State's request to recall Luthi to the stand for additional examination, and (4) excluding the report of Defendant's BAC. Because we reverse on the first issue, we address the other three issues only to provide guidance on remand.
DISCUSSION
The Trial Court's Ruling
{12} The parties have different views of the trial court's ruling excluding retrograde extrapolation evidence. The State contends the trial court relied on a flawed reading of the BAC nexus cases, while Defendant argues that the trial court found the extrapolation evidence to be unreliable pursuant to State v. Alberico, 116 N.M. 156, 861 P.2d 192 (1993). We believe the State's view of the trial court's ruling is correct.
{13} In Alberico, our Supreme Court explained that "Rule 11-702 [NMRA] establishes three prerequisites for admission of expert testimony: (1) the expert must be qualified, (2) the scientific evidence must assist the trier of fact, and (3) the expert may only testify to scientific, technical or other specialized knowledge." Lopez v. Reddy, 2005-NMCA-054, ¶ 11, 137 N.M. 554, 113 P.3d 377 (Ct.App. 2005) (citing Alberico, 116 N.M. at 166, 861 P.2d at 202 (internal quotation marks omitted)). There is no issue here regarding the first requirement because the trial court expressly found Luthi to be qualified. While the other two requirements are prerequisites to the admission of retrograde extrapolation evidence, the record establishes that the parties and the trial court never reached the applicability of Rule 11-702 and Alberico.
{14} The parties' arguments and the trial court's comments on the admissibility of Luthi's testimony focused on the requirements set out in the BAC nexus cases. Although defense counsel made passing references to matters reminiscent of the Alberico requirements, neither the attorneys nor the judge ever mentioned Rule 11-702, Alberico, or related cases, and the court's ultimate conclusion was clearly based on the BAC nexus cases. In announcing its ruling, the trial court reviewed the requirements of the BAC nexus cases and stated that, based on Christmas, Martinez, and Baldwin and the facts presented, the law would not allow Luthi to testify.
{15} While we conclude that the trial court based its decision on the BAC nexus cases, we do not mean to suggest that Alberico is irrelevant to a trial court's determination of whether to admit evidence of retrograde extrapolation. On remand, if the issue is raised, the trial court may consider whether *185 the requirements of Rule 11-702 and Alberico are satisfied.
Retrograde Extrapolation
{16} Defendant contends the State failed to preserve its argument that the trial court misapplied the BAC nexus cases. We disagree. The record establishes that the prosecutor explicitly argued the meaning of the BAC nexus cases and pointed out his disagreement with the trial court's interpretation. See State v. Varela, 1999-NMSC-045, ¶ 26, 128 N.M. 454, 993 P.2d 1280 (explaining that in order to preserve an issue for appeal, a timely objection must specifically apprise the trial court of the nature of the claimed error and invoke an intelligent ruling thereon).
{17} We now turn to the merits of the trial court's ruling. Although the admission or exclusion of expert testimony is within the sound discretion of the trial court, "the threshold question of whether the trial court applied the correct evidentiary rule or standard is subject to de novo review on appeal." State v. Torres, 1999-NMSC-010, ¶ 28, 127 N.M. 20, 976 P.2d 20. Thus, having determined that the trial court relied on the BAC nexus cases in ruling to exclude retrograde extrapolation testimony, we consider whether the trial court's analysis of those cases was correct.
{18} In any case where the State attempts to prove a violation of the per se DWI statute, which requires a minimum specific BAC at the time "[t]he defendant operated a motor vehicle," UJI 14-4503 NMRA, the critical inquiry is how to determine the defendant's BAC at the time of driving if there is a significant delay between the time of driving and the time BAC is measured. In the BAC nexus cases, this Court has attempted to provide guidance on this issue. We have noted that some delay between driving and testing is inevitable, and that an hour's delay would not be unreasonable. Christmas, 2002-NMCA-020, ¶¶ 23-25. However, "[t]he longer the delay between the time of [the] incident and [the] sample collection, the more difficult it becomes, scientifically, to draw reasonable inferences from one data point, back to the driving time." Id. ¶ 20 (internal quotation marks and citations omitted). Consequently, when the delay between driving and testing is significant, the State must prove a nexus between the defendant's BAC score and the time of driving through evidence corroborating the inference that the defendant's BAC at the time of driving was at the statutory level of 0.08 or above. See Christmas, 2002-NMCA-020, ¶ 6 (assessing corroborative evidence where the delay was "about an hour"); Martinez, 2002-NMCA-043, ¶¶ 11 (evaluating corroborative evidence where the delay was one and a half hours); Baldwin, 2001-NMCA-063, ¶ 4 (reversing conviction where corroborative evidence was insufficient to support relation-back inference when the delay was two hours and fifteen minutes). We have declined to provide an exhaustive list of the types of corroborative evidence that would suffice, but we have said that
[t]he evidence might include a police officer's observation of significant incriminating behavior on the part of the driver, or the evidence might include expert testimony relating the test result back in time to the time of driving.
Id. ¶ 2. Thus, we have suggested that retrograde extrapolation might suffice to provide a nexus between the results of a defendant's BAC test and the likely BAC at the time of driving.
{19} It appears from the trial court's comments to counsel during the hearing that the trial court viewed the BAC nexus cases as establishing three prerequisites to the admissibility of expert retrograde extrapolation evidence: (1) a delay between the time of driving and the measurement of BAC not exceeding two hours and fifteen minutes, (2) a BAC at, near, or above 0.08, and (3) evidence of some behavior by the accused that corroborates the inference of excessive BAC at the time of driving. The court noted that the longest delay found in the BAC nexus cases was two hours and fifteen minutes in Baldwin and that all of the BAC nexus cases involved BACs at or above 0.08. From these observations, the trial court apparently concluded that retrograde extrapolation evidence would be inadmissible if the delay exceeded two hours and fifteen minutes *186 and/or if the defendant's BAC tested below 0.08. The trial court also intimated that there must be some corroborative behavior evidence, such as inability to pass field sobriety tests, before expert retrograde extrapolation testimony could be admitted. The prosecutor tried unsuccessfully to persuade the court that the BAC nexus cases should not be read so narrowly.
{20} The trial court's analysis of the BAC nexus cases was flawed. The cases do not place an outer limit on the delay between the time of driving and testing. At most, they explain that a delay of any significance necessitates the introduction of some evidence providing a nexus between BAC and the time of driving. This is true whether the delay is two hours or six hours. While there may be a question as to the admissibility of the corroborative evidence on other grounds, such as reliability under Rule 11-702 and Alberico, the fact of significant delay alone does not render such evidence inadmissible as a matter of law.
{21} Similarly, the fact that Defendant's BAC six hours after driving was only 0.02, significantly below the per se level of 0.08, does not by itself mandate exclusion of corrobative evidence, also known as "relation-back evidence." See Baldwin, 2001-NMCA-063, ¶ 22. It is true that the BAC nexus cases emphasized the importance of relation-back evidence when the BAC was "0.08 or more" in Baldwin, 2001-NMCA-063, ¶ 8 or "0.08 or only marginally above" in Martinez, 2002-NMCA-043, ¶ 11, which may have suggested to the trial court that a BAC below 0.08 would not be susceptible to relation-back evidence. However, we read these phrases in the BAC nexus cases as simply illustrative of the problem created by a significant delay in BAC testing and the need for relation-back evidence to establish the BAC at the time of driving. If an expert can determine a defendant's likely BAC at the time of driving from a BAC, of whatever measurement, taken a significant time after driving, and if the trial court finds that the expert's methodology satisfies the requirements of Rule 11-702, then nothing in the BAC nexus cases requires exclusion of that expert's testimony. The issue in each of the BAC nexus cases was the sufficiency of the evidence to convict the defendant of per se DWI without relation-back evidence, not the admission or exclusion of such evidence. See State v. Montoya, 2005-NMCA-078, ¶ 20, 137 N.M. 713, 114 P.3d 393 (Ct.App. 2005).
{22} In addition, corroborative behavior evidence is not a prerequisite to the admissibility of expert relation-back testimony. Behavior evidence and expert testimony are but two alternative methods of establishing the nexus between BAC and the time of driving. Baldwin, 2001-NMCA-063, ¶ 2 (noting that corroborative evidence "might include a police officer's observation of significant incriminating behavior on the part of the driver, or the evidence might include expert testimony relating the test result back in time to the time of driving"). Here, although Defendant apparently passed the field sobriety tests, Luthi nonetheless explained that retrograde extrapolation could establish that Defendant's BAC at the time of driving equaled or exceeded 0.08. Assuming Luthi's testimony passed muster for admissibility on other grounds, the testimony could conceivably provide the nexus between BAC and time of driving required by the BAC nexus cases.
{23} In summary, the BAC nexus cases do not establish a bright line rule circumscribing a trial court's decision to admit or exclude relation-back evidence. Instead, they provide guidance to a trial court in determining when relation-back evidence is necessary and the types of such evidence that may suffice to support a conviction. It is important to note that we are not holding that relation-back evidence is necessarily admissible, even after a time lapse as long as six hours. In the related case of State v. Hughey, 2005-NMCA-114, ___ N.M. ___, 119 P.3d 188 [No. 24,732 (N.M. Ct.App. June 27, 2005)], filed today, we have affirmed a trial court's exercise of discretion to exclude relation-back evidence when it found such evidence unreliable. On remand, the trial court may again consider the question of the admissibility of Luthi's testimony within the context of the considerations that ordinarily guide the sound exercise of discretion, such as the requirements of Rule 11-702.
*187 Other Arguments
{24} Because we reverse the trial court's decision on the basis of its erroneous interpretation of the BAC nexus cases, we need not determine the other issues raised by the State. However, because these issues are likely to recur on remand, we briefly address them to provide guidance to the trial court and the parties.
{25} The State argues the trial court erred in excluding evidence regarding the relation of BAC to impairment. It appears the trial court excluded the evidence because the State failed to give Defendant notice that this evidence was a subject of the State's motion in limine. While the State concedes that the trial court excluded this evidence only for purposes of the motion in limine being heard at that time and not for all purposes, the State's main objection is that the trial court refused to make a pretrial ruling on the admissibility of the evidence. On remand, of course, if the State still wishes to introduce this evidence at trial, the trial court's ruling at the motion hearing does not preclude the State from attempting to do so, and the State is free to file motions seeking pretrial rulings on the admissibility of this evidence. We do not mean to suggest that Defendant cannot raise additional objections to this evidence at the appropriate time.
{26} Next, the State contends the trial court erred in ruling that the State could not recall Luthi to the stand after she had concluded her initial testimony. Although a trial court's denial of leave to recall a witness is discretionary, see State v. Ortiz, 92 N.M. 166, 169, 584 P.2d 1306, 1309 (Ct.App.1978), the trial court in this case did not exercise discretion when it denied the State's request to recall Luthi. Instead, the court stated that it was without the authority to permit the recall. While the court seemed to recognize its authority to permit recall of a witness at trial, it apparently believed that different rules pertain at a hearing on a motion. The trial court certainly has the authority to control the presentation of evidence and may permit a party to reopen its case. See Sena v. N.M. State Police, 119 N.M. 471, 474-75, 892 P.2d 604, 607-08 (Ct.App.1995). This is so regardless of whether the evidence is offered at trial or at a hearing. Thus, should the issue arise on remand, the decision whether to permit recall of a witness is entrusted to the trial court's sound discretion.
{27} Finally, the State argues that the trial court erroneously required it to prove Defendant's BAC at the hearing on the motion in limine in order to obtain a ruling on the admissibility of Luthi's retrograde extrapolation testimony. To the extent the trial court believed that admission of the BAC reports was a prerequisite to its consideration of the admissibility of Luthi's testimony, the trial court was mistaken. An offer of proof as to the BAC measurements would suffice in the context of ruling on the State's motion in limine. Of course, at trial, the State would be required to introduce the BAC reports in order to establish the foundation for Luthi's relation-back testimony. Cf. Rule 11-104(B) NMRA (stating that "[w]hen the relevancy of evidence depends upon the fulfillment of a condition of fact, the court shall admit it upon, or subject to, the introduction of evidence sufficient to support a finding of the fulfillment of the condition").
CONCLUSION
{28} We reverse the trial court's exclusion of expert relation-back testimony and remand for proceedings consistent with this opinion.
{29} IT IS SO ORDERED.
WE CONCUR: LYNN PICKARD and IRA ROBINSON, Judges.
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154 B.R. 531 (1993)
In re Peggy Carroll COWDEN.
David H. COWDEN IV and John Kenneth Cowden, Plaintiffs,
v.
Richard L. RAMSAY, Trustee for the Estate of Peggy Carroll Cowden, Debtor, Defendant.
Bankruptcy No. 89-41679S, Adv. No. 92-4095.
United States Bankruptcy Court, E.D. Arkansas, Little Rock Division.
April 7, 1993.
*532 Katherine Gay, Fayetteville, AR, for plaintiffs.
Richard Ramsay, Little Rock, AR, for Trustee.
FINDINGS OF FACT AND CONCLUSIONS OF LAW
MARY D. SCOTT, Bankruptcy Judge.
The Complaint for Declaratory Judgment and Petition for Turnover of Property, filed on June 30, 1992, by the sons of the debtor, was tried before the Court on February 9, 1993. The sons seek a declaration that certain funds are not property of the estate. The trustee asserts that the debtor holds both legal and equitable title to the funds such that the funds are property of the estate.
The Court has jurisdiction over this matter pursuant to 28 U.S.C. §§ 157(a), 1334. Moreover, this Court concludes that this is a "core proceeding" within the meaning of 28 U.S.C. § 157(b) as exemplified by 28 U.S.C. § 157(b)(2)(A).
In anticipation of a divorce, David Cowden III cleaned out the joint accounts and safety deposit boxes he held with his wife, Peggy Carroll Cowden. His children held accounts titled "David H. Cowden IV, minor, by David Cowden III and Peggy Cowden" and "John Kenneth Cowden, minor, by Peggy Cowden." Fearing that he would also appropriate the children's accounts, Peggy Cowden changed the name on David Cowden IV's account to remove *533 her husband's name from that account. The funds in these two accounts, later converted to a certified check, are the subject of this litigation.
The boys opened their accounts several years prior to the parents' divorce and subsequent bankruptcies. Worthen Bank (the "Bank") would not permit them, as minors, to open the accounts solely in their name. An officer of the bank testified that the bank required the parent or guardian also be named on a child's account, and that only the parent could make withdrawals from the account.[1] Accordingly, Peggy Cowden made withdrawals from time to time at her sons' request. The testimony was uncontroverted that she considered the monies her sons' property. She made no withdrawals for herself, but only withdrew funds, at her sons' requests, for their personal wants.
The testimony was uncontroverted that the deposits into the sons' accounts were solely their property. The deposits consisted of monies the boys earned working at a grocery store and received as gifts. The relatively small amounts of the deposits, and the small amounts at issue,[2] corroborate this testimony.
When the father pilfered the marital accounts, Peggy Cowden, with her son's permission, closed the account titled "David H. Cowden IV, minor, by David Cowden III and Peggy Cowden" and reopened it in the name "David H. Cowden IV, minor, by Peggy Cowden," thereby removing the father's name from the account. Later, fearing that her creditors would garnish the boys' accounts, the debtor, with the permission of the boys, closed both accounts. She feared that inasmuch as her name was on the accounts, creditors would attempt to reach the funds belonging to her children. Later, still unsure how to protect her sons, and unable to reach her attorney by telephone, the debtor had a certified check issued in her name and placed the check in a safety deposit box. When her bankruptcy case was filed, the debtor listed the existence of this check in her schedules.
The debtor does not dispute that at all times she had legal access to the funds. Indeed, the bank's policy provided that only she could withdraw the funds. Debtor does not dispute that the certified check was issued solely to her. At all times she has had power over the funds. The evidence is also uncontroverted that the monies belong, in equity, to the children. The debtor testified that while she had the power to spend the money, that she had not and would not spend the boys' funds. She stated: "It's not my money. It's never been my money."
Property of the estate includes "all legal or equitable interests of the debtor in property as of the commencement of the case." 11 U.S.C. § 541(a). Property of the estate is also limited to interests of the debtor:
Property in which the debtor holds, as of the commencement of the case, only legal title and not an equitable interest ... becomes property of the estate under subsection (a)(1) or (2) of this section only to the extent of the debtor's legal title to such property, but not to the extent of any equitable interest in such property that the debtor does not hold.
11 U.S.C. § 541(d).
While federal bankruptcy law determines the effect of legal or equitable interests in property, N.S. Garrott & Sons v. Union Planters National Bank (In re N.S. Garrott & Sons), 772 F.2d 462, 466 (8th Cir.1985), the Court looks to state law to determine the nature and extent of the interest, Butner v. United States, 440 U.S. 48, 99 S.Ct. 914, 59 L.Ed.2d 136 (1979); In *534 re N.S. Garrott & Sons, 772 F.2d at 466. Accordingly, Arkansas law determines the nature and extent of the debtor's interest in the certified check. Under federal bankruptcy law, the estate succeeds only to the title and rights in property the debtor had at the time of the filing of the petition in bankruptcy. In re N.S. Garrott & Sons, 772 F.2d at 467.
It is clear that the debtor holds a legal interest in the funds: the certified check is made payable to the order of Peggy Carroll Cowden. She has at all times had access to the funds. Under Arkansas law, however, the funds are protected by a resulting trust,[3] which arises when a party becomes invested with legal title, but holds that title for the benefit of another. See First National Bank of Roland v. Rush, 30 Ark.App. 272, 785 S.W.2d 474 (1990). Under Arkansas law, a creditor of the legal owner cannot reach the property subject to a resulting trust. Id., 785 S.W.2d at 478 (the resulting "trustee's interest is not sufficient to allow a personal creditor of the trustee to obtain satisfaction of his claim out of the trust property.").
Under the facts before the Court, a resulting trust existed with respect to the boys' monies. This is true regardless of the manner in which the funds were held in a minor's account from which only debtor could make withdrawals, in a certificate of deposit, or a certified check made payable to the debtor. The evidence is credible and uncontroverted that the monies were earned or given directly to the boys. All parties considered the funds as belonging to the boys. Despite her financial woes, the debtor did not use the funds because they were not hers to take. The debtor's sons hold equitable title to the certified check; the debtor's legal title is impressed with the duty to reconvey it to the rightful owners.
It makes no difference in the analysis that the facts of Garrott & Sons involve a constructive trust. Under state law, the debtor holds only "bare legal title," whether as a result of a constructive trust or a resulting trust. Since the debtor held, under state law, only bare legal title which was subject to the duty to reconvey it to the rightful owner, the estate holds only that interest which is also subject to the duty to convey it to the rightful owners, the children of the debtor. See Garrott & Sons, 772 F.2d at 467; see also In re Goldstein, 135 B.R. 703 (Bankr.S.D.Fla. 1992) (checking account opened for sole benefit of another was not property of the estate although debtor had access to the account); In re Altchek, 124 B.R. 944 (Bankr.S.D.N.Y.1991) (proceeds from property held in trust excluded from estate). Thus, while bare legal title to the funds is property of the estate, the estate has no equity in the property to be liquidated for the benefit of creditors. See Garrott & Sons, 772 F.2d at 467 (funds subject to turnover had to be remitted to beneficiaries). Accordingly, bare legal title to funds in the certified check in the amount $1,929.57 is property of the estate. However, the estate has no equitable interest in the check such that the trustee should abandon the estate's interest in the check.
At trial, it came to the Court's attention that there is difficulty in rendering judgment for both plaintiffs. The action was filed by David H. Cowden IV and John Kenneth Cowden, both of whom were minors at the time of the filing of the suit. David Cowden IV attained his majority, Ark.Code 9-25-101, during the pendency of the proceedings and by pursuing the action has ratified the proceedings. See CocaCola Bottling Co. v. Davidson, 193 Ark. 825, 102 S.W.2d 833 (1937). John Cowden, however, is only 15.
*535 Under Arkansas law, suits by minors must be brought by their next friend. Ark.R.Civ.Proc. 17(b); Ark.Code 16-61-103. While incapacity may be waived by an opposing party, Obennoskey v. Obennoskey, 215 Ark. 358, 220 S.W.2d 610 (1949), this particular case raises concerns. As a minor, John Cowden may sue only by his next friend, a person cloaked in the appropriate authority. Counsel indicated that the father has physical custody of John Cowden. Further, although John Cowden was under subpoena, the father refused to permit his son to appear. Clearly the father wants his children to have no part in this lawsuit, albeit at the cost of the children's savings.
The concern of the Court is not merely a formal one. The precepts with which the Court is concerned are designed to protect minors. Further, rules regarding parties, in general, serve to prohibit collusive suits and suits by "officious intermeddlers." See, e.g., Duvall v. Humphrey, 153 F.2d 798 (D.C.Cir.1946). The Federal Rules of Civil Procedure and judicial doctrine set forth three distinct concepts regarding ability to file suit. The issue of standing, whether plaintiff is the person injured, is not at issue here: John Cowden is clearly the person harmed by trustee's attempt to obtain his funds. Accordingly, there is no standing issue which raises jurisdictional questions.
John Cowden is also the real party in interest in this suit because it is he who holds, under substantive law, the right to the funds. See Mason-Rust v. Laborers' Int'l Union of North America, 435 F.2d 939 (8th Cir.1970); Fed.R.Civ.Proc. 17(a). The instant suit by or on behalf of John Cowden has merit: the funds at issue clearly belong to him and should not be appropriated by the trustee. This situation is thus distinguishable from the case in which an "officious intermeddler" comes in to stir up strife and litigation. Indeed, the debtor's intervention "was not officious but appropriate." Duvall v. Humphrey, 153 F.2d 798, 799 (D.C.Cir.1946).
The problem in the instant case is solely one of capacity, the question of who has the right to litigate. See Beam v. Monsanto Co., 414 F.Supp. 570 (W.D.Ark.1976) ("Capacity to sue depends on whether the person who is bringing suit has authority to use the courts of the jurisdiction in question. This is a problem of power and depends neither on the court involved nor on the cause of action asserted."). Under Rule 17(b) the capacity to sue is determined by the law of the individual's domicile. Infants must sue by their next friend or guardian ad litem who may be appointed by the court. Fed.R.Civ.Proc. 17(c). The court may "make such other order as it deems proper for the protection of the infant." Id.; Accord M.S. v. Wermers, 557 F.2d 170, 174 (8th Cir.1977) ("Appointment of a guardian ad litem is considered to be discretionary under the Federal Rules, provided the District Court enters a finding that the interests of the minor are adequately protected in the event it does not make such appointment.... Regardless of whether state or federal law should be applied, the District Court was bound to consider the appointment of a guardian ad litem for the minor plaintiff and clearly has the power to appoint one in her behalf."). The presence of John Cowden's mother, although not named in the action, sufficiently protects the interests of the minor child. See Laundry Workers Union v. Mahoney, 491 F.2d 1029 (8th Cir.) (en banc), cert. denied, 419 U.S. 825, 95 S.Ct. 42, 42 L.Ed.2d 49 (1974). The Court notes that the boys' case was prosecuted by their aunt, sister to the debtor. Accordingly, additional protection of John Kenneth Cowden's interest existed.[4]
Finally, the court notes that any issues regarding capacity were expressly waived by the trustee. Since the only impediment to suit by John Cowden was one of capacity, the Court may enter judgment in favor of the minor child John Cowden. See Obennoskey v. Obennoskey, 215 Ark. 358, 220 S.W.2d 610 (1949).
*536 ORDERED that judgment shall be entered in favor of the plaintiffs.
IT IS SO ORDERED.
JUDGMENT
This action came on for trial before the Court, Honorable Mary Davies Scott, U.S. Bankruptcy Judge, presiding, and the issues having been duly tried and a decision having been duly rendered,
It is Ordered and Adjudged as follows:
1. The bankruptcy estate holds legal title to the subject funds, consolidated in certified check No. 174072 in the amount of $1,929.57, but holds the fund subject to a duty to convey the property to the equitable owners, plaintiffs David H. Cowden IV and John Kenneth Cowden.
2. The estate's interest in the subject funds, consolidated in certified check No. 174072 in the amount of $1,929.57, is of such inconsequential value and benefit to the estate that the trustee is directed to abandon the funds to plaintiffs David H. Cowden IV and John Kenneth Cowden, 11 U.S.C. § 554(b), in the manner set forth in paragraph 3, below.
3. The trustee shall deliver certified check No. 174072 to the debtor Peggy Carroll Cowden within fifteen (15) days of entry of this Order. The debtor Peggy Carroll Cowden shall ensure that the plaintiffs David H. Cowden IV and John Kenneth Cowden receive their respective shares of the funds.
It is so Ordered.
NOTES
[1] While upon cross-examination the Bank officer admitted that it may not legally be able to enforce in every instance this "preference," the testimony indicated that this "preference" was a stringent rule.
[2] The trustee made several comments regarding the "small" amount of the funds which are the subject of this litigation. It is true that the amounts are relatively small. Indeed, this Court has previously commented that litigation over meager amounts may be wasteful. Smith v. Worthen National Bank (In re Smith), 145 B.R. 618, 619 n. 1 (Bankr.W.D.Ark.1992). However, to an 18-year old college student whose tuition for next quarter is soon due, and to a 14-year old child, the amounts are not at all "small."
[3] This is only one variety of implied trusts imposed by virtue of law where the benefits of property title do not go with the legal title. Andres v. Andres, 1 Ark.App. 75, 613 S.W.2d 404 (1981). Constructive trusts are generally imposed where fraudulent conduct of the legal owner exists such that retention by the legal owner is unjust. See, e.g., In re N.S. Garrott & Sons, 772 F.2d 462. Resulting trusts exist where property is purchased in the name of one person with money furnished by another. Andres, 613 S.W.2d at 406; First National Bank of Roland v. Rush, 30 Ark.App. 272, 785 S.W.2d 474, 478 (1990). There is no requirement that fraud be shown for a resulting trust to exist. See Rush, 30 Ark.App. 272, 785 S.W.2d at 478.
[4] Counsel was candid with the Court, advising the Court of pertinent facts regarding the relationships of the interested persons and the views of the boys' father.
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DISTRICT COURT OF APPEAL OF THE STATE OF FLORIDA
FOURTH DISTRICT
PETER TOROCSIK,
Appellant,
v.
HSBC BANK USA, NATIONAL ASSOCIATION, a Nationally Associated
Corporation; and MATTHEW WEAVER, an individual,
Appellees.
No. 4D13-2569
[May 27, 2015]
Appeal from the Circuit Court for the Fifteenth Judicial Circuit, Palm
Beach County; Howard Harrison, Senior Judge; L.T. Case No.
502011CA006974XXXXMB.
Peter Torocsik, West Palm Beach, pro se.
George G. Kurschner of Karyo & Kurschner, P.A., Boca Raton, for
appellee Matthew Weaver.
Daniel J. Barsky of Shutts & Bowen, LLP, West Palm Beach, for
appellee HSBC Bank USA, N.A.
CIKLIN, J.
Peter Torocsik appeals the order denying his motion for summary
judgment and entering summary judgment for HSBC, et al. (“the Bank”),
on Torocsik’s suit for damages related to a dishonored cashier’s check.
We reverse.
In 2008, Torocsik was the seller of his restaurant and entered into a
stock purchase agreement contract with Matthew Weaver and Yanni
Agelopoulos, the buyers of the restaurant. The contract provided that at
the closing, Torocsik (“the seller”) was to provide specified corporate
documents to Weaver and Agelopoulos (“the buyers”) and that the buyers
were to make various payments toward a total purchase price of
$100,000. The contract provided for a closing date of May 27, 2008, and
the closing was to take place in the office of the buyers’ attorney. The
closing was made contingent on “the parties[’] approval of employment
contracts . . . and the Purchasers and Sellers agreeing upon the terms of
an operating agreement.” The closing never took place although at least
one payment of $30,000 was made by one of the buyers to the seller.
Subsequent to the failed closing date, the seller brought suit against
the Bank, seeking money damages for wrongful dishonor of the subject
cashier’s check. The seller alleged as follows. Pursuant to the contract,
one of the buyers, Weaver, agreed to partially pay the seller $30,000.
The Bank issued a cashier’s check to Weaver (with the seller as payee), in
the amount of $30,000 which was voluntarily delivered to the seller on
May 19, 2008. That day, the seller deposited the check into his
Wachovia bank account. On May 20, Weaver executed an affidavit which
identified the cashier’s check he had delivered to the seller as “stolen.”
With that information, the Bank then demanded Wachovia return the
funds. That same day, Wachovia froze the seller’s account after
withdrawing the $30,000 that the seller had deposited the day before.
The Bank informed the seller that it had stopped payment based on “the
stolen check affidavit” from Weaver. The affidavit stated that the Bank
issued the buyer a U.S. Dollar Draft in the amount of $30,000, payable
to the seller, and that the check was “stolen.” Weaver did not elaborate
on the details of the alleged theft.
As a defense to the seller’s suit, the Bank asserted in its answer that
Weaver tendered the check as a good-faith deposit and that the sale of
the business was never consummated.
The seller and the Bank filed cross-motions for summary judgment.
The Bank argued summary judgment was required because the seller
had no right to retain the $30,000 payment. In support of its motion,
the Bank submitted portions of transcripts of the seller’s deposition
testimony. In the depositions, the seller testified that after the subject
$30,000 cashier’s check was delivered to him, the buyers asked the seller
to return the money after the buyers spoke to restaurant employees, who
“scared [the buyers] away” by telling them that the restaurant was not
profitable. The seller informed the buyers that the check was already
deposited. The seller additionally informed the buyers that he would not
return the money because the buyers refused to return corporate papers
he had given to them in return for their check.
The trial court denied the seller’s motion for summary judgment but
granted summary judgment in favor of the Bank. In ruling for the Bank,
the trial court found that under the unambiguous terms of the contract,
the seller was not entitled to cash the check when he deposited it in his
2
Wachovia account. The court also found that the Bank was permitted to
refuse payment because the check was stolen.
The standard of review is de novo. Chhabra v. Morales, 906 So. 2d
1261, 1262 (Fla. 4th DCA 2005) (citation omitted). To the extent the
seller challenges the court’s denial of his motion for summary judgment,
this court has no jurisdiction to review such an order, even where a final
summary judgment for the opposing party has been entered. See Sheres
v. Genender, 965 So. 2d 1268, 1270 (Fla. 4th DCA 2007) (recognizing
that rules of appellate procedure do not provide for appeal of an order
denying a motion for summary judgment, but do permit jurisdiction over
appeal of portion of the order granting summary judgment and entering
partial summary judgment). As such, this opinion is limited to the
portion of the order entering summary judgment for the Bank.
The seller’s action for damages against the Bank was based on section
673.4111, Florida Statutes (2008), which provides in pertinent part:
(1) In this section, the term “obligated bank” means:
(a) The acceptor of a certified check; or
(b) The issuer of a cashier’s check or teller’s check bought
from the issuer.
(2) If the obligated bank wrongfully refuses to pay a cashier’s
check or certified check, wrongfully stops payment of a
teller’s check, or wrongfully refuses to pay a dishonored
teller’s check, the person asserting the right to enforce the
check is entitled to compensation for expenses and loss of
interest resulting from the nonpayment and may recover
consequential damages if the obligated bank refuses to
pay after receiving notice of particular circumstances
giving rise to the damages.
(3) Expenses or consequential damages under subsection (2)
are not recoverable if the refusal of the obligated bank to
pay occurs because:
(a) The bank suspends payments;
3
(b) The obligated bank asserts a claim or defense of the bank
that it has reasonable grounds to believe is available
against the person entitled to enforce the instrument;
(c) The obligated bank has a reasonable doubt whether the
person demanding payment is the person entitled to
enforce the instrument; or
(d) Payment is prohibited by law.
In concluding that summary judgment for the Bank was warranted,
the trial court relied in part on Warren Fin., Inc. v. Barnett Bank of
Jacksonville, N.A., 552 So. 2d 194 (Fla. 1989). However, application of
the holding of that case to the facts of this case is a non-sequitur; it does
not support summary judgment for the Bank.
Warren involved a financing agreement. Redan, the named payee on a
cashier’s check, endorsed it over to Warren, a party with whom it had
entered into a financing agreement. After Warren deposited the check, it
failed to follow through on an alleged agreement to advance funds to
Redan. Redan then persuaded the purchaser of the check to request the
issuing bank to stop payment based on fraud. After the bank complied,
Warren sued the bank for wrongfully dishonoring the check.
On appeal, the Florida Supreme Court held that the issuing bank
wrongfully dishonored the check under these circumstances. Id. at 201.
In response to a question certified to it by the district court, the supreme
court held that an obligated bank may raise limited defenses when it
dishonors a cashier’s check:
[W]e hold that upon presentment for payment by a holder, a
bank may only assert its real and personal defenses in order
to refuse payment on a cashier’s check issued by the bank.
It may not, however, rely on a third party’s defenses to refuse
payment. The only inquiry a bank may make upon
presentment of a cashier’s check is whether or not the payee
or endorsee is in fact a legitimate holder, i.e., whether the
cashier’s check is being presented by a thief or one who
simply found a lost check, or whether the check has been
materially altered.
Id. at 201 (footnote omitted).
4
The Florida Supreme Court rejected the argument that an obligated
bank should be able to rely on a third party’s claim to the cashier’s
check:
We disagree . . . for several reasons. Banks should not be
placed in a position that requires them to determine the
respective rights of parties to a cashier’s check prior to
paying the holder of the check. The actual dispute in this
case pertains to the underlying transaction between Redan
and Warren, i.e., whether Warren defrauded Redan into
transferring the cashier’s checks to Warren. The issuance of
a cashier’s check is a distinct and separate transaction from
that underlying dispute. Comment 5 to section 3-306 [of the
Uniform Commercial Code] addresses this point and states
in part:
The contract of the obligor is to pay the holder of the
instrument, and the claims of other persons against the
holder are generally not his concern. He is not required
to set up such a claim as a defense, since he usually
will have no satisfactory evidence of his own on the
issue; and the provision that he may not do so is
intended as much for his protection as for that of the
holder . . . . The provision includes all claims for
rescission of a negotiation, whether based on
incapacity, fraud, duress, mistake, illegality, breach of
trust or duty or any other reason.
Id. at 198-99.
Here, the trial court erroneously interpreted Warren as allowing the
Bank to stop payment based on a third party’s defense of theft. This was
error for two reasons.
First, the trial court’s finding of theft was not supported by the
summary judgment submissions. The trial court found that the seller’s
action of depositing the check (nine days) before the closing date
amounted to conversion because the contract called for payment literally
to be made on May 27: “The Contract is clear and unambiguous and
confirms that [the seller] was not entitled to negotiate or cash the Check
when he deposited it in his Wachovia bank account. . . . In depositing
and cashing the check before he was entitled to do so under the
Contract, [the seller] converted and stole the Check.” In point of fact, the
contract said nothing about what the seller was permitted to do with the
5
cashier’s check. The contract provided only that the buyers were to pay
the seller by cashier’s check in the total amount of $60,000 on the
closing date of May 27, 2008. The contract did not address the scenario
where, as here, one of the buyers provided the seller with a check in
advance of the closing date. Additionally, Weaver’s affidavit did not
explain the circumstances surrounding the alleged theft of the check.
The record established that Weaver did, in fact, intend to deliver the
$30,000 check to the seller. The record also reflects that the buyers
wanted to back out of the contract after speaking to restaurant
employees.
Second, the Bank dishonored the check based on a barebones claim
of Weaver that the $30,000 cashier’s check had been stolen, even though
it was made payable to the seller and deposited into his account. Under
these circumstances, while the unadorned claim in the affidavit alleging
a theft may have supplied the Bank with grounds to conduct an inquiry,
it did not permit it to prevent payment to the seller of the restaurant.
Again, as stated by the Florida Supreme Court in Warren, the Bank’s
issuance of the cashier’s check was a distinct and separate transaction
from the contract for sale and purchase of the restaurant. Essentially,
the Bank dishonored the check based on a defense available only to the
purchaser of the check, Weaver, rather than on the Bank’s own defenses
to the claim of wrongful dishonor of the cashier’s check. Warren makes
it clear that this is not permitted. See id. at 201 (holding that an
obligated bank may not rely on third party’s defenses in dishonoring a
check). For the foregoing reasons, we reverse.
Reversed and remanded for further proceedings.
STEVENSON and TAYLOR, JJ., concur.
* * *
Not final until disposition of timely filed motion for rehearing.
6
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696 F.2d 988
Adamsv.Dale
82-8210
UNITED STATES COURT OF APPEALS Fourth Circuit
11/22/82
1
N.D.W.Va.
CPC DENIED--DISMISSED
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294 P.2d 586 (1956)
In re Habeas Corpus of Nameon See BOLTON, Petitioner,
v.
H.C. McLEOD, Warden, Oklahoma State Penitentiary, McAlester, Oklahoma, Respondent.
No. A-12256.
Criminal Court of Appeals of Oklahoma.
February 21, 1956.
Nameon See Bolton, pro se.
Mac. Q. Williamson, Atty. Gen., Lewis A. Wallace, Asst. Atty. Gen., for respondent.
*587 BRETT, Judge.
This is an original, unverified petition in habeas corpus, brought by Nameon See Bolton, petitioner, alleging he is being unlawfully detained and restrained of his liberty by H.C. McLeod, warden of the Oklahoma State Penitentiary, in McAlester. He alleges that the cause of said restraint is the judgment and sentence of the District Court of Tulsa County, Oklahoma, in a case styled State of Oklahoma v. Nameon See Bolton, No. 16,082. It appears the judgment and sentence was upon a charge *588 of murder allegedly committed on October 15, 1954, upon the person of Clinton Jones by means of shooting him with a certain automatic pistol. The petitioner alleges that the said judgment and sentence was unlawfully obtained upon the basis of false evidence, physical and mental duress, force, fear, and threats of the electric chair by the investigating officers and the county attorney, by means of which he was forced to plead guilty.
He alleges he was persuaded by his counsel if he did not plead guilty, he would probably go to the electric chair. He further alleges his counsel was incompetent and not interested in his welfare, but merely performed a distasteful duty and did not bother to challenge the information.
Moreover, he alleges that the trial court did not properly perform its duty as to the petitioner's rights, allowing highly prejudicial methods to be employed by the prosecuting authorities, and he contends that the punishment imposed was excessive. Based upon the foregoing allegations, petitioner prays that the writ of habeas corpus be issued in his behalf.
To this petition, the State filed its response alleging that the detention of Nameon See Bolton was predicated upon his plea of guilty to the charge of manslaughter and the trial court found him guilty of manslaughter in the first degree, and sentenced him to a term of 55 years in the State Penitentiary in McAlester. The State of Oklahoma denied all the material allegations in the petition set forth, specifically denying that he was the subject of threats or physical force at the hands of the investigating officers which compelled him to enter a plea of guilty to the charge of first degree manslaughter, and further denied that the petitioner was represented by incompetent counsel and that he was denied his legal and constitutional rights.
The petitioner demurred to the response of the State, and in addition to what he alleged in his petition, he asserted there was a promise by the prosecuting officers that he would receive not more than 5 years.
The allegations of the State's response is supported by photostatic copies of the appearance docket, the affidavit of J. Howard Edmondson, county attorney, and a statement of Honorable W. Lee Johnson, District Judge, who tried the case below.
The affidavit of Mr. Edmondson discloses that the defendant was represented by W.H. McClarin, the lawyer of his own choosing, and Quinn Dickason, public defender. Edmondson denies that the defendant was subjected to any force, duress, or threats at any time and alleges petitioner's plea of guilty was entered after being fully advised of all his rights, constitutional or otherwise.
The minutes of the court confirm the allegation, contended in the county attorney's affidavit, and support the statement of Judge W. Lee Johnson, to the effect that the defendant first entered a plea of not guilty to a charge of murder and proceeded to the trial of his case. It appears that veteran public defender, Quinn Dickason, had been representing the defendant prior to setting of the case, but before the case was called for trial, the petitioner had employed W.H. McClarin. Due to the fact that Dickason was familiar with the case, and by reason of the seriousness of the charge, Judge Johnson directed the defender to continue his representation of the defendant and to assist Mr. McClarin, which was entirely agreeable to Mr. McClarin, and apparently to the defendant.
Thereafter, it appears a jury was duly selected and sworn to try the issues of the case. Seven witnesses were sworn and testified for the State concerning the circumstances of the homicide. Whereupon, the State rested.
Thereafter, opening statement on behalf of the defendant was made, and two witnesses were called by the defendant, including himself, who testified at great length concerning the homicide, which was admitted by him. Thereupon, both sides rested.
The court recessed to prepare instructions. Before the instructions could be read to the jury, both defense counsel came to the judge's chambers where they informed the court they were fearful the defendant would receive the death penalty, because of the atrocious nature of the homicide and the defendant's own guilty *589 knowledge thereof. Counsel for the defendant also were fearful that in event the death penalty was imposed, it would be affirmed on appeal. The trial court being so advised, informed the defendant that if he desired to withdraw his plea of not guilty to murder and enter a plea of guilty to the included offense of first degree manslaughter, the same would be accepted by him, but in any event, the sentence imposed would be in excess of 50 years in the penitentiary. The record herein made discloses the defendant's counsel consulted further with the defendant, returned into court, and followed the procedure as herein before indicated. The trial court then inquired of the defendant if he personally desired to withdraw his plea of not guilty to murder and enter a plea of guilty to manslaughter in the first degree. His answer was in the affirmative. Formal time for sentencing being waived, the trial court fixed the defendant's punishment at 55 years in the penitentiary.
Furthermore, this record discloses, in regard to the petitioner's complaint, that he was coerced by the prosecutor and particularly, "that he was put in mental fear by the prosecuting attorney by threats of the electric chair," is without foundation. The trial judge specifically states that neither the county attorney nor any assistant of his participated in the proceeding by and between himself and counsel for the defendant. The foregoing conclusions are supported by the transcript of the proceedings had in the District Court of Tulsa County, Oklahoma.
The foregoing facts disclose there is no justification for the petitioner's allegation that he would receive only a five year sentence if he would change his plea of not guilty to murder and enter a plea of guilty to a charge of manslaughter.
Under the conditions herewith presented, we are of the opinion that the trial court did nothing to defeat its jurisdiction.
Where it appears the trial court had jurisdiction of the person of the defendant, jurisdiction of the subject matter, and authority under the law to pronounce judgment and sentence, relief by habeas corpus may not be had against such judgment and sentence. De Wolf v. State, 96 Okl.Cr. 382, 256 P.2d 191.
The question of whether a sentence was excessive under the facts may not be inquired into under habeas corpus, but is a matter to be considered only on appeal from the conviction. Perry v. Waters, 97 Okl.Cr. 17, 256 P.2d 1119.
It appears that this proceeding is resorted to as a substitute for an appeal. It has been repeatedly held that this is not the function of habeas corpus. Ex parte Conway, 97 Okl.Cr. 1, 256 P.2d 189; De Wolf v. State, supra; Ex parte Giles, 97 Okl.Cr. 292, 262 P.2d 909.
Moreover, where the record and evidence reveals that the judgment and sentence under which the petitioner is being held is not void, that relief may not be granted by habeas corpus. Ex parte Murray, 97 Okl.Cr., 14, 257 P.2d 327; In re Brewster, Okl.Cr., 284 P.2d 755. The judgment herein involved is not void.
To the question of the allegation that the defendant was represented by incompetent counsel, the charge is entirely lacking in support in the record. Moreover, it discloses that the trial court took precautions to assure that the defendant was adequately and properly represented by requiring the public defender to remain in the case to assist the counsel of the defendant's own choice, because of his familiarity with the case.
The function of the Criminal Court of Appeals under habeas corpus proceedings is not to determine the guilt or innocence of petitioner, but to determine whether he is being restrained of his liberty by due process of law and whether the court, which rendered judgment imposing sentence, was without jurisdiction. Winchester v. Waters, 97 Okl.Cr. 337, 263 P.2d 535.
We are of the opinion herein, that the petitioner was accorded due process in that the trial court did nothing during its proceedings to cause it to lose jurisdiction. The writ of habeas corpus is accordingly denied.
JONES, P.J., and POWELL, J., concur.
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125 F.Supp. 709 (1954)
FIRST SUFFOLK NATIONAL BANK OF HUNTINGTON, Libelant,
v.
THE AIR BRANT, etc.
THE DEMAND, etc.
United States District Court E. D. New York.
November 7, 1954.
Abraham W. Sereysky, New York City, for petitioner Prather-Johnston, Inc.
Bernhardt, Sahn, Shapiro & Epstein, New York City, Mendes & Mount, Walter B. Hall, New York City, of counsel, for First Suffolk Nat. Bank, libelant.
Alfred J. Bedard, New York City, By Julian A. Ronan, New York City, of counsel, for respondent Burmeister & Wain American Corp.
Kreis & Kreis, New York City, for Consolidated Fisheries Co.
*710 INCH, Chief Judge.
On January 22, 1954 libelant, the First Suffolk National Bank of Huntington, duly recorded a fleet mortgage against both the vessels herein concerned. On August 23, 1954, libelant duly proceeded against the vessels in rem to foreclose this preferred mortgage, and the United States marshal, now in possession of the vessels, is about to sell same.
After the recording of the mortgage, Prather-Johnston, Inc., installed certain fish pumps and pertinent equipment aboard said vessels under a conditional sales agreement, said equipment becoming an integral part of these fishing vessels and essential to their navigation and operation as such.
The same is true as to 34 blocks and 8 fish boat davits which it is alleged were loaned by Consolidated Fisheries Company to the owner of the vessels, but which were also installed on the vessels and were essential to their navigation and operation as fishing vessels.
This Court is now asked by these two parties to be allowed to remove the above-mentioned essential items of equipment from the vessels prior to the marshal's sale. The effect of this, if successful, would be to reduce materially the prospective bids of potential purchasers at the marshal's sale. In any event, all of the above items of equipment are essential to the navigation and operation of these vessels as fishing vessels, and being part of the res, are subject to process in rem regardless of title. See The Augusta, 5 Cir., 15 F.2d 727; The Katherine, 5 Cir., 15 F.2d 387; The Hope, 1 Cir., 191 F. 243; Learned v. Brown, 5 Cir., 94 F. 876; The Showboat, 1 Cir., 47 F.2d 286; Turner v. United States, 2 Cir., 27 F.2d 134; The Joseph Warner, 1 Cir., 32 F.Supp. 532; The Hirondelle, D.C., 21 F.Supp. 223; The Frolic, 1 Cir., 148 F. 921.
Moreover, the purpose of the Ship Mortgage Act, 46 U.S.C.A. § 911 et seq., was to establish sound security in favor of loans to ship owners, and the statute accords stated priorities to the mortgage over subsequent contract liens, where, as here, the mortgage has been duly recorded at the home port and the fact endorsed on the vessels' documents. In view of these provisions of the Act, it is my opinion that the proposed repossession of these items of equipment should not be allowed to take place, on the facts sufficiently set forth in the papers submitted, unless there were authority clearly to the contrary.
Therefore, the motion of Prather-Johnston, Inc., to remove the fish pumps and related equipment is in all respects denied, and the possessory libel of Consolidated Fisheries Company is dismissed. The marshal is directed to advertise the sale without excepting these items of equipment.
As to the Fathometers and pertinent equipment, it is agreed by all parties that said equipment should be removed from the vessels prior to the sale or excepted from the sale.
Settle orders.
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193 Cal.App.2d 216 (1961)
THE PEOPLE, Appellant,
v.
ONE 1950 PONTIAC 2-DOOR COUPE, ENGINE NO. C8TH19459, Defendant; MOSES POOLE, Respondent.
Civ. No. 24833.
California Court of Appeals. Second Dist., Div. Three.
June 20, 1961.
Stanley Mosk, Attorney General, William E. James, Assistant Attorney General, and Philip C. Griffin, Deputy Attorney General, for Appellant.
No appearance for Respondent. *217
BISHOP, J. pro tem. [fn. *]
We have not been favored with any argument on respondent's behalf, either written or oral. This does not surprise us, for we are satisfied that the affirmative answer given by the trial court to the question that the parties stipulated was the sole issue before the court, can not be successfully defended.
This is an action brought under sections 11610-11629, Health and Safety Code, providing for the forfeiture to the state of a vehicle used for the unlawful transportation of a narcotic. In reply to the "Notice of Seizure and Intended Forfeiture Proceedings," addressed to Moses Poole as the registered owner of the vehicle identified in the title, Poole filed an answer in which he admitted ownership of the vehicle; denied that it had been used to transport a narcotic unlawfully; and, as an affirmative defense, alleged that he had been arrested for the possession of a narcotic on the day the vehicle was alleged to have been seized; that thereafter he was charged in an information with the violation of section 500 of the Health and Safety Code (by which, no doubt, he meant section 11500, which prohibits the possession, transportation, or other dealings with a narcotic); that he was tried and found not guilty by reason of the fact that the evidence in the case, the narcotic, was obtained by an illegal search and seizure.
We are given no record of the oral proceedings at the trial, but in the findings of fact and conclusions of law the trial court, in its recital of the proceedings that had taken place said: "... and it being stipulated by and between the parties through their respective counsel, that the sole issue before the Court was whether the plaintiff, the State of California, is estopped from forfeiting a vehicle in which narcotics were being transported subsequent to an acquittal of the said claimant following a trial on the merits for the offense of possession of the same narcotics giving rise to said forfeiture action, said acquittal being grounded solely upon the opinion of the trial judge that said contraband was obtained as a result of an illegal search and seizure. ..." As its conclusions of law the trial court stated: "Forfeiture of the defendant automobile is denied for the reason that the judgment of acquittal of the claimant, Moses Poole, on the sole ground of the illegality of the search and seizure collaterally estops the People of the State of California from introducing evidence of probable cause, thereby precluding the introduction into evidence of the *218 illegal narcotics and consequently causing a failure of proof on the part of the plaintiff." A judgment was entered that the vehicle in question be not forfeited, but be returned to Moses Poole.
[1] From this judgment the People have appealed, as they are authorized to do in forfeiture proceedings (People v. One 1952 Chevrolet Bel Air (1954), 128 Cal.App.2d 414, 419 [275 P.2d 509, 512]; People v. One 1950 Cadillac Club Coupe (1955), 133 Cal.App.2d 311, 318 [284 P.2d 118, 123]), and successfully did in People v. One 1948 Chevrolet Conv. Coupe (1955), 45 Cal.2d 613 [290 P.2d 538, 55 A.L.R.2d 1272]. [2] The character of the proceeding is civil, as was noted in the cases just cited. [3] One would expect, therefore, to find applied in such a case as this, the general rule expressed in In re Anderson (1951), 107 Cal.App.2d 670, 671-672 [237 P.2d 720, 721], "... that judgments in criminal prosecutions are neither bars to subsequent civil proceedings founded upon the same facts nor proof of anything in such civil proceedings (50 C.J.S. 269), and that even where the same acts or transactions constitute a crime and also give a right of action in a civil proceeding the acquittal of the defendant when tried for the criminal offense is no bar to the prosecution of the civil action against him nor evidence of his innocence in such action. (Id 272.)" [4] That rule is applied in just such proceeding as that under review. We deem it sufficient, in support of our statement, to cite People v. One 1950 Cadillac Club Coupe, supra (1955), 133 Cal.App.2d 311 [284 P.2d 118], with the authorities that it reviews, without quoting from its opinion. See also Cornell v. Reilly (1954), 127 Cal.App.2d 178, 187 [273 P.2d 572, 578].
Our conclusion is not that the plaintiff may make out a case for a forfeiture by evidence obtained by unlawful search and seizure. That which we do hold is that plaintiff's failure to convict the owner of the vehicle sought to be forfeited because it did not rely on admissible evidence, does not preclude the plaintiff from prosecuting this proceeding.
The judgment is reversed.
Shinn, P. J., and Ford, J., concurred.
NOTES
[fn. *] *. Assigned by Chairman of Judicial Council.
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945 So.2d 1106 (2005)
WILLIAM HESTER LOVELACE
v.
STATE
No. CR-04-1811
Court of Criminal Appeals of Alabama
September 16, 2005.
Decision without published opinion. Affirmed.
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567 N.E.2d 10 (1990)
207 Ill. App.3d 968
153 Ill.Dec. 295
Dennis BALL, Plaintiff-Appellant,
v.
WALDO TOWNSHIP, a Governmental Entity, Marvin Gerdes, Highway Commissioner of Waldo Township and Panola Township, a Governmental Entity, John Gauger, Highway Commissioner of Panola Township, Defendants-Appellees.
No. 4-90-0208.
Appellate Court of Illinois, Fourth District.
December 12, 1990.
James Walker, Ltd., Bloomington, for plaintiff-appellant.
Dunn, Goebel, Ulbrich, Morel & Hundman, Bloomington (John L. Morel, of counsel), for Waldo Tp. & Marvin Gerdes.
Judge & Knight, Ltd., Park Ridge (Sarah Hansen Sotos, Janella L. Barbrow, Joseph R. Martan, of counsel), for Panola Tp. & John Gauger.
Justice KNECHT delivered the opinion of the court:
Plaintiff Dennis Ball brought suit for personal injuries sustained by him as a *11 result of a car accident which occurred on February 3, 1986. Plaintiff appeals the trial court's orders dismissing portions of his complaint and granting summary judgment. We affirm.
Plaintiff was injured when the car in which he was a passenger left the road and landed in a nearby ditch. Plaintiff and the driver, Donald Maurer, had been traveling north on a two-lane blacktop road in a rural area near Gridley in Panola Township. The road on which they were traveling intersected with another at Woodford County 1200N, and then narrowed to a one-lane dirt road immediately beyond the intersection. Maurer missed the dirt road and drove into a field on the east side of the road. Maurer did not stop the vehicle there, but instead drove back toward the road. Once on the dirt road, he traveled across it at least once, struck a culvert, and ended up in a creek bed on the west side of the dirt road.
Plaintiff filed a complaint naming Waldo Township; Marvin Gerdes, highway commissioner for Waldo Township; Livingston County; Panola Township; John Gauger, highway commissioner for Panola Township; and Woodford County as defendants. Plaintiff alleged defendants were negligent in:
"a) * * * maintain[ing] the road * * * in a reasonably safe condition in violation of Ill.Rev.Stat., Ch. 121, § 6-201.7[;]
b) * * * plac[ing] and maintain[ing] stop signs so as to provide warning to vehicles being driven upon the road of the change in the surface of the road and the necessity that direction be altered for northbound traffic in order to enter the dirt road[;]
c) * * * inspect[ing] and fail[ing] to set up a schedule of inspections calculated to discover the existence of unsafe conditions[;]
d) * * * maintain[ing] its property in a reasonably safe condition for use by motor vehicles[; and]
e) * * * provid[ing] traffic warning signals, signs, or markings, to warn of the change in road surface and the necessity that vehicle direction be altered for northbound traffic in order to enter the dirt road, when such conditions were not reasonably apparent, nor would be anticipated, by travelers in a northbound direction on the paved road, in violation of Ill.Rev.Stat. Ch. 85, § 3-104."
Plaintiff alleged the negligence of defendants was the proximate cause of his injury.
Plaintiff's allegations regarding Livingston and Woodford Counties were dismissed, and plaintiff does not appeal this dismissal order. Plaintiff's case as to each of the townships and their respective highway commissioners proceeded through discovery at the trial court level. In each instance, the respective township and its commissioner appeared by the same attorney and filed identical pleadings. After dismissal of the counties, plaintiff's complaint in effect pended against Waldo Township and its commissioner, Marvin Gerdes, and Panola Township and its commissioner, John Gauger.
Defendants moved to dismiss plaintiff's complaint. The court allowed partial dismissal of plaintiff's complaint, striking allegations (b) and (e) which alleged defendants had failed to provide a stop sign or other traffic warning signal.
On February 15, 1989, defendants moved for summary judgment. Defendants' motions alleged there was no evidence in the record of any defect in the road surface and, as a matter of law, the sole proximate cause of the accident was Maurer's driving. The trial court heard arguments on summary judgment motions on December 19, 1989, and awarded summary judgment for defendants. The judgment order of February 2, 1990, stated no issue of material fact existed, defendants had no duty as a matter of law to make improvements upon township roads, and the sole proximate cause of the accident was Maurer's driving.
The trial court correctly granted defendants' motions to dismiss after finding plaintiff's complaint failed to allege a duty to maintain a traffic control sign. Defendants' motions to dismiss were made pursuant to section 2-615 of the Code of Civil Procedure. (Ill.Rev.Stat.1985, ch. 110, par. *12 2-615.) In considering a motion to dismiss filed pursuant to section 2-615, trial courts are confined to consideration of the facts alleged on the face of the complaint. Seibring v. Parcell's Inc. (1988), 178 Ill. App.3d 62, 127 Ill.Dec. 326, 532 N.E.2d 1335; Dunn v. Baltimore & Ohio R.R. Co. (1987), 162 Ill.App.3d 97, 113 Ill.Dec. 868, 515 N.E.2d 1027, aff'd in relevant part (1989), 127 Ill.2d 350, 130 Ill.Dec. 409, 537 N.E.2d 738.
Plaintiff's complaint cited section 3-104 of the Local Governmental and Governmental Employees Tort Immunity Act (Ill. Rev.Stat.1985, ch. 85, par. 3-104) as providing a duty on behalf of defendants to maintain a traffic warning signal. Section 3-104 provides:
"Failure to provide traffic signals and signs.
(a) Neither a local public entity nor a public employee is liable under this Act for an injury caused by the failure to initially provide regulatory traffic control devices, stop signs, yield right-of-way signs, speed restriction signs, distinctive roadway markings or any other traffic regulating signs.
(b) Neither a local public entity nor a public employee is liable under this Act for an injury caused by the failure to provide traffic warning signals, signs, markings or other devices unless such a signal, sign, marking or device was necessary to warn of a condition which endangered the safe movement of traffic, and which would not be reasonably apparent to or anticipated by a person in the exercise of due care." (Ill.Rev.Stat. 1985, ch. 85, par. 3-104.)
However, plaintiff's complaint did not contain any factual allegations indicating it was necessary to warn of the condition or that the condition was not reasonably apparent to, or anticipated by, a person in the exercise of due care. The extent of plaintiff's factual allegations was that plaintiff was a passenger in a vehicle driven by Maurer, Maurer's vehicle left the road striking a bridge abutment, and plaintiff was injured. Accordingly, the trial court appropriately dismissed allegations (b) and (e) of plaintiff's complaint.
Prior to defendants' motions for summary judgment, discovery depositions were taken from plaintiff and Maurer. Plaintiff and Maurer, in deposition, stated that after leaving work February 3, 1986, they went to Fat Albert's, a tavern in Gridley. Maurer deposed he drank four or five 12-ounce beers. After a couple of hours, they left Fat Albert's to go to a friend's house in the country. Maurer drove. The weather conditions that night were rainy and foggy. Maurer stated he had his headlights and wipers on. He estimated he could see a distance of 500 to 600 feet and was driving at a speed of 35 to 40 miles per hour. Maurer stated that when he came to the dirt road he safely traversed a ditch on the north side of the intersecting road. He then proceeded into a bean field, driving parallel to and east of the dirt road. Maurer first stated he did not apply his brakes upon entering the field, but later stated he just touched them. Maurer did not stop the vehicle because it was raining and he did not want to get stuck. Maurer instead drove through the ditch on the east side of the dirt road as he headed back toward the road. He traveled across the dirt road and struck a culvert on the west side of the road. At this time, he lost control of the vehicle and traveled into a creek bed. Prior to striking the culvert, Maurer stated he had been steering the vehicle. Plaintiff, in deposition, stated Maurer crisscrossed the dirt road several times before completely going off the west side of the road and coming to a stop in the creek bed. In plaintiff's opinion, Maurer lost control of the vehicle after leaving the paved road.
Summary judgment is an appropriate remedy when the pleadings, depositions, and admissions on file, together with the affidavits, if any, show there is no genuine issue of material fact and the moving party is entitled to a judgment as a matter of law. Ill.Rev.Stat.1985, ch. 110, par. 2-1005.
Plaintiff cited section 6-201.7 of the Illinois Highway Code (Ill.Rev.Stat. 1985, ch. 121, par. 6-201.7) as again providing a duty on the behalf of defendants to maintain *13 the road in a reasonably safe condition. However, a careful reading of the statute makes no reference to such a duty. The statute instead provides terms for contracting, bidding, and advertising bids for roads within the district.
Moreover, the sole proximate cause of the accident was Maurer's negligent driving.
"Proximate cause is one which produces the injury through a natural and continuous sequence of events unbroken by any effective intervening cause. (Kemp v. Sisters of the Third Order of St. Francis (1986), 143 Ill.App.3d 360[, 97 Ill.Dec. 709, 493 N.E.2d 372].) As was discussed by the Illinois Supreme Court, a `cause vs. condition' analysis has evolved in examining whether proximate cause exists in certain situations:
`[I]f the negligence charged does nothing more than furnish a condition by which the injury is made possible and that condition causes an injury by the subsequent, independent act of a third person, the creation of the condition is not the proximate cause of the injury where the subsequent act is an intervening efficient cause which breaks the causal connection between the original wrong and the injury, and itself becomes the proximate or immediate cause.' Merlo v. Public Service Co. (1942), 381 Ill. 300, 316[, 45 N.E.2d 665, 675]."
Novander v. City of Morris (1989), 181 Ill.App.3d 1076, 1078-79, 130 Ill.Dec. 817, 818-19, 537 N.E.2d 1146, 1147-48.
Here, neither the absence of a traffic control device nor the design of the road did anything more than furnish a condition. Maurer's decision to continue driving through the field was an intervening efficient cause. The trial court appropriately awarded summary judgment.
Affirmed.
LUND, P.J., and GREEN, J., concur.
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NUMBER 13-10-00553-CR
COURT OF APPEALS
THIRTEENTH DISTRICT OF TEXAS
CORPUS CHRISTI - EDINBURG
____________________________________________________________
CHRISTOPHER JAMES CHAPMAN, Appellant,
v.
THE STATE OF TEXAS, Appellee.
____________________________________________________________
On appeal from the County Court at Law No. 1
of Montgomery County, Texas.
____________________________________________________________
MEMORANDUM OPINION
Before Chief Justice Valdez and Justices Rodriguez and Perkes
Memorandum Opinion Per Curiam
Appellant, Christopher James Chapman, by and through his attorney, has filed a
motion to withdraw his appeal because he no longer desires to prosecute it. See TEX. R.
APP. P. 42.2(a). Without passing on the merits of the case, we grant the motion to
withdraw the appeal and pursuant to Texas Rule of Appellate Procedure 42.2(a), dismiss
the appeal. Having dismissed the appeal at appellant's request, no motion for rehearing
will be entertained, and our mandate will issue forthwith.
PER CURIAM
Do not publish. See TEX. R. APP. P. 47.2(b).
Delivered and filed the 17th
day of February, 2011.
2
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231 S.W.3d 273 (2007)
David RASCHE, Appellant,
v.
STATE of Missouri, Respondent.
No. ED 88203.
Missouri Court of Appeals, Eastern District, Division Two.
June 26, 2007.
Motion for Rehearing and/or Transfer Denied August 13, 2007.
Application for Transfer Denied September 25, 2007.
David Rasche, Moberly, MO, pro se.
Shaun J. Mackelprang, Stephanie L. Wan, Jefferson City, MO, for respondent.
Motion for Rehearing and/or Transfer to Supreme Court Denied August 13, 2007.
OPINION
GEORGE W. DRAPER III, P.J.
David Rasche (hereinafter, "Movant") appeals pro se from the trial court's judgment dismissing and denying his motion to reopen his Rule 29.15 proceeding. We dismiss this appeal for lack of subject matter jurisdiction.[1]
*274 Movant was convicted in 1998 of one count attempted sodomy, Section 564.011 RSMo (1994) and one count of first degree trespassing, Section 566.060.2 RSMo (1994). Movant's conviction was affirmed on appeal. State v. Rasche, 985 S.W.2d 868, 869 (Mo.App. E.D.1998). Movant sought post-conviction relief pursuant to Rule 29.15, which was denied by this Court after an evidentiary hearing. Rasche v. State, 41 S.W.3d 48 (Mo.App. E.D.2001).
On April 20, 2006, Movant filed a pro se motion to reopen his Rule 29.15 proceeding. In his motion, Movant alleged his post-conviction counsel abandoned him by failing to raise the following issues: (1) the trial court sentenced him under an erroneous provision; (2) the crime for which Movant was convicted was not prohibited by the statute; (3) Movant was charged improperly; (4) the jury received erroneous instructions; (5) Movant was denied ineffective assistance of post-conviction counsel; and (6) post-conviction counsel should have investigated trial counsel's effectiveness and raised these alleged deficiencies in an amended motion. The motion court issued its order on April 27, 2006, dismissing and denying Movant's motion. This appeal follows.
Movant raises three points on appeal. First, Movant argues his court-appointed post-conviction relief counsel filed a patently defective amended motion that resulted in a nullity constituting abandonment. Second, Movant claims he has a liberty interest derived from a "rule created right to effective assistance of [post-conviction relief] counsel" which required his post-conviction relief counsel to raise all claims known in an amended Rule 29.15 motion. Third, Movant challenges his conviction for attempted forcible sodomy. The State argues both the trial court and this Court lack jurisdiction because the trial court's order was not an appealable judgment. We agree with the State.
Pursuant to Rule 75.01, the "trial court retains control over judgments during the thirty-day period after entry of judgment. . . ." The Missouri Supreme Court recognized a possible exception to Rule 75.01, allowing reopening of a timely filed Rule 29.15 motion when there was abandonment by post-conviction counsel. Daugherty v. State, 116 S.W.3d 616, 617 (Mo.App. E.D.2003)(citing State ex rel. Nixon v. Jaynes, 63 S.W.3d 210, 217-18 (Mo. banc 2001)). Only a narrow category of cases will rise to the level of abandonment. Russell v. State, 39 S.W.3d 52, 54 (Mo.App. E.D.2001). Abandonment is recognized when:
(1) post-conviction counsel takes no action on a movant's behalf with respect to filing an amended motion and as such the record shows that the movant is deprived of a meaningful review of his claims; or (2) when post-conviction counsel is aware of the need to file an amended post-conviction relief motion and fails to do so in a timely manner.
Walker v. State, 194 S.W.3d 883, 885 (Mo. App. E.D.2006)(quoting Barnett v. State, 103 S.W.3d 765, 774 (Mo. banc 2003)).
Notwithstanding Movant's allegations in this case, his motion to inquire into the issue of abandonment merely complains about the quality of appointed counsel's amended motion. "Claims of ineffective assistance of post-conviction counsel are categorically unreviewable. . . ." State v. Lyons, 129 S.W.3d 873, 874 (Mo. banc 2004). There was no allegation Movant was deprived of meaningful review of his claims in his initial Rule 29.15 motion nor was there an allegation that counsel failed to file a timely post-conviction motion. *275 Movant does not raise an issue of abandonment for review.
Accordingly, the motion court lacked subject matter jurisdiction to consider the merits of the underlying action due to the allegations raised therein. Since the circuit court lacks jurisdiction, this Court also lacks jurisdiction. See In re Marriage of Jeffrey, 53 S.W.3d 173, 175 (Mo.App. E.D. 2001); Simmons v. State, 190 S.W.3d 558 (Mo.App. E.D.2006).
The motion court's order is dismissed.
ROBERT G. DOWD, JR., and PATRICIA L. COHEN, J., concur.
NOTES
[1] The motion taken with case directing Movant to show cause why his appeal should not be dismissed due to lack of jurisdiction is denied as moot. Perhaps Movant should have availed himself of the provisions of Rule 81.07 to appeal the denial of his motion to set aside as opposed to the dismissal of his motion.
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J-A01016-20
NON-PRECEDENTIAL DECISION - SEE SUPERIOR COURT I.O.P. 65.37
COMMONWEALTH OF PENNSYLVANIA : IN THE SUPERIOR COURT OF
: PENNSYLVANIA
:
v. :
:
:
LATOYA N. HICKSON :
:
Appellant : No. 1132 EDA 2018
Appeal from the Judgment of Sentence November 15, 2017
In the Court of Common Pleas of Philadelphia County Criminal Division at
No(s): MC-51-CR-0030427-2016
BEFORE: NICHOLS, J., MURRAY, J., and COLINS, J.*
MEMORANDUM BY MURRAY, J.: FILED JANUARY 28, 2020
Latoya H. Hickson (Appellant) appeals from the judgment of sentence
imposed following her conviction of driving under the influence (DUI) – highest
rate of alcohol.1 We affirm.
The facts of this case are not in dispute. On the night of October 26,
2016, Appellant was arrested on Germantown Avenue in Philadelphia,
Pennsylvania, on suspicion of driving under the influence of alcohol. Following
transport to police headquarters, Appellant took a breathalyzer test, which
indicated that her blood alcohol content (BAC) was 0.225, well above the legal
limit. Consequently, Appellant was charged with, inter alia, DUI – highest rate
of alcohol under Section 3802(c) of the Pennsylvania Vehicle Code.
____________________________________________
*Retired Senior Judge assigned to the Superior Court.
1 75 Pa.C.S.A. § 3802(c).
J-A01016-20
During discovery in an unrelated case, the Commonwealth learned that,
on June 4, 2016 (roughly five months before Appellant’s breathalyzer test),
the device the police used to test Appellant’s BAC had produced two results
on another individual that differed from one another by .020. Consequently,
the police took that device out of service for maintenance and accuracy
calibrations. On July 1, 2016, Officer Mary Beth Novak (Officer Novak), a
police officer certified in the operation, maintenance, and calibration of
breathalyzers, see N.T., 6/21/17, at 28, recalibrated the device and tested it
for accuracy. Officer Novak determined that the device complied with the
applicable regulations and that no repairs to the device were necessary.
Officer Novak therefore placed the breathalyzer back into service.
On April 3, 2017, Appellant filed a motion to suppress the results of her
breathalyzer test.2 Specifically, Appellant alleged that the police should have
removed the breathalyzer from service and repaired it before placing the
device back into service, rather than merely recalibrating and retesting it. On
June 21, 2017, the Philadelphia Municipal Court held a hearing on Appellant’s
suppression motion. On July 6, 2017, the municipal court denied the motion.
On October 11, 2017, the municipal court found Appellant guilty of DUI
– highest rate of alcohol. On November 15, 2017, the municipal court
____________________________________________
2 Along with Appellant, several other criminal defendants, upon whom the
police used the breathalyzer at issue after its return to service, filed identical
suppression motions. The Philadelphia Municipal Court consolidated each of
the motions for disposition.
-2-
J-A01016-20
sentenced Appellant to 72 hours to 6 months of incarceration. On December
6, 2017, Appellant filed a writ of certiorari to the Philadelphia County Court of
Common Pleas challenging the denial of her suppression motion. On February
16, 2018, the Philadelphia Court of Common Pleas denied Appellant’s petition
for a writ of certiorari. This timely appeal followed.
Appellant presents the following issue for review:
Where a breathalyzer machine produced BAC measurement
results with such a variance between the results as to violate the
regulations governing the use of breathalyzer machines, and
where the Commonwealth then failed to have the machine
serviced, repaired or adjusted as required by the regulations, did
not the lower court err by failing to suppress breath test results
for [] Appellant which were subsequently obtained through the
use of that faulty breathalyzer machine?
Appellant’s Brief at 3.
Appellant challenges the denial of her suppression motion. Our standard
of review is as follows:
[An appellate court’s] standard of review in addressing a challenge
to the denial of a suppression motion is limited to determining
whether the suppression court’s factual findings are supported by
the record and whether the legal conclusions drawn from those
facts are correct. Because the Commonwealth prevailed before
the suppression court, we may consider only the evidence of the
Commonwealth and so much of the evidence for the defense as
remains uncontradicted when read in the context of the record as
a whole. Where the suppression court’s factual findings are
supported by the record, [the appellate court] is bound by [those]
findings and may reverse only if the court’s legal conclusions are
erroneous. Where . . . the appeal of the determination of the
suppression court turns on allegations of legal error, the
suppression court’s legal conclusions are not binding on an
appellate court, whose duty it is to determine if the suppression
court properly applied the law to the facts. Thus, the conclusions
of law of the courts below are subject to [ ] plenary review.
-3-
J-A01016-20
Commonwealth v. Jones, 121 A.3d 524, 526-27 (Pa. Super. 2015) (citation
omitted). Our scope of review from a suppression ruling is limited to the
evidentiary record that was created at the suppression hearing. In re L.J.,
79 A.3d 1073, 1087 (Pa. 2013).
Appellant argues that the trial court erred in denying her suppression
motion. Specifically, Appellant asserts that because the breathalyzer
produced results when the police used it on another individual that differed by
.020 prior to its use on Appellant, the applicable regulations dictate that the
police should have serviced and repaired the machine upon its removal from
service — as opposed to simply recalibrating and retesting it. Appellant
contends that because the police did not service or repair the breathalyzer
following the deviation, the trial court erred in failing to suppress the results
of her breathalyzer test.
The General Assembly has provided that the results of breathalyzer tests
are admissible in court under the following circumstances:
(c) Test results admissible in evidence.--In any summary
proceeding or criminal proceeding in which the defendant is
charged with a violation of section 3802 or any other violation of
this title arising out of the same action, the amount of alcohol or
controlled substance in the defendant’s blood, as shown by
chemical testing of the person’s breath or blood, which tests were
conducted by qualified persons using approved equipment, shall
be admissible in evidence.
(1) Chemical tests of breath shall be performed on devices
approved by the Department of Health using procedures
prescribed jointly by regulations of the Departments of Health and
Transportation. Devices shall have been calibrated and tested for
-4-
J-A01016-20
accuracy within a period of time and in a manner specified by
regulations of the Departments of Health and Transportation. For
purposes of breath testing, a qualified person means a person who
has fulfilled the training requirement in the use of the equipment
in a training program approved by the Departments of Health and
Transportation. A certificate or log showing that a device was
calibrated and tested for accuracy and that the device was
accurate shall be presumptive evidence of those facts in every
proceeding in which a violation of this title is charged.
75 Pa.C.S.A. § 1547(c)(1).
The regulations, mentioned above, which govern the calibration and
testing of breathalyzers, state, in pertinent part as follows:
(b) Procedures. Alcohol breath tests shall be conducted by a
certified breath test operator. Accuracy inspection tests and
calibrations conducted using breath test equipment shall be
performed by a certified breath test operator, the manufacturer
or its authorized representative or a person who has received
comparable training or instruction. Alcohol breath tests, accuracy
inspection tests and calibrations conducted using breath test
equipment shall be performed in accordance with accepted
standard procedures for operation specified by the manufacturer
of the equipment or comparable procedures. The procedures for
alcohol breath testing shall include, at a minimum:
(1) Two consecutive actual breath tests, without a required
waiting period between the two tests.
(2) One simulator test using a simulator solution designed to
give a reading of .10%, to be conducted immediately after the
second actual alcohol breath test has been completed. The
lower of the two actual breath test results will be the result
used for prosecution. The test results will be disregarded, and
the breath test device will be removed from service under §
77.25(b)(4) (relating to accuracy inspection tests for Type A
equipment) if one of the following occurs:
(i) If the difference between the results of the two actual
alcohol breath tests is .02 or more, for machines read to the
second decimal place, or .020 or more for machines read to
the third decimal place.
-5-
J-A01016-20
(ii) If the simulator test yields a result less than .09% or
greater than .10% when the breath test device is read to
the second decimal place, or if the simulator test yields a
result less than .090% or greater than .109% when the
breath test device can be read to the third decimal place.
(c) Procedures for adjustment. Breath test equipment which fails
the testing under § 77.25(b) or subsection (b) shall be placed out
of service and shall be serviced, repaired and adjusted, as
necessary, by the manufacturer or its authorized representative
or a person who has received comparable training or instruction
prior to being placed back into service. In addition, the breath
test device shall be tested under subsection (b) prior to being
placed back into service.
67 Pa. Code § 77.24(b)-(c).
Appellant recognizes the authority articulated by this Court in
Commonwealth v. Demor, 691 A.2d 958 (Pa. Super. 1997). See
Appellant’s Brief at 28 (“Appellant concedes that if Demor controls, the denial
of suppression here is correct under that holding.”). In Demor, we
interpreted the regulations governing the admission of breathalyzer tests. We
explained:
We interpret the regulations to mean that pursuant to Sections
77.24(b)(2)(i) and 77.24(c), when the results of two consecutive
breath tests deviate from one another by .020[] or greater, the
breathalyzer machine must be tested for accuracy and
calibrations, and, then, if necessary, serviced, repaired or
adjusted. After the necessary repairs or adjustments have been
made, the machine is to be re-tested for accuracy and calibrations
under Section 77.24(b) to ensure that any defects in the machine
have been corrected. We explicitly find that only those machines
which have failed accuracy and calibrations testing under Sections
77.24(b) or 77.25(b) must be
serviced, repaired or adjusted as needed, and then re-tested for
accuracy and calibrations. To interpret the Code as requiring
service, repair or adjustment of the machine before
-6-
J-A01016-20
determining that the machine is malfunctioning defies
common sense.
Id. at 962 (emphasis added).
Applying this rationale to the facts before it, the Court in Demor
explained:
Here, it is undisputed that the breath test results of the last
suspect who used the same machine as appellant deviated by
.020[] or greater. It is also undisputed that the breathalyzer
machine was placed out of service and tested for accuracy and
calibrations on January 10, 1995, two days after the last variance
incident prior to appellant’s test. Since the machine passed the
accuracy and calibrations tests, Technician Richey determined
that the machine did not need to be serviced, repaired or
adjusted. Therefore, the breathalyzer machine was put back into
service and, on January 28, 1995, appellant was tested on the
machine. We find that this was not error and satisfied the Code’s
mandates. Accordingly, the lower court did not err in failing to
suppress the results of appellant’s breathalyzer test.
Id. (footnote omitted).
We find this case analogous to Demor. Here, the police —
approximately five months prior to their encounter with Appellant — used the
breathalyzer at issue to test the BAC of another individual, and the machine
produced two separate results that differed by .020. As with Demor, the
police took the device out of service, recalibrated it, and retested it for
accuracy. See N.T., 6/21/17, at 37-38. Based on the retesting, the police
determined that the breathalyzer did not need repair, and placed the machine
back into service. See N.T., 6/21/17, Commonwealth’s Exhibit 2 (Certificate
of Breathtesting Device Calibration, 7/1/16). There is no evidence that the
breathalyzer malfunctioned when the police used it on Appellant. See N.T.,
-7-
J-A01016-20
6/21/17, at 23. Therefore, we conclude that police actions satisfied the
mandates of the regulations and Demor. Accordingly, the trial court did not
abuse its discretion in denying Appellant’s suppression motion.
Although Appellant recognizes the authority of Demor, she nevertheless
asserts that we should disregard that decision because it “was simply wrong.”
Appellant’s Brief at 35-36. However, Appellant does not identify any Supreme
Court precedent that calls Demor into question. See id. “It is beyond the
power of a Superior Court panel to overrule a prior decision of the Superior
Court, . . . except in circumstances where intervening authority by our
Supreme Court calls into question a previous decision of this Court.”
Commonwealth v. Pepe, 897 A.2d 463, 465 (Pa. Super. 2006) (citation
omitted).
Consistent with the foregoing, Appellant’s suppression issue lacks merit.
We therefore affirm the judgment of sentence.
Judgment of sentence affirmed.
Judgment Entered.
Joseph D. Seletyn, Esq.
Prothonotary
Date: 1/28/20
-8-
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70 F.3d 1279
NOTICE: Ninth Circuit Rule 36-3 provides that dispositions other than opinions or orders designated for publication are not precedential and should not be cited except when relevant under the doctrines of law of the case, res judicata, or collateral estoppel.Lockhart, Plaintiff-Appellant,v.UNITED STATES of America, Donna Shalala, in her individualand official capacities as Secretary of the Department ofHealth and Human Services, and June Gibbs Brown, in herindividual and official capacities as Inspector General ofthe Department of Health and Human Services, Defendants-Appellees.
No. 95-35179.
United States Court of Appeals, Ninth Circuit.
Submitted Oct. 16, 1995.*Decided Nov. 29, 1995.
Before: CHOY, SNEED, and SKOPIL, Circuit Judges.
1
MEMORANDUM**
2
James Lockhart appeals the district court's Order dismissing his complaint as frivolous pursuant to 28 U.S.C. Sec. 1915(d). Lockhart contends that the district court erred in dismissing his complaint because: (1) the Federal Tort Claims Act ("FTCA") allows novel claims, and (2) the applicable statute of limitation period was tolled. We affirm.
Factual and Procedural Background
3
Lockhart was employed by the U.S. Oil and Refining Company from June 1979 to May 14, 1981 when he was placed on sick leave. Lockhart's employment was subsequently terminated for an alleged disability on December 16, 1981. Lockhart was unable to find work and applied for Social Security disability benefits on May 3, 1982. His application was denied on October 7, 1983 when he was found "not disabled." Following the United States Supreme Court's decision in Bowen v. City of New York, 476 U.S. 467 (1986), Lockhart's claim was reevaluated. On December 9, 1986 he was notified that he was eligible for benefits. Lockhart received benefits retroactively from the date of his initial application.
4
On March 18, 1993 Lockhart filed an administrative claim with the Department of Health and Human Services ("DHHS") under the FTCA, 28 U.S.C. Sec. 1346(b). He alleged that the DHHS deprived him of his property interest in employment when the Secretary attributed a mental disability to him. Lockhart claimed $3,008,493.80 in damages. On September 27, 1993 Lockhart's claim was denied on the following grounds: (1) there was no evidence that the alleged injury was due to an act or omission of a federal employee, (2) the Social Security Act, 42 U.S.C. Sec. 405(h), barred his claim under the FTCA, and (3) his claim was time barred under 28 U.S.C. Sec. 2401(b). Lockhart filed a request for reconsideration on October 18, 1993 which was denied on April 22, 1994.
5
Lockhart's complaint was filed in the district court on October 18, 1994. He alleged, inter alia, that the Secretary negligently determined him to be disabled. On October 27, 1994 the district court ordered Lockhart to show cause why his complaint should not be dismissed because: (1) 42 U.S.C. Sec. 405(h) bars recovery under the FTCA, and (2) Lockhart's claim was time barred under 28 U.S.C. Sec. 2401(b). After reviewing Lockhart's response, the district court dismissed his complaint as frivolous under 28 U.S.C. Sec. 1915(d). Lockhart now appeals.
Background Law
6
28 U.S.C. Sec. 1915 allows a litigant to commence a federal court action in forma pauperis by filing an affidavit stating that he or she is unable to afford the costs of the lawsuit. Sec. 1915(a). To prevent abusive lawsuits by litigants who have little economic incentive to refrain from filing suit, a district court may dismiss an in forma pauperis complaint "if the allegation of poverty is untrue, or if satisfied that the action is frivolous or malicious." Sec. 1915(d). A complaint is frivolous if it lacks an arguable basis in law or fact. Neitzke v. Williams, 490 U.S. 319, 325 (1989). "[T]he statute accords judges not only the authority to dismiss a claim based on an indisputably meritless legal theory, but also the unusual power to pierce the veil of the complaint's factual allegations and dismiss those claims whose factual contentions are clearly baseless." Id. at 327.
7
We review a Sec. 1915(d) dismissal for abuse of discretion. Denton v. Hernandez, 504 U.S. 25, 33 (1992). In reviewing a dismissal, the Supreme Court has instructed us to consider: (1) whether the plaintiff is proceeding pro se, (2) whether the district court inappropriately resolved genuine issues of disputed fact, (3) whether the district court applied erroneous legal conclusions, (4) whether the district court has provided a statement explaining the dismissal that facilitates appellate review, and (5) whether the dismissal was with or without prejudice. Id. at 34.
Discussion
8
1. Is the Plaintiff Proceeding Pro Se?
9
Lockhart is proceeding pro se. We recognize that pro se litigants face many obstacles in bringing a successful claim in federal court. Therefore, we will carefully scrutinize the dismissal to determine if the district court abused its discretion.
10
2. Did the District Court Inappropriately Resolve Genuine Issues of Disputed Fact?
11
The district court did not inappropriately resolve genuine issues of disputed fact. Rather, the district court dismissed Lockhart's claim because it has no basis in law.
12
3. Did the District Court Apply Erroneous Legal Conclusions?
13
The district court did not apply erroneous legal conclusions. While the basis for the district court's dismissal is not clear from the November 29, 1994 Order, we believe the district court dismissed Lockhart's claim on the two grounds set forth in the October 27, 1994 Order to Show Cause: (1) that the Social Security Act, 42 U.S.C. Sec. 405(h), bars Lockhart's claim under the FTCA, and (2) that Lockhart's claim is time barred under 28 U.S.C. Sec. 2401(b).
14
The district court correctly determined that 42 U.S.C. Sec. 405(h) bars Lockhart's claim under the FTCA. 42 U.S.C. Sec. 405(h) provides in relevant part: "No action against the United States, the Secretary, or any officer or employee thereof shall be brought under section 1331 or 1346 of Title 28 to recover on any claim arising under this subchapter." As Lockhart's action was filed under 28 U.S.C. Sec. 1346(b), the Federal Tort Claims Act, the dispositive issue is whether his claim arises under Title II of the Social Security Act.
15
A claim arises under Title II where the Social Security Act provides "both the standing and the substantive basis" for the action. Weinberger v. Salfi, 422 U.S. 749, 761 (1975). We applied this definition in Hooker v. United States Dep't of Health & Human Serv., where we held that claims for damages caused by the Secretary's allegedly tortious determinations "arise under" the Act. 858 F.2d 525, 528-30 (9th Cir.1988). While Hooker involved an allegedly tortious determination that the claimant was not disabled, we see no reason why the result should be different for an allegedly tortious determination of disability. Therefore, since Hooker is controlling, we hold that Lockhart's claim arises under Title II and is barred by Sec. 405(h).1
16
The district court also determined that Lockhart's claim is time barred. Because we hold that Lockhart's claim is barred by 42 U.S.C. Sec. 405(h), we do not reach this alternative ground.
17
4. Did the District Court Adequately Explain the Dismissal?
18
The district court adequately explained the dismissal. As noted above, the November 29, 1994 Order did not clearly explain the basis for the dismissal under 28 U.S.C. Sec. 1915(d). Nevertheless, the dismissal, when read in the context of the October 27, 1994 Order to Show Cause, provided adequate guidance to this court.
19
5. Was the Dismissal with or Without Prejudice?
20
The dismissal was without prejudice. See Denton v. Hernandez, 504 U.S. 25, 34 (1992) ("Because a Sec. 1915(d) dismissal is not a dismissal on the merits, but rather an exercise of the court's discretion under the in forma pauperis statute, the dismissal does not prejudice the filing of a paid complaint making the same allegations.").
Conclusion
21
Applying the foregoing five factors, we conclude that the district court did not abuse its discretion in dismissing Lockhart's complaint. Judgment of the district court is AFFIRMED.
*
The panel unanimously finds this case suitable for decision without oral argument. Fed.R.App.P. 34(a); 9th Cir.R. 34-4
**
This disposition is not appropriate for publication and may not be cited to or by the courts of the circuit except as provided by Ninth Circuit Rule 36-3
1
We reject Lockhart's argument that his claim is not frivolous because it is "novel" and therefore permitted under the FTCA. Regardless of whether the FTCA generally allows novel claims, it is clear that no claim may be brought under the FTCA which "arises under" Title II
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218 Cal.App.2d 317 (1963)
THE PEOPLE, Plaintiff and Respondent,
v.
GARRICK EARL MURRAY, Defendant and Appellant.
Crim. No. 8577.
California Court of Appeals. Second Dist., Div. Two.
July 15, 1963.
Apple & Cohen and Irving D. Apple for Defendant and Appellant.
Stanley Mosk, Attorney General, William E. James, Assistant Attorney General, and S. Clark Moore, Deputy Attorney General, for Plaintiff and Respondent.
FOX, P. J.
Defendant was convicted of the charge of possession of marijuana (Health & Saf. Code, 11530). He has appealed from the judgment (order granting probation) and sentence.
On March 2, 1962, at approximately 10:10 p.m., Officer A. L. Allen of the North Hollywood division of the Los Angeles Police Department, observed defendant going towards the rear of a laundromat at Magnolia and Cartwright. He was not carrying any clothes but did have a brown paper bag. As there had been numerous burglaries of laundromats in the area, the officer decided to investigate. He parked and entered the laundromat but no one appeared to be in it. He went to the rear where there was a men's restroom, tried the door and found it locked. At this point a male voice from inside said, "Just a moment." The officer then heard the toilet flush. Officer Allen went outside of the laundromat and peered through the window into the restroom, which was lighted. The window had had paint on it but there were numerous places where the paint had worn off and the window could be seen through. These various unobstructed spots on the window were probably 2 inches in diameter. It was *319 not necessary for the officer to stand on anything to look through these various spots. When the officer first observed defendant in the washroom he was facing the officer. He had in his arm a brown paper bag and in his hands a wax cellophane bag which was open. Defendant was looking in the latter bag. The officer could see into the bag and observed a leafy substance which in his opinion was marijuana.
The officer came back inside the laundromat and kicked in the door, at which time he observed defendant bending over a wastebasket in the corner. He recovered a cigarette from defendant's lips or mouth, then went through the wastebasket and recovered a brown paper bag that appeared to be the one he had previously observed defendant carrying. The cigarette and the paper bag both contained marijuana. The officer thereupon arrested defendant.
Officer Gastaldo had a conversation with defendant. Officer Allen stated to defendant that Officer Gastaldo had related this conversation to him. Officer Allen stated that Officer Gastaldo had informed him that defendant had said: "...'A chick gave me a number to call if I wanted some stuff.' He stated, 'I called this number this night and I told the fellow I wanted three sacks. He stated that it would cost me $15 per sack and I drove to Burbank and Coldwater Canyon where we made the switch.' Further he stated he asked this person if the stuff was good. He stated at this time that the fellow told him that, 'Here is a cigarette; you smoke it and try it.' He stated. 'I was smoking the cigarette as I drove back towards North Hollywood.' He said, 'Then I came to the laundromat and I decided to go into the laundromat to check and see what kind of stuff I bought.' " Defendant stated this was correct. This statement was made freely and voluntarily.
The defendant did not testify, nor did he offer any evidence in his behalf.
[1a] Defendant's sole contention for reversal is that the contraband obtained by the officer was the product of an illegal search and seizure and therefore inadmissible in evidence.
It will be recalled that Officer Allen observed defendant entering a laundromat at approximately 10:10 p.m. which was located in an area where numerous burglaries of laundromats had occurred; that he was carrying a brown paper bag but he did not have any clothes in his hands. This caused the *320 officer to investigate. He therefore entered the laundromat. He, of course, had a legal right to enter this business establishment without a search warrant. (People v. Roberts, 182 Cal.App.2d 431, 437 [6 Cal.Rptr. 161].) There was nothing illegal about his initial attempt to open the door to the men's restroom. The officer was simply pursuing usual investigative procedure. Finding the door locked, he proceeded on through the building into the outside area. This, of course, violated none of defendant's rights. (People v. Montes, 146 Cal.App.2d 530, 533 [303 P.2d 1064].) The officer then looked through the unpainted portion of the window into the men's restroom where he observed defendant examining a leafy substance which his previous police experience indicated to him was marijuana. It has been repeatedly held that looking through a window does not constitute an unreasonable search. (People v. Martin, 45 Cal.2d 755, 762 [290 P.2d 855]; People v. Hen Chin, 145 Cal.App.2d 583, 586 [303 P.2d 18]; People v. Rayson, 197 Cal.App.2d 33, 39 [17 Cal.Rptr. 243].) Hence this observation of the officer did not violate any of defendant's constitutional rights. Once the officer observed defendant in possession of contraband, it was proper for him to enter and arrest defendant for a felony which was committed in his presence and he was therefore entitled to make the arrest without a warrant. (Pen. Code, 836, sub. 1; People v. Bradley, 152 Cal.App.2d 527, 532 [314 P.2d 108].)
[2] Further, defendant may not complain that the officer entered without a demand or explanation of his purpose since it is probable that if such demand had been made, the incriminating evidence would have been destroyed. (People v. Montano, 184 Cal.App.2d 199, 205 [7 Cal.Rptr. 307].)
[1b] It is therefore apparent that the police officer had sufficient probable cause to enter the restroom and arrest defendant and search the premises and that in so doing, he did not violate any of defendant's constitutional rights against unreasonable search and seizure. The contraband was legally obtained and properly admissible in evidence. (People v. Norton, 209 Cal.App.2d 173 [25 Cal.Rptr. 676]; People v. Young, 214 Cal.App.2d 131 [29 Cal.Rptr. 492].)
Defendant's reliance on Bielicki v. Superior Court, 57 Cal.2d 602 [21 Cal.Rptr. 552, 371 P.2d 288], and Britt v. Superior Court, 58 Cal.2d 469 [24 Cal.Rptr. 849, 374 P.2d 817], is misplaced because the factual situation in the instant *321 case is readily distinguishable from those involved in the cited cases. (See analysis of Bielicki in Norton, supra.)
The judgment (and sentence, which are one and the same) is affirmed.
Ashburn, J., and Herndon, J., concurred.
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601 F.2d 574
Douglasv.U. S.
No. 78-1472
United States Court of Appeals, Third Circuit
7/2/79
1
D.N.J.
AFFIRMED
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478 N.W.2d 635 (1991)
Richard L. DUNTZ, Appellant,
v.
Alicia ZEIMET, Appellee.
No. 91-198.
Supreme Court of Iowa.
December 24, 1991.
David L. Leitner, Des Moines, for appellant.
William G. Brewer, Des Moines, for appellee.
Considered by HARRIS, P.J., and LARSON, CARTER, LAVORATO, and SNELL, JJ.
PER CURIAM.
On July 2, 1989, Richard Duntz and Alicia Zeimet were involved in an automobile accident at an intersection in Des Moines. It was alleged that the accident occurred when Duntz made a left turn across the lane Zeimet was driving. Both parties sustained bodily injuries and property damages. At the time of the accident, Zeimet was not wearing her seat belt.
In January 1990, Duntz filed a petition seeking damages from Zeimet arising out of the accident. Zeimet filed an answer, denying liability. Zeimet also filed a counterclaim claiming that Duntz was negligent and proximately caused the accident.
Before trial, Duntz filed a motion to adjudicate law points. Duntz asked the district court to determine that Iowa Code section 321.445(4) (1989) was unconstitutional as violative of equal protection, due process, and a plaintiff's right to trial by jury. Section 321.445(4) provides, in relevant part, that the failure of a party to wear a safety belt is not evidence of comparative fault but may be considered to reduce the amount of a party's recovery by no more *636 than five percent. The district court found the statute constitutional and denied the motion. The case proceeded to trial. At trial, Zeimet was represented by two attorneys. Over Duntz's objections, the court permitted both attorneys to voir dire potential jurors and to separately address the jury in opening and closing arguments.
Following trial, the jury returned its verdict. The jury found both Duntz and Zeimet fifty percent at fault as to the claims of each party. The jury determined Duntz's damages at $5867. Zeimet's damages were set at $9271.65. The jury then determined that Zeimet's recovery should be reduced by five percent for her failure to wear a seat belt. The district court then entered judgment accordingly. Duntz has filed this appeal.
I. On appeal, Duntz contends that section 321.445(4) deprived him of his right to trial by jury and of the equal protection of the laws. As a result, Duntz argues that the failure to wear a seat belt should be considered as evidence of an unreasonable failure to mitigate damages under comparative fault.
Article one, section nine of the Iowa Constitution provides that "the right of trial by jury shall remain inviolate." In discussing the extent of the right to a jury, this court has held that, "[T]he right to a jury trial preserved by the Iowa Constitution, article I, section 9, is the right that existed at common law." Iowa Nat'l Mut. Ins. Co. v. Mitchell, 305 N.W.2d 724, 728 (Iowa 1981). In determining that damage limits in medical malpractice cases were unconstitutional, the Kansas Supreme Court noted that, "Common law allows for the recovery of damages for negligent injury..., and therefore the right to jury trial applies here. Kansas cases hold that the right to a jury trial includes the right to have a jury determine damages." Kansas Malpractice Victims v. Bell, 243 Kan. 333, 342, 757 P.2d 251, 258 (1988). Here, though, the question is whether the failure to wear a seat belt would be considered a failure to mitigate damages at common law.
Recently, this court concluded that the nonuse of a helmet by a moped or motorcycle operator did not constitute a failure to mitigate damages. Meyer v. City of Des Moines, 475 N.W.2d 181 (Iowa 1991). The court analyzed the question by considering whether there was a duty at common law to use such a helmet. Id. at 187. The court noted that several jurisdictions have found the doctrine of mitigation of damages inapplicable in seat belt and helmet cases since the nonuse of the safety device occurred before the negligent act of the defendant. Id. at 188. See also Tanberg v. Ackerman Invest. Co., 473 N.W.2d 193 (Iowa 1991). This court then concluded that the use of a helmet was a question for the legislature and not a duty under common law. Meyer, 475 N.W.2d at 191.
We find Meyer persuasive in considering whether the duty to wear a seat belt would exist under the common law. The fact that the legislature has required the use of seat belts under Iowa Code section 321.445 does not establish a common law duty. Mitchell, 305 N.W.2d at 728. We find that the duty to wear a seat belt did not arise at common law. Welsh v. Anderson, 228 Neb. 79, 421 N.W.2d 426 (1988). We conclude, therefore, that Iowa Code section 321.445(4) does not violate the constitutional right to a jury trial.
II. Duntz also contends that section 321.445(4) deprives him of the equal protection of the laws by not permitting him to argue that Zeimet's failure to wear a seat belt constituted an unreasonable failure to mitigate. We disagree. In scrutinizing the constitutionality of section 321.445(4), we apply a "rational basis" analysis, there being no claim that the statutory classification in question is suspect or involves fundamental rights. Bennett v. City of Redfield, 446 N.W.2d 467 (Iowa 1989). As long as the statutory classification is not patently arbitrary and bears a rational relationship to a legitimate governmental interest, Duntz's constitutional objections must fail. Id. Here, the adoption of a penalty in the form of a percentage reduction of recovery arising from the nonuse of safety belts is clearly consistent with the stated public purpose of the seat belt statute; namely, reducing the public *637 costs associated with serious injuries and deaths caused by automobile accidents. State v. Hartog, 440 N.W.2d 852, 858 (Iowa 1989). That the legislature did not go as far as Duntz desires concerning the penalty for nonuse of safety belts does not make the classification arbitrary. In fact, this court has stated that, "... without the five percent limitation in section 321.445(4)(b)(2), evidence of nonuse could actually prevent an otherwise innocent plaintiff from recovering anything." Meyer, 475 N.W.2d at 190. Thus, the five percent limitation reduces the chances of an unfair result under our comparative fault statute. Id. at 190. We conclude that the statutory five percent limitation is not arbitrary but bears a rational relationship to a legitimate governmental interest and therefore does not offend equal protection.
III. Finally, Duntz contends that the district court erred in permitting both of Zeimet's attorneys to separately voir dire potential jurors and to address the jury. We find these assignments of error without merit and the district court's rulings well within its discretion.
IV. Accordingly, we affirm the judgment of the district court in its entirety.
AFFIRMED.
All Justices concur except LARSON, J., who dissents.
LARSON, Justice (dissenting).
I believe that the arbitrary limitation of five percent imposed by Iowa Code section 321.445(4)(b)(2) on the mitigation of damages that may be charged for failure to wear a seat belt unconstitutionally infringes on a defendant's right to a trial on that issue.
The law has always required that a person act responsibly with respect to his or her own safety, and the party failing to do so ordinarily suffers the monetary consequences. It should make no difference whether the negligence is based on a failure to follow traditional standards of due care, such as observing rules of the road, or in spurning the use of self-protective devices such as seat belts. In the traditional case, a negligent defendant pays damages, or a plaintiff suffers a reduction of his recovery, according to the actual amount of negligence chargeable to that party.
Despite these general rules, the legislature has declared that a negligent failure to use self-protective devices such as seat belts should be treated differently, although in many cases nearly all of the injuries are directly caused by the failure to wear seat belts.
Although no Iowa cases have addressed the question, I believe our common law would grant the right to a defendant to prove the true extent of a plaintiff's negligence based on a failure to wear seat belts as required by law and to obtain a corresponding reduction of damages.
Section 321.445(4)(b)(2), which seriously abridges that right, should be viewed as an unconstitutional impairment of a defendant's right to trial on that issue. See Iowa Nat'l Mut. Ins. Co. v. Mitchell, 305 N.W.2d 724, 728 (Iowa 1981).
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51 Wn.2d 149 (1957)
316 P.2d 462
FRANCES TRAVERSO, Respondent,
v.
DONALD R. PUPO et al., Appellants.[1]
No. 34301.
The Supreme Court of Washington, Department Two.
October 17, 1957.
*150 Morrissey, Hedrick & Dunham and John E. Hedrick, for appellants.
Chavelle & Millard and Howard P. Pruzan, for respondent.
OTT, J.
Donald R. Pupo and his wife are the owners and operators of a restaurant. Frances Traverso, a divorcee, was employed elsewhere as a waitress in a cocktail lounge. Mr. Pupo became acquainted with her on an occasion when he was a patron in the lounge. Thereafter, over an extended period of time, they met after her working hours and partook of coffee, drinks, or dinner at various places.
January 19, 1956, Pupo arranged for a dinner engagement with Mrs. Traverso. He met her at her home about nine p.m., and they drove to several cocktail lounges. They drank intoxicating liquor at each such place, but did not eat any food. At approximately three a.m., they left the Stork Club and, while driving to Mrs. Traverso's home, the automobile struck a concrete traffic island. Mrs. Traverso was seriously injured.
She commenced this action for damages against Pupo and his wife, alleging that Pupo was negligent while operating the automobile, and that she was an occupant of the automobile because Pupo was attempting to persuade her to accept employment in his restaurant. Pupo answered, denying the allegations of negligence and alleging that Mrs. Traverso was driving the automobile at the time of the accident; that her damages were the result of her own negligence, and that she was an invited guest in his automobile and was guilty of contributory negligence.
The cause was tried to a jury. Mrs. Traverso testified that the venture that evening was solely for business, while Pupo contended that it was for sociability and friendship. Pupo testified that Mrs. Traverso was driving his automobile at the time of the accident. Two witnesses who saw the *151 automobile in operation only seconds before the accident stated that a man was driving the car. The investigating police officers, who were present shortly after the accident, testified that they found Mrs. Traverso lying unconscious on the floor in front of the front seat; that the right-front door was crushed so that it could not be manually opened, and that the left-front door was open and Pupo was sitting on the pavement, leaning against the left-front fender of the automobile. Mrs. Traverso testified that, as a result of the impact, she suffered retrograde amnesia and could not remember anything that happened that evening after they visited the first cocktail lounge.
There was no testimony by any witness that Pupo appeared to be intoxicated or affected by the use of intoxicating liquor. In his pretrial deposition, Pupo stated that he "wasn't drunk ... I was capable of driving the car." At the trial, he testified that, although he was not intoxicated, he felt that he should not drive the automobile. The determination of the weight to be given his testimony was for the jury.
The jury were instructed upon the several theories and defenses. No error is assigned to any of the instructions. The jury returned a verdict for the plaintiff. The defendants have appealed.
Donald R. Pupo will be referred to herein as though he were the sole appellant. He assigns as error the denial of his motions for judgment notwithstanding the verdict, for a directed verdict, and for nonsuit at the close of all of the evidence.
[1] In moving for nonsuit, for a directed verdict, and for judgment notwithstanding the verdict, the moving party admits the truth of the evidence of the party against whom the motions are made and all inferences that reasonably can be drawn therefrom. Such motions require that the evidence be interpreted most strongly against the moving party and in the light most favorable to the opposing party. Fink v. Dixon, 46 Wn. (2d) 794, 796, 285 P. (2d) 557 (1955). The record before us sustains the trial court's determination *152 that there was sufficient evidence, under the rule, to submit this case to the jury.
Was there sufficient evidence to sustain the verdict?
[2] The court instructed the jury that, if they found from the evidence that the respondent was driving the car at the time of the accident, their verdict must be for the appellant. The court instructed further on the application of the host-guest statute. It is presumed that the jury followed the court's instructions. State v. Kelsey, 46 Wn. (2d) 617, 625, 283 P. (2d) 982 (1955).
We must therefore conclude that, applying the instructions to the evidence, the jury determined (1) that the respondent was not driving the automobile, and (2) that the respondent was not a guest. The jury accepted the testimony of the respondent that Pupo's purpose in entertaining her that evening was to persuade her to accept employment in his restaurant (a business venture). Where, as here, the evidence on this issue was denied and was in sharp conflict, the factual determination was within the sole province of the jury.
Appellant contends that, assuming that a business relationship was proved, nevertheless the respondent was guilty of contributory negligence when she voluntarily rode in appellant's automobile, with knowledge that he had recently consumed intoxicating liquor. In support of this contention, appellant cites Taylor v. Taug, 17 Wn. (2d) 533, 136 P. (2d) 176 (1943). In the Taylor case, the statutory host-guest relationship was found to have existed at the time the guest entered the automobile and to have continued to the end of the trip. We held, in that case, that the guest was precluded from recovery, since there was no showing of intentional injury. Although there was reference to the use of intoxicating liquor by the driver of the automobile, such conduct on the part of the driver was not essential to the court's determination of liability, under the statute there in question. The cited case does not support appellant's contention.
Where no host-guest relationship exists, is one guilty of *153 contributory negligence by riding with a driver who has recently consumed intoxicating liquor?
The trial court's instruction No. 9 reads as follows:
"If you find by a fair preponderance of the evidence that at the time plaintiff [respondent] and defendant [appellant] left the Stork Club the defendant was under the influence of or affected by intoxicating liquor; and if you find that plaintiff actually knew, or in the exercise of reasonable care should have known, of such condition, if any; and if you find that thereafter plaintiff voluntarily rode in defendant's car with defendant driving; and if you further find that a person exercising reasonable care would not have done so; and that plaintiff suffered injury as a proximate result of such condition, if any, of the driver, then you will find plaintiff guilty of contributory negligence."
[3] No error was assigned to this instruction. It therefore became the law of the case. Cline v. Department of Labor & Industries, 50 Wn. (2d) 614, 616, 313 P. (2d) 687 (1957); Becker v. Tacoma Transit Co., 50 Wn. (2d) 688, 694, 314 P. (2d) 638 (1957). The instruction is a proper statement of the applicable law. See Wayson v. Rainier Taxi Co., 136 Wash. 274, 239 Pac. 559, 45 A.L.R. 290 (1925).
The jury found, from the evidence, that contributory negligence had not been proved when they returned a verdict for the respondent.
[4] We find no merit in appellant's contention that contributory negligence should have been determined by the court, as a matter of law, for the reason that the evidence with reference to it was such that the minds of reasonable men might differ with reference thereto. French v. Chase, 48 Wn. (2d) 825, 831, 297 P. (2d) 235 (1956); Becker v. Tacoma Transit Co., supra, p. 695.
The judgment is affirmed.
HILL, C.J., DONWORTH, ROSELLINI, and FOSTER, JJ., concur.
NOTES
[1] Reported in 316 P. (2d) 462.
| {
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} |
Filed 10/31/18
CERTIFIED FOR PUBLICATION
IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA
SECOND APPELLATE DISTRICT
DIVISION FIVE
TERRI BROWN, B278911
Plaintiff and Appellant, (Los Angeles County
Super. Ct. No. BC423782)
v.
RALPHS GROCERY COMPANY et al.,
Defendants and Respondents.
APPEAL from a judgment of the Superior Court of Los
Angeles County, Richard E. Rico, Judge. Reversed and remanded
with directions.
Capstone Law, Glenn A. Danas, Melissa Grant, Liana
Carter and Arnab Banerjee for Plaintiff and Appellant.
Reed Smith, Linda S. Husar, Mara D. Curtis and Kasey J.
Curtis for Defendants and Respondents.
I. INTRODUCTION
Plaintiff Terri Brown brought a representative action
against her employer, Ralphs Grocery Company (Ralphs), and its
parent company, The Kroger Co. (collectively defendants), under
the Private Attorneys General Act of 2004 (PAGA; Lab. Code,
§ 2698, et seq.), alleging wage and hour violations. In 2009,
plaintiff filed with the California Labor and Workforce
Development Agency (LWDA) a notice of alleged Labor Code
violations, as required under Labor Code section 2699.3,
subdivision (a) as a condition of filing a PAGA action, and filed
her complaint in this action alleging PAGA claims. Thereafter,
plaintiff filed a second amended complaint alleging new
violations of different Labor Code provisions not specified in her
2009 notice.
Defendants moved for judgment on the pleadings arguing
the 2009 notice was deficient, which the trial court granted with
leave to amend the notice and the complaint. In March 2016,
plaintiff amended her notice and filed a third amended
complaint.
Defendants demurred to the third amended complaint,
which was sustained by the trial court. The trial court held that
the PAGA claims were barred because the 2009 notice was
deficient and the 2016 notice and third amended complaint were
filed more than five years after the expiration of the statute of
limitations. The trial court rejected plaintiff’s contention that
equitable tolling saved the PAGA claims.
We conclude part of plaintiff’s 2009 notice was adequate
and satisfied the PAGA notice requirements under Labor Code
section 2699.3, subdivision (a), and part was not and did not. We
2
also conclude plaintiff’s later-added PAGA claims for violations of
Labor Code provisions not alleged in the 2009 notice did not
timely comply with section 2699.3’s notice requirements and are
time-barred. Furthermore, the deficient claims and later-added
claims are not saved by equitable tolling, the relation back
doctrine, judicial estoppel, or waiver, except to the extent the
later-added claims may relate back to the PAGA claim
adequately and timely noticed in 2009. We reverse the judgment
and remand with directions.
II. FACTUAL AND PROCEDURAL BACKGROUND
Plaintiff was employed by Ralphs as an hourly, nonexempt
security guard at two distribution centers from October 2005 to
December 2009. She worked eight hours or more a day and 40
hours or more per week.
On October 12, 2009, she sent two two-page letters to the
LWDA and defendants alleging violations of Labor Code 1 sections
204, 226, subdivision (a), 226.7, and 512 (2009 Notice). The 2009
Notice identified defendants as her employer, defendants’
addresses, and plaintiff’s job as an hourly-paid security guard in
Los Angeles County. The 2009 Notice alleged defendants had
violated sections 226.7 and 512 because “[plaintiff] and other
aggrieved employees did not take all meal and rest periods and
were not properly compensated for missed meal and rest periods.”
The 2009 Notice alleged defendants had violated section 204
because they “failed to pay [plaintiff] and other aggrieved
1 Further statutory references are to the Labor Code unless
otherwise indicated.
3
employees all wages due to them within any time period specified
by California Labor Code section 204.” And it alleged defendants
had violated section 226, subdivision (a) by not providing
“[plaintiff ]and other aggrieved employees with proper itemized
wage statements” because, among other things, the wage
statements failed “to include the name and address of the legal
entity that is the employer.”
Two days later on October 14, 2009, plaintiff filed a class
action and PAGA representative action against defendants. The
complaint alleged defendants violated sections 226.7 and 512 by
requiring plaintiff to work through meal and rest periods without
compensation, violated section 204 by failing to pay plaintiff the
full wages due within the required time period, and violated
section 226, subdivision (a) by failing to provide complete and
accurate wage statements, including by not listing the legal name
and address of the employer. In addition, plaintiff advanced a
Business and Professions Code section 17200 cause of action.
On November 30, 2009, plaintiff filed a first amended
complaint alleging the same causes of action and adding an
allegation that she had satisfied the administrative prerequisites
under section 2699.3, subdivision (a) by sending the 2009 Notice.
She alleged that more than 33 days had passed since she sent the
2009 Notice and the LWDA had not provided any response. On
December 8, 2009, the LWDA advised plaintiff and defendants
that it had received the 2009 Notice and did not intend to
investigate the allegations.
On approximately December 11, 2009, plaintiff’s
employment with defendants was terminated.
Rather than answer or demur, on January 6, 2010, Ralphs
filed a petition to compel arbitration. The trial court concluded
4
the class action and PAGA waivers were substantively
unconscionable and denied the petition. On July 12, 2011, we
reversed the trial court’s ruling invalidating the class action
waiver because plaintiff’s opposition to the petition had not made
the necessary factual showing under the test in Gentry v.
Superior Court (2007) 42 Cal.4th 443, 446. (Brown v. Ralphs
Grocery Co. (2011) 197 Cal.App.4th 489, 497.) But we affirmed
the ruling that the PAGA waiver was substantively
unconscionable and held PAGA was not preempted by the
Federal Arbitration Act. (197 Cal.App.4th at pp. 500-503.) We
reversed and remanded for a determination whether the PAGA
waiver provision could be severed from the arbitration
agreement. (Id. at p. 504.) Defendants’ petition for review by our
Supreme Court was denied on October 19, 2011. (Id. at p. 510.)
Defendants’ petition for certiorari to the United States Supreme
Court was denied on April 16, 2012. (Ralphs Grocery Co. v.
Brown (2012) 566 U.S. 937.)
On May 2, 2012, the trial court severed the PAGA waiver
provision from the arbitration agreement, granted Ralphs’s
request to arbitrate the non-PAGA claims on an individual basis,
and stayed the PAGA claims until completion of the arbitration.
Shortly thereafter, plaintiff decided not to pursue her individual
claims in arbitration and instead to amend her complaint to drop
her individual claims and proceed only on her PAGA claims.
On September 21, 2012, plaintiff moved for leave to file her
second amended complaint. The proposed second amended
complaint no longer alleged class and individual causes of action.
It included the PAGA claims for violations of sections 204, 226,
subdivision (a), 226.7, and 512 from the first amended complaint,
and it added new PAGA claims. The new claims alleged
5
violations of sections 201, 202, and 203 by not paying plaintiff
and other aggrieved employees within the statutory time period
after terminating their employment, and violations of section
1198 by failing to provide meal and rest periods, timely paid
wages, and accurate employment records. The proposed second
amended complaint also sought civil penalties under section 558
for the Labor Code violations.
Defendants filed an opposition to plaintiff’s motion on
procedural grounds. They argued the proper course was to allow
plaintiff to dismiss the non-PAGA causes of action from the first
amended complaint and lift the stay on the PAGA claims.
Defendants did not challenge the substance of the proposed
second amended complaint and did not argue that the PAGA
claims were based on inadequate notice or time-barred.
On October 16, 2012, the trial court granted plaintiff’s
motion for leave to file the second amended complaint “on the
grounds that Defendants essentially do not oppose this motion
and will not suffer any prejudice by the proposed amendments.”
Defendants were ordered to file their answer by November 15,
2012.
Defendants elected instead to renew their petition to
compel arbitration pursuant to Code of Civil Procedure section
1008, subdivision (b) based on new decisions from various
California and federal courts. The trial court denied the motion,
and we dismissed defendants’ appeal because an order denying a
renewed motion under Code of Civil Procedure section 1008,
subdivision (b) is not appealable. (Brown v. Ralphs Grocery Co.
(Mar. 6, 2014, B247297) [nonpub. opn.].)
On January 20, 2016, defendants filed a motion for
judgment on the pleadings challenging the second amended
6
complaint. For the first time, defendants argued that the 2009
Notice was inadequate. Specifically, defendants asserted: (1) the
2009 Notice did not mention violations of sections 201, 202, 203,
558, and 1198, which were alleged in the second amended
complaint but not the earlier complaints, and (2) the 2009 Notice
did not sufficiently allege the facts and theories supporting the
alleged violations of sections 204, 226, subdivision (a), 226.7, and
512. Plaintiff countered that the 2009 Notice was sufficient, and
if it was not, she should be granted leave to amend because
equitable tolling and the relation back doctrine saved her claims
from the statute of limitations.
On March 11, 2016, the trial court granted defendants’
motion with leave to amend. The trial court held that the 2009
Notice was inadequate because it did not refer to sections 201,
202, 558, or 1198 (the trial court did not mention section 203),
and the second amended complaint introduced new theories of
liability such as the failure to pay wages at discharge. At the
hearing, the trial court stated several times that it was allowing
the amended complaint without ruling on the arguments raised
in defendants’ motion and that defendants could raise those
issues after the third amended complaint was on file. The trial
court also allowed plaintiff to amend her 2009 Notice.
On March 24, 2016, plaintiff sent two nine-page letters to
the LWDA and defendants alleging in more detail violations of
the Labor Code (2016 Notice). The 2016 Notice alleged
defendants required aggrieved employees to sign invalid on-duty
meal agreements, did not permit rest periods, and did not pay
meal and rest period premiums in violation of sections 226.7 and
512, subdivision (a). Defendants allegedly failed to give plaintiff
and aggrieved employees properly itemized wage statements by
7
not listing the name and address of the employer’s legal entity
and the net wages earned, in violation of section 226, subdivision
(a). Plaintiff alleged defendants did not maintain accurate
payroll records in violation of section 1174, subdivision (d), and
did not keep records of meal periods in violation of section 1198.
Defendants allegedly failed to pay all wages due, including meal
and rest period premium wages, in violation of section 204.
Plaintiff also asserted violations of sections 201, 202, and 203 for
failing to timely pay discharged employees their final wages and
to pay former employees all their earned wages. Plaintiff sought
civil penalties under section 558 for the violations.
On March 25, 2016, plaintiff filed a third amended
complaint. She alleged defendants did not: provide meal and rest
periods (§§ 226.7, 512, subd. (a), 1198); provide and maintain
compliant wage statements (§§ 226, subd. (a), 1174, subd. (d),
1198); pay wages during employment (§ 204); and pay wages
upon termination (§§ 201, 202, 203). The third amended
complaint was the first pleading to reference section 1174,
subdivision (d). On July 14, 2016, defendants filed a demurrer to
the third amended complaint, contending the 2016 Notice was too
late and the PAGA claims were time-barred.
On August 8, 2016, the trial court sustained the demurrer
without leave to amend. The trial court held the 2009 Notice was
deficient because it did not allege “facts and theories” to support
the alleged violations and did not include violations of the Labor
Code provisions plaintiff had added to later complaints, such as
violations of sections 201, 202, 558, and 1198. Although the trial
court ruled plaintiff could amend the 2009 Notice as she had done
with the 2016 Notice, the court concluded that any claim based
on the 2016 Notice was barred by PAGA’s one-year statute of
8
limitations. Because plaintiff’s last day as an employee was
December 10, 2009, plaintiff needed to file her notice by
December 10, 2010 at the latest. The 2016 Notice, filed on
March 4, 2016, was more than five years too late. The trial court
rejected plaintiff’s contention that the doctrine of equitable
tolling applied because plaintiff had added new factual
allegations and Labor Code violations not referenced in the
original complaint and 2009 Notice, and plaintiff failed to
demonstrate a lack of prejudice to defendants. The trial court
declined to address the relation back doctrine because it found
equitable tolling did not apply to expand plaintiff’s PAGA claims.
The trial court thereafter entered judgment in favor of
defendants, and plaintiff appealed.
III. DISCUSSION
A. Standards of Review
On appeal from a judgment based on an order sustaining a
demurrer, we assume all facts alleged in the complaint are true.
(Pineda v. Williams-Sonoma Stores, Inc. (2011) 51 Cal.4th 524,
528; Sheehan v. San Francisco 49ers, Ltd. (2009) 45 Cal.4th 992,
998.) We accept all properly pleaded material facts but not
contentions, deductions, or conclusions of fact or law. (Winn v.
Pioneer Medical Group, Inc. (2016) 63 Cal.4th 148, 152.) We read
the complaint as a whole and its parts in their context to give the
complaint a reasonable interpretation. (Evans v. City of Berkeley
(2006) 38 Cal.4th 1, 6; Blank v. Kirwan (1985) 39 Cal.3d 311,
318.) Likewise, we independently review a trial court’s order on
9
a motion for judgment on the pleadings. 2 (Jacks v. City of Santa
Barbara (2017) 3 Cal.5th 248, 273; People ex rel. Harris v. Pac
Anchor Transportation, Inc. (2014) 59 Cal.4th 772, 777 [“‘A
motion for judgment on the pleadings is equivalent to a demurrer
and is governed by the same de novo standard of review’”].)
The decision to deny leave to amend is reviewed for abuse
of discretion. (Aubry v. Tri-City Hospital Dist. (1992) 2 Cal.4th
962, 967.) “[I]t is an abuse of discretion to sustain a demurrer
without leave to amend if the plaintiff shows there is a
reasonable possibility any defect identified by the defendant can
be cured by amendment.” (Ibid.)
B. The Notice Requirements of Section 2699.3, Subdivision (a)
PAGA was enacted to remedy systemic under-enforcement
of worker protections. (Williams v. Superior Court (2017) 3
Cal.5th 531, 545 (Williams).) To address this problem, the
Legislature adopted civil penalties for “provisions that lacked
existing noncriminal sanctions” and deputized “employees
harmed by labor violations to sue on behalf of the state and
collect penalties, to be shared with the state and other affected
employees.” (Ibid.) Of the civil penalties recovered, LDWA
receives 75 percent, leaving 25 percent for “aggrieved employees.”
(§ 2699, subd. (i); Iskanian v. CLS Transportation Los Angeles,
LLC (2014) 59 Cal.4th 348, 380.)
An aggrieved employee may bring a representative action
for wage and hour violations, including for violations of the Labor
2 Plaintiff contends the trial court’s demurrer ruling was a
“continuation” of its ruling on the motion for judgment on the
pleadings.
10
Code provisions listed in section 2699.5. (§§ 2699, subd. (a) &
2699.3, subd. (a); Munoz v. Chipotle Mexican Grill, Inc. (2015)
238 Cal.App.4th 291, 310.) But “[b]efore bringing a civil action
for statutory penalties, an employee must comply with Labor
Code section 2699.3. ([] § 2699, subd. (a).)” (Arias v. Superior
Court (2009) 46 Cal.4th 969, 981 (Arias); see also § 2699.5
[requiring compliance with § 2699.3, subd. (a), for violations of
§§ 201, 202, 203, 204, 226, subd. (a), 226.7, 512, 1174, subd. (d),
and 1198, among other sections].)
Section 2699.3, subdivision (a)(1) “requires the employee to
give written notice of the alleged Labor Code violation to both the
employer and the [LWDA], and the notice must describe facts and
theories supporting the violation.” 3 (Arias, supra, 46 Cal.4th at
p. 981.) Then, “[i]f the agency notifies the employee and the
employer that it does not intend to investigate . . . , or if the
agency fails to respond within 33 days, the employee may then
bring a civil action against the employer.” 4 (Ibid.) If the plaintiff
3 Section 2699.3, subdivision (a)(1)(A) currently states: “The
aggrieved employee or representative shall give written notice by
online filing with the Labor and Workforce Development Agency
and by certified mail to the employer of the specific provisions of
this code alleged to have been violated, including the facts and
theories to support the alleged violation.” The prior version of
this subdivision in effect when plaintiff gave notice did not
require online filing and was differently numbered but otherwise
identical.
4 After the time period relevant here, the section was revised
so that after June 26, 2016, the agency has 60 days to respond to
a notice, and the plaintiff may commence a civil action if the
agency does not respond within 65 days. (§ 2699.3, subd.
(a)(2)(A).)
11
has an action pending, the plaintiff “may as a matter of right
amend an existing complaint to add a cause of action arising
under [PAGA]” within 60 days. (§ 2699.3, subd. (a)(2)(C).) The
periods specified in section 2699.3 “are not counted as part of the
time limited for the commencement of the civil action to recover
penalties” under PAGA. (§ 2699.3, subd. (d).) Proper notice
under section 2699.3 is a “condition” of a PAGA lawsuit.
(Williams, supra, 3 Cal.5th at p. 545; Caliber Bodyworks, Inc. v.
Superior Court (2005) 134 Cal.App.4th 365, 371, 376 (Caliber).)
Plaintiff contends that the trial court erroneously
concluded that the 2009 Notice was deficient under section
2699.3, subdivision (a). In its decision granting defendants’
motion for judgment on the pleadings following the second
amended complaint and its decision sustaining defendant’s
demurrer to the third amended complaint, the trial court found
the 2009 Notice deficient for two reasons. The trial court
concluded the notice did not sufficiently allege “facts and
theories” to support the violations claimed in the first amended
complaint (i.e., violations of sections 204, 226, subdivision (a),
226.7, and 512) and did not refer to violations of Labor Code
statutes that plaintiff later alleged in the second and third
amended complaints (i.e., violations of sections 201, 202, 203,
558, 1174, subdivision (d), and 1198). 5 We agree in part. After
5 The trial court also held that the 2009 Notice was deficient
because plaintiff did not identify the other “aggrieved employees.”
PAGA defines “aggrieved employee” as “any person who was
employed by the alleged violator and against whom one or more
of the alleged violations was committed.” (§ 2699, subd. (c).) We
can infer from the 2009 Notice that the other “aggrieved
employees” are non-exempted, hourly-paid workers employed by
defendants and against whom defendants committed the alleged
12
the trial court’s rulings, our Supreme Court issued its decision in
Williams. The Supreme Court identified “the clear legislative
purposes [PAGA] was designed to serve,” namely “to advance the
state’s public policy of affording employees workplaces free of
Labor Code violations, notwithstanding the inability of state
agencies to monitor every employer or industry” and “to
remediate present violations and deter future ones.” (3 Cal.5th
at p. 546.)
In the context of deciding whether a PAGA plaintiff must
have “some modicum of substantial proof before proceeding with
discovery,” the Supreme Court addressed the PAGA notice
requirement: “Nothing in . . . section 2699.3, subdivision
(a)(1)(A), indicates the ‘facts and theories’ provided in support of
‘alleged’ violations must satisfy a particular threshold of
weightiness, beyond the requirements of nonfrivolousness
generally applicable to any civil filing. (See Code Civ. Proc.,
§ 128.7.) The evident purpose of the notice requirement is to
afford the relevant state agency, the [LWDA], the opportunity to
decide whether to allocate scarce resources to an investigation, a
decision better made with knowledge of the allegations an
aggrieved employee is making and any basis for those
allegations. Notice to the employer serves the purpose of
allowing the employer to submit a response to the agency (see []
§ 2699.3, subd. (a)(1)(B)), again thereby promoting an informed
agency decision as to whether to allocate resources toward an
investigation. Neither purpose depends on requiring employees
to submit only allegations that can already be backed by some
particular quantum of admissible proof.” (Williams, supra, 3
Labor Code violations. We conclude the 2009 Notice sufficiently
identified the other aggrieved employees.
13
Cal.5th at pp. 545-546; see also Caliber, supra, 134 Cal.App.4th
at p. 375 [notice provision intended to “‘allow[] the [LWDA] to act
first on more “serious” violations such as wage and hour
violations and give employers an opportunity to cure less serious
violations’”].)
The Supreme Court in Williams recognized the distinction
in the notice provision between the alleged violation (i.e., “the
allegations an aggrieved employee is making”) and the facts and
theories to support the alleged violation (i.e., “any basis for those
allegations”). (3 Cal.5th at p. 546.) Federal court decisions also
recognize that the notice provision requires something more than
bare allegations of a Labor Code violation. In Alcantar v. Hobart
Service (9th Cir. 2015) 800 F.3d 1047 (Alcantar), the court held
the plaintiff’s notice was “a string of legal conclusions with no
factual allegations or theories of liability to support them.” (Id.
at p. 1057.) The notice identified plaintiff’s employer and stated
the employer “(1) failed to pay wages for all time worked; (2)
failed to pay overtime wages for overtime worked; (3) failed to
include the extra compensation required by . . . section 1194 in
the regular rate of pay when computing overtime compensation,
thereby failing to pay Plaintiff and those who earned additional
compensation for all overtime wages due;” and so on. (Ibid.) The
court reasoned these bare allegations were insufficient because
they simply paraphrased the allegedly violated statutes. (Ibid.
[“The only facts or theories that could be read into this letter are
those implied by the claimed violations of specific sections of the
California Labor Code”].) The notice did not allow the LWDA “to
intelligently assess the seriousness of the alleged violations” or
give the employer enough information “to determine what
policies or practices are being complained of so as to know
14
whether to fold or fight.” (Id. at p. 1057; see, e.g., Green v. Bank
of America, N.A. (9th Cir. 2015) 634 Fed.Appx. 188, 191 [notice
stating “plaintiffs could use a seat in their position” was
sufficient for “simple seating claim”]; Moua v. International
Business Machines Corp. (N.D.Cal. Jan. 31, 2012, No. 5:10-cv-
01070 EJD) 2012 WL 370570, at *5 [notice “identifies at least
some alleged facts and theories”]; Mireles v. Paragon Systems,
Inc. (S.D.Cal. Feb. 9, 2016, No. 13-cv-00122-L-BGS) 2016 WL
7634439, at *5 [notice reciting elements from the Labor Code and
a Wage Order and alleging a violation of § 226.7 “fails to provide
any facts, not implied by reference to the Labor Code or Wage
Order, as to how [the] defendant violated [] § 226.7”]; Cardenas v.
McLane Foodservices, Inc. (C.D.Cal. 2011) 796 F.Supp.2d 1246,
1260 [“the plain meaning” of the phrase “facts and theories to
support the alleged violation” “suggests that [the p]laintiffs were
required to put forward sufficient facts to support their claims of
labor violations”].)
The 2009 Notice suffers from the same defect as in
Alcantar. It stated plaintiff was an hourly-paid security guard
employed by defendants at Los Angeles County business
locations. Plaintiff alleged she and other aggrieved employees
“did not take all meal and rest periods and were not properly
compensated for missed meal and rest periods” in violation of
sections 226.7 and 512. She claimed defendants “failed to pay
[her] and other aggrieved employees all wages due to them
within any time period specified by California Labor Code section
204.” Plaintiff alleged that defendants “did not provide [her] and
other aggrieved employees with proper itemized wage
statements” as required by section 226, subdivision (a), including
by failing “to include the name and address of the legal entity
15
that is the employer.” These allegations identified “the specific
provisions” of the Labor Code alleged to have been violated, as
required by section 2699.3, subdivision (a)(1)(A). But with one
exception, the 2009 Notice was a string of legal conclusions that
parroted the allegedly violated Labor Code provisions. It did not
state facts and theories supporting the alleged violations not
implied by reference to the Labor Code. The notice did not give
sufficient information for the LWDA to assess the seriousness of
the alleged violations and decide whether to allocate scarce
resources to an investigation, or for defendants to determine
what policies or practices were being complained of, have an
opportunity to cure the violations, and prepare a meaningful
response.
The one exception is the allegation of violations of section
226, subdivision (a), requiring employers to maintain accurate
and complete wage statements. That allegation adds: “The
violations include, without limitation, the failure to include the
name and address of the legal entity that is the employer.” This
minimal fact supports the alleged violation, making the 2009
Notice adequate for the alleged violation of section 226,
subdivision (a).
The second and third amended complaints also included
allegations based on Labor Code provisions that plaintiff did not
specify in the 2009 Notice and did not include in the first
amended complaint, namely sections 201, 202, 203, 558, 1174,
subdivision (d), and 1198. Section 2699.3, subdivision (a)
requires a plaintiff to give notice of “the specific provisions of this
code alleged to have been violated” as a condition of filing suit.
Plaintiff did not do that in the 2009 Notice for the alleged
violations of sections 201, 202, 203, 1174, subdivision (d), and
16
1198, making the 2009 Notice deficient as to claims based on
those sections.
Section 558 is different. That provision sets forth a remedy
—a civil penalty—for certain Labor Code violations and
violations of Industrial Welfare Commission orders. (§ 558, subd.
(a); Thurman v. Bayshore Transit Management, Inc. (2012) 203
Cal.App.4th 1112, 1147 [§ 558 provides a remedy in the form of a
civil penalty].) An employee wishing to assert a PAGA claim
would need to allege an underlying violation for which section
558 provides the remedy. Section 558, therefore, is not the type
of provision to be specified in a PAGA notice. This is confirmed
by section 2699.5, listing the Labor Code provisions subject to the
notice requirement of section 2699.3, subdivision (a). (§ 2699.5
[“The provisions of subdivision (a) of [s]ection 2699.3 apply to any
alleged violation of the following provisions”].) The long list of
provisions does not include section 558. (Ibid.) And, indeed, the
second and third amended complaints do not allege violations of
section 558 but seek penalties under that section for violations of
other Labor Code provisions.
In sum, the 2009 Notice adequately alleged a violation of
section 226, subdivision (a), but not violations of sections 204,
226.7 and 512. The 2009 Notice cannot serve as notice of alleged
violations of sections 201, 202, 203, 1174, subdivision (d), and
1198. The plaintiff did not need to specify section 558 in her
PAGA notice and can proceed with a claim for remedies under
that section so long as she gave adequate notice of a violation for
which section 558 provides a remedy.
17
C. The Statute of Limitations for PAGA Claims
Because the 2009 Notice did not specify violations of
sections 201, 202, 203, 1174, subdivision (d), and 1198, plaintiff
filed her second amended complaint adding claims under those
sections before satisfying the notice condition of section 2699.3,
subdivision (a). Plaintiff contends she remedied that deficiency
with her 2016 Notice. Although a plaintiff may seek to amend an
existing complaint after complying with the requirements of
section 2699.3, subdivision (a) (Caliber, supra, 134 Cal.App.4th at
p. 385, fn. 19), by the time of the 2016 Notice, it was far too late
for plaintiff to give notice of the alleged violations and to amend
her complaint based on the 2016 Notice.
The statute of limitations for PAGA claims is one year.
(Code Civ. Proc., § 340, subd. (a).) At the time of plaintiff’s
notices, section 2699.3 gave the agency 33 days to respond to a
notice. (Former § 2699.3, subd. (a)(2)(A); Arias, supra, 46 Cal.4th
at p. 981.) Section 2699.3 also allowed plaintiff to amend her
existing complaint to add a PAGA cause of action within 60 days
of that 33-day period. (§ 2699.3, subd. (a)(2)(C).) The 33-day and
60-day periods were in addition to the one-year statute of
limitations. (§ 2699.3, subds. (a)(2)(C) & (d).)
Because plaintiff’s employment terminated in December
2009, to timely pursue PAGA claims for alleged violations
occurring during her employment or upon her discharge, plaintiff
had until December 2010 to file her PAGA notice. Section 2699.3
then gave her another 93 days, or until March 2011, to amend
her complaint to include any PAGA claims. But plaintiff waited
until March 2016 to file the 2016 Notice alleging violations of
sections 201, 202, 203, 1174, subdivision (d), and 1198 and to
seek to file the third amended complaint based on the 2016
18
Notice. By then, the one-year statute of limitations on her PAGA
claims for violations of those provisions had long since run.
D. Doctrines Saving Time-Barred Claims
Plaintiff does not explain why she waited so long to file a
PAGA notice for violations of sections 201, 202, 203, 1174,
subdivision (d), and 1198. The alleged violations of sections 1174,
subdivision (d) and 1198 concerned conduct while she was
employed, namely defendant’s failure to maintain accurate
payroll records, provide meal and rest periods, and keep accurate
records of meal periods. The alleged violations of sections 201,
202, and 203 involve the failure to promptly pay former
employees all earned wages, including meal and rest period
premiums. At the time of the 2009 Notice, plaintiff was still
employed and so understandably she did not include violations of
sections 201, 202, and 203. But she does not explain why she did
not file a new notice in the year after her termination.
Plaintiff seeks to avoid the consequences of her dilatory
2016 Notice by arguing that an assortment of doctrines—
equitable tolling, relation back, judicial estoppel, and waiver—
saves her from the PAGA notice deadline and one-year statute of
limitations.
1. Equitable Tolling
Plaintiff contends the time for her to give adequate notice
by way of the 2016 Notice and to add PAGA claims to the second
and third amended complaints was equitably tolled. She claims
equitable tolling preserves all of her PAGA claims because she
filed the 2009 Notice and original complaint in good faith and had
19
no reason to believe they were deficient, and the parties then
litigated for years without objection from defendants.
“Equitable tolling is not permissible where it is inconsistent
with the text of the relevant statute.” (United States v. Beggerly
(1998) 524 U.S. 38, 48; Lantzy v. Centex Homes (2003) 31 Cal.4th
363, 371.) Equitable tolling “must be applied with sensitivity to
the Legislature’s intentions.” (Bjorndal v. Superior Court (2012)
211 Cal.App.4th 1100, 1111 (Bjorndal).) The doctrine is not
applicable where the statute “demonstrates the Legislature
intended the timely filing of a complaint [with the administrative
authority] to be a prerequisite to, and to precede, the filing of
litigation.” (Id. at p. 1111.)
As discussed, the Supreme Court in Williams described the
Legislature’s intent in passing PAGA: “to advance the state’s
public policy of affording employees workplaces free of Labor
Code violations” and “to remediate present violations and deter
future ones.” (3 Cal.5th at p. 546.) The Supreme Court also
addressed the purpose of the notice requirement: “to afford the
[LWDA] the opportunity to decide whether to allocate scarce
resources to an investigation” and “allow[] the employer to
submit a response.” (Id. at pp. 545-546.) Section 2699.3,
subdivision (a) evinces the Legislature’s intent for workplace
violations to be addressed expeditiously by setting a tight
timeline for the LWDA to respond to the notice of alleged
violations and the plaintiff to thereafter file or amend a
complaint. The concomitant one-year statute of limitations
emphasizes the Legislature’s desire for quick action on workplace
violations.
Allowing equitable tolling to preserve PAGA claims where
a plaintiff failed to file an adequate section 2699.3 notice for
20
years is inconsistent with the text and purpose of section 2699.3,
subdivision (a) and would defeat the entire purpose of PAGA. If a
plaintiff could wait many years to assert violations of the Labor
Code or amend deficient notices, the LWDA would be hard
pressed to make an informed decision about allocating scarce
resources to old violations, the employer would be faced with
responding based on stale evidence, and workplace violations
could continue for years without being remediated or deterred.
Further, plaintiff acknowledges that an element of
equitable tolling is “good faith and reasonable conduct by the
plaintiff in filing the second claim.” (Collier v. City of Pasadena
(1983) 142 Cal.App.3d 917, 924.) But she does not address her
failure to file any notice regarding alleged violations of sections
201, 202, 203, 1174, subdivision (d), and 1198 for more than six
years after the 2009 Notice. The federal cases she cites did not
involve that kind of delay. In Ramirez v. Ghilotti Bros. Inc. (N.D.
Cal. 2013) 941 F.Supp.2d 1197, the plaintiffs filed two timely
notices and a timely amended complaint, and the court ruled that
the claims in the amended complaint based on the allegations in
the second notice would relate back to the original complaint.
(Id. at pp. 1209-1210.) In Williams v. Veolia Transportation
Services, Inc. (C.D.Cal. June 28, 2012) 2012 WL 12960640, when
the original notice was defective, the court allowed the plaintiff to
file a new notice and held that the plaintiff’s claims were
preserved by equitable tolling. (Id. at pp. *1-2.) Nothing in that
decision indicates the plaintiff later tried to add new claims based
on Labor Code provisions not specified in the original notice. Nor
did that decision consider the legislative intent to remedy
workplace violations through expeditious notice, investigation,
and litigation, which would be hindered if an untimely new notice
21
could cure a deficient notice filed more than six years earlier as
occurred here.
2. Relation Back
Plaintiff argues the relation back doctrine permits the
PAGA claims added to the 2016 Notice and the second and third
amended complaints because they arise out of the same set of
facts as the claims alleged in the 2009 Notice and original
complaint. Under the relation back doctrine, an amended
complaint is deemed to have been filed at the time of the earlier
complaint if the amended complaint “(1) rest[s] on the same
general set of facts, (2) involve[s] the same injury, and (3) refer[s]
to the same instrumentality . . . .” (Norgart v. Upjohn Co. (1999)
21 Cal.4th 383, 409.) The doctrine cannot be used to frustrate
the intent of the Legislature to require compliance with
administrative procedures as a condition to filing an action.
(Bjorndal, supra, 211 Cal.App.4th at p. 1113.)
Because we conclude the 2009 Notice was adequate as to
the alleged violations of section 226, subdivision (a), the question
remains open whether any of the later-alleged PAGA claims
relate back to the claim for violations of section 226, subdivision
(a). (Cf. Soldinger v. Northwest Airlines (1996) 51 Cal.App.4th
345, 381 [“Incidents not described in a DFEH charge can be
included in the subsequently filed lawsuit if they would
necessarily have been discovered by investigation of the charged
incidents, i.e., if the allegations in the civil complaint were ‘like or
related’ to those specified in the DFEH charge”].) On remand,
the trial court is to consider whether any of the later-added
PAGA claims in the third amended complaint—the claims for
22
violations of sections 201, 202, 203, 1174, subdivision (d), and
1198—relate back solely as to the adequately noticed and alleged
claim for violations of section 226, subdivision (a).
3. Judicial Estoppel
Plaintiff contends judicial estoppel prevents defendants
from relying on a lack of notice or statute of limitations defense.
Judicial estoppel is an equitable doctrine that applies when “‘(1)
the same party has taken two positions; (2) the positions were
taken in judicial or quasi-judicial administrative proceedings; (3)
the party was successful in asserting the first position (i.e., the
tribunal adopted the position or accepted it as true); (4) the two
positions are totally inconsistent; and (5) the first position was
not taken as a result of ignorance, fraud, or mistake.’” (Aguilar v.
Lerner (2004) 32 Cal.4th 974, 986-987.) The application of
judicial estoppel, even when all necessary elements are present,
is discretionary. (MW Erectors, Inc. v. Niederhauser Ornamental
& Metal Works Co., Inc. (2005) 36 Cal.4th 412, 422.)
Plaintiff contends defendants knew about her PAGA claims
including the later-added PAGA claims in the 2012 second
amended complaint, but did not oppose them or challenge the
sufficiency of the notice until 2016. But plaintiff does not identify
any position defendants successfully asserted, which the trial
court adopted or accepted as true, that was later totally
inconsistent with another position of defendants. The case law
speaks of a party successfully “asserting the first position”
(Aguilar v. Lerner, supra, 32 Cal.4th at pp. 986-987), indicating
judicial estoppel does not occur absent an affirmative assertion.
23
In other words, silence and lack of objection does not result in
judicial estoppel.
4. Waiver
Plaintiff next argues defendants waived their statute of
limitations and lack of notice defenses by not asserting them
when plaintiff first moved for leave to file the second amended
complaint in 2012. Defendants instead argued plaintiff should
simply dismiss the non-PAGA causes of action.
Generally, a defendant must plead defenses in an answer
or demurrer, or risk waiver. (Code Civ. Proc., § 430.80, subd. (a).)
A defendant waives a statute of limitations defense by failing to
plead it in an answer or raise it as a ground of a general
demurrer. (Minton v. Cavaney (1961) 56 Cal.2d 576, 581; accord,
Adams v. Paul (1995) 11 Cal.4th 583, 597.) Here, defendants
never answered the complaints. But they did assert the defenses
in their motion for judgment on the pleadings and their demurrer
to the operative third amended complaint and thus have
preserved the defenses.
Plaintiff’s argument that defendants waived the defenses
by not raising them in their opposition to plaintiff’s motion for
leave to file the second amended complaint is not well-taken. The
“better course of action” is to allow a plaintiff to amend the
complaint “and then let the parties test its legal sufficiency in
other appropriate proceedings.” (Atkinson v. Elk Corp. (2003) 109
Cal.App.4th 739, 760.) Thus, a defendant is not required to make
its arguments about the sufficiency of the pleading in an
opposition to a motion for leave to amend.
24
E. Denial of Leave to Amend
Plaintiff contends she should be given leave to amend her
third amended complaint. We review the denial of leave to
amend a complaint for an abuse of discretion. (City of Dinuba v.
County of Tulare (2007) 41 Cal.4th 859, 865.) “If the court
sustained the demurrer without leave to amend . . . we must
decide whether there is a reasonable possibility the plaintiff could
cure the defect with an amendment. [Citation.] If we find that
an amendment could cure the defect, we conclude that the trial
court abused its discretion and we reverse; if not, no abuse of
discretion has occurred. [Citation.] The plaintiff has the burden
of proving that an amendment would cure the defect.” (Schifando
v. City of Los Angeles (2003) 31 Cal.4th 1074, 1081.)
Plaintiff has not specified how she can amend the third
amended complaint to cure the deficient notice of the alleged
violations of sections 204, 226.7, and 512, and to timely give
notice of the alleged violations of sections 201, 202, 203, 1174,
subdivision (d), and 1198. Nothing can now remedy the
deficiency of the 2009 Notice or lateness of the 2016 Notice.
Therefore, amendment would be futile, and the trial court did not
abuse its discretion in denying leave to amend.
As we explained above, the 2009 Notice was sufficient as to
plaintiff’s PAGA claims for alleged violations of section 226,
subdivision (a). No statute of limitations or notice requirement
prevents plaintiff’s claim for a violation of that section to go
forward. But the third amended complaint alleges a claim under
that section in the same cause of action as claims under the other
sections for which plaintiff failed to give timely and adequate
notice. “The appropriate procedural device for challenging a
25
portion of a cause of action seeking an improper remedy is a
motion to strike.” (Caliber, supra, 134 Cal.App.4th at p. 385.)
Although defendants did not bring a motion to strike as an
alternative to their demurrer, “a court may ‘at any time in its
discretion, and upon terms it deems proper[,]’ ‘[s]trike out all or
any part of any pleading not drawn or filed in conformity with the
laws of this state. . . .’” (Ibid.) Accordingly, the trial court may
strike portions of plaintiff’s cause of action for violations of Labor
Code sections other than section 226, subdivision (a), which it
determines do not relate back to that section.
26
IV. DISPOSITION
The judgment is reversed and the matter is remanded for
further proceedings consistent with this opinion. Specifically, the
trial court is directed to overrule defendant’s demurrer as to
plaintiff’s section 226, subdivision (a) claim and to sustain the
demurrer as to plaintiff’s remaining claims, not including the
demand for relief under section 558, except to the extent the trial
court concludes the relation back doctrine—solely as to the
section 226, subdivision (a) claim—permits plaintiff to maintain
one or more of those remaining claims.
The parties are to bear their own appeal costs.
SEIGLE, J. ∗
We concur:
BAKER, Acting P.J.
MOOR, J.
∗ Judge of the Los Angeles Superior Court, assigned by the
Chief Justice pursuant to article VI, section 6 of the California
Constitution.
27
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71 F.Supp. 991 (1947)
FRIEDMAN'S EXPRESS, Inc., et al.
v.
MIRROR TRANSP. CO., Inc.
Civ. A. No. 10136.
District Court, D. New Jersey.
June 12, 1947.
Edmond J. Dwyer, of Newark, N. J., and Charles E. Cotterill, of New York City, for plaintiffs.
August W. Heckman, of Jersey City, N. J., and McCauley & Henry and John B. Siefken, all of New York City, for defendant.
MEANEY, District Judge.
Application has been made to this Court for a temporary injunction, restraining the defendant company from transporting certain commodities known as "Comic Supplements". Nothing would be involved upon a final hearing that may not now be determined, and the whole matter may be disposed of by a finding as to the simple question at issue in the present application.
Reduced to its simplest form, the court is called upon to determine whether or not the commodity being transported, is at the time of such transportation, a newspaper within the meaning of Congress in 49 U.S.C.A. § 303(b)(7).
Indubitably the original concept of what constituted a newspaper was confined to a publication containing a recital of current events, with comments and opinions on them and other matters of public import. Whether the term has such a limited application at the present time is another matter.
The present-day newspaper, in addition to carrying "items of general news interest", contains enormous quantities of advertising, political comment, chess problems, cross word puzzles, what are called (and very often with lamentable inaccuracy) comics, and special features of un-ending variety. The sum total is known as a newspaper, and generally regarded as such. The proportion of news items to advertisements and special features varies with different papers; and in the Sunday issues of Metropolitan journals which are imposing in bulk, if not always in contents, the proportion of news to the rest of the printed and pictured matter is but small. News of world-shattering import will be conveyed to readers in far less space than is occupied in calling attention to contraptions for shapely confinement of the female figure, or for perfumes guaranteed to slay the most recalcitrant misogynist, or for conveying the reminder that even your best friends won't tell you. Reports of discussions at the United Nations Organization or Ecclesiastical synods yield in amount of line-space to paid recital of the ultimate in boudoir furnishings or kitchen equipment. The greater part of the matter furnished for the edification of the Sunday newspaper reader is concerned with salesmanship, fiction and mental titillators rather than the exposition of news. Enormous amounts of advertising are the main source of revenue of dailies, weeklies and monthlies. *992 Without this financial return, the general and extensive coverage of news, local, national and world-wide, would be impossible; and the more valuable functions of the newspaper would be severely handicapped and circumscribed.
All of this melange is contained in what are known as special sections of the paper. There is the advertising section, the home section, the magazine section, the financial section, the sports section and the news section, each with its appeal to various members of the family. The collection in its entirety is recognized as a Newspaper and is carried and distributed as such without distinction as to sections. Each section is thus an integral part of the newspaper, made so not because it is physically folded in a news section, but because it has assumed the character of the journal of which it is a part; and each bears at its masthead the name of the publication of which it is a part.
Since then, when included with the balance of the sections of the "newspaper", comic supplements are part of such newspaper, it seems a bit contradictory to say that it loses its character when it is not in company with the other sections though destined for no other purpose than union with such other component parts of the total bulk, which later may be known as the Sunday Mirror, or the Sunday Newark News, or the Sunday Herald Tribune. Just as a magazine meant for sale as an independent publication cannot acquire the status of a newspaper part simply by being folded with the news section of a newspaper, so e contrario, a comic supplement is not deprived of its character as part of a newspaper simply because it is not yet placed in physical contiguity with the rest of its fellow parts that go to make up the modern intelligencer. It has no character of its own, nor is it intended for sale separate from the balance of the newsprint with which it makes up the journal.
There does not seem to be much weight to the contention that the comic supplement is printed in a plant other than that in which the news items are set up. There is no warrantable limitation on a newspaper publisher as to where the parts of his paper may be composed and reduced to visual condition or who shall do it for him. Convenience, economy and other such conceivable considerations may influence the place of production of the whole newspaper or its parts, without affecting the character of the finished product.
Congress in its decision to exclude newspaper distribution from the operation of the statute was affected by easily recognizable zeal to ease the burden of newspaper publishers in the distribution of their product, and it is not unreasonable to recognize that the desires and convenience of the reading and scanning public prompted this concern for the producers of newspapers. And who shall say that the elders of the family, as well as juniors, are not enraptured by the adventures of The Yellow Kid, Mutt & Jeff, Superman, Lil Abner, Joe Palooka, Orphan Annie and the other miscellaneous improbabilities which appeal to the minds of our day, the law of supply and demand being what it is? Or that only the older members of a family are to be considered, in so far as their newspaper predilections are concerned?
References to these cartoon figures are contained in editorial comments, which it might be noted in passing, could possibly account for the seeming familiarity of the Court with such Antic personalities.
It is not for this court to express any opinion on the quality of the commodity in question or its educational value. Suffice it to say that the foregoing considerations lead to the conclusion that comic supplements, so called, for good or ill, are to be deemed to be within the term newspaper as comprehended in the act in question.
Since this finding is dispositive of the whole question, and is conceded to be so, by both parties to the controversy, let an order for final judgment be submitted for entry.
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___________
No. 96-1920
___________
United States of America, *
*
Appellee, *
* Appeal from the United States
v. * District Court for the Eastern
* District of Missouri.
Terrance Eugene Bell, *
* [UNPUBLISHED]
Appellant. *
___________
Submitted: August 21, 1996
Filed: August 26, 1996
___________
Before BOWMAN, MAGILL, and LOKEN, Circuit Judges.
___________
PER CURIAM.
Terrance Eugene Bell challenges the 54-month sentence imposed by the
district court1 following his guilty plea to being a felon in possession
of a firearm, in violation of 18 U.S.C. § 922(g)(1). We affirm.
We reject Bell's contention on appeal that the district court
miscalculated his criminal history category by failing to treat two prior
offenses as "related" under U.S.S.G. § 4A1.2(a)(2). "[P]rior sentences are
considered related if they resulted from offenses that (1) occurred on the
same occasion, (2) were part of a single common scheme or plan, or (3) were
consolidated for trial or sentencing." Section 4A1.2, comment. (n.3).
1
The HONORABLE EDWARD L. FILIPPINE, United States District
Judge for the Eastern District of Missouri.
Bell argues that, as a practical matter, his offenses were
consolidated for sentencing. It is well-settled in this circuit, however,
that "two or more sentences imposed at the same time `are not related for
purposes of U.S.S.G. § 4A1.2(a)(2) if the cases proceeded to sentencing
under separate docket numbers, and there was no formal order of
consolidation.'" United States v. Klein, 13 F.3d 1182, 1185 (8th Cir.)
(quoting United States v. McComber, 996 F.2d 946, 947 (8th Cir. 1993) (per
curiam)), cert. denied, 114 S. Ct. 2722 (1994); accord United States v.
Lewchuck, 958 F.2d 246, 247 (8th Cir. 1992). To the extent Bell asks this
panel to reconsider the above line of cases, one panel of this court may
not overrule the opinion of another panel. See Campbell v. Purkett, 957
F.2d 535, 536 (8th Cir. 1992) (per curiam).
Bell also argues that the offenses were part of a common scheme or
plan. We conclude the district court did not clearly err in finding
otherwise, as the offenses at issue occurred two weeks apart and involved
different victims. Cf. United States v. Lowe, 930 F.2d 645, 646-47 (8th
Cir. 1991) (standard of review; noting similar crimes are not necessarily
related crimes and upholding unrelatedness determination because offenses
occurred at different times, involved different victims, had been committed
in different locales, and had not been consolidated).
Accordingly, we affirm.
A true copy.
Attest:
CLERK, U. S. COURT OF APPEALS, EIGHTH CIRCUIT.
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Filed 12/22/14 Schmidbauer v. Deelo CA2/7
NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS
California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for
publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication
or ordered published for purposes of rule 8.1115.
IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA
SECOND APPELLATE DISTRICT
DIVISION SEVEN
WENDY SCHMIDBAUER, B248349
Plaintiff and Respondent, (Los Angeles County
Super. Ct. No. SC110602)
v.
CHRISTINE RENEE DEELO, et al.
Defendants and Appellants.
APPEAL from a judgment of the Superior Court of Los Angeles County, Cesar
Sarmiento, Judge. Affirmed.
Anderson, McPharlin & Conners, Michael S. Robinson and Lisa Ann Coe, for
Plaintiff and Respondent.
Alan G. Novodor and the Law Offices of Alan G. Novodor, for Defendants and
Appellants.
________________________
Wendy Schmidbauer filed a complaint against Christine and Michael Deelo
seeking to quiet title to a condominium development stairway that provided access to an
underground parking structure. Schmidbauer argued that the condominium plan’s floor
diagram showed the stairway was located in an area designated as her private patio space.
The Deelos, however, argued that the condominium plan and other documents made clear
that all stairways within the development were intended to be common areas. The trial
court found the documents were ambiguous and admitted extrinsic evidence to aid in
their interpretation. After a bench trial, the court entered judgment in favor of
Schmidbauer. We affirm.
FACTUAL AND PROCEDURAL BACKGROUND
A. Description of the Condominium Development
The Blue Pacific is a three-story condominium development that contains eight
individual units and an underground parking structure. The development is located on
the southern side of Pacific Street with the front side of the building facing northward.
Units one through three are located on the first floor; the remaining six units are located
on floors two and three. The three first floor units run the width of the building from east
to west, with their front doors opening onto the west side of the building. Unit one is
located in the front (northern) third of the building, unit three is located in the rear
(southern) third of the building and unit two is located in the middle third of the building,
positioned between units one and three.
All of the first floor units have private patio areas. Units one and two each have
two patio areas: a small patio located next to each unit’s front door on the west side of
the building and a larger patio located behind the unit that extends from its eastern
exterior wall to the development’s eastern property boundary. Unit three, which is in the
rear of the building, has a u-shaped patio area that wraps around the southern third of the
building, extending from unit three’s exterior walls to the western, southern and eastern
property boundaries.
2
The development is accessible from Pacific Street through two common doorways
on the front side of the property. The first common doorway opens onto a common
pathway that runs along the western side of the building, past the front doors of units one
and two. The pathway ends at a wooden gate that is located at the boundary of unit
three’s western patio area. The second common doorway is on the east side of the
building and opens onto a multi-level wooden stairway that runs from the first floor to the
third floor, providing access to the upper level units. This stairway is attached to the
northeast corner of the building. The development also contains an elevator in the
southeast corner of the building that runs from the parking structure to the second and
third floors; the elevator does not stop on the first floor. A second multi-level wooden
stairway is positioned next to the elevator, which runs from the first floor to the third
floor.
The development’s underground parking structure has a vehicular garage door that
opens onto Pacific Street and a pedestrian doorway located next to the garage door.
There is a stairway at the back (southern end) of the parking structure that runs
diagonally, east to west, up the back wall of the building and opens into unit three’s patio
area near unit three’s front door. Based on the design of the development, units on the
upper levels have different access to the parking structure than units on the first floor.
Tenants in the upper-level units can access the parking structure by using the elevator in
the southeast corner of the building. Alternatively, the upper-level tenants can walk
down the multi-level stairway at the northeast corner of the building, walk out the
common doorway on the east side of the building, and then travel along the front of the
building and access the parking structure through its pedestrian doorway.
Tenants on the first floor units, which open on to the west side of the building, can
walk northward along the common path on the west side of the development, exit through
the western common doorway on to Pacific Street, and then follow the sidewalk down to
the parking structure’s pedestrian doorway. Alternatively, tenants on the first floor can
access the parking structure by walking southward along the western common path,
3
entering into unit three’s patio area and accessing the stairway that leads down to the
back of the parking structure (the garage stairway).
B. The Parties’ Dispute Regarding Use of the Garage Stairway
In 2001, defendant and appellant Christine Renee Deelo (Deelo) purchased unit
two. At the time of her purchase, unit three was owned by Richard Rudolph. When
Rudolph owned unit three, Deelo normally accessed the parking structure by traveling
south along the western common path, entering unit three’s patio area and walking down
the garage stairway. On some occasions, however, Deelo would access the parking
structure by traveling north along the pathway, exiting through the common doorway
onto Pacific Street, and then entering the structure through its pedestrian doorway. Deelo
preferred to use the garage stairway to access the parking structure because she thought it
was safer and more convenient than walking outside the front of the building.1
In 2003, plaintiff and respondent Wendy Schmidbauer purchased unit three from
Rudolph. Shortly after the purchase, Schmidbauer informed the building tenants that a
floor diagram in the condominium plan showed that the garage stairway was located in
unit three’s patio space and was therefore excluded from the development’s common
area. Schmidbauer requested that all occupants stop using the stairway to enter or exit
the parking structure. Deelo, however, continued to use the stairway.2
In 2006, Deelo got married and her husband, Michael Deelo, moved into unit two.
The Deelos eventually had two children. In 2010, Schmidbauer informed the Deelos that
their increased use of the garage stairway was impinging on her privacy and requested
1 At trial, Rudolph and Deelo provided conflicting testimony as to whether Rudolph
had provided Deelo permission to access his patio area and the garage stairway. Deelo
testified that although Rudolph had told her not to use the garage stairway, she had
informed him it was a common area accessible to all tenants. Rudolph, however, testified
that he had permitted Deelo to use the garage stairway when there was inclement weather
or when she returned to her condominium late at night.
2 At trial, Schmidbauer testified that she gave Deelo permission to continue using
the stairway because Deelo was a young, single female. Deelo, however, testified that
she had continued to use the stairway over Schmidbauer’s objection.
4
that they stop using it. The Deelos refused, asserting that the stairway was part of the
common area of the development.
C. Summary of the Parties’ Pleadings and the Condominium Development’s
Governing Documents
1. The parties’ complaints
In December of 2010, Schmidbauer filed a complaint seeking to quiet title to the
garage stairway and for a declaratory judgment prohibiting the Deelos or any other
building occupants from entering unit three’s patio area to access the garage stairway.
The complaint alleged that the condominium plan’s floor diagram showed the garage
stairway was not common area, but rather was part of unit three’s patio.
The Deelos filed cross-complaint seeking to quiet title to the garage stairway and
an easement over the portion of unit three’s patio area that lead to the stairway. The
Deelos’s cross-complaint asserted that language in the condominium plan and the
development’s “Declaration of Restrictions” made clear that all stairways within the
development were common areas and that every separate interest was subject to
easements for ingress and egress to common areas. Alternatively, the cross-complaint
asserted a prescriptive easement over unit three’s patio space and the garage stairway
based on the Deelos’s prior use.3
2. The condominium development’s governing documents
The parties’ cross-complaints were predicated on their conflicting interpretations
of two governing documents that the original owner of the development had recorded
pursuant to state laws governing common interest developments: the “Condominium
Plan” and the “Declaration of Restrictions.”4 (See former Civil Code, § 1352; current
3 The Deelos’s cross-complaint raised additional claims against Schmidbauer and
other defendants that are not relevant to this appeal.
4 At the time the Blue Pacific was constructed in 1975, it was governed by the
Condominium Act, former Civil Code sections 1350 et seq. (See Witkin, Summary of
Cal. Law (10th ed. 2005) Real Property, § 85, p. 134-135 (Witkin) [historical summary
5
§ 4200 [common interest development is created when “separate interest coupled with an
interest in the common area . . . is, or has been, conveyed” and “all of the following are
recorded:” (1) “A declaration”; (2) “A condominium plan, if any exists”; and (3) a final
map or parcel map, if one is required under the Government Code].)
a. The Condominium Plan5
The Condominium Plan (the Plan) consists of a “diagrammatic floor plan of the
building” (floor diagram) and a list of “Notes and Definitions” (Notes) that clarifies
aspects of the floor diagram.
The Plan’s Notes state that the “common area of the project” includes all areas
within the lines of the project “except units 1 through 8” as depicted on the floor diagram.
The Notes explain that each “unit” consists of “all those elements [on the floor diagram]
bearing” the unit’s number. Different “elements” of the unit are assigned different
letters: areas marked “A” designate the units’s “dwelling area”; areas marked “C” or “D”
designate the units’s “balconies and patios.” Thus, for example, any area marked “3C”
denotes unit three’s separately held patio area. Note six, however, excludes the following
of statutes governing condominiums and other common interest developments].) In
1985, the Condominium Act was repealed and replaced by the Davis-Stirling Common
Interest Development Act. (See Thaler v. Household Finance Corp. (2000) 80
Cal.App.4th 1093, 1101; Witkin, supra, Real Property, § 314, p. 134.) Effective
January 1, 2014, the Davis-Stirling Act was “repealed, reenacted and renumbered” as
§§ 4000 et seq. (Seahaus La Jolla Owners Assn. v. Superior Court (2014) 224
Cal.App.4th 754, 760, fn. 1.) This appeal does not does not involve any dispute
regarding the statutory requirements governing common interest developments. The sole
issue is whether the trial court properly interpreted the condominium development’s
governing documents. In their appellate briefs, the parties cite to provisions of the Davis-
Stirling Act, rather than the former Condominium Act. For purposes of simplicity, we do
the same. Unless otherwise noted, all further statutory citations are to the Civil Code.
5 Under the Davis-Stirling Act, a condominium plan generally has three elements:
(1) “A description or survey map of a condominium project, which shall refer to or show
monumentation on the ground; (2) “A three-dimensional description of a condominium
project . . . in sufficient detail to identify the common area and each separate interest”;
and (3) a certificate consenting to the recordation of the condominium plan. (See former
§ 1351, subd. (e); current §§ 4285, 4290.)
6
items from each unit: “bearing walls, columns, floors, roofs, slabs, foundations, balcony
and patio structures, common stairways and hallways . . . .”
The floor diagram of the first floor, attached as an appendix to this opinion, shows
a large rectangle designating the development’s property boundaries. Within this
rectangle, there are three similarly-sized smaller rectangles labeled as areas 1A, 2A and
3A, designating the floor-level units’s dwelling areas. The diagram shows a common
area running along the entire northern border (the front side) of the development where
the sidewalks and access ramp to the parking structure are located. The diagram shows
another common area running along the northern two-thirds of the western border of the
development, which represents the western common pathway that passes the front doors
of units one and two, ending at the boundary of unit three’s western patio area. There are
two small spaces blocked out from the western common pathway marked “1D” and
“2D,” which depict unit one and unit two’s western patio areas.
Along the eastern border of the development, the floor diagram shows unit one
and unit two’s eastern patios (marked “1C” and “2C”), which extend from each units’s
eastern exterior wall to the eastern property boundary. Area 1C contains a blocked out
section (representing common area) in the location of the multi-level wooden stairway on
the northeast corner of the building.
The floor diagram also shows unit three’s u-shaped patio (area “3C”), which
wraps around the entire rear of the building. On the west side of the development, the 3C
patio area begins at the end of the western common pathway and extends to the southern
property boundary; on the eastern side of the development, the patio borders unit two’s
eastern patio and extends to the southern property boundary; on the southern side of the
development, the patio extends from unit three’s exterior southern wall to the southern
property boundary. The eastern side of area 3C contains a blocked out section in the
location of the elevator and the exterior multi-level wooden stairway that runs adjacent to
the elevator. Area 3C does not have a blocked out section in the area where the garage
stairway is located.
7
b. The Declaration of Restrictions
The Declaration of Restrictions (DOR)6 sets forth a “plan for the ownership of the
units and common area within the development.” The DOR, which incorporates the
Condominium Plan, contains a description of the project stating that each unit
“designated on the . . . Plan” constitutes “a separate freehold estate consisting of the
dwelling space and any accompanying balcony or patio space.” The DOR defines the
term “common areas” to include the “remaining portion of the project.” As with the
Plan, the DOR includes a list of items that are excluded from each unit, which
includes “bearing walls, columns, floors, slabs, foundations, storage spaces, balcony
structures, . . . elevators, stairways. . . .” Thus, although both the DOR and the Plan
exclude “stairways” from the definition of a unit, the Plan states that “common
stairways” are excluded while the DOR states only that “stairways” are excluded.
The DOR further provides that “[i]f any portion of the common areas
encroach upon the units, a valid easement for the encroachment and for the maintenance
of same, . . . shall and does exist. . . Common areas shall always be subject to easements
for minor encroachments thereon of the unit; and a non-exclusive easement for ingress
and egress and support are subject to such easements.”
Finally, the DOR includes a provision describing “restricted common area,” which
is defined as a portion of the common area “set aside . . . for the restricted use of
respective units.” Only the individual parking spaces located within the parking structure
are identified as “restricted common area.”
6 A common interest development “declaration” is required to include “a legal
description of the common interest development” and “the restrictions on the use or
enjoyment of any portion of the common interest development that are intended to be
enforceable equitable servitudes.” The declaration may also contain “any other matters
the declarant or the members consider appropriate.” (See former §§ 1351, subd. (h),
1353; current §§ 4135, 4250.)
8
D. Trial Court Proceedings
1. The Deelos’s motion for summary judgment
In October of 2011, the Deelos moved for summary judgment, arguing that the
governing documents unambiguously demonstrated that the garage stairway and
“walkway in [unit three’s patio] . . . leading to the top of the [garage] stairway” were
common areas. In support, the Deelos cited the provisions in the DOR stating that
“stairways” were not part of any unit and that an easement existed over any part of a unit
that was encroached upon by a common area. They also cited the language in the Plan
stating that “common stairways and hallways” were not part of any unit. The Deelos
argued this language made clear that although the garage stairway was located within unit
three’s patio area, the stairway was nonetheless part of the development’s common area
and therefore freely accessible to all tenants.
The Deelos acknowledged the Plan’s floor diagram did not include any
designation within area 3C (unit three’s patio) showing that the garage stairway was
actually common area. They argued, however, that the “diagram ha[d] no legal effect”
because the DOR and the Plan both included express language clarifying that: (1)
“stairways” were not part of a unit; and (2) any area that was not part of a unit qualified
as common area.
Schmidbauer, however, argued that if the original owner of the development had
intended the garage stairway to be common area, the floor diagram would have shown
that area blocked out from unit three’s patio space. In support of this argument,
Schmidbauer noted that the floor diagram did block out other common areas from the
units’s patio spaces, including the elevator and adjacent multi-level staircase (blocked out
from unit three’s patio) and the multi-level wooden stairway located at the front of the
building (blocked out from unit one’s eastern patio). Schmidbauer also argued that,
contrary to the Deelos’s assertions, the DOR and Plan did not exclude all “stairways”
from the definition of the unit. Rather, the Plan, incorporated by reference into the DOR,
stated that “common stairways” were not part of any unit. According to Schmidbauer,
9
the term “common stairways” was only intended to refer to stairways located in areas that
were designated as common area on the floor diagram.
Schmidbauer filed several pieces of evidence in support of her opposition,
including a personal declaration describing the layout of the development, numerous
photographs of the development and an expert declaration from David Knell, a
professional surveyor who had prepared numerous condominium plans. Knell’s
declaration stated that, based on his knowledge and experience, the floor diagram would
have shown the garage stairway blocked out of unit three’s patio area if it was intended to
be common area. Knell also stated that if the stairway was intended to be common area,
he would expect to see a “corridor” blocked out of unit three’s patio area connecting the
stairway to the western common pathway. Knell concluded that because there was no
“visual representation or provision in the Condominium Plan address[ing] the parking
garage stairs as being common area,” the stairs were likely intended to be “used in
emergency situations only.”
The court denied the Deelos’s motion for motion for summary judgment,
concluding that they had “failed to establish, as a matter of law, that the [governing
documents] unambiguously make[s] the disputed area ‘common area’” and that
Schmidbauer’s evidence demonstrated there were “triable issues of material fact as to
whether the subject area is a common area.”
2. Bench trial
a. Summary of evidence at trial
During the bench trial, the parties relied on extrinsic evidence to aid the court in
the interpretation of the DOR and the Plan. First, the parties invited the court to conduct
a visual inspection of the property. (See City and County of San Francisco v. Meyer
(1962) 208 Cal.App.2d 125, 130 [“the trial judge’s view of the property ‘with the consent
of counsel is evidence in the case’”].) According to the court’s statements at trial, it had
visited the property with counsel and spent 20 to 30 minutes examining “the entire
condominium project,” including all the “accessways . . . and the stairways.”
10
Second, the parties introduced several photographs of the development.
Photographs of the front side of the development (the north side) showed the common
doorways on the east and west side of the building that open onto Pacific Street and
provide access to sidewalk areas that lead to the parking structure’s pedestrian doorway.
Photographs of the western side of the development showed the common pathway that
runs past the front doors of units one and two and ends at a wooden gate at the boundary
of unit three’s western patio area. Several other photographs showed unit three’s patio
area and the disputed garage stairway, which is positioned next to unit three’s front door.
Third, David Knell provided expert testimony regarding condominium plan
diagrams. Knell stated that he had personally prepared approximately 70 condominium
plans and was frequently retained by title companies to review condominium plans
prepared by third parties. Knell testified that, under industry standards and practices, any
area within a condominium development floor diagram that is not designated as part of a
separate interest is generally common area. Knell also explained that if a common area is
located within a separate interest area, surveyors will normally “block[] out” the common
area from the separate interest.
Knell testified that when preparing condominium plans, he would generally mark
any stairway that was intended for “everyday use” as “common area” by either placing a
box denoted “common area” where the stairway was located or by making a separate note
in the declaration of restrictions. Knell further testified that if a stairway that opened into
a separate interest area was intended to be common area, the standard practice would be
to “depict a route through the separate interest to join [the stairway] to a common area.”
Knell further stated that the floor diagram at issue here did not include any markings
indicating that the garage stairway was meant to be “common area,” nor did it depict a
route through unit three’s patio connecting the stairway to a common pathway. Knell
also noted that the diagram did block out a section of unit three’s patio in the area where
the elevator and adjoining multi-level wooden staircase extended out from the southeast
corner of the building. Knell also stated that, in his opinion, the Plan and the common
areas depicted within it had been drawn in conformity with standard practices.
11
On cross-examination, Knell admitted the Plan’s floor diagram did not include any
specific designations showing where the stairways or elevators within the development
were located. Knell explained it was “standard practice in the industry” not to include
specific designations for stairways and elevators. Knell clarified, however, that the
diagram did depict common areas in the locations where the elevator and multi-level
wooden staircases were positioned. In contrast, the diagram did not depict any common
area in the location where the disputed garage stairway was located. Knell stated that
because the stairway was located within an area that had not been depicted as common
area, he did “not believe it to be anything more than an emergency stairway.”
Knell admitted that during his deposition he had initially described the garage
stairway as a “common area.” Knell explained that this comment was only intended
to convey that the stairway was “common” to the extent “it can be used by . . . other
people . . . in the case of emergency to get, say, from . . . a fire in the garage, from the
garage to . . . out of the side. [sic.]” Knell then reiterated that, based on the “custom and
practice in the industry,” it was unlikely that a stairway located within an area designated
as a separate interest would be intended as common area in the absence of some marking
showing it as such.7
b. Trial court’s findings and judgment
After the parties submitted closing briefs, the trial court issued a tentative order
concluding that the garage stairway was not intended to be common area. The court
explained that it had previously found the governing documents to be “ambiguous” on
the issue, thereby permitting the use of extrinsic evidence to aid in their interpretation.
The court stated that it found Knell’s testimony credible and persuasive: “[Schmidbauer]
introduced the expert testimony of [Knell], who testified that the subject stairs would be
expressly designated as ‘common area’ if they were intended to be common, but they
7 Schmidbauter, Christine Deelo and other witnesses testified at trial regarding the
Deelos’s prescriptive easement claim. Their testimony was not relevant to the
interpretation of the governing documents.
12
were not so designated. He also testified that the subject stairs, per the condo plan, are
for emergency use only. Additionally, the condo plan clearly shows the subject patio
area as separate interest, not common interest. [The Deelos] did not provide contrary
expert testimony, and the court finds [Knell’s] testimony on this issue was convincing
and credible. The court finds the governing documents are susceptible to the
interpretation put forth by [Knell] and in the absence of contrary expert testimony, the
Court finds [Knell’s] interpretation must be accepted.”8
Two weeks after the court issued its tentative order, the Deelos requested a
statement of decision. Schmidbauer opposed, arguing that the Deelos were required to
request a statement of decision before the matter had been submitted to the court. (See
Code of Civ. Proc., § 632, subd. (n) [where trial is less than 8 hours, request for statement
of decision must be made prior to submission of matter to the court]; see also California
Rules of Court, rule 3.1590, subd. (n).) The trial court denied the request as untimely,
adopted its tentative order as its final ruling and directed Schmidbauer to prepare a
judgment.
The court subsequently entered a judgment stating that the “stairwell within 3C
and the patio area designated as 3C are not common areas to be used by the Deelos, other
owners of units in the complex, or any of their agents . . . or guests, but are instead . . .
Schmidbauer’s separately owned interest included as part of her Unit 3.” The judgment
also enjoined the Deelos and any successor owners of unit two “from entering unit 3’s
patio, designated as 3C in the Condominium Plan, and . . . from entering the subject
stairwell that is within the patio designated as 3C” except in cases of emergency.
DISCUSSION
The Deelos argue that the trial court committed multiple errors in interpreting the
condominium development’s governing documents. First, they contend the court was
8 The court also found the Deelos had failed to establish they were entitled to a
prescriptive easement over unit three’s patio or the garage stairway. The Deelos have not
appealed that portion of the judgment.
13
precluded from considering extrinsic evidence because there is no ambiguity in the
governing documents. Second, they argue that even if the court were permitted to
consider extrinsic evidence, the most reasonable construction of the governing documents
is that the garage stairway is part of the development’s common area, not part of
Schmidbauer’s separate interest.
A. Summary of Applicable Legal Principles and Standard of Review
The parties do not dispute that the ordinary rules of contract interpretation apply
when construing the governing documents of a common interest development. (See
generally Christian v. Flora (2008) 164 Cal.App.4th 539, 551 [applying rules of contract
interpretation to common interest development declaration].) “When possible, the
parties’ . . . intention is to be determined solely from the language of the [documents].
‘The “clear and explicit” meaning of these provisions, interpreted in their “ordinary and
popular sense,” . . . controls judicial interpretation.’ [Citation.] ‘Interpretation of a
contract “must be fair and reasonable, not leading to absurd conclusions. [Citation.]”’
[Citation.]” (Bill Signs Trucking, LLC v. Signs Family Ltd. Partnership (2007) 157
Cal.App.4th 1515, 1521 (Bill Signs Trucking).) “The whole contract must be considered
together in order to ‘give effect to every part, if reasonably practicable, each clause
helping to interpret the other.’” (§ 1641.)
If a contract is “ambiguous on its face, parol evidence is admissible to interpret it.
[Citation.] Further, a [contract] is latently ambiguous if it appears clear on its face, but
parol evidence shows it is reasonably susceptible to two or more interpretations.
[Citation.] In that instance, the ‘“decision whether to admit parol [or extrinsic] evidence
involves a two-step process. First, the court provisionally receives (without actually
admitting) all credible evidence concerning the parties’ intentions to determine
‘ambiguity,’ i.e., whether the language is ‘reasonably susceptible to the interpretation
urged by a party. If in light of the extrinsic evidence the court decides the language is
‘reasonably susceptible’ to the interpretation urged, the extrinsic evidence is then
admitted to aid in the second step - interpreting the contract.”’ [Citation.] ‘The test of
14
admissibility of extrinsic evidence to explain the meaning of a written instrument is not
whether it appears to the court to be plain and unambiguous on its face, but whether the
offered evidence is relevant to prove a meaning to which the language of the instrument
is reasonably susceptible.’ [Citation.]” (Bill Signs Trucking, supra, 157 Cal.App.4th at
p. 1521.)
“The trial court’s threshold finding of ambiguity is a question of law subject to our
independent review. The court’s ultimate construction of ambiguous language is subject
to our independent review if the extrinsic evidence is not in conflict, even when the
parties draw different inferences from the evidence. If the extrinsic evidence conflicts,
we uphold any reasonable construction supported by substantial evidence.” (Bill Signs
Trucking, supra, 157 Cal.App.4th at p. 1521; see also Wolf v. Superior Court (2004) 114
Cal.App.4th 1343, 1351 (Wolf).)
B. The Trial Court Did Not Err in Permitting Extrinsic Evidence to Aid in the
Interpretation of the Governing Documents
The Deelos initially contend the court erred by admitting extrinsic evidence
because the only reasonable interpretation of the governing documents is that they
designate the garage stairway as common area. In support, the Deelos cite language in
the DOR stating that: (1) “stairways” are not part of any unit; and (2) any area that is not
part of a unit is common area. The Deelos argue that because the DOR expressly
excludes all “stairways” from the definition of a unit, the governing documents are not
reasonably susceptible to the meaning offered by Schmidbauer (that the garage stairway
is part of unit three).
This argument fails to address conflicting language in the Condominium Plan that
suggests not all stairways within the development were intended to be excluded from the
units. The Plan is expressly incorporated into the DOR and must therefore be treated as
“an actual part” of the DOR. (Republic Bank v. Marine Nat. Bank (1996) 45 Cal.App.4th
919, 922.) In contrast to the text of the DOR, the Plan states that only “common
stairways” are to be excluded from a unit. Neither the DOR nor the Plan expressly
15
defines what qualifies as a “common stairway.” Thus, based solely on the language of
the DOR and the Plan, it is unclear whether all stairways or only common stairways were
intended to be excluded from the units. It is also unclear what qualifies as a “common
stairway.”
The Plan’s floor diagram does not, standing alone, resolve these issues. The floor
diagram merely illustrates what areas of the development are separate interests and what
areas are common area. The floor diagram does not actually depict any of the stairways
or other features in the development nor does it offer any further insights into what
constitutes a common stairway.
Schmidbauer’s extrinsic evidence, however, provides additional details about the
stairways and common areas within the development. Schmidbauer’s declaration and
photographs indicate there is a wooden stairway attached to the northeast corner of the
building that runs from the first floor to the third floor. On the Plan’s floor diagram, the
location of this stairway is depicted as common area that is blocked out from unit one’s
patio space. Schmidbauer’s declaration and photographs also show there is a second
exterior multi-level stairway that runs alongside the elevator shaft on the southeast corner
of the building. On the floor diagram, the area where the elevator and adjacent stairway
sit is depicted as common area that is blocked out from unit three’s patio. Schmidbauer’s
evidence also establishes the position of the disputed garage stairway, which is located in
an area of the floor diagram that is designated as part of unit three’s patio and not
depicted as common area. This evidence supports Schmidbauer’s claim that the
governing documents are properly interpreted as excluding from the definition of a unit
only those stairways that are located within an area designated as “common area” on the
floor diagram.
Knell’s expert testimony provides additional support for this proposed
interpretation. Knell explained that, under the industry customs and practices applicable
to the drafting of condominium plan diagrams, any area located within a separate interest
that was intended to be common area would be marked as such. He further testified that,
consistent with these practices, the floor diagram in this case did appear to designate at
16
least one stairway that was located within a separate interest as common area: the multi-
level stairway on the southeast corner of the building that encroached upon unit three’s
patio area. Knell testified that the absence of any similar demarcations in the area where
the garage stairway was located suggested that the stairway was only intended to be used
in emergency situations.
Considered together, the DOR, the Plan and the proffered extrinsic evidence
demonstrate the governing documents are reasonably susceptible to the interpretation set
forth by Schmidbauer. While the DOR states that “stairways” are excluded from any
unit, the Plan’s text and floor diagram, considered in conjunction with the extrinsic
evidence, show that this language can be reasonably interpreted as meaning stairways
located within areas that are denominated as common area on the floor diagram. The trial
court therefore did not err in admitting the extrinsic evidence to aid in the interpretation
of the governing documents.
C. The Trial Court’s Interpretation Is Supported by Substantial Evidence
Having concluded the court properly admitted extrinsic evidence, we next assess
the trial court’s ultimate construction of the governing documents. Preliminarily,
however, we must determine the appropriate standard of review. As stated above, if the
extrinsic evidence is not in conflict, “construction of the instrument is a question of law,
and the appellate court will independently construe the writing.” (Winet v. Price (1992) 4
Cal.App.4th 1159, 1166 (Winet).) “When the competent parol evidence is in conflict, and
thus requires resolution of credibility issues, any reasonable construction will be upheld
as long as it is supported by substantial evidence.” (Ibid.; see also Bill Signs Trucking,
supra, 157 Cal.App.4th at p. 1521; see also Wolf, supra, 114 Cal.App.4th at p. 1351.)
The Deelos argue that “the trial court did not base its interpretation of the [DOR]
and [the Plan] on any credibility issue concerning conflicting extrinsic evidence.
Accordingly, this Court is obliged to conduct de novo review and exercise its
independent judgment concerning the proper interpretation of the [governing
documents].” Schmidbauer disagrees, contending that we should apply the more
17
deferential “substantial evidence” standard of review because the trial court “was called
upon to evaluate extrinsic evidence,” including its own visual inspection of the premises,
expert Knell’s testimony and various photographs.
The record demonstrates that the trial court’s interpretation of the governing
documents was predicated in substantial part on David Knell’s expert testimony
regarding the customs and standard practices that govern condominium plan diagrams.
(See Midwest Television, Inc. v. Scott, Lancaster, Mills & Atha (1988) 205 Cal.App.3d
442, 452 (Midwest) [“Evidence of custom or standard practice is admissible to interpret
the terms of a contract and to imply terms when no contrary intent is apparent from the
other terms of the contract”].) Knell testified that, customarily, if an area within a
separate interest was intended to be common area, the floor diagram would show that
area blocked out from the separate interest. He further testified that if an external
stairway was located within a separate interest, but not marked as common area, the
stairway would normally be intended for emergency use only.
The Deelos do not concede that Knell’s testimony properly reflects industry
customs and standard practices. Instead, they assert Knell’s testimony is not credible
because it is “self contradicting,” lacks “factual foundation” and merely “expresse[s] his
belief on how the case should be decided.” The Deelos raised similar arguments in their
post-trial closing brief, asserting that the trial court should discount Knell’s conclusions
because he previously admitted at deposition that the garage stairway was a form of
common area and that condominium plan diagrams generally do not depict stairways.
Given the Deelos’s objections to Knell’s expert testimony both at trial and on appeal, it is
apparent that the extrinsic evidence was―and is still―in conflict. (See Warner Constr.
Corp. v. City of Los Angeles (1970) 2 Cal.3d 285, 291-292 [interpretation of contractual
language that “depends on the credibility of [a single expert’s] testimony” is a question of
fact]; Winet, supra, 4 Cal.App.4th at p. 1166 [“parol evidence is in conflict [when it] . . .
requires resolution of credibility issues”].) Accordingly, we must uphold the trial court’s
interpretation of the governing documents if it is reasonable and supported by substantial
evidence.
18
Knell’s testimony constitutes substantial evidence supporting the trial court’s
interpretation. (See Bailey v. Breetwor (1962) 206 Cal.App.2d 287, 291 [expert
testimony is permitted “as to the proper interpretation of technical words used in . . .
contracts”].) Although the Deelos assert we should not credit Knell’s testimony because
he made conflicting statements during his deposition and on cross-examination, “we
defer to the [trial] court’s determination of the witnesses’ credibility.” (See Benach v.
County of Los Angeles (2007) 149 Cal.App.4th 836, 847-848.)9
The court’s ruling is also supported by evidence showing that the Plan’s floor
diagram did in fact block out areas within separate interests where other stairways were
located. Specifically, the floor diagram blocked out sections of unit one and three’s
patios where the northeast and southeast multi-level wooden stairways are located. The
diagram did not, however, block out the area of unit three’s patio where the garage
stairway is located.
9 The Deelos also argue that none of Knell’s testimony was admissible because it
concerned issues of law and “legal conclusion[s].” (See generally Nevarrez v. San
Marino Skilled Nursing and Wellness Centre (2013) 221 Cal.App.4th 102, 122 [“an
expert may not testify about issues of law or draw legal conclusions”].) The Deelos
contend Knell did nothing more than provide his own personal interpretation of the
governing documents, which was a matter for the trial court to decide. We disagree.
During Knell’s testimony, the court specifically clarified that it would not permit or
consider testimony “regarding [Knell’s] specific [understanding] of this condominium
plan” or his legal conclusions. The court further stated that it would only allow (and only
consider) evidence on “[Knell’s] understanding of what the standard practice is[;] . . . .
his understanding of what the standards are as to common areas and not common areas.”
Consistent with these statements, the trial court repeatedly directed Knell to explain how
common areas would normally be depicted on a condominium plan and the factual
significance of certain markings in light of industry customs and practices. The mere fact
that Knell’s testimony may have embraced the ultimate issue to be decided by the court
does not render the testimony inadmissible. (See Evid. Code, § 805 [“Testimony in the
form of an opinion that is otherwise admissible is not objectionable because it embraces
the ultimate issue to be decided by the trier of fact”]; Wells Truckways, Ltd. v. Cebrian
(1954) 122 Cal.App.2d 666, 674 [fact that expert witness’s expression of opinion may be
adopted by court as basis for ultimate decision does not mean that such witness is
deciding case or usurping court’s functions, as court may or may not accept witness’s
opinion].)
19
Moreover, it is undisputed that the court, acting at the parties’ request, actually
viewed the premises and examined the access ways and pathways at issue in this matter.
“‘When the trial judge views the premises in question during a trial what he sees is not a
part of the transcript of the record but is independent evidence which may be considered
by him in arriving at his decision and which this court will assume supports the findings.
[Citing cases.]’” (Endara v. City of Culver City (1956) 140 Cal.App.2d 33, 41; see also
South Santa Clara Val. Water Conservation Dist. v. Johnson (1965) 231 Cal.App.2d 388,
399 [“it is . . . well settled that when the trial judge views the premises and a record of
what he saw has not been made a part of the transcript on appeal, an appellate court must
assume that the evidence acquired by such view is sufficient to sustain the finding in
question”].) Thus, although not included in the record, we must presume that whatever
the court saw while viewing the premises supported its conclusion that the garage
stairway was not intended to be common area. (Kraemer v. Superior Oil Co. (1966) 240
Cal.App.2d 642, 648 [“The court viewed the premises and although the record does not
and could not disclose what he saw, so long as his view of the premises was authorized
that which he did see is as much supporting evidence for his findings as is any proof in
the record”]; Downey v. Santa Fe Transp. Co. (1955) 134 Cal.App.2d 720, 725-726
[when the record does not disclose what the trier of fact saw during its viewing of the
premises, the reviewing court “is required to presume” the evidence supported the
judgment].)10
The Deelos argue that even if the court’s interpretation is supported by substantial
evidence, it must nonetheless be rejected as unreasonable. (See Winet, supra, 4
Cal.App.4th at p. 1166 [“[w]hen . . . parol evidence is in conflict, . . . any reasonable
10 The Deelos contend we should not consider the fact that the trial court viewed the
premises because the court did not reference this evidence in its final minute order or the
judgment. The Deelos have cited no authority suggesting that, under the substantial
evidence standard, we may only consider evidence that is specifically referenced within
the order or judgment at issue. This argument conflicts with the well-established rule that
the “determination whether there was substantial evidence to support a finding or
judgment must be based on the whole record.” (Rivard v. Board of Pension
Commissioners (1985) 164 Cal.App.3d 405, 412.)
20
construction will be upheld as long as it is supported by substantial evidence”].) The
Deelos first assert that the court’s interpretation is unreasonable because it would require
tenants of units one and two to access the parking structure by exiting through the front
door of the development onto Pacific Street, and then re-entering through the pedestrian
doorway of the parking structure. According to the Deelos, forcing tenants to leave the
“secure” area of the building to access their vehicles is an absurd and “extraordinarily
harsh result, given the serious safety concerns adduced at trial.” The only evidence the
Deelos cite in support of this argument is Christine Deelo’s testimony that she had seen
homeless people outside the building and heard about criminal activity in the area. On
cross-examination, Deelo admitted she had never reported any of these purported safety
concerns to the police.
Christine Deelo’s current safety concerns regarding homeless people and
neighborhood crime have no relevance to the interpretation of governing documents that
were written more than 25 years before she purchased her condominium. To the extent
such evidence had any relevance, we must presume the trial court found that Deelo’s
purported safety concerns did not render its interpretation of the governing documents
extraordinarily harsh. (See Fladeboe v. American Isuzu Motors, Inc. (2007) 150
Cal.App.4th 42, 48 [“[u]nder the doctrine of implied findings, the reviewing court must
infer, following a bench trial, that the trial court impliedly made every factual finding
necessary to support its decision.”].) This implied finding is supported by Deelo’s
admission at trial that she never contacted law enforcement about her alleged safety
concerns. The finding is also supported by the fact that the trial court actually viewed the
premises and was therefore able to assess her safety claims.
The Deelos next contend that the court’s conclusion that the garage stairway was
only intended for emergency access, rather than as common area, is unreasonable because
“there is absolutely no ‘emergency use only’ restriction found in [the governing
documents].” According to the Deelos, the trial court impermissibly read a provision into
the governing documents that simply does not exist. This argument overlooks that
Knell’s expert testimony regarding industry customs and standard practices was
21
admissible not only to interpret the explicit terms of the governing documents, but also to
“imply terms when no contrary intent is apparent from the other terms of the
[documents].” (Midwest, supra, 205 Cal.App.4th at p. 451.) Knell testified that: (1)
based on his expertise as a condominium plan surveyor, a stairway located within a
separate interest that was not designated as common area would customarily be intended
for emergency egress, rather than for everyday use; and (2) the Plan’s floor diagram
appeared to have been prepared in conformity with standard customs and practices.
Because there is no provision in the governing documents that specifically addresses how
stairways that lead from a separate interest area to a common area (the parking structure)
are to be treated, the court was permitted to imply this term based on Knell’s expert
testimony.
Third, the Deelos argue the court’s interpretation is unreasonable because it
conflicts with and renders meaningless language in the DOR and the Plan that
“exclud[es] stairways . . . from unit ownership.” As explained above, however, the
governing documents do not state that all stairways within the development are excluded
from the definition of a unit. Although the DOR contains general language stating that
“stairways” are to be excluded from units, the incorporated language of the Plan states
that only “common stairways” are to be excluded from the unit. “[U]nder well
established principles of contract interpretation, ‘. . . when a general and a particular
provision are inconsistent, the particular and specific provision is paramount to the
general provision.’ [Citations] (National Ins. Underwriters v. Carter (1976) 17 Cal.3d
380, 386 [citing § 3534, Code of Civ. Proc., § 1859].) Applying those principles here,
the trial court could reasonably conclude that the term “stairway” in the DOR was
intended to mean “common stairway” as stated in the incorporated Plan. Based on the
evidence at trial, the court could also reasonably conclude the term “common stairways”
22
was only intended to refer to stairways within the development that were located in areas
designated on the floor diagram as common area.11
DISPOSITION
The trial court’s judgment is affirmed. Schmidbauer shall recover her costs on
appeal.
ZELON, J.
We concur:
PERLUSS, P. J.
WOODS, J.
11 The Deelos also argue that Civil Code section 4505 and language in the governing
documents establish an easement over any portion of a separate interest that is necessary
to access common area, thereby entitling them to use unit three’s patio walkway to access
the garage stairway. Because we affirm the trial court’s finding that the garage stairway
was not intended to be common area, we need not assess this argument. We also reject
the Deelos’s conclusory contention that, in deciding the merits of the case, the court
failed to conduct “an independent . . . review and interpretation of the legal effect of the
governing documents.” This argument is belied by the judgment itself, which
specifically states that the trial court considered all of the “evidence at trial” and
specifically references the Condominium Plan and the DOR.
23
| {
"pile_set_name": "FreeLaw"
} |
231 Cal.App.3d 1 (1991)
282 Cal. Rptr. 114
THE PEOPLE, Plaintiff and Respondent,
v.
C. AUTREY JOHNSON, Defendant and Appellant.
Docket No. A048877.
Court of Appeals of California, First District, Division Two.
June 10, 1991.
*6 COUNSEL
Betsy Wolkin, under appointment by the Court of Appeal, for Defendant and Appellant.
John K. Van de Kamp, Attorney General, Richard B. Iglehart, Chief Assistant Attorney General, John H. Sugiyama, Assistant Attorney General, Martin S. Kaye and David D. Salmon, Deputy Attorneys General, for Plaintiff and Respondent.
OPINION
SMITH, J.
Charged by information with unlawfully possessing cocaine (Health & Saf. Code, § 11350, subd. (a)) and a syringe (Bus. & Prof. Code, § 4149) and with resisting arrest (Pen. Code, § 148), defendant C. Autrey Johnson pled not guilty and moved in superior court to suppress evidence (id., § 1538.5). When the court denied the motion, he entered a negotiated plea of guilty to cocaine possession and was sentenced to 16 months in prison. He appeals, challenging the suppression ruling. We affirm.
BACKGROUND
Defendant first sought suppression at the preliminary hearing in municipal court, and the motion was denied. It was then renewed in superior court and denied there as well, based solely on the preliminary hearing transcript, with no new evidence presented. In these circumstances, the superior court judge did not hear the matter de novo. He had to accept the municipal court judge's express and implied factual findings to the extent supported by substantial evidence and then independently apply the appropriate legal/constitutional standards to that state of the facts. (1) Our review standard on appeal is the same. We defer to all supported municipal court findings, draw all inferences in favor of that court's ruling, resolve legal/constitutional issues independently and, in effect, disregard the superior court's conclusions. (People v. Ramsey (1988) 203 Cal. App.3d 671, 677-679 [250 Cal. Rptr. 309]; Pen. Code, § 1538.5, subd. (i); cf. People v. Laiwa (1983) 34 Cal.3d 711, 718 *7 [195 Cal. Rptr. 503, 669 P.2d 1278]; People v. Leyba (1981) 29 Cal.3d 591, 596-597 [174 Cal. Rptr. 867, 629 P.2d 961].)
The challenged search occurred in the common hallway of an apartment building at 4346 Third Street in San Francisco. The building, sandwiched "between two mom and pop type stores," apparently had just three units apartment 1 at ground level, apartment 2 opening onto a second-floor landing up two sets of interior steps, and apartment 3, which opened onto a third-floor landing at the top of more steps going up to the left from the second-floor landing.
Police officer Brian Danker and his partner, Officer Dinslage, were on duty at about 4:30 p.m. on August 25, 1989, when dispatch reported an anonymous complaint that "someone was selling drugs or doing drugs in the hallway of [the] apartment building." The officers, both in uniform, went to the address, found the street door unlocked, stepped inside a hallway and started up a short flight of steps to a first landing below the second floor. It was very dark inside, dimly lit by a single bulb.
They reached the first landing and paused. As their eyes adjusted to the darkness, they saw defendant just off the second-floor landing, on the first steps leading to the third floor. He was "crouched over in the corner," 12 to 15 feet away, angled perpendicular to them yet facing them. Danker related: "I was startled by the fact that somebody was there instead of just being there, and saying, `Yes, Officer,' or walking past us. I didn't understand why this person was in that position and acting like that at first."
Defendant stood up. Danker then repeatedly said, "`Come down towards me. Step down off that landing. Come down towards me....'" Defendant was "staring right at" him but gave no response. Danker recalled: "I repeated it four times. He wouldn't come down or move anywhere towards us. Then I said if I have to repeat myself one more time I'm going to come up there to get you." At that demand, defendant moved his right hand to his mouth, as if to put something in it, and simultaneously fled up the stairs toward the closed door of apartment 3. (Defendant did not live in the building, but the officers apparently did not know him or where he lived.)
Danker did not see exactly what defendant put in his mouth. He testified: "I just saw some type of substance, which I suspected to be possibly rock cocaine." His suspicion was an assumption based on experience in working the Potrero District, where "basically" all of his arrests had involved rock cocaine.
The officers tackled defendant as he fled up the stairs. A "serious non-injury wrestling match" ensued, and it took the officers a full five minutes to *8 get defendant "finally subdued and into handcuffs." Danker, who did not recall whether the cuffs were in front or in back, explained: "I wanted cuffs on him and I didn't care where."
Once subdued and handcuffed on the second-floor landing, defendant was brought to his feet. Dinslage at that point saw something in his mouth and, with Danker's help, tried to retrieve it.[1] The effort took about a minute and worked. Danker held defendant from behind in a control hold, his right arm around defendant's neck and his left hand grasping and pulling on the right hand fist so that the arm forced defendant's head up and back against the officer. Danker deliberately kept the crook of his arm in front of the neck. Demonstrating for the court, he explained: "[T]he procedure ... for a control hold is keeping it in the small of your hold [sic] instead of the bar of your arm. If you can use the bar of your arm you have a situation where you can end up choking the person and killing them."
While Danker restrained defendant in that manner, Dinslage stood in front with one or both hands on the lower part of defendant's face. He was squeezing or "[c]lenching" the jaw, trying to get it open. Defendant resisted and made "gagging" noises. Then "[a]n object came flying out of [his] mouth" a single white rock of what was stipulated below to be cocaine. It fell to the carpeted floor of the landing, where Dinslage seized it as evidence.
Afterward, Danker picked up a Ford Pinto repair book which had dropped from under defendant's arm sometime during the struggle. As he did, a hypodermic needle fell out from between the pages. It was also seized as evidence.
Defendant did not testify but called Helen Williams, who lived in apartment 2 and saw part of the incident. She knew defendant from speaking with him on the street and had once let him into her apartment to use the bathroom.
Williams recounted hearing a moan outside her door (like a crying out) and opening it. She saw defendant, his hands behind him (as if handcuffed), being held against a wall just outside her doorway, two or three feet away, by one of the officers. The officer held him with one hand under defendant's chin, his fingers around defendant's neck, about half way up his throat. Demonstrating for the court, she showed the officer's thumb on one side of the neck and the fingers around the other, as though pushing into the Adam's *9 apple area. Defendant made noises interpreted by the court as "choking and having a seizure, or something of that nature" but could not get any words out.
According to Williams, the second officer just stood there, his hands at his side. The hallway was light enough to see, illuminated in part by an unshaded window. Neither officer had a gun, nightstick or mace drawn. Her view lasted only five or six seconds, though, because she went back inside when "[t]he officers said, `Get back in your house and shut the damn door.'"
APPEAL
Defendant attacks the suppression ruling, contending that (1) he was detained without reasonable suspicion, (2) he was arrested without probable cause, and (3) the officers used excessive force, "choking" him to get the cocaine. We reject each point in turn.
I
(2) The detention issue, we hold, was waived by failure to raise it anytime below. Generally, "`questions relating to the admissibility of evidence will not be reviewed on appeal in the absence of a specific and timely objection in the trial court on the ground sought to be urged on appeal.'" (People v. Benson (1990) 52 Cal.3d 754, 786, fn. 7 [276 Cal. Rptr. 827, 802 P.2d 330], quoting People v. Rogers (1978) 21 Cal.3d 542, 548 [146 Cal. Rptr. 732, 579 P.2d 1048].) This is also true of search and seizure questions. (People v. Privitera (1979) 23 Cal.3d 697, 710 [153 Cal. Rptr. 431, 591 P.2d 919, 5 A.L.R.4th 178], cert. den. 444 U.S. 949 [62 L.Ed.2d 318, 100 S.Ct. 419].) Trial counsel's argument in superior court that "probable cause" to arrest was lacking did not preserve the issue. We reject the notion that trial attorneys commonly use that terminology to connote unjustified detentions as well as arrests. Competent counsel would be acutely aware of the distinction.
(3a) Thus, we analyze the issue indirectly, on defendant's alternative argument that trial counsel denied him effective assistance by failing to raise the issue. (4) To succeed on that theory, however, defendant must show that (1) competent counsel would have raised the issue and (2) a favorable result was reasonably probable had the issue been posed. (In re Fields (1990) 51 Cal.3d 1063, 1069-1070 [275 Cal. Rptr. 384, 800 P.2d 862], summarizing state and federal constitutional guaranties.) (3b) He cannot satisfy either component on this record because justification for a detention was clear.
*10 (5) "[T]he police can stop and briefly detain a person for investigative purposes if the officer has a reasonable suspicion supported by articulable facts that criminal activity `may be afoot,' even if the officer lacks probable cause. [¶] The officer, of course, must be able to articulate something more than an `inchoate and unparticularized suspicion or "hunch."' ... The Fourth Amendment requires `some minimal level of objective justification' for making the stop.... That level of suspicion is considerably less than proof of wrongdoing by a preponderance of the evidence.... [P]robable cause means `a fair probability that contraband or evidence of a crime will be found,' ... and the level of suspicion required for a [detention] is obviously less demanding than that for probable cause, ... [¶] The concept of reasonable suspicion, like probable cause, is not `readily, or even usefully, reduced to a neat set of legal rules.' ... In evaluating the validity of a [detention], we must consider `the totality of the circumstances the whole picture.' ..." (United States v. Sokolow (1989) 490 U.S. 1, 7-8 [104 L.Ed.2d 1, 10, 109 S.Ct. 1581], citations omitted.)
(3c) Viewing the evidence favorably to the ruling, the officers here had an anonymous report that someone was selling or doing drugs in the hallway of the building. They arrived to find a three-unit building in an area of the city where one of the officer's arrests had "basically" all involved rock cocaine. The hallway was so dimly lit that they had to allow their eyes to adjust from the light outside. There, a step or two above the second-floor landing, they saw defendant strangely crouched over in a corner, peering down at them and saying nothing. Both officers were in uniform. Defendant then stood up, still silent. Officer Danker repeatedly said, "`Come down towards me. Step down off that landing. Come down towards me...." The cold record does not reveal his tone of voice, but we imply in support of the ruling that it was coaxing rather than demanding. Still, defendant stared, saying and doing nothing. Danker, his voice apparently insistent, then warned, "[I]f I have to repeat myself one more time I'm going to come up there to get you."
(6) The Attorney General suggests, and we agree, that at that point, "`in view of all of the circumstances surrounding the incident, a reasonable person would have believed that he was not free to leave.'" (Michigan v. Chesternut (1988) 486 U.S. 567, 573 [100 L.Ed.2d 565, 572, 108 S.Ct. 1975], quoting United States v. Mendenhall (1980) 446 U.S. 544, 554 [64 L.Ed.2d 497, 509, 100 S.Ct. 1870].) Such an impression may be conveyed by a "tone of voice indicating that compliance with the officer's request might be compelled." (United States v. Mendenhall, supra, at p. 554 [64 L.Ed.2d at p. 509], citations omitted.)
(3d) Defendant did not submit to that show of authority, however. Instead he made a motion to his mouth and fled up the stairs. Under very *11 recent high court authority clarifying the so-called Mendenhall test of detention quoted above, a person reasonably believing he is not free to leave is nevertheless not detained for Fourth Amendment purposes until he either submits to that show of authority or is physically seized by the officer. (California v. Hodari D. (1991) ___ U.S. ___, ___ [113 L.Ed.2d 690, 698, 111 S.Ct. 1547, 1551].) Adapting the holding of Hodari D. to our facts: "[A]ssuming that [the officers' conduct] in the present case constituted a `show of authority' enjoining [defendant] to halt, since [he] did not comply with that injunction he was not seized until he was tackled." (Id., at p. ___ [113 L.Ed.2d at p. 699].)
We hold that reasonable suspicion existed then. An untested informant's general, uncorroborated report of criminal activity, without more, may lack reliability to support probable cause. (7) However, "[t]his is not to say that an anonymous caller could never provide the reasonable suspicion necessary for [an investigative detention]." (Alabama v. White (1990) 496 U.S. 325, ___ [110 L.Ed.2d 301, 308, 110 S.Ct. 2412] (White).) "Reasonable suspicion is a less demanding standard than probable cause not only in the sense that reasonable suspicion can be established with information that is different in quantity or content than that required to establish probable cause, but also in the sense that reasonable suspicion can arise from information that is less reliable than that required to show probable cause." (Id., at p. ___ [110 L.Ed.2d at p. 309].)
In White, reasonable suspicion arose from an anonymous phone tip that a named woman carrying cocaine in a brown attache case would be leaving an apartment to drive in a brown Plymouth station wagon with a broken taillight to a motel at a particular time. Police were justified in stopping a woman (name unknown) who emerged from the apartment building within the foretold time (without an attache case), got in a car like the one described and drove to the motel. (496 U.S. at pp. ___-___, ___-___ [110 L.Ed.2d at pp. 306-307, 309-310].)
(3e) The tip here was less detailed but, significantly, could only have been given by someone who had just been in the hallway of what the officers found to be a small, three-unit apartment building. This gave some insight into the caller's "`basis of knowledge.'" (White, supra, 496 U.S. 325, ___ [110 L.Ed.2d 301, 308].) Also, the tip implied someone hanging out in the hallway, a far more unusual activity than the mundane departure of the woman in White. The officers arrived right after the report and, indeed, saw a man in the hallway not coming or going but strangely crouched over in a corner. The dark hallway plus defendant's odd position and mute demeanor could reasonably suggest to an officer experienced in rock cocaine arrests that criminal activity may be afoot. (8) "[C]orroboration is sufficient if *12 police investigation has uncovered probative indications of criminal activity along the lines suggested by the informant.... Even observations of seemingly innocent activity provide sufficient corroboration if the anonymous tip casts the activity in a suspicious light...." (People v. Johnson (1990) 220 Cal. App.3d 742, 749 [270 Cal. Rptr. 70], citations omitted; cf. People v. Costello (1988) 204 Cal. App.3d 431, 446 [251 Cal. Rptr. 325], cert. den. (1989) 492 U.S. 921 [106 L.Ed.2d 595, 109 S.Ct. 3294].) (3f) Suspicion was heightened by Officer Danker's personal experience, from past arrests in the area, that rock cocaine use was prevalent there. (In re Frederick B. (1987) 192 Cal. App.3d 79, 86 [237 Cal. Rptr. 338].) Then, defendant's complete lack of response after standing up, and his staring as Danker asked him repeatedly to come down, added suspicion to an already bizarre encounter. Finally, suspicion abounded once defendant made the hand-to-mouth movement, as though secreting drugs, and fled up the stairs.
Reasonable suspicion of drug possession existed.
II
(9a) Defendant next claims that the officers arrested him without probable-cause justification when, after he moved his hand to his mouth and fled up the stairs, they tackled and handcuffed him. We disagree with the premise that he was arrested at that point and thus find his analysis misfocused.
We have already held (pt. I, ante) that reasonable suspicion supported a detention when defendant made the motion to his mouth and fled. This in turn precipitated the tackle and five-minute "wrestling match" in which the officers subdued, handcuffed and stood him up. We hold that those restraining actions constituted not an arrest, but a forcible detention.
(10) Having reasonable suspicion, the officers had constitutional authority to use "the least intrusive means reasonably available to verify or dispel [their] suspicion in a short period of time. [Citation.]" (Florida v. Royer (1983) 460 U.S. 491, 500 [75 L.Ed.2d 229, 238, 103 S.Ct. 1319].) The least-intrusive-means limitation is "directed at the length of the investigative stop, not at whether the police [have] a less intrusive means to verify their suspicions before stopping" a suspect. (United States v. Sokolow, supra, 490 U.S. 1, 11 [104 L.Ed.2d 1, 12].)
The right to verify or dispel suspicion is meaningless unless officers may, when necessary, forcibly detain a suspect. "The Fourth Amendment does not require a policeman who lacks the precise level of information necessary for probable cause to arrest to simply shrug his shoulders and allow a crime to occur or a criminal to escape. On the contrary, ... [a] brief stop of a *13 suspicious individual, in order to determine his identity or to maintain the status quo momentarily while obtaining more information, may be most reasonable in light of the facts known to the officer at the time." (Adams v. Williams (1972) 407 U.S. 143, 145-146 [32 L.Ed.2d 612, 617, 92 S.Ct. 1921], italics added.) With reasonable suspicion, "the officer is entitled to make a forcible stop" and, if he has reason to believe the suspect is armed and dangerous, conduct a limited search for weapons. (Id., at p. 146 [32 L.Ed.2d at p. 617], italics added, fn. omitted.)
Thus, "[a] police officer attempting to make an investigatory detention may properly display some force when it becomes apparent that an individual will not otherwise comply with his request to stop, and the use of such force does not transform a proper stop into an arrest. [Citations.]" (United States v. Thompson (9th Cir.1977) 558 F.2d 522, 524, cert. den. sub nom. Reeve v. United States (1978) 435 U.S. 914 [55 L.Ed.2d 504, 98 S.Ct. 1466]; accord United States v. Perate (4th Cir.1983) 719 F.2d 706, 709.) (11) "Levels of force and intrusion in an `investigatory stop' may be legitimately escalated to meet supervening events, such as attempted flight.... [¶] A `reasonable' reaction in this context, like `probable cause,' turns on `the factual and practical considerations of everyday life on which reasonable and prudent men, not legal technicians, act.'" (United States v. White (D.C. Cir.1981) 648 F.2d 29, 40 [208 App.D.C. 289], citations omitted, cert. den. 454 U.S. 924 [70 L.Ed.2d 233, 102 S.Ct. 424]; United States v. Richards (9th Cir.1974) 500 F.2d 1025, 1028-1029, cert. den. (1975) 420 U.S. 924 [43 L.Ed.2d 393, 95 S.Ct. 1118].) Even "a complete restriction [of liberty], if brief and not excessive under the circumstances, may constitute a valid `Terry stop' and not an arrest. [Citations.]" (United States v. Robertson (9th Cir.1987) 833 F.2d 777, 781, referring to Terry v. Ohio (1968) 392 U.S. 1 [20 L.Ed.2d 889, 88 S.Ct. 1868].)
(9b) Officers here had to physically restrain defendant before they could investigate any further since he had bolted up the stairs toward the third apartment, obviously unwilling to remain or comply with their request to come down.[2] It took two officers five minutes of "serious non-injury wrestling" to get him subdued and upright. Handcuffs were needed to do it. Defendant does not argue otherwise. The record shows that the officers used no more force than was reasonably necessary in the circumstances to effectuate the detention.
(12) A suspect's resistance cannot unilaterally elevate a detention into an arrest. Just as "resistance alone does not make an otherwise proper search *14 illegal" (People v. Bracamonte (1975) 15 Cal.3d 394, 406 [124 Cal. Rptr. 528, 540 P.2d 624], citations omitted), resistance alone does not make an otherwise proper seizure illegal. "[U]tilization of force in making a stop will not convert the stop into an arrest if it is precipitated by the conduct of the individual being detained [citations]." (United States v. Beck (9th Cir.1979) 598 F.2d 497, 501.) If suspects could convert detentions into arrests by their own flight or violence, sophisticated or simply violence-prone suspects might never be detained on less than probable cause, an absurd result.[3]
Also, "[t]he fact that a defendant is handcuffed while being detained does not, by itself, transform a detention into an arrest.... Instead, the issue is whether the restraint employed exceeded that which was reasonably necessary for the detention...." (In re Carlos M. (1990) 220 Cal. App.3d 372, 385 [269 Cal. Rptr. 447], citations omitted.) In Carlos M., for example, it was held that handcuffing a suspect in a police car on the way to a hospital for identification by a rape victim did not amount to a de facto arrest. The detention was not unreasonably long, and the handcuffs were justified by concern for officer safety. "Since a patdown search is not an infallible method of locating concealed weapons, the temporary use of handcuffs for safety purposes, used in this instance by a single officer briefly transporting two men suspected of a violent crime, did not exceed the restraint reasonably necessary to accomplish quickly the purposes of the detention." (Id., at p. 385; United States v. Bautista (9th Cir.1982) 684 F.2d 1286, 1289 [handcuffs were reasonably necessary to detain a nervous suspect who paced back and forth, as if thinking about running], cert. den. (1983) 459 U.S. 1211 [75 L.Ed.2d 447, 103 S.Ct. 1206].) In People v. Bowen (1987) 195 Cal. App.3d 269 [240 Cal. Rptr. 466], also an identification case, handcuffing a suspect to a guardrail for 25 minutes while police waited for the victim to arrive did not elevate a detention into an arrest. (Id., at pp. 272-274.)
(9c) Here, defendant struggled violently with the officers for five minutes. The need for handcuffing during questioning was patently justified by concern for officer safety. "The handcuffs eliminated the possibility of an assault or escape attempt during the questioning, particularly if an arrest became imminent." (United States v. Bautista, supra, 684 F.2d 1286, 1290.)
Upon bringing defendant to a standing position, handcuffs in place, the officers were finally able to carry out an investigation. Before doing that, *15 however, Officer Dinslage saw something in defendant's mouth, starting the one-minute-long control-hold struggle. While the officers up until then had only seen defendant move his hand to his mouth as if placing suspected rock cocaine into it, Dinslage's actual observation of something in the mouth cinched the existence of probable cause on the total facts. (People v. Cappellia (1989) 208 Cal. App.3d 1331, 1336, 1338 [256 Cal. Rptr. 695]; U.S. v. Caldera (9th Cir.1970) 421 F.2d 152, 153.) By then defendant had fled up the hallway steps in response to the uniformed officers' justified command to come down. (Cf. United States v. Lane (6th Cir.1990) 909 F.2d 895, 898-900 [detention proper when suspects fled through apartment hallways when uniformed police entered in response to anonymous phone tip of drug activity there].) His running off in response to a proper command, plus other factors, makes this a far cry from innocently avoiding police. (Cf. People v. Aldridge (1984) 35 Cal.3d 473, 479 [198 Cal. Rptr. 538, 674 P.2d 240]; People v. Bower (1979) 24 Cal.3d 638, 647-648 [156 Cal. Rptr. 856, 597 P.2d 115]; People v. Holloway (1985) 176 Cal. App.3d 150, 153-155 [221 Cal. Rptr. 394].)
Probable cause supports the recovery of cocaine from defendant's mouth (People v. Cappellia, supra, 208 Cal. App.3d 1331, 1336) and, of course, justifies the one-minute struggle as a full arrest, making it unnecessary to analyze it as a mere detention.
III
(13a) Defendant lastly contends that the officers used excessive force choking to get the cocaine from him. We uphold the municipal court's express contrary conclusion that no choking occurred.
(14) Police use of excessive force which shocks the conscience violates due process of law. (People v. Bracamonte, supra, 15 Cal.3d 394, 399, citing Rochin v. California (1952) 342 U.S. 165 [96 L.Ed. 183, 72 S.Ct. 205, 25 A.L.R.2d 1396].) Also, a search may by virtue of its intolerable intensity and scope violate the Fourth Amendment. (People v. Bracamonte, supra, 15 Cal.3d at p. 400.)
(13b) "The police may, in order to prevent the destruction of evidence, reach into a person's mouth to recover evidence if there is sufficient probable cause to believe a crime is being, or has been, committed.... The mouth is not a `sacred orifice' and `there is no constitutional right to destroy or dispose of evidence....' ..." (People v. Cappellia, supra, 208 Cal. App.3d 1331, 1336, citations omitted.) Thus, "attempts to swallow evidence can be prevented [citations] as long as excessive force is not employed. [Citations.]" (People v. Bracamonte, supra, 15 Cal.3d 394, 405, *16 fn. 6.) However, choking someone to recover evidence violates due process, without any need to inquire into the precise degree of choking involved. (People v. Jones (1989) 209 Cal. App.3d 725, 730 [257 Cal. Rptr. 500].)
Whether a choking occurred is a question of fact for the lower court to resolve and its finding must be upheld if supported by substantial evidence. (People v. Jones, supra, 209 Cal. App.3d 725, 730-731.) Here, the finding was of no choking and the evidence, viewed favorably to that finding, supports it.
The two witnesses gave irreconcilably divergent accounts. Officer Danker said he had defendant in a control hold from behind, the crook of his arm placed in front of the neck to avoid choking, while Officer Dinslage used one or both of his hands at defendant's jaw or lower face (not neck) in an attempt to retrieve the cocaine. The apartment resident, Ms. Williams, recounted an officer holding an apparently handcuffed defendant against the wall by squeezing his Adam's apple area with one hand while a second officer just stood by, hands at his sides. Williams only saw about five or six seconds of the incident, but it was reasonable for the judge to find that she witnessed part of the same one-minute struggle during which the officer said he applied the control hold. Defendant had his hands behind his back (impliedly in handcuffs) and was making gagging noises like the ones Danker described. Thus, the court had to resolve a conflict and impliedly did so in favor of the officer's testimony, which he found to be "believable." The judge did say he found Williams's testimony "also believable," but we take that to mean only that he thought she was truthful or, perhaps, that either witness's account, standing alone, was plausible. The court could not reconcile both and impliedly accepted the officer's, rejecting Williams's account of choking.
Defendant points to the facts of People v. Jones, supra, 209 Cal. App.3d 725, where choking was found when an officer pressed his thumb into the underside of the defendant's jaw, above the Adam's apple. (Id., at p. 727.) However, there was no such testimony in this case only that Officer Dinslage "grabbed the lower jaw, below the lower jaw, and requested and tried to get the jaw to open up." Dinslage was squeezing or "[c]lenching" the jaw, not pressing into the throat below it. Jones was also a case where the Court of Appeal upheld, with due deference, a finding that there was choking. (Id., at p. 728.) Deference here is in favor of a no-choke finding and, as in Jones, special respect is due the factfinder's "benefit of ... observing a re-creation of the neck hold used by the officer" (id., at p. 731).
The only suggestion of choking in Officer Danker's testimony was that defendant "was gagging" during the struggle. It is true, as defendant notes, that one definition of "gag" is "choke." (Webster's New Internat. Dict. *17 (3d ed. 1965) p. 928.) Still, assuming that the court accepted that testimony, it was not bound to find illegality. Defendant struggled throughout the minute-long episode; Danker recalled, "I was trying to keep my balance the whole time." Given this great exertion and the upward position into which the control hold forced defendant's head, it is not surprising that he made "gagging" sounds. We also bear in mind that he was fighting to keep a chunk of rock cocaine in his mouth, an object which could cause obstruction independent of the officers' actions. Also, when he finally expelled the rock, still in the control hold position, it "came flying out of [his] mouth," which suggests that his airway was not otherwise obstructed. (Contrast People v. Jones, supra, 209 Cal. App.3d 725, 728 [suspect expelled balloon only as he was forced to the ground by pressure to the back of his neck].) Thus, substantial evidence supports a no-choke finding despite the "gagging" testimony.
DISPOSITION
The judgment is affirmed.
Kline, P.J., and Benson, J., concurred.
NOTES
[1] Danker testified without objection to the perceptions of his partner. Dinslage was not called as a witness.
[2] Given their right to forcibly detain, California precedent arguably would have allowed the officers to arrest for flight which unlawfully delayed the performance of their duties (Pen. Code, § 148, subd. (a); In re Gregory S. (1980) 112 Cal. App.3d 764, 778 [169 Cal. Rptr. 540]), although this theory was not raised below.
[3] Defendant relies on Penal Code section 835, which states: "An arrest is made by an actual restraint of the person, or by submission to the custody of an officer. The person arrested may be subjected to such restraint as is reasonable for his arrest and detention." (Italics added.) He implies that a state statutory definition of "arrest" can alter constitutional distinctions between detention and arrest. No authority is cited, and we know of none.
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UNPUBLISHED
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
No. 07-7129
UNITED STATES OF AMERICA,
Plaintiff - Appellee,
v.
LINO H. HAYNES,
Defendant - Appellant.
Appeal from the United States District Court for the Eastern
District of Virginia, at Norfolk. Henry Coke Morgan, Jr., Senior
District Judge. (2:90-cr-00105-HCM)
Submitted: June 30, 2008 Decided: July 14, 2008
Before MOTZ and KING, Circuit Judges, and HAMILTON, Senior Circuit
Judge.
Affirmed by unpublished per curiam opinion.
Lino H. Haynes, Appellant Pro Se. Charles Philip Rosenberg, United
States Attorney, Alexandria, Virginia, for Appellee.
Unpublished opinions are not binding precedent in this circuit.
PER CURIAM:
Lino H. Haynes appeals the district court’s order denying
his Fed. R. Crim. P. 35(a) motion and denying reconsideration of
its May 11, 2004 order granting in part and denying in part his
Fed. R. Crim. P. 35(a) motion. We have reviewed the record and
find no reversible error. Accordingly, we affirm for the reasons
stated by the district court. See United States v. Haynes, No.
2:90-cr-00105-HCM (E.D. Va. filed July 9, 2007; entered July 12,
2007). We dispense with oral argument because the facts and legal
contentions are adequately presented in the materials before the
court and argument would not aid the decisional process.
AFFIRMED
- 2 -
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259 P.3d 324 (2011)
STATE of Washington, Respondent,
v.
Gary D. MEREDITH, Appellant.
No. 38600-3-II.
Court of Appeals of Washington, Division 2.
August 9, 2011.
*325 James Elliot Lobsenz, Carney Badley Spellman, Seattle, WA, for Appellant.
Kathleen Proctor, Pierce County Prosecuting Atty. Ofc., Tacoma, WA, for Respondent.
OPINION PUBLISHED IN PART
PENOYAR, C.J.
¶ 1 Gary D. Meredith appeals his convictions for second degree child rape and communicating with a minor for immoral purposes. His primary contention is that the prosecutor's peremptory challenge of the sole African American venire member constituted a prima facie case of purposeful discrimination in violation of Batson v. Kentucky, 476 U.S. 79, 106 S.Ct. 1712, 90 L.Ed.2d 69 (1986). In the published part of this opinion, we review the facts relevant to his Batson claim and hold that a defendant does not establish a prima facie case of purposeful discrimination under Batson by showing only that the prosecutor peremptorily challenged the sole venire member of a cognizable racial group that is different from the defendant's racial group. We also conclude that Meredith failed to establish a prima facie case of purposeful discrimination here.
¶ 2 Meredith also argues that (1) the trial court violated his rights to confrontation and cross-examination, (2) insufficient evidence supports his communication with a minor for immoral purposes conviction, and (3) the trial *326 court improperly prohibited him from arguing about the absence of DNA[1] evidence during closing argument. In the unpublished portion of this opinion, we discuss the facts relevant to these claims, each of which we reject. Accordingly, we affirm on both counts.
PUBLISHED FACTS
¶ 3 In 1996, Meredith was preparing to stand trial on one count of second degree child rape[2] and one count of communication with a minor for immoral purposes.[3] During voir dire, the prosecutor peremptorily challenged juror 4, the sole African American on the venire. Meredith, who is Caucasian, objected, arguing that the State did not give a basis for challenging juror 4 and, thus, the "only belief can be that she was removed because of her minority status." III Report of Proceedings (RP) at 107.
¶ 4 The prosecutor responded that Meredith had failed to meet his burden under Batson to show purposeful discrimination because he failed to present any evidence for this claim other than that juror 4 was African American. Additionally, the prosecutor maintained that he did not strike other racial minorities on the venire, including one woman who appeared to be of "Southern European descent . . . or perhaps even Middle Eastern." III RP at 109. He observed that the juror questionnaires did not include information on the venire members' race, "so it's difficult to know who is and is not a racial minority." III RP at 109. The prosecutor further argued that, as the "other half of the Batson challenge" requires, Meredith failed to meet his burden of proof that he was of the same race as the excluded venire member. III RP at 109.
¶ 5 The trial court agreed with the prosecutor that removing the sole African American venire member was insufficient to establish a prima facie case of purposeful discrimination under Batson:
At this point in time, the Court finds that the burden of proof is on the Defendant to demonstrate the use of a peremptory challenge based on a discriminatory reason. Defense has failed in that proof, one, as to whether or not the Prosecuting Attorney's Office here in Pierce County exercises challenges in a racially biased or discriminatory manner, or two, that . . . [the] prosecutor in this case has done so. There is no evidence of racial bias in challenging Juror No. 4 on either of those two bas[es].
The fact that there has been an exclusion of a single black juror is insufficient to establish a prima facie case pattern of exclusion. This is under Batson and under State v. Ashcroft [Ashcraft],[[4]] even though from appearances she was the only black or African American juror on the panel. There being no other evidence, the Court denies the motion.
III RP at 111. Accordingly, the trial court did not require the prosecutor to provide a race-neutral reason for challenging juror 4.
¶ 6 The jury convicted Meredith on both counts. He appeals.
PUBLISHED ANALYSIS
Batson Challenge
¶ 7 We must decide whether Meredith established a prima facie case of purposeful discrimination under Batson by showing that the prosecutor removed the only African American venire member. We hold that he did not.
¶ 8 In Batson, the United States Supreme Court recognized that the Fourteenth Amendment's equal protection clause requires defendants to be "tried by a jury whose members are selected pursuant to nondiscriminatory criteria." 476 U.S. at 85-86, 106 S.Ct. 1712 (citing Martin v. Texas, 200 U.S. 316, 321, 26 S.Ct. 338, 50 L.Ed. 497 (1906)). Batson articulated a three-part analysis to determine whether discriminatory *327 criteria were used to peremptorily challenge a venire member. 476 U.S. at 96-98, 106 S.Ct. 1712. First, the defendant must establish a prima facie case of purposeful discrimination. Batson, 476 U.S. at 96-97, 106 S.Ct. 1712. To establish a prima facie case, the defendant must provide evidence of any relevant circumstances that raise an inference that a peremptory challenge was used to exclude a venire member from the jury on account of his or her race. Batson, 476 U.S. at 96-97, 106 S.Ct. 1712. Second, if the defendant establishes this prima facie case, the burden shifts to the prosecutor to articulate a race-neutral explanation for challenging the venire member. Batson, 476 U.S. at 97, 106 S.Ct. 1712. Finally, the trial court must determine whether the defendant has established purposeful discrimination. Batson, 476 U.S. at 98, 106 S.Ct. 1712.
¶ 9 "In reviewing a trial court's ruling on a Batson challenge, [t]he determination of the trial judge is accorded great deference on appeal, and will be upheld unless clearly erroneous." State v. Hicks, 163 Wash.2d 477, 486, 181 P.3d 831 (2008) (internal quotation marks omitted) (quoting State v. Luvene, 127 Wash.2d 690, 699, 903 P.2d 960 (1995)).
¶ 10 Meredith argues that our Supreme Court's recent decision in State v. Rhone, 168 Wash.2d 645, 229 P.3d 752 (2010), cert. denied, ___ U.S. ___, 131 S.Ct. 522, 178 L.Ed.2d 385 (2010), created a bright-line rule in Washington that a defendant establishes a prima facie case of purposeful discrimination when the record shows that the prosecutor exercised a peremptory challenge against the sole remaining venire member of a constitutionally cognizable racial group. Because the prosecutor challenged the only African American venire member in the present case, Meredith concludes that he established a prima facie case of purposeful discrimination. He asserts that the trial court erred in determining otherwise, and he asks us to reverse his convictions and remand for a new trial.
¶ 11 In Rhone, there were two African Americans in the venire. 168 Wash.2d at 648, 229 P.3d 752. One was challenged for cause per the parties' agreement, and the other was removed by one of the prosecutor's peremptory challenges without an objection by the defense. Rhone, 168 Wash.2d at 648, 229 P.3d 752. After the jury was sworn in, the defendant, an African American, raised a Batson challenge. Rhone, 168 Wash.2d at 648-49, 229 P.3d 752. The trial court ruled that the defendant had failed to establish a prima facie case of purposeful discrimination. Rhone, 168 Wash.2d at 650, 229 P.3d 752.
¶ 12 In Rhone's lead opinion, four justices[5] rejected a bright-line rule that a prima facie case of discrimination is always established whenever the prosecutor peremptorily challenges a venire member who is a member of a racially cognizable group. 168 Wash.2d at 652-53, 229 P.3d 752. They noted that Batson involved a three-part analysis, in which the first part directs a trial court "to determine whether `something more' exists than a peremptory challenge of a member of a racially cognizable group." Rhone, 168 Wash.2d at 653, 229 P.3d 752. Consequently, they explained:
Adopting a bright-line rule would negate this first part of the analysis and require a prosecutor to provide an explanation every time a member of a racially cognizable group is peremptorily challenged. Such a rule is beyond the intended scope of Batson, transforming a shield against discrimination into a sword cutting against the purpose of a peremptory challenge.
Rhone, 168 Wash.2d at 653-54, 229 P.3d 752.
¶ 13 Chief Justice Madsen wrote a separate concurrence, stating, "I agree with the lead opinion in this case. However, going forward, I agree with the rule advocated by the dissent." Rhone, 168 Wash.2d at 658, 229 P.3d 752 (Madsen, C.J., concurring).
¶ 14 The dissent, which Justice Alexander[6] authored, advocated "a bright line rule that a prima facie case of discrimination is established under Batson when the sole remaining venire member of the defendant's constitutionally cognizable racial group or the last remaining minority member of the venire is peremptorily challenged." Rhone, 168 *328 Wash.2d at 661, 229 P.3d 752 (Alexander, J., dissenting). The dissenters recognized that, under an earlier precedent,[7] a trial court has discretion to find a prima facie case of purposeful discrimination where the only venire member from a constitutionally cognizable group is peremptorily challenged; however, the dissenters were persuaded to depart from this precedent because "the benefits of [a bright-line rule] far outweigh the State's minimal burden to provide a race-neutral explanation for its challenge during venire." Rhone, 168 Wash.2d at 661, 229 P.3d 752 (Alexander, J., dissenting). Some of these benefits include ensuring an adequate record for appellate review, accounting for the realities of the demographic composition of Washington venires, and effectuating the Washington Constitution's elevated protection of the right to a fair jury trial. Rhone, 168 Wash.2d at 661, 229 P.3d 752 (Alexander, J., dissenting).
¶ 15 Rhone's future is uncertain now that a new justice has joined our Supreme Court. Other Batson cases in the future will present different facts, different challenges, and different results. In any case, we need not consider the reach of the bright-line rule advocated by Rhone's minority/possible future majority because the record here is inadequately developed to tell us with any certainty whether this case even falls within that rule.
¶ 16 First, although the challenged venire member in this case was African American, Meredith is not. Thus, under the first prong of the minority/possible future majority's bright-line rule, Meredith's claim falls short because the peremptorily challenged juror was not a "member of the defendant's constitutionally cognizable racial group." See Rhone, 168 Wash.2d at 661, 229 P.3d 752 (Alexander, J., dissenting) (emphasis added). And under the minority/possible future majority's second prong, Meredith fails again because the record does not clarify whether juror 4 was, in fact, the last remaining minority member of the venire. See Rhone, 168 Wash.2d at 661, 229 P.3d 752 (Alexander, J., dissenting). For instance, the prosecutor pointed out that at least one of the remaining venire members appeared to be a racial minority.
¶ 17 Turning to Rhone's majority/possible future minority opinion, we conclude that it also does not support Meredith's claim that he established a prima facie case of purposeful discrimination. Under that opinion's analysis, to determine whether a defendant has established a prima facie claim of purposeful discrimination, the trial court must look to see whether the record reflects "something more" than "a peremptory challenge against a member of a racially cognizable group." Rhone, 168 Wash.2d at 656, 229 P.3d 752. Some factors to consider in determining whether there was purposeful discrimination include:
(1) [S]triking a group of otherwise heterogeneous venire members who have race as their only common characteristic, (2) exercising a disproportionate use of strikes against a group, (3) the level of a group's representation in the venire as compared to the jury, (4) the race of the defendant and the victim, (5) past discriminatory use of peremptory challenges by the prosecuting attorney, (6) the type and manner of the prosecuting attorney's questions during voir dire, (7) disparate impact of using all or most of the challenges to remove minorities from the jury, and (8) similarities between those individuals who remain on the jury and those who have been struck.
Rhone, 168 Wash.2d at 656, 229 P.3d 752.
¶ 18 Although this is not an exhaustive list of factors that a court may consider in deciding whether "something more" exists, Meredith did not argue to the trial court that any of these factors were present. Instead, he argued that nothing in juror 4's answers indicated "that she was in any way confused, evasive or said anything that might lead one to believe that there would be a proper basis for removing the juror." III RP at 107. We hold that this alone is not "something more" under Rhone. And without this "something more" a court will not ascribe discriminatory motives to the challenge. We recognize that there are a host of other factors, any one of *329 which may determine a trial attorney's choice to remove a venire member, including the tone and inflections in a venire member's voice, as well as non-verbal cues, including eye contact, body gestures, reactions to other venire members' responses, et cetera. In sum, the record does not reflect any discriminatory motive in removing juror 4, nor does it exclude the existence of many potential non-discriminatory motives. Thus, we hold that the trial court did not err by concluding that Meredith did not meet his burden to show a prima facie case of purposeful discrimination.
¶ 19 Finally, we agree with the dissent that a defendant may rely on "[a] single invidiously discriminatory governmental act" to establish a prima facie case of purposeful discrimination. Dissent at 1 (quoting Batson, 476 U.S. at 95, 106 S.Ct. 1712). We agree, therefore, that the trial court applied the wrong legal standard when it concluded that Meredith had to demonstrate "a pattern of exclusion" in order to establish a prima facie case of purposeful discrimination. III RP at 111. But this error does not warrant reversal of Meredith's convictions because, as we explain in the preceding paragraphs, Meredith failed to establish a prima facie case of purposeful discrimination under both the Rhone majority's "something more" standard and the Rhone minority's bright-line rule. Accordingly, although the trial court applied an incorrect legal standard, its determination with regard to Meredith's Batson challenge was not clearly erroneous.
¶ 20 A majority of the panel having determined that only the foregoing portion of this opinion will be printed in the Washington Appellate Reports and that the remainder shall be filed for public record pursuant to RCW 2.06.040, it is so ordered.
We concur: HUNT, J.
JOHANSON, J. (dissenting).
¶ 54 I respectfully dissent for two reasons. First, Batson v. Kentucky, 476 U.S. 79, 106 S.Ct. 1712, 90 L.Ed.2d 69 (1986), does not require a pattern of racial discrimination. And, second, I agree with Justice Alexander's conclusion in his dissent in State v. Rhone, 168 Wash.2d 645, 659, 229 P.3d 752, cert. denied, ___ U.S. ___, 131 S.Ct. 522, 178 L.Ed.2d 385 (2010) (Alexander, J., dissenting), that there should be a bright-line rule "that a defendant establishes a prima facie case of discrimination when, as here, the record shows that the State exercised a peremptory challenge against the sole remaining venire member" of a specific racial group.
¶ 55 As to my first reason, the record shows that the trial court clearly applied the wrong standard articulated in Batson, 476 U.S. at 95, 106 S.Ct. 1712. Under Batson, "`a consistent pattern of official racial discrimination' is not `a necessary predicate to a violation of the Equal Protection Clause. A single invidiously discriminatory governmental act' is not `immunized by the absence of such discrimination in the making of other comparable decisions.'" Batson, 476 U.S. at 95, 106 S.Ct. 1712 (quoting Vill. of Arlington Heights v. Metro. Hous. Dev. Corp., 429 U.S. 252, 266 n. 14, 97 S.Ct. 555, 50 L.Ed.2d 450 (1977)). Batson replaced the previous "threshold requirement to prove systemic discrimination under a Fourteenth Amendment jury claim, with the rule that discrimination by the prosecutor in selecting the defendant's jury sufficed to establish the constitutional violation." Miller-El v. Dretke, 545 U.S. 231, 236, 125 S.Ct. 2317, 162 L.Ed.2d 196 (2005).
¶ 56 Under these rules, the trial court's ruling here is clearly erroneous. The trial court held that "[t]he fact that there has been an exclusion of a single black juror is insufficient to establish a prima facie case pattern of exclusion." 3 Verbatim Report of Proceedings (VRP) at 111 (emphasis added). But as Justice Alexander noted in his dissent in Rhone, "it is clearly inappropriate for a trial court to consider whether the jury selection process involves systematic exclusion of venire members based on a discriminatory purpose." Rhone, 168 Wash.2d at 660, 229 P.3d 752 (citing Batson, 476 U.S. at 95, 106 S.Ct. 1712). Instead, "a `single invidiously discriminatory governmental act' is sufficient to warrant reversal of a conviction." Rhone, 168 Wash.2d at 660, 229 P.3d 752 (quoting Batson, 476 U.S. at 95, 106 S.Ct. 1712) (Alexander, J., dissenting). Here, the trial court *330 required Meredith to show systematic discrimination by showing a "pattern of exclusion." 3 VRP at 111. In so doing, the court applied the incorrect standard and, thus, its ruling was clearly erroneous.
¶ 57 My second reason for dissenting is that I would follow Justice Alexander's bright-line rule in Rhone: "a prima facie case of discrimination is established under Batson when the sole remaining venire member of the defendant's constitutionally cognizable racial group or the last remaining minority member of the venire is peremptorily challenged."[12]Rhone, 168 Wash.2d at 661, 229 P.3d 752 (Alexander, J., dissenting). I agree with Justice Alexander that:
Speculation after the fact about whether the State had a discriminatory purpose in exercising a peremptory challenge is unreliable. The need to speculate can be avoided entirely by requiring the State to provide a short explanation when a defendant raises a Batson challenge.
. . . A bright line rule would provide clarity and certainty concerning the State's obligations in future cases and would simultaneously engender greater fidelity to Batson and its equal protection guaranty.
Rhone, 168 Wash.2d at 661-62, 229 P.3d 752 (Alexander, J., dissenting).
¶ 58 I recognize that Justice Alexander's proposed rule suggests that the dismissed juror must be of the same racial group as the defendant and that the majority here emphasizes this aspect of the rule. But in my view, the majority here reads this rule too narrowly by requiring the defendant and struck venire person to share the same race.
¶ 59 It is well settled that a defendant can object to a peremptorily challenged juror even though they do not share the same race. Powers v. Ohio, 499 U.S. 400, 406, 111 S.Ct. 1364, 113 L.Ed.2d 411 (1991). Limiting a defendant's right to object "conforms neither with our accepted rules of standing to raise a constitutional claim nor with the substantive guarantees of the Equal Protection Clause and the policies underlying federal statutory law." Powers, 499 U.S. at 406, 111 S.Ct. 1364; accord Rhone, 168 Wash.2d at 651 n. 2, 229 P.3d 752 ("The United States Supreme Court has expanded the scope of Batson's basic constitutional rule" to the use of peremptories by prosecutors "where the defendant and the excluded juror are of different races.").
¶ 60 Additionally, "Batson `was designed "to serve multiple ends,"' only one of which was to protect individual defendants from discrimination in the selection of jurors." Powers, 499 U.S. at 406, 111 S.Ct. 1364 (quoting Allen v. Hardy, 478 U.S. 255, 259, 106 S.Ct. 2878, 92 L.Ed.2d 199 (1986)). "The opportunity for ordinary citizens to participate in the administration of justice has long been recognized as one of the principal justifications for retaining the jury system." Powers, 499 U.S. at 406, 111 S.Ct. 1364; see also Carter v. Jury Comm'n of Greene County, 396 U.S. 320, 330, 90 S.Ct. 518, 24 L.Ed.2d 549 (1970) ("Whether jury service be deemed a right, a privilege, or a duty, the State may no more extend it to some of its citizens and deny it to others on racial grounds than it may invidiously discriminate in the offering and withholding of the elective franchise.").
¶ 61 I believe that a bright-line rule should not be limited to situations where the defendant and the peremptorily challenged juror share the same race. Limiting a bright-line rule in such a manner ignores the realities of the defendant obtaining a cross-section of his community. It also hinders the members of that community from equally participating in our legal system.
¶ 62 The benefit of giving each member of a racially cognizable group a fair opportunity to serve justice far exceeds the State's minimal burden in offering a race-neutral reason. Ensuring that justice is blind to race in selecting a jury pool is the ultimate goal, and a bright-line rule addressing the first prong of the Batson analysis should be crafted without considering the defendant's race against the peremptorily challenged juror's race.
*331 ¶ 63 The trial court applied the wrong standard by requiring the defendant to show a pattern of discrimination to establish a prima facie case. Alternatively, I would apply Justice Alexander's proposed bright-line rule to situations like this case, in which the defendant does not share the same race as the peremptorily challenged juror.
¶ 64 Based on my disagreement of the majority's Batson analysis, I would reverse the convictions.
NOTES
[1] Deoxyribonucleic acid.
[2] RCW 9A.44.076.
[3] Former RCW 9.68A.090 (1989).
[4] The trial court may have been referring to State v. Ashcraft, 71 Wash.App. 444, 859 P.2d 60 (1993).
[5] Justices Charles Johnson (writing), Susan Owens, James Johnson, and Debra Stephens.
[6] Justices Richard Sanders, Tom Chambers, and Mary Fairhurst joined.
[7] State v. Thomas, 166 Wash.2d 380, 397, 208 P.3d 1107 (2009).
[12] Justice Madsen did not adopt this bright-line rule in Rhone, but she stated that "going forward, [she] agree[d] with the rule advocated by [J. Alexander]." Rhone, 168 Wash.2d at 658, 229 P.3d 752 (Madsen, C.J., concurring).
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107 F.3d 880
97 CJ C.A.R. 417
NOTICE: Although citation of unpublished opinions remains unfavored, unpublished opinions may now be cited if the opinion has persuasive value on a material issue, and a copy is attached to the citing document or, if cited in oral argument, copies are furnished to the Court and all parties. See General Order of November 29, 1993, suspending 10th Cir. Rule 36.3 until December 31, 1995, or further order.
Melvin ANDERSON, Petitioner-Appellant,v.FEDERAL BUREAU OF PRISONS, Respondent-Appellee.
No. 96-1229.
D.C. No. 94-N-2333.
United States Court of Appeals, Tenth Circuit.
March 18, 1997.
1
ORDER AND JUDGMENT*
2
Before BRORBY and KELLY, Circuit Judges, and CAUTHRON,** District Judge.
3
After examining the briefs and appellate record, this panel has determined unanimously that oral argument would not materially assist the determination of this appeal. See Fed. R.App. P. 34(a); 10th Cir. R. 34.1.9. The case is therefore ordered submitted without oral argument.
4
Petitioner/Appellant Melvin Anderson appeals from the district court's order dismissing his petition, phrased in the form of a complaint, for writ of mandamus or prohibition directed to Respondent/Appellee Federal Bureau of Prisons. A magistrate judge recommended that summary judgment be granted for appellee. The district court accepted this recommendation, and dismissed appellant's complaint.
5
Appellant appealed and filed, in this court, an "emergency verified summary motion to vacate order and judgment pending appeal and remand with instruction to resolve summary judgment motion." In this pleading, he sought to have this case immediately remanded to the district court for determination of what he claimed was his own pending motion for summary judgment. He complained, in the motion, that the district court erred in two respects: first, by not ruling on his motion for summary judgment, and second, by not granting the motion in his favor.
6
A motions panel of this court determined that the district court had in fact denied appellant's summary judgment motion. On this basis, the panel denied appellant's motion for remand, but instructed him that he could raise in his appellate brief any issues regarding the motion for summary judgment. Appellant thereafter moved this court to construe his motion to vacate as his opening brief. The motion was granted.
7
Although the motions panel's determination that the district court denied appellant's motion for summary judgment is not binding on this panel, see Stifel, Nicolaus & Co. v. Woolsey & Co., 81 F.3d 1540, 1543-44 (10th Cir.1996), our own review of the record convinces us that the motions panel was entirely correct. The magistrate judge carefully considered appellant's motion, and advised, in a well-reasoned recommendation, that it be denied. R., doc. 16 at 3-4. In its order of dismissal, the district court stated that "[a]ny pending motion not specifically addressed herein is DENIED." Id., doc. 35 at 2.
8
The motions panel did not consider the other issue appellant raises, whether the district court properly denied the motion for summary judgment. We now address this question. We agree with the magistrate judge that appellant's motion for summary judgment should be construed as a motion for default judgment. The only ground he asserted for summary judgment was that appellee had failed to defend the action.
9
Appellee filed its response to appellant's petition thirteen days after the deadline set by the district court. This filing occurred on the day after appellant filed his motion for "summary judgment." The magistrate judge recommended that the untimely filing be excused, and that appellant's motion for default judgment be denied.
10
A trial court is vested with broad discretion in deciding whether to enter default judgment. See Grandbouche v. Clancy, 825 F.2d 1463, 1468 (10th Cir.1987). Moreover, Fed.R.Civ.P. 55(e) restricts the availability of default judgments against agencies of the United States Government. It states that "[n]o judgment by default shall be entered against the United States or an officer or agency thereof unless the claimant establishes his claim or right to relief by evidence satisfactory to the court." Courts have construed this section liberally, refusing to enter default where the government has failed timely to plead or otherwise defend, or setting aside such default on motion by the government. See 10 Charles Alan Wright et al., Federal Practice and Procedure, Civil § 2702 (2d ed.1983); see also Mason v. Lister, 562 F.2d 343, 345 (5th Cir.1977) (district court's refusal to enter default was not abuse of discretion where government responded promptly to motion for default judgment and plaintiff's claim ultimately proved unable to withstand summary judgment).
11
Here, appellee did file a response, indicating that it had not abandoned the action. It also timely responded to appellant's motion for summary judgment. Moreover, appellant's claim did not survive summary judgment on the merits. Under these circumstances, the district court did not abuse its discretion in refusing to enter default judgment for appellant.
12
The judgment of the United States District Court for the District of Colorado is AFFIRMED. The mandate shall issue forthwith.
*
This order and judgment is not binding precedent, except under the doctrines of law of the case, res judicata, and collateral estoppel. The court generally disfavors the citation of orders and judgments; nevertheless, an order and judgment may be cited under the terms and conditions of 10th Cir. R. 36.3
**
Honorable Robin J. Cauthron, District Judge, United States District Court for the Western District of Oklahoma, sitting by designation
| {
"pile_set_name": "FreeLaw"
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Reposted to provide correct counsel listing.
IN THE SUPREME COURT OF
CALIFORNIA
JAZMINA GERARD et al.,
Plaintiffs and Appellants,
v.
ORANGE COAST MEMORIAL MEDICAL CENTER,
Defendant and Respondent.
S241655
Fourth Appellate District, Division Three
G048039
Orange County Superior Court
30-2008-00096591
December 10, 2018
Justice Liu authored the opinion of the court, in which Chief
Justice Cantil-Sakauye and Justices Chin, Corrigan, Cuéllar,
Kruger, and Siggins * concurred.
*
Presiding Justice of the Court of Appeal, First Appellate
District, Division Three assigned by the Chief Justice pursuant
to article VI, section 6 of the California Constitution.
GERARD v. ORANGE COAST MEMORIAL MEDICAL CENTER
S241655
Opinion of the Court by Liu, J.
The Labor Code generally provides that employees who
work more than five hours must be provided with a 30-minute
meal period and that employees who work more than 10 hours
must be provided with an additional 30-minute meal period.
(Lab. Code, § 512, subd. (a); all undesignated statutory
references are to this code.) An employee who works no more
than six hours may waive the meal period, and an employee
who works no more than 12 hours may waive the second meal
period. (Ibid.) A wage order of the Industrial Welfare
Commission (IWC) permits health care employees to waive the
second meal period even if they have worked more than 12
hours. The hospital that is the defendant in this case allowed
employees working shifts longer than 12 hours to waive the
second meal period, and the employees who are the plaintiffs
here waived their second meal periods. Plaintiffs now claim
that the IWC order permitting them to waive second meal
periods for shifts greater than 12 hours violates the Labor
Code and that the hospital must pay back wages and penalties
for unlawfully permitting waiver of the second meal period.
Considering the relevant statutory and regulatory provisions
in light of their history, we agree with the Court of Appeal that
the IWC order does not violate the Labor Code.
1
I.
Plaintiffs Jazmina Gerard, Kristiane McElroy, and
Jeffrey Carl are health care workers who were formerly
employed by defendant Orange Coast Memorial Medical
Center (Hospital). According to their complaint, plaintiffs
usually worked 12-hour shifts and sometimes worked shifts
longer than 12 hours. A Hospital policy allowed health care
employees who worked shifts longer than 10 hours caring for
patients to voluntarily waive one of their two meal periods,
even if their shifts lasted more than 12 hours. Plaintiffs
alleged they signed second meal period waivers and
occasionally worked shifts longer than 12 hours without being
provided a second meal period. Plaintiffs contended that these
second meal period waivers violated the Labor Code, and they
sought penalties, unpaid wages, and injunctive relief for those
and other violations. Gerard alleged claims on her own behalf
and on behalf of others in the form of a private attorney
general action. (Lab. Code, § 2698, et seq. (Labor Code Private
Attorneys General Act of 2004 or PAGA).) McElroy and Carl
also alleged claims on their own behalf and on behalf of others
in the form of a class action. (Code Civ. Proc., § 382.)
The Hospital asserted as an affirmative defense that the
meal period waivers had conformed to the applicable IWC
wage order. The Hospital moved for summary judgment
against Gerard on all of her individual and PAGA claims,
asserting that there was no disputed issue of material fact as
to the cause of action for meal period violations because the
plaintiffs were provided meal periods as required by law. The
trial court granted the Hospital’s motion for summary
judgment and its subsequent motion to deny class certification.
Plaintiffs appealed.
2
As explained in greater detail below, the Court of Appeal
initially reversed the trial court, holding that although the
meal period waivers were obtained in conformity with the
applicable wage order, that wage order violated a provision of
the Labor Code generally prohibiting second meal period
waivers for employees working shifts longer than 12 hours.
We granted the Hospital’s petition for review and transferred
the case to the Court of Appeal with directions to consider
recently enacted legislation that was potentially pertinent to
the case. The Court of Appeal subsequently reversed course
and affirmed the trial court’s rulings in favor of the Hospital.
We then granted plaintiffs’ petition for review.
II
Wage and hour claims, including claims regarding the
availability and timing of meal breaks, are “governed by two
complementary and occasionally overlapping sources of
authority: the provisions of the Labor Code, enacted by the
Legislature, and a series of 18 wage orders, adopted by the
IWC.” (Brinker Restaurant Corp. v. Superior Court (2012) 53
Cal.4th 1004, 1026 (Brinker).) “To the extent a wage order and
a statute overlap, we will seek to harmonize them, as we would
with any two statutes.” (Id. at p. 1027.) But because the
Legislature is the source of the IWC’s authority, a provision of
the Labor Code will prevail over a wage order if there is a
conflict. (See id. at p. 1026; California Hotel & Motel Assn. v.
Industrial Welfare Com. (1979) 25 Cal.3d 200, 207–209.)
In June 1993, at the urging of the health care industry,
the IWC amended Wage Order 5–1989 to add subdivision
11(C), which permitted health care employees who worked
shifts longer than eight hours to waive a second meal period.
3
(Official Notice, Amends. to §§ 2, 3, & 11 of IWC Order No. 5–
89 (June 30, 1993).) As the IWC’s Statement as to the Basis of
Amendments explained: “The petitioner requested the IWC to
allow employees in the health care industry who work shifts in
excess of eight (8) total hours in a workday to waive their right
to ‘any’ meal period . . . as long as certain protective conditions
were met. The vast majority of employees testifying at public
hearings supported the IWC’s proposal with respect to such a
waiver, but only insofar as waiving ‘a’ meal period or ‘one’ meal
period, not ‘any’ meal period. Since the waiver of one meal
period allows employees freedom of choice combined with the
protection of at least one meal period on a long shift, on June
29, 1993, the IWC adopted language which permits employees
to waive a second meal period provided the waiver is
documented in a written agreement voluntarily signed by both
the employee and the employer, and the waiver is revocable by
the employee at any time by providing the employer at least
one day’s notice.” (Ibid.)
In 1999, the Legislature enacted Assembly Bill No. 60
(AB 60), known as the Eight-Hour-Day Restoration and
Workplace Flexibility Act of 1999. This bill was passed in
response to IWC wage orders that had eliminated overtime for
employees working more than eight hours per day. The
legislation repealed five wage orders, including Wage Order
No. 5 covering the health care industry, and required the IWC
to review its wage orders and readopt orders restoring daily
overtime. (See Brinker, supra, 53 Cal.4th at p. 1045.) The
Legislature amended Labor Code section 510 to explicitly
provide that “[a]ny work in excess of eight hours in one
workday . . . shall be compensated at the rate of no less than
one and one-half times the regular rate of pay for an
4
employee.” (Stats. 1999, ch. 134, § 4; compare stats. 1982,
ch. 185, § 1 [earlier version of section 510 without that
provision].) Section 511 was added to allow employers and
employees to agree on an alternative workweek that permitted
employees to work up to 10 hours per day within a 40-hour
week without the obligation to pay overtime. AB 60 also added
section 512, which for the first time set out statutory meal
period requirements. (Brinker, at p. 1045.) Subdivision (a) of
section 512 (section 512(a)) states in relevant part: “An
employer may not employ an employee for a work period of
more than 10 hours per day without providing the employee
with a second meal period of not less than 30 minutes, except
that if the total hours worked is no more than 12 hours, the
second meal period may be waived by mutual consent of the
employer and the employee only if the first meal period was
not waived.” (Italics added.)
Further, AB 60 added section 516, which stated:
“Notwithstanding any other provision of law, the [IWC] may
adopt or amend working condition orders with respect to break
periods, meal periods, and days of rest for any workers in
California consistent with the health and welfare of those
workers.” (Stats. 1999, ch. 134, § 10, italics added.) And AB
60 added section 517, which states in pertinent part in
subdivision (a): “The Industrial Welfare Commission shall, at
a public hearing to be concluded by July 1, 2000, adopt wage,
hours, and working conditions orders consistent with this
chapter without convening wage boards, which orders shall be
final and conclusive for all purposes.”
Consistent with that mandate, the IWC adopted a new
version of Wage Order No. 5 on June 30, 2000, and it became
effective on October 1, 2000. Section 11(D) of Wage Order No.
5
5 essentially readopted former section 11(C) discussed above:
“Notwithstanding any other provision of this order, employees
in the health care industry who work shifts in excess of eight
(8) total hours in a workday may voluntarily waive their right
to one of their two meal periods.”
After section 11(D) was adopted, but before it became
effective, the Legislature enacted Senate Bill No. 88 (SB 88),
which among other things expanded the class of employees
exempt from overtime to include certain computer software
and nursing professionals. (See §§ 515, subd. (f), 515.5; Stats.
2000, ch. 492, §§ 2–3.) SB 88 also amended section 516 to say:
“Except as provided in Section 512, the [IWC] may adopt or
amend working condition orders with respect to break periods
[and] meal periods . . . .” (Stats. 2000, ch. 492, § 4, italics
added.)
The present litigation challenged the validity of section
11(D), and the Court of Appeal invalidated the provision in
Gerard v. Orange Coast Memorial Medical Center (2015) 234
Cal.App.4th 285, review granted May 20, 2015, S225205
(Gerard I). As the Court of Appeal here explained: “In Gerard
I we held . . . section 11(D) invalid to the extent it sanctions
second meal period waivers for health care employees who
work shifts of more than 12 hours, because it conflicts with
section 512(a) which allows such waivers only if the total hours
worked is no more than 12 hours. Moreover, we held the IWC
exceeded its authority by enacting . . . section 11(D), because it
created an additional exception for health care workers,
beyond the second meal period waiver exception in section
512(a), all in violation of section 516(a). For these reasons, we
concluded hospital’s second meal period waiver policy violates
sections 512(a) and 516(a) and is invalid.” (Gerard v. Orange
6
Coast Memorial Medical Center (2017) 9 Cal.App.5th 1204,
1210 (Gerard II).)
After Gerard I, the Legislature further amended section
516 with Senate Bill No. 327 (SB 327). The previous language
requiring the IWC to conform to section 512 was retained but
labeled as subdivision (a), and a new subdivision (b) was
added, stating: “Notwithstanding subdivision (a), or any other
law, including Section 512, the health care employee meal
period waiver provisions in Section 11(D) of [IWC] Wage
Orders 4 and 5 were valid and enforceable on and after October
1, 2000, and continue to be valid and enforceable. This
subdivision is declarative of, and clarifies, existing law.”
(Stats. 2015, ch. 506, § 2.)
SB 327 also stated as legislative findings: “The
Legislature finds and declares the following: [¶] (a) From 1993
through 2000, [IWC] Wage Orders 4 and 5 contained special
meal period waiver rules for employees in the health care
industry. Employees were allowed to waive voluntarily one of
the two meal periods on shifts exceeding 12 hours. On June
30, 2000, the [IWC] adopted regulations allowing those rules to
continue in place. Since that time, employees in the health
care industry and their employers have relied on those rules to
allow employees to waive voluntarily one of their two meal
periods on shifts exceeding 12 hours. [¶] (b) Given the
uncertainty caused by a recent appellate court decision, Gerard
v. Orange Coast Memorial Medical Center (2015) 234
Cal.App.4th 285, without immediate clarification, hospitals
will alter scheduling practices.” (Stats. 2015, ch. 506, § 1.)
SB 327 also contained an urgency provision: “This act is
an urgency statute necessary for the immediate preservation of
7
the public peace, health, or safety within the meaning of
Article IV of the Constitution and shall go into immediate
effect. The facts constituting the necessity are: [¶] In order to
confirm and clarify the law applicable to meal period waivers
for employees in the health care industry throughout the state,
it is necessary that this act take effect immediately.” (Stats.
2015, ch. 506, § 3.)
SB 327 was supported not only by hospitals and
healthcare organizations but also by health care employee
unions. The United Nurses Association of California/Union of
Health Care Professionals (UNAC) stated: “Under this wage
order provision, UNAC members have for years enjoyed the
flexibility of alternate work schedules, which allows for greater
staffing flexibility and better patient care. Patient outcomes
are dramatically improved in environments where the nurses
and other health care professionals can place priority on the
needs of their patients without interruption by an arbitrary
meal period when the shift runs long. (RNs are generally able
to eat during work time in break rooms.)” (Assem. Com. on
Labor & Employment, Bill Analysis of Sen. Bill No. 327 (2015–
2016 Reg.Sess.) Sept. 8, 2015, p. 8.) UNAC commented that
“[Gerard I] will result in a severe disruption of the lives of our
members, many of whom have built a schedule of work, child
care, and other obligations around the ability to waive a second
meal period.” (Ibid.)
At the same time as the Legislature was acting, the
Hospital petitioned this court to review Gerard I, supported by
amici letters from UNAC and Service Employees International
Union Local 121RN. We granted the petition and transferred
the cause to the Court of Appeal with directions to vacate the
8
decision and to reconsider the cause in light of the enactment
of SB 327.
On remand, the Court of Appeal concluded it had erred in
Gerard I: “The lynchpin of our analysis was the conclusion
that . . . section 11(D) conflicts with section 512(a). However,
in reaching this conclusion we failed to account for a subtle but
critical distinction in administrative law—the date an agency
regulation or order is adopted is not the same as the date it
becomes effective. (Compare Gov. Code, § 11346, et seq.
[‘Procedure for Adoption of Regulations’ . . . ] with Gov. Code, §
11343.4, subd. (a) [adopted regulations filed with Secretary of
State ‘become effective’ in accordance with prescribed schedule]
. . . ; also compare § 1173 [authorizing the IWC to ‘adopt an
order’] with § 1184 [adopted order ‘shall be effective . . . not less
than 60 days from the date of publication’] . . . .) Long-settled
case law validates the distinction between the adoption date
and the effective date. (See, e.g., Ross v. Bd. of Retirement of
Alameda County Employees’ Retirement Assn. (1949) 92
Cal.App.2d 188, 193.)
“In this case, . . . the [SB] 88 amendment to section
516(a) took away the IWC’s authority to adopt wage orders
inconsistent with the second meal period requirements of
section 512(a) as of September 19, 2000. But the IWC had
already adopted . . . section 11(D) on June 30, 2000, under the
[AB] 60 version of section 516(a) which authorized the IWC to
do so ‘notwithstanding’ section 512(a). Thus, the [SB] 88
amended version of section 516(a) should have been irrelevant
to our analysis in Gerard I. Instead, it became dispositive. We
concluded . . . section 11(D) is subject to the [SB] 88 amended
version of section 516(a). It isn’t.” (Gerard II, supra, 9
Cal.App.5th at pp. 1210–1211.) The court therefore concluded
9
that “the IWC did not exceed its authority by adopting . . .
section 11(D), and hospital’s second meal period waiver policy
does not violate section 512(a).” (Id. at p. 1211.)
To summarize this chronology: The IWC in 1993
amended Wage Order 5 with section 11(C), allowing health
care employees who work more than eight hours in a shift to
waive a second meal period. In 1999, AB 60 provided in Labor
Code section 512 that employees could only waive the second
meal period if they worked 12 hours or less, but also provided
in former section 516 that the IWC could adopt or amend wage
orders with respect to meal periods “notwithstanding any other
provision of law” as long as the order was consistent with the
health and welfare of the employees. In 2000, the IWC
adopted section 11(D), which, like 11(C), permitted health care
workers who work more than eight hours to waive a second
meal period. Also in 2000, after section 11(D) was adopted but
before it went into effect, the Legislature enacted SB 88, which
required IWC wage orders to be consistent with section 512.
Eight years later, this litigation challenged the validity of the
second meal period waivers of health care employees working
shifts greater than 12 hours. In Gerard I, the Court of Appeal
held that such waivers are invalid because section 11(D)
violated sections 512 and 516. In response, the Legislature
enacted SB 327, declaring the meal waiver provisions for
health care employees in Wage Order No. 5 valid and
enforceable. We granted the Hospital’s petition for review and
transferred the case to the Court of Appeal. The Court of
Appeal in Gerard II reversed itself, and we granted Gerard’s
petition for review.
10
III.
Plaintiffs do not dispute the distinction between the
adoption of a wage order and its effective date, or that the
amended version of section 516 does not apply to wage orders
that had already been adopted. Indeed, the text of amended
section 516 qualifies the IWC’s authority to adopt wage orders
going forward, but it contains no terms invalidating wage
orders already adopted: “Except as provided in Section 512,
the [IWC] may adopt or amend working condition orders with
respect to break periods [and] meal periods . . . .” (Stats. 2000,
ch. 492, § 4, italics added.) But plaintiffs contend that the IWC
lacked authority to adopt section 11(D) because even under the
version of section 516 in effect at the time the wage order was
adopted, section 512(a) limited the IWC’s authority to permit
meal period waivers.
Plaintiffs’ argument is based principally on section 517’s
language that IWC wage orders adopted by July 1, 2000, must
be “consistent with this chapter,” that is, consistent with the
provisions of AB 60. (Stats. 1999, ch. 134, § 11.) “ ‘[C]onsistent
with this chapter,’ ” plaintiffs contend, “included a requirement
that the IWC wage order be consistent with section 512 from
the moment the Eight-Hour-Day Restoration and Workplace
Flexibility Act of 1999 was enacted. Section 516 specifically
granted the IWC authority to adopt wage orders related to
meal periods, but did not grant authority to disregard the
minimum standards established in the Act in section 512.”
Plaintiffs construe the phrase “notwithstanding any other
provision of law” in former section 516 narrowly: “The correct
reading is that the IWC was authorized to adopt orders as to
break periods and meal periods even if another law limited
11
IWC’s authority to adopt such orders, not that the IWC could
disregard all existing law in exercising its authority.”
This reading of the statutory language is unpersuasive.
It ignores the broad sweep of the phrase “notwithstanding any
other provision of law.” (Arias v. Superior Court (2009) 46
Cal.4th 969, 983, italics omitted [describing “notwithstanding
any other provision of law” as a “ ‘ “term of art” ’ [citation] that
declares the legislative intent to override all contrary law”].)
We need not define the outermost parameters of the phrase in
order to conclude that there is no reason to read it in former
section 516 to exclude from its scope the law regarding meal
periods found in section 512(a). The two provisions were
adopted simultaneously as part of the same legislation and in
order to further a common purpose. Moreover, at the time the
IWC adopted the disputed wage order, the phrase “consistent
with this chapter” in section 517 meant consistency not only
with section 512(a) but also with former section 516, which by
its terms authorized the IWC to make rules about meal periods
“notwithstanding any other provision of law.”
The more natural way to reconcile the phrases
“notwithstanding any other provision of law” of former section
516 and “consistent with this chapter” in section 517 is to give
them their literal meaning. The main purpose of AB 60, the
Eight Hour Day Restoration Workplace Flexibility Act of 1999,
was to restore overtime for a nonexempt employee working
more than eight hours a day. “[C]onsistent with this chapter”
means that IWC orders going forward can no longer disregard
daily overtime. But even as AB 60 limited the discretion of the
IWC in that and other respects, it explicitly retained in former
section 516 the IWC’s rulemaking prerogative,
“notwithstanding any other provision of law,” with respect to
12
“break periods, meal periods and days of rest,” limited only by
a requirement that any rules be “consistent with the health
and welfare” of affected workers. (Stats. 1999, ch. 134, § 10.)
Read literally, the “notwithstanding” phrase undoubtedly
gives broad powers to the IWC. That literal reading makes
sense in this context. The Legislature’s broad delegation to the
IWC is consistent with its recognition that the IWC is
constitutionally authorized (Cal. Const., art. XIV, § 1), and has
been long understood to have the power, to adopt rules nearly
co-equal to legislative enactments. (See Brinker, supra, 53
Cal.4th at pp. 1026–1027.) Only after section 11(D) was
adopted did the Legislature, through SB 88, further limit the
IWC’s discretion by requiring any rules about meal periods to
be consistent with section 512. Accordingly, we reject Gerard’s
statutory argument and the related argument that section
11(D) was beyond the scope of the authority that the
Legislature conferred on the IWC. (See Agnew v. State Bd. of
Equalization (1999) 21 Cal.4th 310, 321.)
Plaintiffs cite Brinker and a Court of Appeal case for the
proposition that the IWC may not exercise its authority under
section 516 in ways that contravene section 512. (Brinker,
supra, 53 Cal.4th at p. 1043; Bearden v. U.S. Borax, Inc. (2006)
138 Cal.App.4th 429, 438.) But those cases concern the
meaning of section 516 after SB 88 went into effect, not the
meaning of former section 516.
Plaintiffs also cite the legislative history of SB 88. The
Senate Third Reading analysis of SB 88 states: “This bill
clarifies two provisions of the Labor Code enacted in Chapter
134. Labor Code Section 512 codifies the duty of an employer
to provide employees with meal periods. Labor Code section
13
516 establishes the authority of IWC to adopt or amend
working condition orders with respect to break periods, meal
periods, and days of rest. This bill provides that IWC’s
authority to adopt or amend orders under Section 516 must be
consistent with the specific provisions of Labor Code Section
512.” (Sen. Com. on Lab. & Employment, Sen. 3d Reading of
Sen. Bill 88 (1999–2000 Reg. Sess.) as amended Aug. 10, 2000,
p. 5.) According to plaintiffs, the word “clarifies” means that
amended section 516 merely declared existing law and that it
was never the Legislature’s intent to authorize the IWC to
permit meal period waivers other than as provided in section
512.
Whether an amendment represents a change in the law
or merely a declaration of existing law is a question of
interpreting existing law, a task that ultimately belongs to the
judiciary. (McClung v. Employment Dev. Dept. (2004) 34
Cal.4th 467, 472–474.) A legislative statement that a statute
declares or amends existing law is not binding on courts, which
must make their own determination. (Id. at pp. 473–476; see
Coker v. JPMorgan Chase Bank, N.A. (2016) 62 Cal.4th 667,
690.) In this case, it is clear that SB 88’s amendment of former
section 516 worked a change in the law. Before the
amendment, the IWC had the authority to adopt orders
concerning meal periods “notwithstanding any other provision
of law,” including section 512. After the amendment, the IWC
could no longer deviate from the meal period requirements of
section 512. (See Brinker, supra, 53 Cal.4th at pp. 1042–1043.)
Moreover, although SB 88 was an urgency statute, there
is no indication that the reason for the urgency was to prevent
section 11(D) from going into effect. The restriction on the
IWC’s authority with respect to meal period waivers was only
14
one part of SB 88; the bill also addressed, among other things,
the exemption of certain computer software professionals and a
certain class of certified nurse midwives, nurse anesthetists,
and nurse practitioners from overtime pay. (Stats. 2000,
ch. 492, §§ 2–3.) The stated reason for the urgency legislation
was to enact these exemptions: “In order, at the earliest
possible time, to protect businesses that rely on the computer
industry as well as certain vital health care professions, it is
necessary for this act to take effect immediately.” (Id., § 5.)
Plaintiffs also invoke the principle that wage orders and
statutes should be harmonized where possible. (See Brinker,
supra, 53 Cal.4th at p. 1027.) They propose to harmonize the
wage order and statute as follows: Section 512 authorizes
second meal period waivers for shifts up to 12 hours, whereas
wage order No. 5 authorizes waivers of second meal periods for
shifts over 8 hours but says nothing explicitly about shifts over
12 hours. The way to harmonize these two provisions, they
say, is to read the wage order as only authorizing waivers for
shifts of 8 to 12 hours. We find this interpretation
unpersuasive. The language of former section 516
(“Notwithstanding any other provision of law, the Industrial
Welfare Commission may adopt . . . .”) already dictates the
relationship between the wage order and the statutory scheme,
directing that the order take precedence. We decline to insert
limitations into the wage order where none appear.
The parties argue at length about the significance of SB
327. Plaintiffs point to SB 327’s declaration that SB 88’s
amendment of former section 516 did not intend to
countermand the IWC’s already adopted wage order. This
legislative declaration is not binding on the courts. (See
McClung, supra, 34 Cal.4th at pp. 472–473.) Nevertheless, for
15
reasons discussed above, we independently conclude that SB
88 did not undo section 11(D) of Wage Order No. 5 permitting
health care workers who work more than eight hours to waive
a second meal period. The Legislature, when it enacted SB 88,
did not second-guess the IWC’s determination that allowing
health care employees to waive a second meal period is
consistent with promoting their health and welfare.
Since 2000, the Legislature has amended section 512
several times to exempt various classes of employees covered
by collective bargaining agreements from the prohibition
against the waiver of second meal periods for employees
working more than 12 hours. These include certain classes of
bakery workers (Stats. 2003, ch. 207 (A.B.330), § 1), motion
picture or broadcast employees (Stats. 2005, ch. 414
(A.B.1734), § 1), and certain construction employees,
commercial drivers, security officers, and utility employees
(Stats. 2010, ch. 662 (A.B.569), § 1). Thus, although the
Legislature has determined that waiver of a second meal
period for employees working more than eight hours is
generally contrary to public policy, it has not applied that rule
inflexibly to all categories of employees. This is consistent
with our conclusion that the Legislature, in prospectively
requiring IWC wage orders to be consistent with section
512(a), did not intend to disturb the extant exemption for
health care workers based on the IWC’s determination that the
exemption promoted the health and welfare of those workers.
16
CONCLUSION
We affirm the judgment of the Court of Appeal.
LIU, J.
We Concur:
CANTIL-SAKAUYE, C. J.
CHIN, J.
CORRIGAN, J.
CUÉLLAR, J.
KRUGER, J.
SIGGINS, J. *
*
Presiding Justice of the Court of Appeal, First Appellate
District, Division Three assigned by the Chief Justice pursuant
to article VI, section 6 of the California Constitution.
17
See next page for addresses and telephone numbers for counsel who argued in Supreme Court.
Name of Opinion Gerard v. Orange Coast Memorial Medical Center
__________________________________________________________________________________
Unpublished Opinion
Original Appeal
Original Proceeding
Review Granted XXX 9 Cal.App.5th 1204
Rehearing Granted
__________________________________________________________________________________
Opinion No. S241655
Date Filed: December 10, 2018
__________________________________________________________________________________
Court: Superior
County: Orange
Judge: Nancy Wieben Stock
__________________________________________________________________________________
Counsel:
Law Offices of Mark Yablonovich, Mark Yablonovich; Capstone Law, Glenn A. Danas, Robert K. Friedl,
Arlene M. Turinchak and Ryan H. Wu for Plaintiffs and Appellants.
Sheppard, Mullin, Richter & Hampton, Richard J. Simmons, Derek R. Havel, Daniel J. McQueen, Robert J.
Stumpf, Jr., and Karin Dougan Vogel for Defendant and Respondent.
Seyfarth Shaw, Jeffrey A. Berman, James M. Harris and Kiran A. Seldon for California Hospital
Association as Amicus Curiae on behalf of Defendant and Respondent.
Counsel who argued in Supreme Court (not intended for publication with opinion):
Ryan H. Wu
Capstone Law
1875 Century Park East, Suite 1000
Los Angeles, CA 90067
(310) 556-4811
Richard J. Simmons
Sheppard, Mullin, Richter & Hampton
333 South Hope Street, 43rd Floor
Los Angeles, CA 90071
(213) 620-1780
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SJC-11699
KEIAL KIMBROUGHTILLERY vs. COMMONWEALTH.
Suffolk. February 3, 2015. - May 26, 2015.
Present: Gants, C.J., Spina, Cordy, Botsford, Duffly, Lenk,
& Hines, JJ.
Practice, Criminal, Probation, Revocation of probation,
Collateral estoppel. Collateral Estoppel.
Civil action commenced in the Supreme Judicial Court for
the county of Suffolk on April 24, 2014.
The case was reported by Cordy, J.
Rebecca Kiley, Committee for Public Counsel Services, for
the petitioner.
Shoshana E. Stern, Assistant District Attorney, for the
Commonwealth.
SPINA, J. In this case, here on a reservation and report
from a single justice of the county court, we consider whether
principles of collateral estoppel bar a second probation
revocation proceeding on the same charged misconduct that was
litigated in an earlier probation revocation proceeding in a
different county and was resolved in favor of the petitioner,
2
Keial Kimbroughtillery. We conclude that principles of
collateral estoppel bar the second proceeding.
1. Background. On February 28, 2013, the petitioner was
charged by criminal complaint in the New Bedford Division of the
District Court Department (New Bedford District Court) with
unarmed robbery, G. L. c. 265, § 19 (b), and assault and
battery, G. L. c. 265, § 13A (a) (new offenses). The complaint
was based on allegations that on February 26, 2013, while the
victim was sitting in the driver's seat of her vehicle, the
petitioner leaned over her, grabbed an envelope containing $630
from her right coat pocket, and fled the scene. At the time the
complaint issued, the petitioner was serving probationary
sentences imposed by the Dorchester Division of the Boston
Municipal Court Department (Boston Municipal Court), the New
Bedford District Court, and the Fall River Division of the
District Court Department (Fall River District Court).1 A notice
1
On April 25, 2012, the petitioner pleaded guilty in the
Dorchester Division of the Boston Municipal Court Department
(Boston Municipal Court) to a complaint charging him with
assault and battery, G. L. c. 265, § 13A (a). On July 31, 2012,
the petitioner pleaded guilty in the New Bedford Division of the
District Court Department (New Bedford District Court) to a
complaint charging him with uttering a false check, G. L.
c. 267, § 5, and forgery of a check, G. L. c. 267, § 1. That
same day, he pleaded guilty in the New Bedford District Court to
a separate complaint charging him with larceny of property over
$250 by false pretenses, G. L. c. 266, §§ 30 (1), 34, and
uttering a false check. On October 2, 2012, the petitioner
pleaded guilty in the Fall River Division of the District Court
Department (Fall River District Court) to a complaint charging
3
of probation violation and hearing was issued to the petitioner
from the Boston Municipal Court on March 4, 2013. Similar
notices were issued to him from the New Bedford District Court
on March 5, 2013, and from the Fall River District Court on
May 15, 2013. Each notice alleged that the petitioner had
violated the terms of his probation by committing the new
offenses.2
The first probation revocation hearing was held in the
Boston Municipal Court on June 12 and August 20, 2013. During
the hearing, the petitioner's probation officer testified, as
did the alleged victim of the new offenses and three witnesses
called by the defense.3 Following closing arguments, a judge
found "no violation of probation" with respect to the new
offenses.4 However, he did find that the petitioner had violated
him with two counts each of forgery of a check, uttering a false
check, and larceny over $250.
2
The notice from the Boston Municipal Court also alleged
that the petitioner had failed to pay an attorney's fee of $150
and a victim witness fee of $50. In addition, the notice from
the Fall River District Court alleged that he had failed to
report to his probation officer on one occasion and had failed
to pay restitution in the amount of $6,582.40.
3
One of the defense witnesses was Miriam Lopes, a caregiver
for the petitioner who was employed by Beacon Adult Foster Care.
She testified, among other things, that in early February, 2013,
the petitioner had surgery, that he required constant care
because he was "really sick," and that he did not leave the
house on February 26.
4
As this court pointed out in Commonwealth v. Holmgren, 421
Mass. 224, 225 (1995), a criminal prosecution and a subsequent
4
his probation by failing to pay certain fees. See note 2,
supra. Based on the agreement of the parties, the judge
extended the petitioner's probation for nine months.
On September 25, 2013, the petitioner filed a motion in the
New Bedford District Court and the Fall River District Court to
hold the Commonwealth bound by the order of the Boston Municipal
Court. The petitioner asserted that because the judge found no
violation of probation with respect to the new offenses, the
parties were bound by the judge's order under the doctrine of
collateral estoppel. The Commonwealth opposed the motion. The
parties then filed a joint motion to consolidate the probation
violation hearings, which was allowed by a judge in the New
Bedford District Court. On February 18, 2014, the petitioner's
motion to hold the Commonwealth bound by the order of the Boston
Municipal Court was denied. He thereafter filed a petition for
relief in the county court pursuant to G. L. c. 211, § 3,
contending that, because the issue whether he had violated the
terms of his probation by committing the new offenses already
had been decided by a valid and binding final judgment of the
Boston Municipal Court, collateral estoppel barred relitigation
probation revocation proceeding have different standards of
proof. "In a criminal case, of course, the Commonwealth must
prove the elements of each crime charged beyond a reasonable
doubt. In a probation revocation hearing, the Commonwealth
bears a lesser burden. . . . [I]t is proof by a preponderance
of the evidence." Id. at 225-226.
5
of the issue.5 The Commonwealth opposed the petition. On June
18, 2014, a single justice reserved and reported the case to the
full court.
2. Discussion. The petitioner contends that once the
judge in the Boston Municipal Court found no probation violation
with respect to the new offenses, principles of collateral
estoppel barred a subsequent probation revocation proceeding in
a different county on the new offenses. In its brief before
this court, the Commonwealth states that, "having considered at
length both the legal and policy issues inherent in the question
before the [c]ourt, [it] now substantially agrees with the
defendant."
The doctrine of collateral estoppel, also known as issue
preclusion, provides that "when an issue of ultimate fact has
once been determined by a valid and final judgment, that issue
cannot again be litigated between the same parties in any future
lawsuit." Commonwealth v. Lopez, 383 Mass. 497, 499 (1981),
quoting Ashe v. Swenson, 397 U.S. 436, 443 (1970). See
Commonwealth v. Scala, 380 Mass. 500, 503 (1980). "In a
criminal case, the applicability of the doctrine may derive
either from the common law, with roots in civil proceedings,
5
Because the petitioner's claim is so closely identified
with double jeopardy, a petition for relief under G. L. c. 211,
§ 3, is the appropriate avenue for review. Cf. Cepulonis v.
Commonwealth, 426 Mass. 1010, 1010 (1998); Costarelli v.
Commonwealth, 374 Mass. 677, 679-680 (1978).
6
. . . or from the protection against double jeopardy of the
Fifth Amendment to the United States Constitution" (citations
omitted). Commonwealth v. Stephens, 451 Mass. 370, 375 (2008).
See Commonwealth v. Williams, 431 Mass. 71, 74 (2000);
Commonwealth v. Ellis, 160 Mass. 165, 165 (1893).
The double jeopardy clause of the Fifth Amendment consists
of three independent constitutional protections. "It protects
against a second prosecution for the same offense after
acquittal. It protects against a second prosecution for the
same offense after conviction. And it protects against multiple
punishments for the same offense" (footnotes omitted).
Aldoupolis v. Commonwealth, 386 Mass. 260, 271-272, cert.
denied, 459 U.S. 864 (1982), S.C., 390 Mass. 438 (1983), quoting
North Carolina v. Pearce, 395 U.S. 711, 717 (1969). See Krochta
v. Commonwealth, 429 Mass. 711, 713 (1999). Unlike the United
States Constitution, the Massachusetts Declaration of Rights
does not include a double jeopardy clause, but our statutory and
common law have long embraced the same principles and
protections. See Commonwealth v. Selavka, 469 Mass. 502, 509
n.8 (2014); Commonwealth v. Woods, 414 Mass. 343, 346, cert.
denied, 510 U.S. 815 (1993). See also G. L. c. 263, § 7.
Jeopardy does not attach at a probation revocation proceeding.6
6
A probation revocation proceeding is not considered to be
a new criminal prosecution because the Commonwealth already has
"met its burden of proving beyond a reasonable doubt the
7
See Commonwealth v. Wilcox, 446 Mass. 61, 66 (2006); Krochta,
supra at 713-714. Therefore, as the petitioner acknowledges,
collateral estoppel based on principles of double jeopardy is
not applicable in this case. See Krochta, supra at 714.
In the past, we have considered, without deciding, "whether
collateral estoppel protection between proceedings litigated
against the government is encompassed within the constitutional
right to due process, independent of the double jeopardy
clause." Id. at 715. See Williams, 431 Mass. at 73-74;
Commonwealth v. Dias, 385 Mass. 455, 460 (1982); Scala, 380
Mass. at 503. Here, we again need not decide this issue because
the present case can be resolved by application of common-law
collateral estoppel principles. See Williams, supra at 74.
"The common-law doctrine of collateral estoppel is designed
to 'relieve parties of the cost and vexation of multiple
lawsuits, conserve judicial resources, and, by preventing
inconsistent decisions, encourage reliance on adjudication.'"
Stephens, 451 Mass. at 375, quoting Massachusetts Prop. Ins.
Underwriting Ass'n v. Norrington, 395 Mass. 751, 756 (1985).
See Scala, 380 Mass. at 505 (describing collateral estoppel
policy considerations). Our decision in Krochta, which
person's guilt on the underlying crime." Commonwealth v.
Wilcox, 446 Mass. 61, 65 (2006). See Gagnon v. Scarpelli, 411
U.S. 778, 782 (1973) (probation revocation, like parole
revocation, not stage of criminal prosecution); Commonwealth v.
Durling, 407 Mass. 108, 112 (1990).
8
concerned the preclusive effect of a determination made at a
probation revocation proceeding on a subsequent criminal
prosecution, set forth the prerequisites for a valid collateral
estoppel claim. "Collateral estoppel is available to a
defendant as a shield against a subsequent attempt by the
government to litigate an issue necessarily decided in previous
litigation between the defendant and the government only where
there is (1) a common factual issue; (2) a prior determination
of that issue in litigation between the same parties; and (3) a
showing that the determination was in favor of the party seeking
to raise the estoppel bar" (footnotes omitted).7 Krochta, 429
Mass. at 715-716. For collateral estoppel to apply, the two
proceedings sharing a "common factual issue" must be resolved
using the same standard of proof.8 See id. at 716-717. The
7
For a discussion of the five requirements that must be met
for collateral estoppel to apply in the context of a motion to
suppress, see Commonwealth v. Cabrera, 449 Mass. 825, 829-831
(2007).
8
In Krochta v. Commonwealth, 429 Mass. 711, 711-712 (1999),
this court held that principles of collateral estoppel did not
bar criminal prosecution of a defendant on various larceny
charges, even though the same offenses had triggered an earlier
probation revocation proceeding that was resolved in the
defendant's favor. We explained that the essential components
of collateral estoppel had not been satisfied because common
factual issues were decided under different standards of proof
and under different procedural rules in the two proceedings.
Id. at 716, 718. See Holmgren, 421 Mass. at 225 (concluding
that, because of different burdens of proof in criminal case and
probation revocation proceeding, "[p]rinciples of collateral
estoppel do not bar the Commonwealth from revoking probation
based on evidence of a violation of law of which a probationer
9
burden of showing the concurrence of these three collateral
estoppel requirements "is always on the person raising the bar."
Lopez, 383 Mass. at 499.
In this case, the petitioner has satisfied the requirements
of collateral estoppel. Following a hearing in the Boston
Municipal Court, a judge determined, based on a preponderance of
the evidence, that the petitioner did not violate the terms of
his probation with respect to the new offenses. The
Commonwealth seeks to relitigate this same factual issue based
on the same standard of proof and the same procedural rules at
subsequent probation revocation proceedings on the new offenses
that have been consolidated in the New Bedford District Court.9
We conclude that principles of collateral estoppel bar the
Commonwealth from doing so.
3. Conclusion. We remand this matter to the single
justice for entry of a judgment allowing the petition for relief
under G. L. c. 211, § 3, and reversing the February 18, 2014,
has been found not guilty"). Further, we stated in Krochta,
supra at 719, that "[i]f collateral estoppel bars a criminal
prosecution as a result of a probation revocation proceeding, a
conflict between the separate goals of the probation department
and the district attorney may result, frustrating the ability of
both to accomplish the ends assigned to them by the
Legislature."
9
With regard to two additional alleged probation violations
set forth in the notice from the Fall River District Court prior
to consolidation of the hearings, see note 2, supra, the
petitioner does not contend that the Commonwealth cannot proceed
on those alleged violations.
10
order of the New Bedford District Court that denied the
petitioner's motion to hold the Commonwealth bound by the order
of the Boston Municipal Court that found no probation violation
with respect to the new offenses.
So ordered.
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762 F.Supp. 1403 (1991)
UNITED STATES of America, Plaintiff,
v.
Royal Lamarr HARDY, Loren Scott Hardy, Cassie H. Eleson, Michael Harada, Defendants.
Crim. No. 90-01466.
United States District Court, D. Hawaii.
April 29, 1991.
*1404 Daniel A. Bent by Leslie E. Osborne, Asst. U.S. Atty., Honolulu, Hawaii, for U.S.
Alexander Silvert, Federal Public Defender's Office, Honolulu, Hawaii, for Royal Lamarr Hardy.
Ignacio Garcia, Honolulu, Hawaii, for Loren Scott Hardy.
Cassie H. Eleson, pro se.
Keith Kiuchi, Honolulu, Hawaii, for Michael Harada.
ORDER DISMISSING COUNTS 1 AND 5 OF THE INDICTMENT, DISMISSING THE MOTIONS THEREBY RENDERED MOOT, AND DENYING THE VARIOUS MOTIONS FOR PRODUCTION OF GRAND JURY PROCEEDINGS, FOR SEVERANCE, AND TO DISMISS COUNTS 6 AND 7
PENCE, District Judge.
I. Introduction
This cause came before the court on several motions filed by various defendants. *1405 The first two motions seek dismissal of Count 1 of the Superseding Indictment on the grounds that it is vague and duplicitous. The third motion concerns Count 5 of the Superseding Indictment and requests that it be dismissed on the ground that it is defective.
The next motion seeks production of grand jury testimony and is based on the belief that there were "irregularities and improprieties" in the grand jury proceedings and in the resulting Superseding Indictment. Defendants wish to review the transcript for such items.
Additionally, the defendants have brought two motions to sever. Defendant Harada has moved to have his trial severed from that of the other three defendants. Defendant Lamarr Hardy has moved to sever the trial of Count 5, arguing that it is factually distinct from the rest of the Superseding Indictment.
Defendants have also filed a motion seeking dismissal of Counts 1, 6 and 7 of the Superseding Indictment based on the fact that they do not state a criminal offense. In another motion, Harada has complained that Counts 1, 6, and 7 fail to allege the proper specific intent, and therefore must be dismissed.
Finally, defendants have filed a motion to strike paragraphs 5, 10 and 16 of the Superseding Indictment on the grounds that they fail to allege acts that could have furthered the conspiracy alleged in Count 1.
II. Background
A. Introduction
On September 13, 1990, the government filed a two count Indictment ("Indictment") charging defendants Lamarr Hardy, Loren Hardy and Michael Harada with the substantive crime of "money laundering" as well as conspiracy to commit the same arising out of events which occurred in August, 1990. Thereafter, on November 29, 1990, the government filed a seven count Superseding Indictment ("Superseding Indictment") which added charges of crimes arising out of activity engaged in by defendants Cassie Eleson and Lamarr Hardy which took place in February, 1989.
As indicated, the events chronicled in the Superseding Indictment involve two distinct criminal transactions. The first transaction, which uniquely involved the structuring of financial exchanges to avoid currency reporting requirements, took place in February of 1989 and was allegedly participated in by Cassie H. Eleson and Lamarr Hardy. The second transaction, which involved the same kind of aforementioned "structuring" and drug money laundering, took place in August of 1990 and allegedly involved Lamarr Hardy, Loren Hardy, and Michael Harada, but not Cassie Eleson. The following paragraphs detail the facts surrounding each criminal transaction.
B. The Hardy-Eleson Transaction
The Superseding Indictment alleges that on February 2, 1989, in the District of Hawaii, Eleson spoke to one Ken Morris, who was then involved in a business transaction with Eleson's employer, Lamarr Hardy, and informed Morris that the $25,000 he was to deliver, pursuant to that business deal, should consist of cashier's checks in amounts less than $10,000 each.
On February 3, 1989, Eleson negotiated the various cashier's checks, that had been made payable to her by Morris pursuant to the Hardy transaction, in the following fashion:
a. Eleson cashed one cashier's check in the amount of $7,800 at the Kapiolani Branch of First Nationwide Bank;
b. Eleson deposited one $8,800 cashier's check to an account at First Federal Savings, and
c. Several days later Eleson cashed the $8,400 cashier's check at the Kapiolani Branch of First Nationwide Bank.
On approximately February 8, 1990, Ken Morris was told by Eleson that he could not have a refund of the $25,000 he had delivered, until Mr. Hardy authorized a refund, even though the three checks, totaling $25,000, had been made payable to Eleson, not Hardy.
*1406 As a result of the above conduct, Eleson and Hardy were charged in Count 5 of the Superseding Indictment with unlawfully, knowingly, and willfully, for the purpose of evading the reporting requirements of Title 31, U.S.C. § 5313(a), structuring and assisting in the structuring of a financial transaction, the payment of $25,000, to Lamarr Hardy by Ken Morris, in a fashion that would avoid the filing of Currency Transaction Reports, by the payment of three separate cashier's checks in amounts less than $10,000 all made payable to Cassie Eleson.
C. The Hardy-Harada Transaction
On August 10, 1990, the Lamarr Hardy agreed to process, for IRS undercover agents, large amounts of U.S. currency, which he allegedly believed to be the proceeds of alleged drug transactions, in such a way that none of the federal currency transaction reporting requirements would be triggered. Hardy indicated to the agents that he had a contact who was the owner of Hawaii Check Cashing Service and that "money laundering" could be conducted at the outlets of that company.
On August 14, 1990, during a meeting with undercover agents arranged by Hardy, defendant Michael Harada, who stated he was the owner of Hawaii Check Cashing Service, agreed to accept three percent of the gross amount of currency exchanged through his check cashing business for Bank of Hawaii orders as payment for his services and for the utilization of Hawaii Check Cashing Services.
Then, also on August 14, 1990, Harada personally imprinted nine $1,000 money orders and provided them to one of the undercover agents in exchange for U.S. currency. Thereafter, on the same day, Harada accompanied the undercover officers to another one of his check cashing outlets and advised one of the officer as to how much currency he should convert into money orders at that location.
On August 15, 1990, Hardy accepted the payment of $930 from the undercover agents, which represented his three percent commission for assisting with the purchase of $31,000 in personal money orders that had occurred at Hawaii Check Cashing Service locations the previous day.
Later that same day, the undercover agents met with Harada and discussed the amounts of cash that should be exchanged for money orders at each Hawaii Check Cashing Service location. Additionally, Harada accepted $930 from the undercover agents which represented his three percent commission for the purchase of $31,000 in personal money orders that had occurred at Hawaii Check Cashing locations the previous day. Further, Harada imprinted seven money orders that day totalling $6,500.
Also on August 15, 1990, defendant Loren Hardy, Lamarr's brother, accompanied two undercover agents and visited six outlets of Hawaii Check Cashing Service. At five of the locations, he conducted a transaction in the amount of $6,500, during which cash was exchanged for seven personal money orders drawn on the Bank of Hawaii. Thereafter, Loren Hardy accepted approximately $200 for his efforts in obtaining the thirty-five money orders on August 15, 1990.
On August 16, 1990, defendants Lamarr and Loren Hardy visited undercover agents for the purpose of obtaining a large amount of cash to be "laundered" through the purchase of additional personal money orders at Hawaii Check Cashing Service and other places. During the course of that meeting the Hardy Boys took and received approximately $168,000, the alleged proceeds of dealing in narcotics, for the purpose of converting that cash into personal money orders and other negotiable instruments. It was understood that these negotiable instruments were then to be delivered to the undercover agents.
Also on that day, Lamarr Hardy accepted $10,000 as his prepaid commission for the intended "laundering" of $168,000 in cash, represented to be drug money, from the undercover agents. Additionally, Hardy accepted his $15,000 commission as well as Harada's $1500 commission for the money that had been converted to money orders at Hawaii Check Cashing Service locations on August 15, 1990.
*1407 D. Component Sections of the Superseding Indictment
All of the aforementioned defendants are charged in the seven-count Superseding Indictment with conspiracy to launder drug money and to structure financial transactions to avoid reporting requirements from January 30, 1989 through August 16, 1990. In Count 1, all the defendants are charged with a general conspiracy which incorporates as its objects the remaining counts in the Superseding Indictment.
In Counts 2, 3, and 4, Lamarr Hardy is charged with substantive counts of laundering drug money with codefendant Loren Hardy on August 14 and 15, 1990. In Counts 6 and 7, Lamarr Hardy is charged, along with codefendants Loren Hardy and Michael Harada, with structuring financial transactions in order to avoid reporting requirements on August 14-15 1990.
Thus, Counts 2, 3, 4, 6, and 7 exclusively deal with the "second criminal transaction," which occurred in August of 1990 and involved the laundering of monies allegedly represented to have been the proceeds of drug deals made by undercover IRS agents.
In Count 5, Lamarr Hardy is charged with structuring financial transactions with codefendant Cassie Eleson. This count deals exclusively, however, with the "first criminal transaction," which occurred in February of 1989 and involved a structuring incident in which no IRS agents, Loren Hardy, or Michael Harada ever participated, and which has no apparent temporal or substantive connection with the August, 1990 transaction.
More specifically, Count 5 involves an alleged incident in which Ken Morris, an investor in an enterprise with Lamarr Hardy, claims that Lamarr Hardy and Cassie Eleson structured Morris' investment payments in such a way as to avoid financial reporting requirements. Other than the blanket conspiracy charge in Count 1, defendant Cassie Eleson appears as a defendant only in Count 5.
III. Discussion
A. Hardy and Harada's Motions to Dismiss on the Grounds of Duplicity and Vagueness
In their Motions to Dismiss Count 1 of the Superseding Indictment on Grounds of Vagueness and Duplicity, defendants Hardy and Harada argue that Count 1 of the Superseding Indictment is vague (argued only by Harada) and duplicitous (argued by both) because it alleges multiple objects of one conspiracy and/or because it charges defendants with two separate conspiracies. With respect to the double conspiracy charge, defendants maintain that Count 1 simultaneously charges all of the defendants with: (1) the conspiracy between Hardy and Eleson and (2) the conspiracy among the Hardy brothers and Harada.
1. Vagueness
Only Harada moves to dismiss Count 1 on grounds of vagueness. He argues that, conceding Count 1 alleges only one conspiracy, the Superseding Indictment is vague because it alleges two separate objects of the conspiracy and thus clouds what the actual objective of the conspiracy was to be. However, in the next breath, while advancing his duplicity argument, Harada concedes that "Federal courts in the District of Columbia and the Fifth Circuit have found that merely charging two offenses as the objective of the conspiracy is not in and of itself a basis for the court to dismiss the indictment." Harada Memorandum at 4. Accordingly, no such basis for dismissal is present here either.
Defendant additionally attempts to support his vagueness argument by citing a case from the Sixth Circuit, United States v. Piccolo, 696 F.2d 1162 (6th Cir.1983). In Piccolo, a criminal defendant's conviction for conspiracy to distribute and possess cocaine was reversed because the government had failed fully to articulate the theory of conspiracy that it was proceeding on. Harada claims that Count 1 of the Superseding Indictment suffers from the same defect.
However, in this case the government has clearly satisfied its obligation of *1408 articulating its theories of conspiracy in Count 1 of the Superseding Indictment. That count alleges one or more conspiracies to structure financial transactions to avoid currency reporting requirements and to launder money. Therefore, Piccolo is inapposite and Harada's vagueness argument must fail.
2. Duplicity
With respect to duplicity, both defendants argue that Count 1 should be dismissed because it alleges two distinct offenses or conspiracies. Charging two offenses in one count of an indictment is contrary to Rule 8(a) of the Federal Rules of Criminal Procedure, which mandates that an indictment contain "a separate count for each offense." The joining in a single count of two or more distinct offenses is termed "duplicity." See generally 1 Wright, Federal Practice and Procedure § 142 (2nd ed. 1982); 8 Moore's Federal Practice and Procedure § 8.03 (2nd ed. 1984).
Several Ninth Circuit opinions have had occasion to analyze the law regarding duplicity in indictments. See, e.g., U.S. v. Gordon, 844 F.2d 1397 (9th Cir.1988) (conspiracy count in indictment was duplicitous, and thus violated defendants' right to unanimous jury verdict, where count alleged conspiracy to defraud Government in administration of weapon program, and conspiracy to obstruct grand jury investigation of fraud); U.S. v. Aguilar, 756 F.2d 1418, 1422 (9th Cir.1985) (information, each count of which charged defendant with "acting as" officer of United States Immigration and Naturalization Service and "obtaining money in such character," suffered from duplicity, since each count alleged two separate and distinct offenses).
The vices of duplicity arise from breaches of the defendant's Sixth Amendment right to knowledge of the charges against him, since conviction on a duplicitous count could be obtained without a unanimous jury verdict as to each of the offenses contained in the count. See U.S. v. Aguilar, 756 F.2d at 1420; U.S. v. UCO Oil Company, 546 F.2d 833, 835 (9th Cir.1976). A duplicitous indictment may also eviscerate the defendant's Fifth Amendment protection against double jeopardy, because of a lack of clarity concerning the offense for which he is charged. See Abney v. United States, 431 U.S. 651, 654, 97 S.Ct. 2034, 2037, 52 L.Ed.2d 651 (1977).
In this case, defendants argue that Count 1 of the Superseding Indictment charges two different offenses, to wit, a conspiracy which occurred in February 1989 and a wholly distinct and separate conspiracy which occurred in August 1990. Defendants' argument has merit.
Count 1 of the Superseding Indictment alleges that all of the defendants conspired to commit the offenses of "money laundering," in violation of 18 U.S.C. § 1956(a)(3)(A), (B) and (C), and "structuring financial transactions to avoid currency reporting requirements" ("structuring") in violation of 31 U.S.C. § 5324(1) and (3). However, paragraphs 1 through 3 of the "Overt Acts" section of Count 1 of the Superseding Indictment indicates the existence of a discrete, self-contained criminal transaction which occurred in February 1989 and involved acts of "structuring" in connection with a business transaction entered into between Lamarr Hardy and Ken Morris. This criminal transaction was participated in uniquely by Lamarr Hardy, Ken Morris (who was not indicted), and Cassie Eleson.
Then sections 4 through 16 of the "Overt Acts" section goes on to indicate the existence of yet another discrete, self-contained criminal transaction which occurred in August 1990 and involved acts of "money laundering" in connection with a government-fabricated undercover transaction between the Hardy brothers, Harada and IRS undercover agents. The Superseding Indictment fails to allege any nexus whatsoever, chronological, substantive or otherwise, between the February 1989 transaction and the August 1990 transaction which took place over a year and half later and involved entirely different actors and circumstances.
From the face of the Superseding Indictment, it appears that the February 1989 *1409 transaction arose out of a business deal between Hardy and Morris and the August 1990 transaction arose spontaneously when Hardy was contacted by undercover agents and enlisted the support of his brother and Harada. Thus, Count 1 of the Superseding Indictment runs afoul of Fed.R.Crim.P. 8(a)'s proscription against charging two offenses in one count of an indictment.
This conclusion is verified by the Ninth Circuit's analysis in U.S. v. Gordon, 844 F.2d at 1397. In Gordon, defendants were convicted of conspiracy pursuant to Count I of the indictment filed against them. On appeal, defendants contended that Count I of the indictment was duplicitous because it impermissibly charged two conspiracies in a single count, to wit, conspiracy to defraud the government in administration of the weapons program and conspiracy to obstruct a grand jury investigation of said fraud.
In deciding whether Count I was duplicitous, the Ninth Circuit formulated the following test:
To determine whether Count I charged one or two conspiracies, we look at `whether there was one overall agreement among the various parties to perform various functions in order to carry out the objectives of the conspiracy.' [citation] The relevant factors in determining the existence of such an `overall agreement' are the nature of the scheme, the identity of the participants, the quality, frequency and duration of each conspirator's transactions, and the commonality of times and goals.
Id. at 1401. The Ninth Circuit then went on to apply the test:
Looking at these factors, we find that Count I charged two conspiraciesone to defraud the United States in the administration of the Trident Missile Program, and another to obstruct the grand jury investigation. The nature of the scheme suggests two conspiracies. The primary agreement between Gordon, Loeswick and Edler was to use inside information to secure government contracts for Edler Industries in return for payoffs. The evidence does not show that the parties contemplated or discussed any plans for a cover-up. We cannot imply a subsidiary conspiracy to conceal the crime. [citation omitted] The conspiracy to obstruct justice was pursuant to a separate agreement, made after Loeswick was subpoenaed by the grand jury. The commonality of time factor also points to two conspiracies. The last kickback transaction occurred in August-September 1983 while the conspiracy to obstruct the grand jury investigation did not begin until Loeswick was subpoenaed in March of 1984.
Id.
The same analysis applies with equal force to the instant case. Count I of the Superseding Indictment appears to charge two conspiraciesone to structure financial transactions to avoid currency reporting requirements arising out of a business transaction and another to similarly structure financial transactions and to launder money arising out of an unconnected government sting operation.
As in Gordon, the nature of the two schemes here suggests two conspiracies. The agreement between Hardy and Eleson was to aid a business client in structuring a financial transaction so as to avoid currency reporting requirements. The agreement between the Hardy brothers and Harada was primarily to launder alleged proceeds of drug sales for what turned out to be undercover IRS agents.
The record and the Superseding Indictment itself does not indicate that the parties to the first criminal transaction contemplated or even discussed with the parties to the second criminal transaction, any plans to carry out the second transaction, or, for that matter, any additional future transactions at all. The conspiracy to launder drug money for the IRS agents, just like the conspiracy to obstruct justice in Gordon, was pursuant to a separate agreement made after the transaction with Morris was complete. It should be noted, though, that there is even stronger evidence of separate conspiracies here, since in Gordon each party to the first conspiracy was also a party to the second conspiracy *1410 while in this case, the parties to the first conspiracy are, with the exception of Lamarr Hardy, entirely different from the parties in the first conspiracy.
The commonality of time factor also points to two conspiracies. In Gordon, the court found a sufficient time lapse to find two separate conspiracies where the last kickback transaction of the first series of events occurred in August-September 1983 while the series of events leading to obstruction of the grand jury investigation did not begin until Loeswick was subpoenaed in March of 1984, a lapse of five months. Here, the last event in the first criminal transaction occurred in February 1989[1] while the first event in the second criminal transaction did not occur until August 1990, a lapse of eighteen months.
In response, the government argues that Count I charges a single conspiracy which has as its object the commission of several crimes and thus Count I is not duplicitous. The government's semantic ruse is not persuasive. While Count I may allege several crimes as the object of conspiratorial activity, the fact remains that the antecedent conspiratorial activity consists of two different conspiracies: (1) the agreement between Hardy/Eleson and Morris and (2) the agreement among the Hardy brothers, Harada, and the undercover agents. Therefore, Count I violates the strictures of Fed.R.Crim.P. 8(a) and must be dismissed.
This is true notwithstanding the government's insistence that even where duplicity has been found to exist in an indictment, any prejudice to the defendant can be corrected by a proper jury instruction and that a duplicity challenge is cured when the jury is properly instructed. However, this court chooses to heed the time-honored adage that "an ounce of prevention is worth a pound of cure." This is particularly true, where, as here, the preservation of defendants' Fifth and Sixth Amendment rights hangs in the balance. In light of the potential infringement of these rights if this court chose to roll the dice and preserve the confusion of Count I until a jury instruction at the end of trial, the Ninth Circuit's observation concerning the timing of duplicity objections is particularly instructive: "A duplicity objection can easily be made before trial because a duplicity claim is directed at the face of the indictment and not at the evidence presented at trial." Gordon, 844 F.2d at 1400.
Count 1 of the Indictment, although not vague, is duplicitous and must be dismissed.
B. Motion to Dismiss Count 5
1. Mischaracterization of the Bank Check
Count 5 of the Superseding Indictment alleges that Lamarr Hardy, together with Eleson, structured a financial transaction in a manner calculated to avoid mandatory reporting requirements, in violation of 31 U.S.C. § 5324(1) and (3). The three payments at issue, however, were made by bank check, not by cashier's check as stated in the Superseding Indictment. This discrepancy, argues Lamarr Hardy, warrants dismissal of the Count.
The government argues that the operative word is "check" and that the adjective used to describe the check is immaterial. Indeed, the government suggests that the word "cashier's" could be struck from the Superseding Indictment with no impact whatsoever. In fact, the checks are labeled neither "cashier's check" nor "bank check," but "official check." The court will not delve into the definitions of these various termsneither party has discussed the distinction between these various types of checks or suggested that such a distinction, *1411 to the extent they can be meaningfully distinguished, is in any way material to the crime charged.
2. The Statute's Application Only to "Transaction[s] in Currency"
The more interesting issue raised by Lamarr Hardy, however, is whether the "official checks" in question constitute "currency" sufficient to bring the transaction within the scope of the statute. Count 5 charges Defendants with violating 31 U.S.C. § 5324(1) and (3), which provides, in part:
No person shall for the purpose of evading the reporting requirements of section 5313(a) ... structure or assist in structuring, or attempt to structure or assist in structuring any transaction with one or more domestic financial institutions.
The statute refers to § 5313(a), which, in turn, provides:
When a domestic financial institution is involved in a transaction for the payment, receipt, or transfer of United States coin or currency (or other monetary instruments the Secretary of the Treasury prescribes), in an amount ... or under circumstances the Secretary prescribes by regulation, the institution ... shall file a report on the transaction in the way the Secretary prescribes.
(Emphasis added.) The references to what "the Secretary prescribes" prompt examination of the applicable regulations, which are found at 31 C.F.R. § 103. Specifically, § 103.22(a)(1) provides
Each financial institution ... shall file a report of each deposit, withdrawal, exchange of currency or other payment or transfer, by, through, or to such financial institution, which involves a transaction in currency of more than $10,000.
(Emphasis added.) "Transaction in currency" is defined at 31 C.F.R. § 103.11(r):
Transactions in currency. A transaction involving the physical transfer of currency from one person to another. A transaction which is a transfer of funds by means of bank check, bank draft, wire transfer, or other written order, and which does not include the physical transfer of currency is not a transaction in currency within the meaning of this part.
Hardy argues that this regulation specifically exempts the bank check transaction that forms the basis for Count 5 from the reporting requirements of 31 U.S.C. § 5313. Although the statute itself contemplated application to "monetary instruments [which] the Secretary of the Treasury prescribes," it appears from the regulations that the Secretary of the Treasury did not actually prescribe any monetary instruments unless actual currency is also involved.[2]
One might argue that use of a bank check, rather than currency, is simply another aspect of "structuring" to evade reporting requirements. Because the reporting requirements of § 5313 apply only to "transactions in currency," someone who purposefully utilizes monetary instruments other than currency for the purpose of frustrating the reporting scheme, might be deemed to have "structured" the transaction in violation of § 5324. This argument fails by the definition of "structuring":
[A] person structures a transaction if that person, acting alone, or in conjunction with, or on behalf of, other persons, conducts or attempts to conduct one or more transactions in currency, in any amount, at one or more financial institutions, on one or more days, in any manner, for the purpose of evading the reporting requirements....
31 C.F.R. § 103.11(p) (emphasis added).
Whether cashier's check or bank check, the literal terms of the regulations do not appear to permit application of the statute to this transaction. The government does not address this issue at all in its memorandum, but simply asserts that § 5324 "was enacted precisely to make the transaction at issue here illegal," and that "defendants *1412 [sic] position ignoring [sic] both the purpose [sic] of Section 5324 and [the regulations]."[3]
The analysis cannot stop here, however. Although neither party cited any case law, there is one decision that directly addresses this argument: United States v. Torres Lebron, 704 F.Supp. 332 (D.Puerto Rico 1989). In that case, the cash was converted to winning lottery tickets, which were subsequently exchanged for certificates of deposit ("CDs"). Under the procedure, repeated on five occasions, bundles of cash were brought to the bank, counted by bank tellers under the supervision of a bank officer, and then informally exchanged for bank checks for winnings from the Puerto Rico lottery, provided by a lottery ticket vendor. The formal transaction conducted by the bank was the exchange of these lottery checks for CDs. Defendants advanced precisely the same argument as has been advanced here: because the transaction processed by the financial institution involved no currency (just bank checks from the lottery and certificates of deposit) there was no duty to report the transaction, so there could be no criminal liability for structuring the transaction. The court was not persuaded:
Defendants argue that the only relevant transactions here were the defendants' purchase of CDs with checks issued payable to them by the Puerto Rico lottery. We concede that such "transactions," viewed in a vacuum, do not in and of themselves trigger a duty on the part of the bank to file CTRs [Currency Transaction Reports]. "Transaction," however, is a "word of flexible meaning" which "may comprehend a series of many occurrences, depending not so much upon the immediateness of their connection as upon the logical relationship...." Moore v. New York Cotton Exchange, 270 U.S. 593, 610 [46 S.Ct. 367, 371, 70 L.Ed. 750] (1926). Hence, just as courts have refused to view "broken up" cash transactions of less the $10,000 occurring at the same bank on the same day in a vacuum, [citations omitted], so too must we look beyond the "paper trail" in order to evaluate the transaction at issue here as a whole.
In the case at bar the indictment charges that on at least five separate occasions defendants conspired among themselves and aided and abetted each other in effectuating an elaborate money laundering scheme whereby bundles of cash in excess of $10,000 were "physically transferred" through Citibank, and with the aid of its officers and employees, from the Torres Lebrons to Gonzalez Couso and his associates, in exchange for lottery checks which were in turn used to purchase CDs at the bank. Thus, the transaction, when viewed as a whole, fits squarely into the Act's definition: a physical transfer of currency in excess of $10,000 from one person to another which is conducted through a financial institution. It is axiomatic that defendants are alleged to have been aware of the statutory duty to report such "transactions in currency," as well as the illegality of deliberate efforts to evade said duty.
Torres Lebron, 704 F.Supp. at 335-36 (emphasis in original).
Critical to this case, however, was the fact that the cash was brought to the bank, and counted by bank tellers under the direction of a bank officer, before it was exchanged for lottery checks. Hence, the reason for the language in the opinion about the money, "cash", passing "through Citibank" becomes apparent. Torres Lebron stands for the proposition that in examining financial transactions under § 5324, the court must look at the bigger picture, and consider all aspects of the larger transaction. Because the bankcheck-for-CD *1413 transaction was directly and immediately traceable to currency, the larger transaction involved currency and the statute applied.
The instant case appears to be factually distinguishable. There is no mention here of the bank checks being funded by more than $10,000.00 in currency. There do not appear to be allegations that the three payments by bank check were part and parcel of a larger transaction involving cash.
Accordingly, the facts as presented to the court do not support the criminal charge contained in Count 5, and the same must be dismissed.
C. Motion for Production of Grand Jury Proceedings
The Defendants seek production of a transcript of the grand jury proceedings. Lamarr Hardy argues that the "cashier's/bank check" discrepancy raises doubts about the accuracy of information given to the grand jury, and that the proceedings should be reviewed for further misinformation. Eleson similarly bases her request on the "apparent irregularities and improprieties of the Indictment."[4] Harada seeks the transcript because he "has received information, through his counsel, that the U.S. Attorney may have misinstructed the federal grand jury," and wishes to ascertain whether this occurred and whether it constitutes misconduct sufficient to dismiss the Superseding Indictment.
None of the defendants cites any law in support of his motion for production of grand jury proceedings, but the motion would apparently be based on Rule 6(e)(3)(C), which provides:
Disclosure otherwise prohibited by this rule of matters occurring before the grand jury may also be made
* * * * * *
(ii) when permitted by a court at the request of the defendant, upon a showing that grounds may exist for a motion to dismiss the indictment because of matters occurring before the grand jury....
This is merely an exception to the general rule that grand jury proceedings are kept secret. Fed.R.Cr.P. 6(e)(2).
The United States Supreme Court has recognized that proper functioning of the grand jury system requires secrecy of grand jury proceedings. United States v. Procter & Gamble Co., 356 U.S. 677, 681, 78 S.Ct. 983, 985, 2 L.Ed.2d 1077 (1958). The proceedings are not to be disclosed absent a showing of "particularized need." Illinois v. Abbott & Assoc., Inc., 460 U.S. 557, 567, 103 S.Ct. 1356, 1361, 75 L.Ed.2d 281 (1983).[5]
The Ninth Circuit has not clarified what constitutes such "particularized need." It has, however, given considerable attention to what does not constitute "particularized need." In United States v. DeTar, 832 F.2d 1110 (9th Cir.1987), the Ninth Circuit held as insufficient the movant's allegation that an unnamed grand juror told him that *1414 a previous grand jury had voted not to indict. DeTar, 832 F.2d at 1113. "It is not sufficient for [movant] to assert that he has no way of knowing whether prosecutorial misconduct occurred." DeTar, 832 F.2d at 1113 (citing United States v. Bennett, 702 F.2d 833, 836 (9th Cir.1983)). "Speculation cannot justify th[e] court's intervention into the grand jury's proceedings." United States v. Claiborne, 765 F.2d 784, 792 (9th Cir.1985), cert. denied, 475 U.S. 1120, 106 S.Ct. 1636, 90 L.Ed.2d 182 (1986); see also United States v. Walczak, 783 F.2d 852, 857 (9th Cir.1986); United States v. Ferreboeuf, 632 F.2d 832, 832 (9th Cir.1980) ("Mere `unsubstantiated, speculative assertions of improprieties in the proceedings' do not supply the `particular need' required to outweigh the policy of grand jury secrecy." (citations omitted)).
The Third Circuit has clarified what will satisfy the "particularized need" standard for purposes of Rule 6(e)(3)(C). It requires a showing of "substantial likelihood of gross or prejudicial irregularities in the conduct of the grand jury." United States v. Budzanoski, 462 F.2d 443, 454 (3d Cir.), cert. denied, 409 U.S. 949, 93 S.Ct. 271, 34 L.Ed.2d 220 (1972), quoted in United States v. Gatto, 746 F.Supp. 432, 480 (D.N. J.1990).
It is clear that on the alleged facts there is little more than "mere speculation" to support the motion for discovery of the grand jury proceedings. The "cashier's/bank check" discrepancy falls far short of demonstrating a "substantial likelihood of gross or prejudicial irregularities" in the grand jury's conduct. Budzanoski, 462 F.2d at 454. Harada's suggestion that he "has received information, through his counsel, that the U.S. Attorney may have misinstructed the federal grand jury," is the same type of vague unsubstantiated allegation as appeared in DeTar, where an unnamed grand juror had purportedly told the defendant that an early grand jury had voted against indictment.
In an attempt to substantiate the claim of irregularity, defendants filed a supplemental affidavit from William Montelongo, who testified before the grand jury in return for immunity. Montelongo's represents that while testifying regarding the search of the Wahiawa Check Cashing store, a grand juror asked Assistant U.S. Attorney Les Osborne whether the search was legal. Osborne said "yes." Montelongo then stated that during the search he had requested, but was refused, permission to call someone (not necessarily an attorney) who represents the Wahiawa Check Cashing store. The grand juror repeated his inquiry as to the legality of the search as well as the legality of the denial of permission to call counsel. Osborne replied that the procedure employed was legal because Montelongo could have made the call upon leaving the premises although no one was allowed to leave during the search.
This affidavit testimony is apparently offered not to suggest that the search was illegal (this is not a motion to suppress the discovered evidence) but to support the claim of irregularity in the grand jury proceedings. Although they do not explain how or why, defendants apparently believe that Osborne's responses to the grand juror's questions were legally erroneous, and that the grand jury proceedings must be produced so they can examine and evaluate this "irregularity."
This argument is also found wanting. The legality of the search is an issue that may be properly considered on a motion to suppress, but no such motion has been made. This is a motion for production of grand jury proceedings, for which defendants must show irregularity in those proceedings. Even if defendants argued and proved that the search was illegal, presentation of the resulting evidence to the grand jury was still legally proper. Illegally obtained evidence is admissible before a grand jury. United States v. Calandra, 414 U.S. 338, 94 S.Ct. 613, 38 L.Ed.2d 561 (1974). Because there is no irregularity if the evidence submitted is illegally obtained, it can hardly be an irregularity that the grand jury may have been erroneously advised that the evidence was legally obtained.
The Motion for Production of Grand Jury Proceedings, therefore, must be denied.
*1415 D. Motions to Sever
1. Lamarr Hardy's Motion to Sever
In his Motion to Sever, defendant Hardy moves this court, pursuant to Fed.R. Crim.P. Rule 8(b) and Rule 14, to sever Count 5 of the Superseding Indictment as it involves a separate and distinct conspiracy. Because the court dismisses Count 5, it need not address the issue of severing that count from the rest of them.
2. Harada's Motion to Sever
Because of the prejudice likely to result at trial due to the inclusion of Count 5 in the Superseding Indictment, defendant Harada moves this court for an order severing his trial from that of the other defendants. Again, Count 5 is dismissed, eliminating any grounds for Harada's motion. Because there is no longer any danger of such prejudice, Harada's Motion to Sever must be denied.
E. Motion to Dismiss Counts 1, 6 and 7
Defendant Harada has moved to dismiss Counts 1, 6, and 7 of the Superseding Indictment on the ground that those counts do not charge an offense which is criminal.[6] He first argues that the Counts do not allege facts which would trigger reporting requirements since his business, Hawaii Check Cashing, is actually a business name that is operated by separate and distinct corporations and the statute requires the transactions to be conducted at at one specific outlet. Second, he argues that his failure to report is due entirely to the fact that he was arrested and detained, and that the government thereby prevent his compliance with reporting requirements. Third, he contends that he is altogether exempt from the reporting requirements since he is a "check-cashing service" and not a "financial institution," within the terms of the statute.
However, all of Harada's arguments here raise questions of fact, not appropriate for resolution at this stage of the proceeding. The Federal Rules of Criminal Procedure require that an indictment be a plain, concise, and definite written statement of the essential facts constituting the offense charged. United States v. Citron, 783 F.2d 307, 314 (2d Cir.1986). In determining whether an indictment sufficiently informs the defendant of the offense, courts give the indictment a common sense construction. United States v. Reed, 721 F.2d 1059, 1061-62 (6th Cir.1983). An indictment that tracks the statutory language defining an offense is usually sufficient. United States v. American West Fibers Company, 809 F.2d 1044, 1046 (4th Cir.1987).
Here, the language used in Counts 6 and 7 of the Superseding Indictment sufficiently tracks the language of the structuring and money laundering statute. 31 U.S.C. § 5324. If Harada wishes to dispute the facts alleged in those counts of the Superseding Indictment, he will have to wait until trial to do so.
Therefore, Harada's Motion to Dismiss Counts 6 and 7 must be denied.
F. Motion to Dismiss for Failure to Allege Specific Intent
Harada argues that Counts 1, 6 and 7 fail because they fail to allege the required specific intent for the crimes charged.[7] The cited Counts charge violations of 31 U.S.C. § 5324(1) and (3), which state that no person shall, for the purpose of evading reporting requirements, "structure" a transaction with a financial institution. Harada points out that typically defendants charged with this offense are also "charged" with § 5322, which provides that "willfully violating" any provision of the subchapter (including § 5324) shall be fined and/or imprisoned for a specified period. The Superseding Indictment in this case does not reference § 5322.
Harada argues that because the Superseding Indictment should have included § 5322, and because § 5322 applies to "willful" violations, the Superseding Indictment *1416 should have specifically charged a "willful violation." In fact, the Superseding Indictment in Count 1 charges that defendants acted "willfully and unlawfully." (Emphasis added.) Counts 6 and 7 allege that they acted "unlawfully, knowingly and willfully." (Emphasis added.) Thus, there does not appear to be a problem; the "willfulness" required by § 5322 (even if it is necessary to bring the Superseding Indictment explicitly under that section) is plainly charged in each count.
Harada's argument is apparently that the Superseding Indictment is too broad because it charged not just "willful" violation, but also "unlawful" and "knowing" violation. He cites United States v. 316 Units of Municipal Securities, 725 F.Supp. 172, 178 (S.D.N.Y.1989) for the proposition that the "villful [sic] violation" element is what distinguishes a criminal action under § 5324 (and, necessarily, § 5322) from a civil forfeiture action. That case dealt with the absence of the willfulness element, however. Here, willfulness is charged.
The fact that the charge also described defendants' actions as "knowing" and "unlawful" cannot render charge deficient. The American Law Institute definition of the word "willful" as it appears in the Model Penal Code § 2.02(8) provides:
A requirement that an offense be committed willfully is satisfied if a person acts knowingly with respect to the material elements of the offense, unless a purpose to impose further requirements appears.
(Emphasis added.) This definition of "willful" has been applied by the Ninth Circuit in interpreting this very statute: 31 U.S.C. § 5324(3). United States v. Hoyland, 914 F.2d 1125, 1129 (9th Cir.1990). Thus acting "willfully" is acting "knowingly." There is no inconsistency: the term "knowingly" in the Superseding Indictment is surplusage. As for the addition of the term "unlawfully," Harada can hardly complain that the Superseding Indictment was invalid because it charged him with "unlawful" activity. That is precisely and definitionally what an indictment is.
The Motion to Dismiss for Failure to Allege Specific intent, therefore, must be denied.
G. Motion to Strike Paragraphs 5, 10 and 16
In this motion, defendant Harada moves this court for an order striking paragraphs 5, 10 and 16 of the "Overt Acts" section of the Superseding Indictment on the grounds that said paragraphs fail to allege acts that could have furthered the conspiracy alleged in Count 1. Because Count 1 is dismissed, this issue is moot.
IV. Conclusion
Count 1 of the Indictment is duplicitous and must be dismissed. Count 5 fails to allege a crime within the meaning of the statute and must also be dismissed. Defendants have failed to allege sufficient grounds for the production of grand jury proceedings, and their motion for the same must be denied. Because Count 5 is dismissed, the motion to sever that Count is moot and the motion to sever Harada's trial lacks any basis. The former may be disregarded but the latter must be denied. The motion to dismiss Counts 1, 6 and 7 depends on issues of fact that must await trial, and therefore must be denied. There is no deficiency in the Indictment's allegations of specific intent, so that motion to dismiss must also be denied. Finally, the motion to strike paragraphs of the indictment is rendered moot by the dismissal of Count 1, and need not be addressed.
IT IS SO ORDERED.
NOTES
[1] It must be pointed out that paragraph 3 in the "Overt Acts" section of the Superseding Indictment charges that "on approximately February 8, 1990, Ken Morris was told by Cassie H. Eleson that he could not have a refund of the $25,000 he had delivered, until Mr. Hardy authorized a refund, even though the three checks, totaling $25,000, had been made payable to her." This "overt act" appears to have no material connection to the charge of conspiracy to illegally structure financial transactions. It appears to this court that the government threw in this paragraph in a disingenuous attempt to show chronological proximity between the first and second criminal transactions.
[2] The regulations define "monetary instruments" to include "[a]ll negotiable instruments (including personal checks, business checks, official bank checks, cashier's checks...." 31 C.F.R. § 103.11(m). "Currency" is defined as "[t]he coin or paper money of the United States or of any other country that is designated as legal tender." 31 C.F.R. § 103.11(e).
[3] It appears from the regulations, at least, that this type of transaction was not the type that Congress intended to prohibit. If Congress was motivated by concern for laundering drug proceeds, it makes sense that Congress would target only cash transactions. Ultimately, drug transactions are cash transactions, so although a commercial transaction by bank check could be structured to avoid reporting requirements, that type of transaction is not what Congress has targeted for scrutiny. Only if the transaction involves currency is it suspect, and within the reach of the criminal statute underlying this indictment.
[4] Eleson's cited "irregularities" include not only the "cashier's/bank check" problem, but also, among other things,
1. On Counts 5, 6 and 7 there is no statement that the grand jury charged the crime;
2. Eleson has raised the irregularities but was denied a Bill of Particulars;
3. Eleson has not consented to the court's jurisdiction;
4. Eleson has not been informed of the Nature and Cause of the Accusation against her, in violation of her "Sixth Amendment ... Inalienable Right to Liberty as a Sovereign;"
5. Eleson has not been arraigned pursuant to Fed.R.Cr.P. 10.
6. The government has not established jurisdiction and venue, "after ELESON had OBJECTED to any assumed or Secret Jurisdiction;"
7. Eleson has "Particularized Need" (not specified), and her due process rights are being violated; and
8. Eleson has a right to know what law was read to the grand jury, as a matter of public record, not subject to "Secrecy".
[5] The Abbott court cited Douglas Oil Co. v. Petrol Stops Northwest, 441 U.S. 211, 99 S.Ct. 1667, 60 L.Ed.2d 156 (1978) for that proposition. Douglas held that
Parties seeking grand jury transcripts under Rule 6(e) must show that the material they seek is needed to avoid a possible injustice in another judicial proceeding, that the need for disclosure is greater than the need for continued secrecy, and that their request is structured to cover only material so needed.
Id. at 222, 99 S.Ct. at 1674.
[6] Of course, this motion is moot as to Count 1, which is dismissed.
[7] Again, Count 1 is dismissed on other grounds, and this motion is considered only as it applies to Counts 6 and 7.
| {
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BLD-292 NOT PRECEDENTIAL
UNITED STATES COURT OF APPEALS
FOR THE THIRD CIRCUIT
___________
No. 13-1795
___________
CRAYTON EVERTON REYNOLDS,
Appellant
v.
DEPARTMENT OF HOMELAND SECURITY CITIZENSHIP AND IMMIGRATION
SERVICES
____________________________________
On Appeal from the United States District Court
for the Western District of Pennsylvania
(D.C. Civil No. 3:13-cv-00036)
District Judge: Honorable Kim R. Gibson
____________________________________
Submitted for Possible Dismissal Pursuant to 28 U.S.C. § 1915(e)(2)(B)
or Summary Action Pursuant to Third Circuit LAR 27.4 and I.O.P. 10.6
June 20, 2013
Before: SCIRICA, HARDIMAN and GREENAWAY, JR., Circuit Judges
(Opinion filed: July 3, 2013)
_________
OPINION
_________
PER CURIAM
Crayton Everton Reynolds, a citizen of Jamaica, is a federal prisoner at the
Moshannon Valley Correctional Center in Philipsburg, Pennsylvania.1 In 2013,
Reynolds filed a “Petition for U.S. Citizenship” pursuant to 8 U.S.C. § 1447(b), claiming
that the United States Citizenship and Immigration Services (USCIS) had failed to act on
his naturalization application (which was allegedly filed in 2006). He requested that the
District Court grant him United States citizenship, or, in the alternative, order USCIS to
process his application and/or grant him citizenship. The District Court denied his
requests and dismissed the petition.
Reynolds appeals. We have jurisdiction under 28 U.S.C. § 1291 and conduct
plenary review of decisions based on subject-matter jurisdiction and other questions of
law. See Nuveen Mun. Trust v. Withumsmith Brown, P.C., 692 F.3d 283, 293 (3d Cir.
2012) (citation omitted); see also Nicini v. Morra, 212 F.3d 798, 805 (3d Cir. 2000) (en
banc) (“We may affirm the District Court on any grounds supported by the record.”).
We agree with the District Court that it lacked subject-matter jurisdiction under 8
U.S.C. § 1447(b). By its plain language, the statute provides jurisdiction for the District
Court to consider citizenship matters “[i]f there is a failure to make a determination under
section 1446 of this title before the end of the 120-day period after the date on which the
examination is conducted.” 8 U.S.C. § 1447(b). In other words, § 1447(b) contains no
1
Reynolds pleaded guilty to drug-related crimes and received a five-year sentence. See
United States v. Reynolds, E.D. Pa. Crim. No. 2:09-cr-00823.
2
basis for action if the applicant has not yet been “examined” in connection with his
citizenship application. And the statute’s language “suggests that the examination is a
distinct, single event[:] the date on which the interview occurs.” Walji v. Gonzales, 500
F.3d 432, 436 (5th Cir. 2007); see also Duran-Pichardo v. Att’y Gen., 695 F.3d 282, 286
(3d Cir. 2012); Etape v. Chertoff, 497 F.3d 379, 386 (4th Cir. 2007) (“The 120-day
period under § 1447(b) does not even begin to run until after the initial naturalization
examination . . . .”); United States v. Hovsepian, 359 F.3d 1144, 1151 (9th Cir. 2004) (en
banc). Without the presence of an eligibility examination, the District Court lacks
jurisdiction under the statute. See Ajlani v. Chertoff, 545 F.3d 229, 237 (2d Cir. 2008),
distinguished on other grounds by Gonzalez v. Sec’y of Dep’t of Homeland Sec., 678
F.3d 254, 259 n.7 (3d Cir. 2012).
While Reynolds’s petition is somewhat vague, he strongly implied that he never
received an interview. See, e.g., Pet. 3–4 (explaining that his interview was cancelled in
2007 and that attempts to reschedule were for naught). Reynolds provided no contrary
information about an interview below. Nor has he done so on appeal, despite being
afforded time to do so (and despite being informed of this defect in his petition by the
District Court). Accordingly, we conclude that the District Court correctly dismissed the
application under § 1447(b) for lack of jurisdiction.
Alternatively, Reynolds’s petition can be read to invoke the District Court’s
mandamus authority (under 28 U.S.C.S. § 1361) or the provisions of the Administrative
Procedure Act (5 U.S.C. § 706(1)). See, e.g., Ali v. Frazier, 575 F. Supp. 2d 1084, 1090
3
(D. Minn. 2008). The District Court appears to have held that Reynolds’s status as a
prisoner defeated any nondiscretionary duty that might have been owed to him by the
USCIS. We need not reach that question, however, because Reynolds is currently in
removal proceedings, and “a district court cannot order the Attorney General to naturalize
an alien who is subject to pendent removal proceedings.” Gonzalez, 678 F.3d at 259; see
also 8 U.S.C. § 1429. The District Court could not order or hasten, whether via the
Administrative Procedure Act or mandamus, relief that the USCIS is statutorily barred
from granting.2
As this appeal presents no substantial question, we will summarily affirm the
judgment of the District Court.3 See Murray v. Bledsoe, 650 F.3d 246, 248 (3d Cir.
2011) (per curiam); see also 3d Cir. L.A.R. 27.4; 3d Cir. I.O.P. 10.6.
2
Removal proceedings may have formally commenced after the Magistrate Judge issued
his Report and Recommendation, but before the District Court adopted it. Thus, by the
time it issued its order, the District Court could not have granted relief.
3
Our decision is without prejudice to Reynolds’s ability to pursue a defensive claim of
citizenship in his removal proceedings or an affirmative application subject to the
statutory requirements and limitations. See Rios-Valenzuela v. Dep’t of Homeland Sec.,
506 F.3d 393, 396–97 & n.4 (5th Cir. 2007) (describing the different ways a person can
assert a claim of citizenship).
4
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UNPUBLISHED
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
UNITED STATES OF AMERICA,
Plaintiff-Appellant,
v.
BENJAMIN HARDEN; DOROTHY M.
HARDEN; PHYLLIS HARDEN; TRACIE
ARCHIE; GWEN ARCHIE, a/k/a Gwen
No. 97-4791
Archer; BRANDON BURTON, a/k/a
Bowlegs; LANCE COURTNEY;
FREDERICK ETHEREDGE; ANTONIO
MILLER; WILLIE SLIGH; CHRIS
SUMTER; KENYA THOMPSON; KEVIN
WRIGHT,
Defendants-Appellees.
Appeal from United States District Court
for the District of South Carolina, at Columbia.
Matthew J. Perry, Jr., Senior District Judge.
(CR-97-545)
Argued: April 9, 1998
Decided: June 26, 1998
Before ERVIN, Circuit Judge, BUTZNER, Senior Circuit Judge,
and STAMP, Chief United States District Judge
for the Northern District of West Virginia,
sitting by designation.
_________________________________________________________________
Affirmed by unpublished per curiam opinion.
_________________________________________________________________
COUNSEL
ARGUED: Jon Rene Josey, United States Attorney, Columbia, South
Carolina, for Appellant. William Glenn Yarborough, III, Greenville,
South Carolina, for Appellees. ON BRIEF: Scarlett A. Wilson,
Assistant United States Attorney, Columbia, South Carolina, for
Appellant. Mark R. Calhoun, Lexington, South Carolina; Gregory P.
Harris, Columbia, South Carolina, for Appellee Dorothy Harden;
Debra Y. Chapman, Columbia, South Carolina, for Appellee Phyllis
Harden; Susan Z. Hitt, Columbia, South Carolina, for Appellee Tracie
Archie; Louis H. Lang, Columbia, South Carolina, for Appellee
Gwen Archie; I.S. Leevy Johnson, Columbia, South Carolina, for
Appellee Burton; James P. Rogers, Columbia, South Carolina, for
Appellee Courtney; Herbert W. Louthian, Jr., Columbia, South Caro-
lina, for Appellee Etheredge; Creighton B. Coleman, Winnsboro,
South Carolina, for Appellee Miller; Cameron B. Littlejohn, Jr.,
Columbia, South Carolina, for Appellee Sligh; Jonathan M. Harvey,
Columbia, South Carolina, for Appellee Sumter; Ed Holler, Colum-
bia, South Carolina, for Appellee Thompson; W. Rhett Eleazer,
Columbia, South Carolina, for Appellee Wright.
_________________________________________________________________
Unpublished opinions are not binding precedent in this circuit. See
Local Rule 36(c).
_________________________________________________________________
OPINION
PER CURIAM:
The United States appeals an order of the district court dismissing
with prejudice, because of a violation of the Speedy Trial Act, the
indictment of appellees Benjamin Harden, Dorothy Harden, Phyllis
Harden, Tracie Archie, Gwen Archie, Brandon Burton, Lance Court-
ney, Frederick Etheredge, Antonio Miller, Willie Sligh, Chris Antwan
Sumter, Kenya Thompson, and Kevin Wright. Finding no error in the
district court's opinion, we affirm.
2
I.
On July 1, 1997, federal arrest warrants were issued charging each
of the appellees with various drug law violations. On July 7, 1997,
United States Magistrate Judge Bristow Marchant conducted a deten-
tion hearing for all of the appellees and denied bond to nine of them.
On July 16, 1997, the government filed an ex parte motion for a con-
tinuance and submitted a proposed order to the court. The government
premised its motion on the involvement in another trial of the Assis-
tant United States Attorney who was assigned to the case and con-
tended that this preoccupation necessitated an extension beyond the
thirty days prescribed by the Speedy Trial Act to obtain an indict-
ment. The district court signed and entered the proposed order based
on the ex parte motion of the United States, granting the government
a continuance to August 19, 1997 to obtain an indictment and
excluded the period of delay pursuant to the "ends of justice" provi-
sion of the Speedy Trial Act, 18 U.S.C. § 3161(h)(8)(A). On August
21, 1997, the grand jury returned an indictment against all of the
appellees, charging them, among other things, with a conspiracy to
distribute cocaine, crack cocaine and marijuana. The grand jury
returned this indictment fifty-one days after the appellees were
arrested, twenty-one days beyond the time permitted by the Speedy
Trial Act and two days beyond the time permitted by the district
court's order.
Prior to the indictment, on August 6, 1997, Gwen Archie filed a
motion to dismiss, alleging a violation of the Speedy Trial Act. On
August 19, 1997, Benjamin Harden filed a motion to dismiss with
prejudice for violation of the Speedy Trial Act and on August 21,
1997, Dorothy Harden filed a similar motion. On September 22 and
23, 1997, United States District Court Judge Matthew J. Perry held
a hearing on the motions to dismiss. At that hearing, all of the appel-
lees joined in the motions, arguing that the charges against them
should be dismissed with prejudice. At the conclusion of the hearing,
the district judge announced his decision to dismiss the case with
prejudice and informed the parties that the court would issue a written
opinion on its ruling.
In his written opinion, the district judge found that the Speedy Trial
Act had been violated for two reasons. The first reason was that the
3
grant of the continuance was grounded upon a reason which the
Speedy Trial Act lists as one for which no continuance should be
granted. Section 3161(h)(8)(C) prohibits the grant of a continuance
based upon "lack of diligent preparation . . . on the part of the attorney
for the Government." The district court found that the government's
reason, the assigned Assistant United States Attorney's involvement
in another trial, fell within this prohibition and that the availability of
other Assistant United States Attorneys who could have obtained the
indictment within thirty days underscored the impropriety of the gov-
ernment's motion. Additionally, the district court found that the gov-
ernment could not reasonably rely on the court's earlier continuance
order based upon an ex parte motion because the government either
knew or should have known that its reason for pursuing a continuance
was invalid under the Speedy Trial Act.
Second, the district court found that the Speedy Trial Act had been
violated because the court did not conduct the necessary balancing of
factors required by § 3161(h)(8)(B) of the Speedy Trial Act when
determining whether or not to grant a continuance. Having found vio-
lations of the Speedy Trial Act, the district court concluded that the
indictment must be dismissed and further found that the dismissal
should be with prejudice.
In granting the dismissal with prejudice, the district court con-
ducted its analysis, as required, pursuant to § 3162(a)(1) of the
Speedy Trial Act. Section 3162(a) lists three factors the court must
weigh: (1) the seriousness of the offense, (2) the facts and circum-
stances leading to the dismissal, and (3) the impact of reprosecution
on the administration of the Speedy Trial Act and on the administra-
tion of justice. The district court found that although the offenses
charged in the indictment were indeed serious, the other factors out-
weighed the seriousness of the offenses charged and warranted a dis-
missal with prejudice.
The district court set forth the arrest and detention without bail of
most of the appellees, the violations of the Speedy Trial Act caused
by the government's ex parte motion and the court's continuance
order, and the resulting violation of the Speedy Trial Act's require-
ment that the government obtain an indictment or information within
thirty days of arrest as the circumstances that warranted dismissal
4
with prejudice. Additionally, with respect to the impact of a repro-
secution upon the mandates of the Speedy Trial Act, the district court
noted that the Speedy Trial Act is meant to protect the Sixth Amend-
ment rights of those charged with crimes and that its mechanical,
strict time limits accomplish this purpose. The court also noted that
the appellees faced criminal charges in state court based upon the
same investigation and, if proven guilty, the appellees would face sen-
tences for their crimes. Finally, the district court found that although
the Speedy Trial Act does not require consideration of prejudice to a
defendant, its legislative history suggests that it is an appropriate fac-
tor to examine. The district court found that the appellees' detention
without bail coupled with the government's ability at an earlier date
to present the matter to the grand jury but its failure to do so weighed
against permitting reprosecution.
United States v. Taylor, 487 U.S. 326 (1988), and United States v.
Jones, 887 F.2d 492 (4th Cir. 1989), on which the government relies,
do not compel a different result. In Taylor, the government was pre-
pared to try the defendant within the seventy day time limit, but the
defendant failed to appear for trial. After the defendant was captured,
the seventy day limit was exceeded by fourteen days. The district
court dismissed the indictment with prejudice based on the govern-
ment's "lackadaisical" behavior. The Supreme Court reversed, hold-
ing:
The District Court relied heavily on its unexplained charac-
terization of the Government conduct as "lackadaisical,"
while failing to consider other relevant facts and circum-
stances leading to dismissal. Seemingly ignored were the
brevity of the delay and the consequential lack of prejudice
to respondent, as well as respondent's own illicit contribu-
tion to the delay.
Taylor, 487 U.S. at 343. This case is quite different from the situation
in Taylor. Here, the district court clearly evaluated all the relevant
factors and concluded that a dismissal with prejudice was appropriate.
In Taylor, the major factor surrounding the dismissal was the defen-
dant's failure to appear for trial. There is no corresponding conduct
by the defendants in this case. The principal fact leading to dismissal
5
was the government's groundless ex parte motion requesting an
extension.
In Jones, the magistrate judge applied a statute no longer in effect.
The magistrate judge committed the defendant pursuant to 18 U.S.C.
§ 4244 which authorized a competency examination for "such reason-
able period as the court may determine." Jones, 887 F.2d at 493 n.1.
Five days before Jones was arrested, the time for such an evaluation
was limited to a maximum of thirty days. See 18 U.S.C. § 4247(b).
Based on this new statute, the district court concluded that only thirty
of the sixty-six days Jones spent committed were excluded under the
act. When the other days were included, the seventy day limit was
exceeded by twenty-six days. Jones, 887 F.2d at 493. We affirmed the
district court's dismissal without prejudice.
In the case before us, however, the government filed an ex parte
motion which was groundless. As we previously noted, the district
court found that the government's reason for a continuance was
excluded as a permissible basis for an extension of time under 18
U.S.C. § 3161(h)(8)(C).
Although both parties have agreed that the government did not act
in bad faith and the district court found that there was no pattern of
neglect, it appears that the United States Attorney's Office on this
occasion was neglectful in not consulting the statute to see whether
its motion for a continuance conformed. In Taylor, 487 U.S. at 338,
the Court observed that "[w]e do not dispute that a truly neglectful
attitude on the part of the Government reasonably could be factored
against it in a court's consideration" of whether to dismiss with or
without prejudice. Based on the factors prescribed by 18 U.S.C.
§ 3162(a)(1), we conclude that the district court did not abuse its dis-
cretion by dismissing the indictment with prejudice.
II.
We have carefully considered the briefs and oral argument of the
parties and those portions of the record pertinent to the various argu-
ments. Having done so, we find no reversible error in the well-
reasoned opinion and decision of the district court. The district court's
decision to dismiss the indictment with prejudice was in accordance
6
with the basic principles of the Speedy Trial Act and the Sixth
Amendment of the United States Constitution.
AFFIRMED
7
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IN THE DISTRICT COURT OF APPEAL
FIRST DISTRICT, STATE OF FLORIDA
MUSA SHABAZZ, NOT FINAL UNTIL TIME EXPIRES TO
FILE MOTION FOR REHEARING AND
Appellant, DISPOSITION THEREOF IF FILED
v. CASE NO. 1D13-2046
STATE OF FLORIDA,
Appellee.
_____________________________/
Opinion filed October 3, 2014.
An appeal from the Circuit Court for Leon County.
Dawn Caloca-Johnson, Judge.
Baya Harrison, III, Monticello, for Appellant.
Pamela Jo Bondi, Attorney General, and Virginia Harris, Assistant Attorney
General, Tallahassee, for Appellee.
PER CURIAM.
AFFIRMED.
THOMAS, ROBERTS, and ROWE, JJ., CONCUR.
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836 F.2d 1348
Unpublished DispositionNOTICE: Sixth Circuit Rule 24(c) states that citation of unpublished dispositions is disfavored except for establishing res judicata, estoppel, or the law of the case and requires service of copies of cited unpublished dispositions of the Sixth Circuit.UNITED STATES of America, Plaintiff-Appellee,v.Judith L. PORTER, Defendant-Appellant.
No. 87-3349.
United States Court of Appeals, Sixth Circuit.
Jan. 13, 1988.
Before MERRITT, CORNELIA G. KENNEDY, and KRUPANSKY, Circuit Judges.
ORDER
1
This case has been referred to a panel of the court pursuant to Rule 9(a), Rules of the Sixth Circuit. Upon consideration of the record and briefs, this panel unanimously agrees that oral argument is not needed. Fed.R.App.P. 34(a).
2
Defendant appeals the order of the district court that denied her motion for findings of fact pursuant to Fed.R.Crim.P. 32(c)(3)(D) for reduction in sentence. On January 21, 1986, the defendant pleaded guilty to one count of conspiracy, 18 U.S.C. Sec. 371, and was sentenced to four years of imprisonment. Thereafter, the defendant filed a series of post-conviction motions in which she claimed that the district court, in violation of Fed.R.Crim.P. 32(c)(3)(D), had failed to make findings of fact regarding alleged factual discrepancies in the defendant's presentence report. Defendant also claimed that her trial counsel had been ineffective in failing to advise her on the importance of the presentencing report or her ability to object to it. The district court in three separate orders rejected these arguments. We also now reject them and affirm the most recent of the three orders of the district court.
3
This court has recently held that a defendant seeking to rely on Rule 32(c)(3)(D) must have brought the alleged inaccuracies clearly to the district court's attention during the sentencing hearing. The defendant on appeal must also demonstrate that the challenged facts are false and that they were the basis for the sentence. United States v. Fry, No. 86-3094, slip op. p. 6-7 (6th Cir. October 22, 1987). The defendant failed to meet either of these requirements. Therefore, her claims relating to Rule 32(c)(3)(D) were properly denied.
4
The defendant's claims of ineffective assistance also were properly rejected. The record and the transcript of the hearing contain no evidence that the performance of defendant's trial counsel was deficient or that it affected the outcome of the sentencing proceeding. Accordingly, no ineffective assistance of counsel was shown. Hill v. Lockhart, 474 U.S. 52 (1985); Strickland v. Washington, 466 U.S. 668 (1984).
5
Finally, the defendant's four year sentence was not a violation of the equal protection clause. The sentence was well within that provided for a conspiracy conviction; it was also not disproportionate when compared to that of several of defendant's codefendants. United States v. Tucker, 404 U.S. 443, 447 (1972); United States v. Garcia, 693 F.2d 412 (5th Cir.1982).
6
Accordingly, the order of the district court entered on February 9, 1987, is affirmed pursuant to Rule 9(b)(5), Rules of the Sixth Circuit.
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FOR PUBLICATION
UNITED STATES COURT OF APPEALS
FOR THE NINTH CIRCUIT
ISMAEL TABLADA,
Petitioner-Appellant,
No. 07-35538
v.
J.E. THOMAS,* Warden, Federal D.C. No.
CV 06-00762-MO
Correction Institute, Sheridan,
OPINION
Oregon,
Respondent-Appellee.
Appeal from the United States District Court
for the District of Oregon
Michael W. Mosman, District Judge, Presiding
Argued and Submitted
March 7, 2008—Portland, Oregon
Filed July 3, 2008
Before: Marsha S. Berzon and Carlos T. Bea, Circuit Judges,
and Philip S. Gutierrez,** District Judge.
Opinion by Judge Gutierrez
*J.E. Thomas is substituted for his predecessor Charles Daniels
as Warden of the Federal Correction Institute, Sheridan, Oregon. Fed. R.
App. P. 43(c)(2).
**The Honorable Philip S. Gutierrez, United States District Judge for
the Central District of California, sitting by designation.
8071
TABLADA v. THOMAS 8073
COUNSEL
Stephen R. Sady, Chief Deputy Federal Public Defender,
Portland, Oregon, for petitioner-appellant Ismael Tablada.
Karin J. Immergut, United States Attorney, Scott E. Asphaug,
Assistant United States Attorney, and Kelly A. Zusman,
Assistant United States Attorney, Portland, Oregon, for the
respondent-appellee.
OPINION
GUTIERREZ, District Judge:
In this appeal, we consider whether the Bureau of Prisons
(“BOP”) violated the Administrative Procedure Act (“APA”)
8074 TABLADA v. THOMAS
in promulgating 28 C.F.R. § 523.20, the regulation interpret-
ing 18 U.S.C. § 3624(b), which governs the calculation of
good conduct time for federal prisoners. The district court
held that the BOP’s interpretation in § 523.20 was reasonable
and that it did not violate § 706(2)(A) of the APA. Accord-
ingly, the district court denied the petitioner’s habeas petition
which challenged the BOP’s calculation of the length of time
the petitioner had left to serve on his sentence. The BOP has
conceded it violated § 706(2)(A) of the APA by failing to
articulate a rational basis for its decision to promulgate
§ 523.20. We hold that the remedy for this violation is to
interpret the federal statute in accordance with the BOP’s Pro-
gram Statement 5880.28, and so affirm.
I. BACKGROUND & PROCEDURE
Ismael Tablada is an inmate at the Federal Correctional
Institute in Sheridan, Oregon. Tablada was convicted of a nar-
cotics offense in the District of Minnesota. On December 17,
1990, he was sentenced to a 20-year term of imprisonment,
followed by 10 years of supervised release. As of February
2007, Tablada’s projected release date, taking into consider-
ation his good time credit, was April 16, 2008.1
On October 31, 2006, Tablada filed an amended petition
for writ of habeas corpus pursuant to 28 U.S.C. § 2241. In the
petition, Tablada challenges the BOP’s calculation of good
time credits pursuant to the good time credit statute, 18 U.S.C.
§ 3624(b). Tablada contends that in promulgating its method
for calculation of good time conduct credit in 28 C.F.R.
§ 523.20 and Program Statement 5880.28, Sentence Computa-
1
Tablada’s projected release date has passed. This fact, however, does
not render his appeal moot because his sentence includes a term of super-
vised release. See Mujahid v. Daniels, 413 F.3d 991, 994-995 (2005)
(“The ‘possibility’ that the sentencing court would use its discretion to
reduce a term of supervised release under 18 U.S.C. § 3583(e)(2) was
enough to prevent the petition from being moot”).
TABLADA v. THOMAS 8075
tion Manual (CCCA of 1984), the BOP failed to articulate a
rational basis for its interpretation of the federal statute, thus
violating 5 U.S.C. § 706(2)(A).2
A. Good Time Credit Statute, 18 U.S.C. § 3624(b)
Title 18 U.S.C. § 3624 governs the timing of federal pris-
oners’ release from custody. Section 3624(b) provides in rele-
vant part:
(b) Credit toward service of sentence for satisfactory
behavior.—
(1) . . . a prisoner who is serving a term of impris-
onment of more than 1 year other than a term of
imprisonment for the duration of the prisoner’s life,
may receive credit toward the service of the prison-
er’s sentence, beyond the time served, of up to 54
days at the end of each year of the prisoner’s term
of imprisonment, beginning at the end of the first
year of the term, subject to determination by the
Bureau of Prisons that, during that year, the prisoner
has displayed exemplary compliance with institu-
tional disciplinary regulations. . . . [C]redit for the
last year or portion of a year of the term of imprison-
ment shall be prorated and credited within the last
six weeks of the sentence.
18 U.S.C. § 3624(b)(1) (emphasis added).
2
Tablada’s habeas corpus petition also claimed the BOP regulation and
Program Statement are invalid because they violate the APA, 5 U.S.C.
§ 553, which requires a notice and comment period, and the Ex Post Facto
Clause. The district court rejected both claims. Tablada has abandoned
these claims by failing to raise them in his brief on appeal. See Blanchard
v. Morton Sch. Dist., 509 F.3d 934, 938 (9th Cir. 2007).
8076 TABLADA v. THOMAS
B. BOP Program Statement and Regulation
Since the passage of 18 U.S.C. § 3624(b) in 1984, the BOP
has interpreted good time credit to be based on the time
served by the prisoner. In November 1988, the BOP’s general
counsel issued an internal memorandum advising staff of the
procedures for awarding good time credits under § 3624(b).
The memorandum recited the text of § 3624(b), and stated
that “good conduct time is earned on sentences of 1 year and
1 day or more at a rate of 54 days for each year of time
served.” (emphasis added). In February 1992, BOP formal-
ized this interpretation of § 3624 via the BOP Program State-
ment 5880.28.
In September 1997, the BOP published for comment as an
interim rule 28 C.F.R. § 523.20, which was the BOP’s inter-
pretation of § 3624(b). 62 Fed. Reg. 50786-01 (Sept. 26,
1997). The commentary to the interim rule stated that “[t]he
awarding and vesting of good conduct time at a rate of 54
days per year (prorated when the time served by the inmate
for the sentence during the year is less than a full year) ha[s]
been clearly stated by statute since the implementation of the
Sentencing Reform Act of 1984.” Id. at 50786. The BOP
received no public comments, and, in 2003, published a
change to the proposed rule and again accepted comments. 68
Fed. Reg. 37776-01 (June 25, 2003). On December 5, 2005,
28 C.F.R. § 523.20 became final. 70 Fed. Reg. 66752-01
(Nov. 3, 2005). 28 C.F.R. § 523.20 provides:
(a) For inmates serving a sentence for offenses com-
mitted on or after November 1, 1987, but before
September 13, 1994, the Bureau will award 54 days
credit toward service of sentence (good conduct time
credit) for each year served. This amount is prorated
when the time served by the inmate for the sentence
during the year is less than a full year.
TABLADA v. THOMAS 8077
28 C.F.R. § 523.20(a) (emphasis added).3
In accordance with the BOP’s regulatory scheme, the pris-
oner does not earn the first 54 days of good time credit until
after completing 365 days of incarceration. Mujahid, 413 F.3d
at 996. During the last year of incarceration, the BOP prorates
the good time credits, awarding the prisoner 0.148 days credit
[54/365 = 0.148] for every day actually served that year.
Pacheco-Camacho v. Hood, 272 F.3d 1266, 1267-1268 (9th
Cir. 2001). The BOP’s admittedly “complicated” mathemati-
cal formula yields, for a model federal prisoner with a 10-year
sentence, a maximum of 470 days of good time credit, which
includes no credit when the prisoner is not in prison. Id. at
1269.
The BOP’s interpretation of the good time conduct statute
led to the filing of numerous lawsuits by federal prisoners.
Like Tablada, these prisoners contested the methodology by
which the BOP computes good time credit under
§ 3624(b)(1), reading the statute as awarding good time credit
based on the sentence imposed rather than the time served.
Under their interpretation, a model federal prisoner with a 10-
year sentence would be entitled to 540 days of credit [54
days/yr x 10yrs = 540], rather than the 470 days awarded
under the BOP’s method. Faced with these competing inter-
pretations of § 3624(b), we have upheld the validity of the
BOP’s interpretation of “term of imprisonment” in § 3624(b)
as meaning time served rather than sentence imposed. See
Pacheco-Camacho, 272 F.3d at 1271.
In Pacheco-Camacho, we noted that § 523.20 was adopted
through the APA’s notice-and-comment procedure, and that
3
This version of 28 C.F.R. § 523.20 is different from the version quoted
by the district court in his order. The district court used a previous version
of the regulation which was effective until December 4, 2005. However,
the distinctions between the previous version and the amended regulation,
quoted here, do not affect the analysis.
8078 TABLADA v. THOMAS
the BOP’s interpretation of § 3624(b) via § 523.20 was there-
fore entitled to full Chevron deference.4 Id. at 1268 (citing
Chevron, 467 U.S. 837). Applying the first step of the
Chevron analysis, we looked at both the plain language of the
statute and its legislative history, and found that the meaning
of “term of imprisonment” as used in § 3624(b) was ambigu-
ous. Id. at 1269-70. Proceeding to the second Chevron step,
we then asked whether the BOP’s interpretation was “reason-
able.” Id. at 1270. Answering in the affirmative, we con-
cluded that the BOP’s interpretation “comports with the
statutory language of section 3624(b), and does not subvert
the statutory design.” Id.
Nearly four years later we revisited the same issue in
Mujahid, 413 F.3d at 998. Citing Pacheco-Camacho, we reaf-
firmed the reasonableness of the BOP’s interpretation of
§ 3624(b). Id. at 999 (“Mujahid’s position rests on an inter-
pretation of this statute at odds with binding authority of this
court”).
Notwithstanding our decisions in Pacheco-Camacho and
Mujahid, Tablada filed this habeas petition, but under a differ-
ent theory. Unlike the previous challenges to the reasonable-
ness of the BOP’s construction of § 3624(b), Tablada instead
contends that the BOP has not complied with the require-
ments of the APA, 5 U.S.C. § 706, because it has not articu-
4
Under Chevron, the Court must first determine “whether Congress has
directly spoken to the precise question at issue. If the intent of Congress
is clear,” then the Court “must give effect to the unambiguously expressed
intent of Congress.” Chevron U.S.A., Inc. v. Natural Resources Defense
Council, Inc., 467 U.S. 837, 842-843 (1984). Next, “if the statute is silent
or ambiguous with respect to the specific issue, the question for the court
is whether the agency’s answer is based on a permissible construction of
the statute.” Id. at 843. “If a statute is ambiguous, and if the implementing
agency’s construction is reasonable, Chevron requires a federal court to
accept the agency’s construction of the statute, even if the agency’s read-
ing differs from what the court believes is the best statutory interpreta-
tion.” Nat’l Cable & Telecomms. Ass’n v. Brand X Internet Servs., 545
U.S. 967, 980 (2005) (citations omitted).
TABLADA v. THOMAS 8079
lated a rational basis for its decision to promulgate its
interpretation of the statute. The United States District Court
for the District of Oregon found that Pacheco-Camacho and
Mujahid prevented it from considering Tablada’s APA chal-
lenge, since the Ninth Circuit had already determined that the
BOP’s method for calculating good time credit was reason-
able. This timely appeal followed.
After the parties submitted briefing on the instant case, we
addressed the very procedural issue raised by Tablada in
Arrington v. Daniels, 516 F.3d 1106 (9th Cir. 2008). In
Arrington, the petitioners brought petitions for habeas corpus
which challenged 28 C.F.R. § 550.58(a)(1)(vi)(B), a BOP reg-
ulation which categorically excluded prisoners with convic-
tions involving a firearm or other dangerous weapon or
explosives from eligibility for early release under 18 U.S.C.
§ 3621(e). Id. at 1109. Reversing the district court’s denial of
the petitions, the Ninth Circuit held that the rule violated the
APA, 5 U.S.C. § 706, because the administrative record con-
tained no rationale explaining the BOP’s decision for the cate-
gorical exclusion. Id. at 1114. The district court had identified
two possible rational bases for the BOP decision: “(1) the
increased risk that offenders with convictions involving fire-
arms might pose to the public and (2) the need for uniformity
in the application of the eligibility regulation.” Id. at 1113
(citations omitted). The Ninth Circuit found the first rationale,
articulated only in the BOP’s brief and not contained in the
administrative record, was “precisely the type of ‘post hoc
rationalization [ ]’ of appellate counsel that we are forbidden
to consider in conducting review under the APA.” Id. (empha-
sis and alteration in original) (citing Burlington Truck Lines,
Inc. v. United States, 371 U.S. 156, 168 (1962)). As for the
second rationale, the Ninth Circuit found it inadequate
because the BOP offered no explanation for why it chose cat-
egorical exclusion of prisoners with convictions involving
firearms to achieve uniformity, rather than categorical inclu-
sion of prisoners with nonviolent convictions involving fire-
8080 TABLADA v. THOMAS
arms, which would achieve the stated goal of uniformity. Id.
at 1114.
The BOP now concedes that the regulation governing good
time conduct credits suffers the same procedural infirmity as
the regulation in Arrington, because the BOP failed to articu-
late in the administrative record the rationale upon which it
relied when it promulgated the good time credit regulation.
II. STANDARD OF REVIEW
We review a district court’s denial of a writ of habeas cor-
pus pursuant to 28 U.S.C. § 2241 de novo. Id. at 1112.
In reviewing the BOP’s conduct, we consider whether the
agency’s promulgation of the final rule is “arbitrary, capri-
cious, an abuse of discretion, or otherwise not in accordance
with law.” 5 U.S.C. § 706(2)(A). We conduct this review
based solely on the administrative record and determine
whether the agency has articulated a rational basis for its deci-
sion. Arrington, 516 F.3d at 1112 (citing Motor Vehicle Mfrs.
Ass’n of U.S., Inc. v. State Farm Mut. Auto. Ins., 463 U.S. 29,
50 (1983)).
III. DISCUSSION
[1] In light of the BOP’s concession that it failed to articu-
late in the administrative record a rationale for the interpreta-
tion of § 3624(b)(1) promulgated in § 523.20, the only
remaining issue, then, is to determine the appropriate remedy.
The BOP contends that any relief in this case should be lim-
ited to a procedural correction, allowing the BOP’s long-
standing practice governing good conduct sentencing credits
to continue until the procedural correction is effected. Tablada
asks us to grant his habeas petition and order the BOP to cal-
culate his good conduct time based on his interpretation of the
good time credit statute.
TABLADA v. THOMAS 8081
A. Deference to the BOP Interpretation of § 3624(b)
[2] Since its promulgation of Program Statement 5880.28
in 1992, the BOP has interpreted § 3624(b) to refer to time
served, rather than sentence imposed. Thus, even if we take
the invalid regulation out of the equation, we are left with an
interpretation of § 3624(b) that bases good time credit on time
served rather than sentence imposed.
An agency’s rules are entitled to two possible levels of def-
erence. Generally, Chevron deference is reserved for legisla-
tive rules that an agency issues within the ambit of the
authority entrusted to it by Congress. See United States v.
Mead Corp., 533 U.S. 218, 226-227 (2001). Such rules are
characteristically promulgated only after notice and comment.
Id. at 230. If, on the other hand, the agency rule or decision
is not within an area of express delegation of authority or does
not purport to have the force of law, it is entitled to a measure
of deference proportional to its power to persuade, in accor-
dance with the principles set forth in Skidmore v. Swift & Co.,
323 U.S. 134 (1944). See Mead, 533 U.S. at 228, 234. Under
this level of review, we look to the process the agency used
to arrive at its decision. Id.; Skidmore, 323 U.S. at 140.
Among the factors we consider are the “interpretation’s thor-
oughness, rational validity, [ ] consistency with prior and sub-
sequent pronouncements,” the “ ‘logic[ ] and expertness’ of
an agency decision, the care used in reaching the decision, as
well as the formality of the process used.” The Wilderness
Society v. U.S. Fish & Wildlife Serv., 353 F.3d 1051, 1068
(9th Cir. 2003) (citing Skidmore, 323 U.S. at 140 and Mead,
533 U.S. at 228).
Program Statement 5880.28 does not purport to carry the
force of law and was not adopted after notice and comment.
We therefore do not accord it Chevron deference. However,
because Program Statement 5880.28 is an internal agency
guideline, “akin to an ‘interpretive rule’ that ‘do[es] not
require notice and comment,’ ” Reno v. Koray, 515 U.S. 50,
8082 TABLADA v. THOMAS
61 (1995) (quoting Shalala v. Guernsey Mem. Hosp., 514
U.S. 87, 99 (1995)), we believe it is entitled to a measure of
deference under Skidmore. We conclude that the Program
Statement 5880.28 does meet the Skidmore standard, and thus
provides the appropriate interpretation of § 3624. We turn
now to the reasons underlying this conclusion.
B. Application of Deference under Skidmore
Applying the factors articulated in Skidmore, we find that
the methodology utilized in Program Statement 5880.28 is
both persuasive and reasonable. Under Skidmore, one of the
factors we consider is the “rational validity” of the agency
decision. See The Wilderness Society, 353 F.3d at 1068. In
Pacheco-Camacho and Mujahid, we already determined that
the BOP’s interpretation of § 3624(b) via its regulation,
§ 523.20, is “reasonable.” See Mujahid, 413 F.3d at 998;
Pacheco-Camacho, 272 F.3d at 1270-1271. Because Program
Statement 5880.28 provides an interpretation of the federal
statute identical to that in § 523.20, our conclusion in
Pacheco-Camacho regarding the reasonableness of § 523.20
applies to it with equal force.
[3] In Pacheco-Camacho, we found that the BOP’s meth-
odology for calculating good time conduct credits was reason-
able because it “comports with the statutory language of
section 3624(b) . . . .” Pacheco-Camacho, 272 F.3d at 1270.
In particular, we examined the statutory language of
§ 3624(b) and focused on its final sentence, which reads,
“credit for the last year or portion of a year of the term of
imprisonment shall be prorated and credited within the last
six weeks of the sentence.” Id. at 1268-69 (emphasis in origi-
nal) (quoting 18 U.S.C. § 3624(b)(1)). Under the BOP’s read-
ing of the statute, “the model prisoner will ordinarily receive
his fifty-four-day credit after complying with prison disciplin-
ary rules for 365 days . . . .” Id. (emphasis in original). During
the last year or portion of a year of the prisoner’s sentence,
the BOP would prorate the 54 days of credit a year to 0.148
TABLADA v. THOMAS 8083
day of credit for every actual day served during good behavior
(54/365 = 0.148). Id. at 1267-68. Like Tablada, the plaintiff
in Pacheco-Camacho read the statute as awarding good time
credit based on the sentence imposed, so a prisoner with a ten-
year sentence would receive 54-days per year multiplied by
ten years, or 540 days. We found the plaintiff’s reading incon-
sistent with a statute that contemplates prorating credit for the
last year of imprisonment. See id. at 1269. We pointed out
that under the plaintiff’s interpretation (or in this case Tabla-
da’s), the model prisoner would receive a 54-day credit after
serving only 311 days (365 days - 54 days), thus conferring
a “windfall” on prisoners. Id. We noted that “[n]othing in the
statute clearly suggests that Congress intended to give the
prisoner such a windfall in his last year.” Id. Likewise in
Mujahid, we reaffirmed the BOP’s interpretation of § 3624(b)
as reasonable and subject to deference. See Mujahid, 413 F.3d
at 997.
[4] In addition to the statutory language, we also discussed
in Pacheco-Camacho the legislative history of § 3624, and
determined that the BOP’s methodology for calculating good
time conduct credits “does not subvert the statutory design.”
Pacheco-Camacho, 272 F.3d at 1270. By enacting § 3624,
Congress sought to simplify the computation of good time
credits which, under its predecessor statute, computed good
time credits after every month served. Id. at 1269. Thus,
unlike the earlier scheme which called for calculating good
time credits at different monthly rates depending on the length
of the prison term and which allowed prison officials discre-
tion to withhold and restore credits depending on the inmate’s
subsequent behavior, the new system embodied in § 3624
envisioned that a prisoner could calculate with certainty the
time of his release. Id. Acknowledging the complexity of the
BOP’s computation method, we explained that “Congress
chose to tolerate the additional complexity in order to arrive
at a more equitable result,” namely “an effective and fair pro-
rating scheme, enabling inmates to calculate with reasonable
certainty the end of their imprisonment . . . .” Id. at 1270. In
8084 TABLADA v. THOMAS
sum, based on our reasoning in Pacheco-Camacho and
Mujahid, we find that the methodology utilized in Program
Statement 5880.28 has “rational validity.”
[5] Another factor we consider under Skidmore is whether
the agency has applied its position consistently. Mead, 533
U.S. at 228; Good Samaritan Hosp. v. Shalala, 508 U.S. 402,
417 (1993). Here, BOP Program Statement 5880.28 has been
in effect for at least sixteen years, since its implementation in
1992. See Bowen v. Hood, 202 F.3d 1211, 1221-1222 (9th
Cir. 2000) (treating unambiguous language in a program
statement as binding upon the BOP). Moreover, Program
Statement 5880.28 incorporated the same sentencing credit
methodology the BOP had been practicing since 1987.
Tablada has not identified any instances where the BOP used
any other methodology for calculating good time credits,
including the methodology he proposes. We may thus assume
that for more than twenty years, the BOP has consistently
implemented its policy of calculating good time credits based
on time served rather than sentence imposed.
[6] While Tablada and others may have asserted a reason-
able alternative interpretation, i.e., calculating good time cred-
its based on sentence imposed rather than time served, the
consistent and even application of the BOP’s methodology
promulgated in Program Statement 5880.28 since 1992 con-
vinces us that we must accord deference to the BOP’s inter-
pretation. To change course now would have an extremely
disruptive effect on the BOP’s administration of the release of
federal prisoners. Given this consideration, as well as the rea-
sonableness of the BOP’s interpretation of § 3624(b)(1) dis-
cussed in Pacheco-Camacho, we conclude that the BOP’s
methodology for calculating good time credits in Program
Statement 5880.28 is reasonable and persuasive.
Finally, we address Tablada’s argument that the United
States Sentencing Commission (“Commission”) has provided
the appropriate standard by which to interpret § 3624. Tablada
TABLADA v. THOMAS 8085
insists that the Commission has interpreted the good time
credit statute to mean a prisoner earns credit on each year of
the sentence imposed. He contends that the fact that the Com-
mission interprets § 3624 in this manner means that the
“proper remedy” for the BOP’s APA violation is to imple-
ment Tablada’s interpretation, rather than the time served rule
unless and until the BOP adopts a regulation complying with
the APA that passes judicial muster.
Congress charged the Commission with establishing sen-
tencing ranges for offenses, 28 U.S.C. § 994(b), and
instructed it, “as a starting point in its development of the ini-
tial sets of guidelines,” to ascertain the average sentences
imposed and length of terms served prior to creation of the
Commission. 28 U.S.C. § 994(m).5 The Commission then
engaged in a statistical analysis of data from thousands of sen-
tences, and presented the results in the “Levels Table” in June
1987. See United States Sentencing Commission, Supplemen-
tary Report on the Initial Sentencing Guidelines and Policy
Statements, at 27-39. Table 1(a), “Estimated Time Served for
Baseline Offenses: 1st Time Offenders, Convicted at Trial,
Sentenced to Prison, Adjusted for Good Time” presents a sta-
tistical analysis of average sentences. See id.
In the Supplementary Report, the Commission provided a
definition of the term “adjusted for good time”:
5
28 U.S.C. § 994(m) states: “The Commission shall insure that the
guidelines reflect the fact that, in many cases, current sentences do not
accurately reflect the seriousness of the offense. This will require that, as
a starting point in its development of the initial sets of guidelines for par-
ticular categories of cases, the Commission ascertain the average sen-
tences imposed in such categories of cases prior to the creation of the
Commission, and in cases involving sentences to terms of imprisonment,
the length of such terms actually served. The Commission shall not be
bound by such average sentences, and shall independently develop a sen-
tencing range that is consistent with the purposes of sentencing described
in section 3553(a)(2) of title 18, United States Code.”
8086 TABLADA v. THOMAS
Adjusted for good time.” Prison time was increased
by dividing by 0.85 good time when the term
exceeded 12 months. This adjustment corrected for
the good time (resulting in early release) that would
be earned under the guidelines. This adjustment
made sentences in the Levels Table comparable with
those in the guidelines (which refer to sentences
prior to the awarding of good time).
Id. at 23.
Tablada asserts that every federal prisoner has a term of
imprisonment imposed based on a Sentencing Table that
assumes good time credit based on 15% of the sentence
imposed.6 He claims that because the Commission was acting
in its authority to interpret the Sentencing Reform Act—
including § 3624(b) covering good time credit—the Commis-
sion’s (and Tablada’s interpretation) should prevail.
We are not persuaded by Tablada’s argument. First, if the
Commission felt the BOP was erroneously interpreting
§ 3624(b), it had ample opportunity to make its objections
known during the notice and comment periods for 28 C.F.R.
§ 523.20, in September 1997 and June 2003. The Commis-
sion, however, remained silent. Second and more importantly,
we have already found that the BOP is the agency charged
with interpreting the good time credit statute. See Pacheco-
Camacho, 272 F.3d at 1270 (“While the statute does not
explicitly vest the BOP with the authority to determine the
basis for the proration of good time credits, this power is
implied by the BOP’s statutory authority [under 18 U.S.C.
§ 3624] to award good time credits to inmates serving federal
sentences”). For these reasons, Tablada’s argument cannot
stand.
6
Tablada’s interpretation of the statute results in a prisoner being eligi-
ble for a 15% reduction in his sentence, whereas the BOP’s interpretation
results in an approximately 13% reduction.
TABLADA v. THOMAS 8087
IV. CONCLUSION
The BOP has admitted it violated § 706(2)(A) of the APA
in failing to set forth a valid rationale for its interpretation of
the federal good time credit statute when it promulgated 28
C.F.R. § 523.20. Nevertheless, invalidating § 523.20 leaves in
place the same interpretation of § 3624(b) contained in BOP
Program Statement 5880.28. We conclude that the BOP’s
methodology for calculating good time credits in Program
Statement 5880.28 is both reasonable and persuasive under
Skidmore. We therefore affirm the district court’s denial of
Tablada’s petition for habeas corpus.
AFFIRMED
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Order entered July 17, 2018
In The
Court of Appeals
Fifth District of Texas at Dallas
No. 05-18-00807-CV
IN RE TOYOTA MOTOR SALES, U.S.A., INC. TOYOTA MOTOR CORPORATION,
TOYOTA MOTOR NORTH AMERICA, INC., TOYOTA MOTOR ENGINEERING &
MANUFACTURING NORTH AMERICA, INC., AND EDWARD MANTEY, Relators
Original Proceeding from the 134th Judicial District Court
Dallas County, Texas
Trial Court Cause No. DC-16-15296
ORDER
Before Justices Lang-Miers, Fillmore, and Whitehill
Before the Court is relators’ emergency motion for temporary relief. The emergency
motion is DENIED AS MOOT in light of the Court’s opinion of this date denying relators’
petition for writ of mandamus.
/s/ ROBERT M. FILLMORE
JUSTICE
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} |
393 F.3d 1238
SHEN MANUFACTURING CO., INC., Appellant,v.THE RITZ HOTEL LIMITED, Cross Appellant.
No. 04-1063.
No. 04-1076.
United States Court of Appeals, Federal Circuit.
December 17, 2004.
John F.A. Earley III, Harding, Earley, Follmer & Frailey, of Valley Forge, Pennsylvania, argued for appellant. With him on the brief were Frank J. Bonini, Jr., and Charles L. Riddle.
Bruce R. Ewing, Dorsey & Whitney LLP, of New York, New York, argued for cross appellant. With him on the brief was Lile H. Deinard.
Before MAYER, Chief Judge, SCHALL and PROST, Circuit Judges.
MAYER, Chief Judge.
1
Shen Manufacturing Co., Inc. ("Shen") appeals the decision of the Trademark Trial and Appeal Board, which dismissed Shen's oppositions to The Ritz Hotel, Limited's ("RHL") registration of: (1) PUTTING ON THE RITZ for shower curtains; (2) RITZ PARIS RITZ HOTEL and design for various items of dinnerware; and (3) RITZ PARIS RITZ HOTEL and design for various floor and wall coverings. Shen Mfg. Co. v. Ritz Hotel Ltd., Opposition Nos. 71,706, 73,756 and 74,517, respectively (TTAB Aug. 7, 2003) ("Board's Opinion"). RHL cross-appeals the board's decision sustaining Shen's opposition to RHL's registration of RITZ for cooking and wine selection classes and THE RITZ KIDS for ready-made and tailored clothing. Board's Opinion, Opposition Nos. 72,818 and 75,003, respectively. We affirm the board's dismissal of Opposition Nos. 71,706, 73,756 and 74,517; and reverse the board's decision sustaining Opposition Nos. 72,818 and 75,003.1
Background
2
RHL owns and operates The Ritz Hotel in Paris, France, which was opened in 1898 by César Ritz. According to RHL, as well as a myriad of publications presented by RHL, The Ritz Hotel is one of the most luxurious and renowned hotels in the world. Aside from hotel and restaurant services, RHL has expanded into other industries, including the sale of coffee, tea, chocolates, drinking glasses and champagne. These products are sold under a variety of registered marks, such as RITZ, RITZ PARIS RITZ HOTEL and design, and HOTEL RITZ. Shen, on the other hand, sells kitchen textiles, such as dish towels, potholders, and aprons, in addition to a variety of other textile items including bathroom towels and ironing board covers. Shen has used the RITZ mark, which was derived from its founder's last name, John Ritzenthaler, since it began doing business in 1892.
3
In 1984 and 1985, RHL applied to register the following marks: (1) PUTTING ON THE RITZ for shower curtains; (2) RITZ PARIS RITZ HOTEL and design for "dinner plates of porcelain or earthenware, cups, saucers and serving pieces of porcelain, hair combs, household sponges, household brushes, steelwool, [and] household glassware"; (3) RITZ PARIS RITZ HOTEL and design for "carpets, rugs, floor mats and matting, linoleum for covering existing floors, [and] wall covering made of vinyl and plastic"; (4) RITZ for cooking and wine selection classes; and (5) THE RITZ KIDS for ready made and tailored clothing, including underwear, dresses, skirts, trousers, shirts, neckties, belts, gloves, hats, raincoats and galoshes. Shen opposed the registrations, arguing that RHL's use of "Ritz" would likely cause confusion based on three factors: (1) the strength of Shen's RITZ mark; (2) the similarity of RHL's marks to Shen's RITZ mark; and (3) the relatedness of the products covered by RHL's applications and those sold by Shen.
4
In 2003,2 the board decided Shen's consolidated oppositions. The board dismissed Opposition No. 71,706, which challenged RHL's registration of PUTTING ON THE RITZ for shower curtains. In so doing, the board found that while shower curtains are closely related to Shen's products, namely bathroom towels, RHL's PUTTING ON THE RITZ mark is dissimilar to Shen's RITZ mark in terms of appearance, sound and commercial impression. The board likewise dismissed Opposition Nos. 73,756 and 74,517, which challenged both of RHL's registrations of RITZ PARIS RITZ HOTEL and design. Again the board found that the goods described in RHL's applications were related to Shen's goods, but that the differences in the marks were sufficient to prevent any likelihood of confusion. In contrast, the board sustained Opposition No. 72,818 covering RITZ for cooking and wine selection classes, finding that there was a likelihood of confusion because cooking classes require the use of kitchen textiles. The board also sustained Opposition No. 75,003 regarding THE RITZ KIDS for clothing, finding that gloves are too related to barbeque mitts considering the similarity of the marks. Shen appealed the board's decision as to Opposition Nos. 71,706, 73,756 and 74,517; RHL cross-appealed the board's decision as to Opposition Nos. 72,818 and 75,003. We exercise jurisdiction pursuant to 28 U.S.C. § 1295(a)(4). Packard Press, Inc. v. Hewlett-Packard Co., 227 F.3d 1352, 1356 (Fed.Cir.2000).
Discussion
5
We review the board's legal conclusions de novo, In re Dixie Rest., Inc., 105 F.3d 1405, 1406 (Fed.Cir.1997), and its findings of fact for substantial evidence, Hoover Co. v. Royal Appliance Mfg. Co., 238 F.3d 1357, 1359 (Fed.Cir.2001). Whether there is a likelihood of confusion is a question of law based on underlying facts, such as the similarity of the marks and the relatedness of the goods or services. In re Dixie, 105 F.3d at 1406.
6
The PTO may refuse to register a trademark that is so similar to a registered mark "as to be likely, when used on or in connection with the goods of the applicant, to cause confusion, or to cause mistake, or to deceive...." 15 U.S.C. § 1052(d) (Supp.2004). In re E.I. DuPont DeNemours & Co., 476 F.2d 1357, 1361 (CCPA 1973), established a test for determining whether there is a likelihood of confusion:
7
In testing for likelihood of confusion ... the following, when of record, must be considered: (1) The similarity or dissimilarity of the marks in their entireties as to appearance, sound connotation and commercial impression. (2) The similarity or dissimilarity and nature of the goods or services as described in an application or registration or in connection with which a prior mark is in use. (3) The similarity or dissimilarity of established, likely-to-continue trade channels. (4) The conditions under which and buyers to whom sales are made, i.e. `impulse' vs. careful, sophisticated purchasing. (5) The fame of the prior mark (sales, advertising, length of use). (6) The number and nature of similar marks in use on similar goods. (7) The nature and extent of any actual confusion. (8) The length of time during and conditions under which there has been concurrent use without evidence of actual confusion. (9) The variety of goods on which a mark is or is not used (house mark, `family' mark, product mark). (10) The market interface between applicant and the owner of a prior mark.... (11) The extent to which applicant has a right to exclude others from use of its mark on its goods. (12) The extent of potential confusion, i.e., whether de minimis or substantial. (13) Any other established fact probative of the effect of use.
8
Neither we nor the board, however, need consider every DuPont factor. Han Beauty, Inc. v. Alberto-Culver Co., 236 F.3d 1333, 1336 (Fed.Cir.2001) ("While it must consider each factor for which it has evidence, the [b]oard may focus its analysis on dispositive factors, such as similarity of the marks and relatedness of the goods."). Instead, we are required only to consider those factors that are relevant. There are three such factors in this case: (1) the alleged fame of Shen's RITZ mark; (2) the similarity of the marks; and (3) the relatedness of the goods.3 See Bose Corp. v. QSC Audio Prods., Inc., 293 F.3d 1367, 1370 (Fed.Cir.2002).
9
Before undertaking a comparison of each set of marks, we address Shen's contention that its RITZ mark is famous and, therefore, entitled to enhanced protection. See id. at 1371 (noting that famous marks enjoy greater protection). In support of this argument, Shen offered evidence that: (1) its mark is arbitrary; (2) more than $5 million worth of products bearing Shen's RITZ mark are sold annually; (3) the RITZ mark has been used continuously since 1892; (4) Shen spends hundreds of thousands of dollars annually on advertising; and (5) products bearing Shen's RITZ mark are advertised nationally. See id. ("[F]ame of a mark may be measured indirectly ... by the volume of sales and advertising expenditures of the goods traveling under the mark, and by the length of time those indicia of commercial awareness have been evident."). This evidence does not, however, justify a finding of fame. In Giant Food, Inc. v. Nation's Foodservice, Inc., 710 F.2d 1565, 1569-70 (Fed.Cir.1983), we found that the GIANT FOOD mark was famous based on its 45 years of use, sales in excess of $1 billion per year, extensive media exposure and prominent display on the facade of supermarkets. Likewise, we found in Bose, 293 F.3d at 1372, that the ACOUSTIC WAVE mark was famous based on 17 years of use, annual sales over $50 million, annual advertising in excess of $5 million, and extensive media coverage. Although Shen's RITZ mark has been in use for more than a century, it does not compare in terms of sales, advertising or media interest. Further, it cannot be said that Shen's mark enjoys the "extensive public recognition and renown" characteristic of a famous mark. Id. at 1371 (quotation marks omitted). Thus, the board's failure to find that Shen's RITZ mark is famous is supported by substantial evidence.
10
We now consider each set of marks in turn, beginning with Opposition No. 71,706, which the board dismissed. The two marks at issue are Shen's RITZ for bathroom towels and RHL's PUTTING ON THE RITZ for shower curtains.4 The board found, and we agree, that bathroom towels and shower curtains are related goods. Board's Opinion, slip op. at 10. Because the goods are related, "the degree of similarity necessary to support a conclusion of likely confusion declines." Century 21 Real Estate Corp. v. Century Life of Am., 970 F.2d 874, 877 (Fed.Cir.1992). As to the marks, the board found that PUTTING ON THE RITZ leaves the consumer with a distinct impression, specifically that of getting dressed up or of the song composed by Irving Berlin. Board's Opinion, slip op. at 10. Shen argues that this was error because it overemphasizes the relevance of the words "Putting on the" while simultaneously underemphasizing the use of "Ritz." In this vein, Shen contends that "Putting on the" has no significance aside from its use in conjunction with "Ritz." As such, "Ritz" is the only relevant portion of the mark and, therefore, RHL's mark is identical to Shen's mark.
11
While there are often discrete terms in marks that are more dominant and, thus, more significant to the assessment of similarity, Giant Food, 710 F.2d at 1570 (finding GIANT to be dominant in both marks), the law forbids the type of dissection proposed by Shen. See Packard Press, 227 F.3d at 1358 ("The ultimate conclusion of similarity or dissimilarity of the marks must rest on consideration of the marks in their entirety."); see also In re Nat'l Data Corp., 753 F.2d 1056, 1059 (Fed.Cir.1985). PUTTING ON THE RITZ, when evaluated as a whole, conveys a strong commercial impression. It conjures images of fancy, even swanky, ladies in full length gowns and gentlemen in tails and top hats congregating in a large Art Nouveau restaurant where an orchestra is about to start. This image, one of comfort, sophistication and wealth, resonates strongly with the buying public, leaving them with an impression unlike that from Shen's RITZ mark, which, when used on kitchen textiles, invokes images, if any, of cleaning, cooking or manual labor generally. The two marks also differ in terms of sound and appearance. See In re Coors Brewing Co., 343 F.3d 1340, 1343 (Fed.Cir.2003). RHL's mark contains other words in addition to "Ritz," making both its visual appearance and pronunciation longer. Thus, we affirm the board's dismissal of Opposition No. 71,706 because the dissimilarity of the marks prevents a likelihood of confusion.
12
We now turn to Opposition Nos. 73,756 and 74,517, which the board also dismissed. Both of these oppositions challenged the registration of RITZ PARIS RITZ HOTEL and design, which is reproduced here.
13
NOTE: OPINION CONTAINING TABLE OR OTHER DATA THAT IS NOT VIEWABLE
14
The products covered in the first opposition include dinnerware, such as plates, cups, saucers and drinking glasses, in addition to cleaning items, such as steelwool and sponges. The second includes various types of floor coverings, such as carpets and rugs, as well as wall coverings. The board found that despite the relatedness of some of the products listed in the applications (e.g., sponges) to Shen's cleaning towels, the marks are sufficiently different to avoid a finding of likely confusion. Board's Opinion, slip op. at 9. Shen argues that the board erred by giving too much weight to the disclaimed elements of RHL's mark, namely the term "Paris" in large font and the terms "Paris" and "hotel" that appear on the banner under the crest. The disclaimed elements of a mark, however, are relevant to the assessment of similarity. In re Shell Oil Co., 992 F.2d 1204, 1206 (Fed.Cir.1993). This is so because confusion is evaluated from the perspective of the purchasing public, which is not aware that certain words or phrases have been disclaimed. In re Nat'l, 753 F.2d at 1059. Therefore, the board did not err by taking into account the reference in RHL's mark to a hotel in Paris, France.
15
RHL's mark is further differentiated by the crest and ribbon, which give the mark a particularly regal feel. The crest, ribbon and reference to Paris collectively give the commercial impression of royalty, old-world tradition and continental elegance, which differs from the more mundane impression imparted by Shen's RITZ mark. Aside from the distinct commercial impression left by RHL's mark, the appearance of the mark is also different from Shen's RITZ mark. See Hewlett-Packard, 281 F.3d at 1265. Shen's mark generally appears as simple block lettering or block lettering centered in a diamond, as reproduced here. NOTE: OPINION CONTAINING TABLE OR OTHER DATA THAT IS NOT VIEWABLE
16
Thus, Shen's uncomplicated mark either has a different shape, a diamond as opposed to the half circle used by RHL, or no embellishment at all. Based on the differences between the RITZ PARIS RITZ HOTEL and design and RITZ marks, we affirm the dismissal of Opposition Nos. 73,756 and 74,517.
17
Next, we assess that portion of the board's decision sustaining Opposition No. 72,818, which relates to RHL's registration of RITZ for cooking and wine selection classes. The marks are identical; therefore, we focus our attention on the relatedness of the goods. The board found that RHL's cooking classes are related to Shen's kitchen textiles because "in providing cooking courses ... it would be necessary that one make use of kitchen towels, dish cloths, aprons, barbecue mitts and potholders." Board's Opinion, slip op. at 6. Thus, the board based its finding of relatedness on the fact that "the services of applicant clearly require the use of certain of opposer's goods." Id.
18
That two goods are used together, however, does not, in itself, justify a finding of relatedness. "[T]he test is not that goods and services must be related if used together, but merely that that finding is part of the underlying factual inquiry as to whether the goods and services at issue ... can be related in the mind of the consuming public as to the origin of the goods." Packard Press, 227 F.3d at 1358. Conversely, goods that are neither used together nor related to one another in kind may still "be related in the mind of the consuming public as to the origin of the goods. It is this sense of relatedness that matters in the likelihood of confusion analysis." Recot, Inc. v. Becton, 214 F.3d 1322, 1329 (Fed.Cir.2000) (comparing FRITO-LAY for snack foods to FIDO LAY for dog treats). Therefore, although a student of RHL's cooking classes would undoubtedly use kitchen textiles, it does not necessarily follow that the consuming public would understand those products to have originated from the same source. For example, in In re Coors, 343 F.3d at 1341, we held that the board erred by finding that beer and restaurant services are related regardless of the fact that countless restaurants serve beer. On the other hand, we found that "distributorship services in the field of automotive parts" were related to service station oil and lubrication services. In re Shell, 992 F.2d at 1206 (comparing the use of RIGHT-A-WAY on both products). Likewise, we found that amplifiers (i.e., parts of sound systems) were related to complete sound systems. Bose, 293 F.3d at 1376 (comparing the use of ACOUSTIC WAVE with POWER WAVE). And, finally, we found that data processing services would be perceived by the purchasing public as related to computer hardware and consultant data processing services. Packard Press, 227 F.3d at 1358 (comparing HEWLETT-PACKARD with PACKARD TECHNOLOGIES).
19
Of these, the relationship between cooking classes and kitchen textiles is more akin to the relationship between restaurant services and beer. Cooking classes are not the same type of product as kitchen textiles: one is a service while the other is a tangible good. Nor are they the same category of product in the sense that snack foods and dog treats are. See Recot, 214 F.3d at 1329. In this sense, it would be more accurate to say that cooking classes are in the same category as language or pottery classes. Thus, aside from the fact that these goods are used together, there is no indication that the consuming public would perceive them as originating from the same source. As a result, the board's finding of relatedness is not supported by substantial evidence. Having determined that cooking classes and kitchen textiles are not related, we likewise reverse the ultimate conclusion as to the likelihood of confusion. Although the marks are identical, the differences in the products as well as the weakness of Shen's mark lead us to dismiss Opposition No. 72,818.
20
Finally, we turn to Opposition No. 75,003 for THE RITZ KIDS, which was sustained by the board. The board found that THE RITZ KIDS was similar to RITZ because "the word THE is one of those words that has virtually no significance in distinguishing trademarks" and "the word KIDS ... simply indicates that the particular item of apparel is designed for kids." Board's Decision, slip op. at 8. The board likewise found that gloves are "legally identical" to barbeque mitts based on the definition in Random House Webster's Dictionary (2001) of "mitt" as a type of glove. Board's Decision, slip op. at 7. In conclusion, the board commented that, "if a consumer were familiar with opposer's RITZ mitts, we believe that upon encountering applicant's mark THE RITZ KIDS for, among other goods, gloves, he or she would assume that they emanate from a common source." Id. at 8.
21
We cannot sanction the board's dissection of RHL's mark. See In re Nat'l, 753 F.2d at 1058 (holding that a "likelihood of confusion cannot be predicated on dissection of a mark"). While it is accurate that terms such as "the" and "kids" often have little impact on consumers, this is not universally true. In this case, for instance, "the" has elevated significance because of the well-known manner in which people refer to RHL as "The Ritz" or "The Ritz Hotel," but not as "Ritz" or "Ritz Hotel." See id. at 1058-59 ("Without question, the descriptive or generic character of an expression ... is pertinent to the issue of likelihood of confusion."). Therefore, "the" operates as an indicator of source in RHL's mark even though it has diminished importance in most other marks. And, while "kids" is undeniably used to indicate that the product is geared toward children, it distinguishes RHL's mark from Shen's; it is unlikely that consumers would mistakenly believe that Shen, the manufacturer of kitchen textiles, has expanded into children's clothing. In addition, the pronunciation of THE RITZ KIDS sounds like "The Rich Kids," leaving the impression of wealth, a concept tied strongly to RHL and not associated in any way with Shen's RITZ mark. Thus, taking into consideration the "appearance, sound, connotation, and commercial impression of the two marks," we reverse the board's finding that THE RITZ KIDS is similar to RITZ. In re Coors, 343 F.3d at 1343.
22
We also reverse the board's finding that gloves are related to barbeque mitts because it is not supported by substantial evidence. The mere fact that "mitt" is defined as a type of glove has no relevance to whether a consumer would believe that the two products emanate from the same source. See Packard Press, 227 F.3d at 1358. First, Shen's product is not a mitt, it is a barbeque mitt. It is designed to protect the hand from heat while cooking. While it covers the hand like a glove, it is better understood as a tool than as an article of clothing. The unrelatedness of RHL's and Shen's products is highlighted by comparing a similar set of goods: hard hats used by construction workers and fedoras. While both are hats that are used to cover the head, they have different purposes. The first is used for protection, just as a barbeque mitt is, while the second functions to keep the head warm in addition to adding an air of style, just as ready made or tailored gloves do. The mere fact that both barbeque mitts and gloves are worn on the hands simply does not support a finding that consumers would associate these products with a common source. See Recot, 214 F.3d at 1329. The board's finding that RHL's and Shen's goods are related is reversed. Because THE RITZ KIDS is not similar to RITZ and gloves are not related to barbeque mitts, we likewise reverse the board's decision sustaining Opposition No. 75,003.
Conclusion
23
Accordingly, we affirm the decision dismissing Opposition Nos. 71,706, 73,756 and 74,517; and reverse the decision sustaining Opposition Nos. 72,818 and 75,003.
Costs
24
No costs.
AFFIRM-IN-PART AND REVERSE-IN-PART
Notes:
1
Shen also appealed the board's dismissal of Opposition No. 72,817. Because RHL has abandoned the corresponding application, Shen's appeal is moot
2
RHL's applications languished at the United States Patent and Trademark Office ("PTO") for nearly two decades as the result of the parties' failure to move the applications and corresponding oppositions forward
3
We assume that the channels of trade and the sophistication of the purchasers are identicalSee Hewlett-Packard Co. v. Packard Press, Inc., 281 F.3d 1261, 1268 (Fed.Cir.2002) ("[A]bsent restrictions in the application and registration, goods and services are presumed to travel in the same channels of trade to the same class of purchasers.").
4
Although Shen asserts that it now uses its RITZ mark on shower curtains, it did not start this practice until after RHL's application. As such, it is not entitled to priority of use for RITZ on shower curtainsSee Person's Co. v. Christman, 900 F.2d 1565, 1569 (Fed.Cir.1990).
| {
"pile_set_name": "FreeLaw"
} |
FILED
AUG 21 2012
SUSAN M SPRAUL, CLERK
U.S. BKCY. APP. PANEL
1 OF THE NINTH CIRCUIT
2
3 UNITED STATES BANKRUPTCY APPELLATE PANEL
4 OF THE NINTH CIRCUIT
5 In re: ) BAP No. HI-11-1635-PaJuH
)
6 SUNRA COFFEE, LLC, ) Bankr. No. 09-01909
)
7 Debtor. ) Adv. Proc. 10-90009
___________________________________)
8 )
MICHAEL NEKOBA, )
9 )
Appellant, )
10 )
v. ) M E M O R A N D U M1
11 )
HAWAII NATIONAL BANCSHARES, INC., )
12 dba HAWAII NATIONAL BANK, )
)
13 Appellee. )
___________________________________)
14
Submitted Without Oral Argument
15 on July 20, 20122
16 Filed - August 21, 2012
17 Appeal from the United States Bankruptcy Court
for the District of Hawaii
18
Honorable Robert J. Faris, Chief Bankruptcy Judge, Presiding
19
Appearances: Jerrold K. Guben and Jeffery Steven Flores of
20 O’Connor Playdon & Guben LLP on brief for
Appellant; Keith Y. Yamada and Theodore D. C. Young
21 of Cades Schutte LLP on brief for Appellee.
22
Before: PAPPAS, JURY and HOLLOWELL, Bankruptcy Judges.
23
24
1
This disposition is not appropriate for publication.
25 Although it may be cited for whatever persuasive value it may have
(see Fed. R. App. P. 32.1), it has no precedential value. See 9th
26 Cir. BAP Rule 8013-1.
27 2
Pursuant to Rule 8012, in an order entered on May 14,
2012, a motions panel unanimously determined after examination of
28 the briefs and record that oral argument was not needed.
-1-
1 Appellant Michael Nekoba (“Nekoba”) appeals a final judgment
2 and subsequent charging order entered by the bankruptcy court in
3 favor of Appellee Hawaii National Bank (“HNB”) and against him.
4 We AFFIRM.
5 I. FACTS
6 The facts in this case are undisputed.
7 Debtor Sunra Coffee, LLC (“Sunra”) owns and operates coffee
8 farms and engages in the production of coffee products in Hawaii.
9 Nekoba is a certified public accountant and member of Sunra.
10 Among Sunra’s properties was a 214-acre development known as the
11 Royal Hualalai Gardens (the “Property”). Sunra obtained several
12 loans from HNB secured by mortgages against the Property. Nekoba
13 signed commercial guarantees of Sunra’s obligations to HNB on the
14 loans secured by the Property. ER at 34-36.
15 HNB filed a complaint in Hawaii state court on December 3,
16 2008, alleging that Sunra defaulted on its obligations to HNB
17 under the notes and mortgages. ER at 1. Hawaii Nat’l Bank v.
18 Sunra Coffee, civ. no. 08-1-00377 (Third Circuit, State of Hawaii)
19 (the “State Court Action”). Nekoba was named as a defendant in
20 the State Court Action, and was served with a summons and
21 complaint. ER at 32, EER at 10. Nekoba concedes that he did not
22 file a counterclaim against HNB, nor a cross-claim against Sunra
23 for indemnification or contribution, in the State Court Action.
24 Nekoba Op. Br. at 3. Indeed, Nekoba made no appearance at all in
25 the State Court Action. ER at 34. On August 3, 2009, the state
26 court entered a default judgment against Sunra and Nekoba for
27 $9,249,245.89, plus interest from February 20, 2009, of $4,233.90
28 per diem. ER at 33, 36.
-2-
1 Sunra filed a petition for relief under chapter 11 on
2 August 21, 2009. An official committee of unsecured creditors was
3 appointed on September 2, 2009 (the “Committee”). Bankr. dkt.
4 no. 28.
5 HNB filed a motion for relief from the automatic stay on
6 December 1, 2009, seeking an order allowing it to proceed to
7 foreclose on the Property. Without opposition, the bankruptcy
8 court granted the motion on January 26, 2010. ER at 41. The
9 order granting relief from stay explicitly stated that the stay
10 did not apply to Nekoba. ER at 44.
11 On January 19, 2010, the Committee filed a motion for
12 appointment of a chapter 11 trustee. Bankr. dkt. no. 166. The
13 bankruptcy court granted the motion on February 18, 2010. Bankr.
14 dkt. no. 185. David Farmer (“Farmer”) was appointed to serve as
15 chapter 11 trustee on February 22, 2010. Bankr. dkt. nos. 189,
16 194.
17 Farmer immediately removed the State Court Action to the
18 bankruptcy court on February 24, 2010. See Rule 9027(a)(2)(B).
19 ER at 48. In the removal notice, Farmer consented to the entry of
20 final orders and a judgment by the bankruptcy court. ER at 51.
21 The removal notice was served on Nekoba. EER at 28. Nekoba did
22 not oppose the removal.
23 The Property was auctioned at a foreclosure sale on March 30,
24 2010. ER at 71. HNB submitted the only bid for $9.5 million and
25 purchased the Property. Id. The bankruptcy court approved the
26 sale of the Property to HNB on April 30, 2010, as part of the
27 removed action. ER at 78. Although Nekoba had received notice of
28 the hearing concerning approval of the sale, he did not appear
-3-
1 either in person or by counsel. ER at 254. The bankruptcy court
2 issued a Writ of Possession on June 15, 2010, allowing HNB to take
3 Possession of the Property. ER at 307.
4 HNB then sought the entry of a deficiency judgment against
5 Sunra and Nekoba for $2,405,247.82, the difference between the
6 total amount of the judgment debt, including interest and
7 attorney’s fees of $11,905,247.82, and the credit bid it made at
8 the foreclosure sale of $9,500,000. ER at 339. No opposition to
9 this request was filed by either Sunray or Nekoba, nor did they
10 appear at the hearing on HNB’s motion for the deficiency judgment
11 held on September 17, 2010. ER at 417. The bankruptcy court
12 granted the unopposed motion on September 23, 2010; the Order and
13 Final Judgment Re: HNB’s Motion for Deficiency Judgment and
14 Attorneys’ Fees and Costs provided, in part, that the court:
15 Approves HNB’s request for a deficiency judgment, and
this document shall constitute entry of judgment in
16 favor of Plaintiff HNB and against each of the named
defendants, to wit: Defendants Sunra Coffee, LLC, ADI
17 LLC, and Michael Nekoba, aka Michael H. Nekoba, in the
amount of $2,405,247.82. This order shall constitute a
18 final judgment[.]
19 Judgment, September 23, 2010 at 2-3, ER at 417-18 (the
20 “Judgment”). The Judgment was not appealed, nor was collection of
21 the Judgment stayed. ER at 418. No party, including Nekoba, has
22 ever sought review or reconsideration of the Judgment.
23 Although a named defendant in the adversary proceeding who
24 was served with all papers and pleadings filed in the proceeding,
25 Nekoba never participated, personally or through counsel, until he
26 was compelled to attend his oral examination in January 2011. At
27 the examination, Nekoba disclosed his assets, including several
28 properties he purportedly held in tenancy by the entireties with
-4-
1 his spouse. Nekoba suggested that those properties, including
2 those owned by Tropic Land, LLC, were exempt from execution
3 because he and his wife were not jointly obligated on his debt to
4 HNB. ER at 440.
5 On March 7, 2011, HNB filed a motion for entry of a charging
6 Order against Nekoba’s membership interest in Tropic Land, LLC,
7 for satisfaction of the Judgment debt. A hearing on the motion
8 was scheduled for April 19, 2011. ER at 421. Meanwhile, on
9 March 14, 2011, the bankruptcy court granted HNB’s ex parte motion
10 for a Writ of Execution After Judgment directed at Nekoba’s
11 personal and real property. ER at 430.
12 On April 4, 2011, Nekoba filed an Opposition to the issuance
13 of the Writ of Execution and requested an evidentiary hearing.
14 Nekoba argued that property held by tenancy by the entireties must
15 be excluded from satisfaction of HNB’s judgment against him alone.
16 ER at 441. Nekoba requested that the bankruptcy court delay
17 execution of the Writ pending an evidentiary hearing where it
18 could “determine which of the claimed tenancy by the entireties
19 personal properties holding[s] are excluded from execution by the
20 judgment creditors[.]” ER at 444. On April 19, 2011, the court
21 granted Nekoba’s request for an evidentiary hearing to be held
22 July 5, 2011. Adv. dkt. nos. 114, 115.
23 On June 23, 2011, the United States Supreme Court decided
24 Stern v. Marshall, 121 S.Ct. 2594 (2011).
25 HNB and Nekoba submitted briefs to the bankruptcy court. HNB
26 argued that, as to Tropic Land, LLC, Nekoba had owned his member
27 interest in that company for five years as an individual before
28 transferring it to him and his wife on September 30, 2010, seven
-5-
1 days after entry of the Judgment against him on September 23,
2 2010. ER at 450. Nekoba’s position was that the funds used to
3 purchase the Tropic Land, LLC, interests came from other tenancy
4 by the entireties interests. ER at 462.
5 At the evidentiary hearing on July 5, 2011, Nekoba for the
6 first time challenged the subject matter jurisdiction and
7 Constitutional authority of the bankruptcy court to enter the
8 Judgment against him based upon Stern v. Marshall. Hr’g Tr. 4:10-
9 23, July 5, 2011, ER at 474. Following Nekoba’s testimony
10 regarding his various assets, the court invited the parties to
11 submit written closing arguments. Hr’g Tr. 100:23, ER at 570.
12 HNB submitted its closing arguments on July 22, 2011,
13 presenting its arguments why Nekoba’s assets were subject to
14 seizure by execution. HNB’s brief made no reference to Nekoba’s
15 Stern v. Marshall argument. ER at 590. In contrast, Nekoba’s
16 closing argument concentrated solely on the Stern v. Marshall
17 issue. ER at 599.
18 The bankruptcy court entered detailed Findings of Fact and
19 Conclusions of Law on October 18, 2011. ER at 740. In addition
20 to ruling against Nekoba on the merits, the court decided that
21 Neboka could not challenge the court’s jurisdiction or authority
22 to enter a judgment once it has become final:
23 A party cannot challenge the court's subject matter
jurisdiction after the judgment has become final.
24 Travelers Indem. Co. v. Bailey, [557 U.S. 137, 152-53
(2009)]; Ins. Corp. Of Ireland v. Compagnie des Bauxite
25 de Guinee, 456 U.S.694, 702 n.9 (1982); Chicot County
Drainage Dist. V. Baxter State Bank, 308 U.S. 371, 375
26 (1940). Mr. Nekoba did not appeal the [Judgment] and it
is now final. Mr. Nekoba can no longer question the
27 court's subject matter jurisdiction.
28 Conclusion of Law 3b, October 18, 2011, ER at 748.
-6-
1 As to the constitutional authority of a bankruptcy judge to
2 enter a final judgment in these proceedings, the court ruled:
3 Stern v. Marshall does not limit the bankruptcy court’s
subject matter jurisdiction. . . . Stern v. Marshall
4 deals with the power of the bankruptcy court to enter a
final judgment. . . . [E]ven under Stern v. Marshall,
5 the bankruptcy court can enter judgment against a
consenting party.
6
7 Conclusion of Law 3a, October 18, 2011. ER at 747-48. The court
8 went on to observe that the adversary proceeding itself was
9 clearly a core proceeding, because it primarily dealt with HNB’s
10 claim against the debtor. Then the court ruled that, even if the
11 proceeding was non-core as to Nekoba, he had impliedly consented
12 by his conduct. Conclusion of Law 9b, October 18, 2011.
13 On November 11, 2011, the bankruptcy court entered its Order
14 Granting Plaintiff’s Motion for Charging Order and Order
15 Sustaining in Part and Overruling in Part Defendant Michael
16 Nekoba’s Opposition to Plaintiff’s Ex Parte Motion for Writ of
17 Execution After Judgment (the “Charging Order”). ER at 789. The
18 court ruled that HNB was entitled to avoidance of the transfer of
19 Nekoba’s interest in Tropic Land, LLC, and that the interests of
20 Nekoba “shall be used to satisfy the Judgment in the amount of
21 $2,405, 247.82.” ER at 791.
22 Nekoba filed a timely appeal of the order on November 9,
23 2011.
24 II. JURISDICTION
25 As discussed below, Nekoba challenges the subject matter
26 jurisdiction of the bankruptcy court and Constitutional power to
27 enter the Judgment in this adversary proceeding. Nekoba has not
28 challenged the Panel’s jurisdiction to decide this appeal under
-7-
1 28 U.S.C. § 158.
2 III. ISSUE
3 Whether the bankruptcy court erred in holding that Nekoba
4 could not challenge the court’s subject matter jurisdiction to
5 enter the Judgment after it became final.
6 IV. STANDARD OF REVIEW
7 We review de novo questions involving the subject matter
8 jurisdiction of the bankruptcy court. Cal. Franchise Tax Bd. v.
9 Wilshire Courtyard (In re Wilshire Courtyard), 459 B.R. 416, 423
10 (9th Cir. BAP 2011).
11 V. DISCUSSION
12 In this appeal, Nekoba asserts that, under Stern v. Marshall,
13 a bankruptcy judge, as an Article I judge, does not have subject
14 matter jurisdiction to adjudicate state law “private right”
15 disputes between two nondebtor parties, and therefore, the
16 bankruptcy court erred when it entered the order in this case
17 granting HNB a money judgment against Neboka.3 However, we need
18
3
19 In his Opening Brief, Nekoba invokes various statements in
Stern to support his attack that an Article I judge cannot enter a
20 final judgment in a non-core adversary proceeding in which he did
not consent to entry of a final judgment. The attack, in the
21 opening brief, appears to fall into two areas. First, Nekoba
suggests that the bankruptcy court did not have any subject matter
22 jurisdiction, because the court did not have “related to”
jurisdiction and, if it did, he did not consent. Second, applying
23 Stern, an Article I judge cannot enter final judgment under the
facts of this case. In short, Nekoba’s Constitutional argument in
24 the Opening Brief is unfocused, simply that Stern does not allow
entry of final judgment in a non-core case where the parties do
25 not consent to entry of that judgment. Such an overbroad
interpretation is not supported in Stern.
26 Nekoba goes into a more precise Constitutional challenge in
his Reply Brief, where he shifts his attention from the final
27 judgment to the Writ of Execution, arguing in more specific detail
how entry of an order in a “supplementary proceeding” runs afoul
28 (continued...)
-8-
1 not endorse nor reject Neboka’s contention, because we agree with
2 the bankruptcy court that it is simply too late for Neboka to
3 collaterally attack the bankruptcy court’s subject matter
4 jurisdiction, because the Judgment is clearly final.
5 First, Nekoba’s assertion that the Supreme Court decision in
6 Stern was somehow a wide-ranging limitation on the authority of
7 Article I courts to adjudicate private rights disputes overstates
8 the Court’s holdings in that limited decision. In Stern, the
9 Supreme Court held that a bankruptcy court "lacked the
10 constitutional authority to enter a final judgment on a state law
11 counterclaim that is not resolved in the process of ruling on a
12 creditor's proof of claim" in a bankruptcy case. Stern, 131 S.Ct.
13 at 2620. The Court instructed that, though 28 U.S.C.
14 § 157(b)(2)(C) expressly authorized the bankruptcy court to decide
15 the merits of the bankruptcy estate's counterclaim against a
16 creditor, such an exercise of judicial power by an Article I
17 bankruptcy judge violated the Constitution, because "Congress may
18 not bypass Article III simply because a proceeding may have some
19 bearing on a bankruptcy case; the question is whether the action
20 at issue stems from the bankruptcy itself or would necessarily be
21 resolved in the claims allowance process." Id. at 2618.
22 However, in Stern, the Court emphasized that its holding was
23 a "narrow one," id. at 2620, that the constitutional infirmity in
24 the bankruptcy court's reliance upon 28 U.S.C. § 157(b)(2)(C) was
25
26 3
(...continued)
of Stern. But as we discuss below, his argument is too little,
27 too late, and we will not examine arguments that were neither
raised in the bankruptcy court nor in the appellant’s opening
28 brief.
-9-
1 limited to "one isolated respect," id., that the Court doubted its
2 decision would generate significant practical consequences, and
3 that the Court "[did] not think that removal of counterclaims such
4 as [the debtor's] from core bankruptcy jurisdiction meaningfully
5 changes the division of labor in the current statute . . . ." Id.
6 And more importantly for our purposes in this appeal, Stern also
7 makes clear that 28 U.S.C. § 157, the statute considered by the
8 Court, merely "allocates the authority to enter final judgment
9 between the bankruptcy court and the district court," and contrary
10 to Nekoba’s position here, "[t]hat allocation does not implicate
11 questions of subject matter jurisdiction." Id. at 2607.
12 Nekoba’s arguments invoking Stern are all premised on an
13 assumption that a Constitutional challenge to the bankruptcy
14 court’s subject matter jurisdiction may be advanced at any stage
15 of the proceedings, including an appeal from an order entered long
16 after the judgment in question became final. Nekoba’s Op. Br. at
17 14. Nekoba provides unconvincing authority for this assumption,4
18 however, and it would appear to directly contradict a well-
19
20 4
Nekoba, in the Opening Br. at 14, argues that under Civil
Rule 60(b)(4), “a party may challenge the subject matter
21 jurisdiction of the Court at any time.” Nekoba badly misconstrues
this provision. It does not give the litigant an unfettered right
22 to challenge jurisdiction “at any time.” It simply provides the
proper (and only) way of challenging subject matter jurisdiction
23 after entry of final judgment. United Student Aid Funds, Inc. v.
Espinosa, 130 S.Ct. 1367, 1370 (2010) (quoting Traveler’s Indem.
24 Co., 129 S.Ct at 2198, for its holding that final unappealed
judgments “stand in the way of challenging enforceability,” but
25 observing that Rule 60(b)(4) allows a party to seek relief from a
final judgment that may be void for jurisdictional error).
26 Indeed, the bankruptcy court in this appeal ruled that Neboka
could not challenge subject matter jurisdiction long after entry
27 of an unappealed final judgment except through a Civil Rule
60(b)(4) motion, which Nekoba never brought. Conclusions of Law
28 ¶¶ 2 and 3b. We agree with the bankruptcy court’s ruling.
-10-
1 established rule.
2 There is no timeless right to challenge the subject matter
3 jurisdiction of the trial court that entered a final judgment
4 against the challenger. Indeed, the Supreme Court has squarely
5 held that, subject to narrow exceptions not applicable here, a
6 bankruptcy court's final orders are not subject to a later,
7 collateral attack based upon a challenge to its subject matter
8 jurisdiction. Traveler's Indem. Co. v. Bailey, 557 U.S. 137, 147
9 (2009). As long as a party to an action is given a fair chance to
10 challenge the bankruptcy court's subject matter jurisdiction
11 during the proceedings, it cannot attack it later by resisting the
12 enforceability of its orders. Id. at 2206, citing Ins. Corp. of
13 Ireland v. Compagnie des Bauxites de Guinee, 456 U.S. 694, 702 n.9
14 (1982) ("A party that has had an opportunity to litigate the
15 question of subject matter jurisdiction may not . . . reopen that
16 question in a collateral attack upon an adverse judgment.");
17 Chicot County Drainage Dist. V. Baxter State Bank, 308 U.S. 371,
18 375 (1940). The Ninth Circuit has amplified this rule in several
19 of its decisions. See, e.g., City of S. Pasadena v. Mineta,
20 284 F.3d 1154, 1157 (9th Cir. 2002) (“Even objections to subject
21 matter jurisdiction, which may be raised at any time, even on
22 appeal, . . . may not be raised for the first time by way of
23 collateral challenge[.]”); Trulis v. Barton, 107 F.3d 685, 691
24 (9th Cir. 1995) (“Since the plaintiffs never appealed the
25 bankruptcy court’s confirmation order, the order is a final
26 judgment and plaintiffs cannot challenge the bankruptcy court’s
27 jurisdiction over the subject matter.”).
28 Put another way, Nekoba’s subject matter jurisdiction
-11-
1 challenge in this appeal comes too late. As the Supreme Court has
2 noted, Constitutional challenges to judgments must be timely: "'No
3 procedural principle is more familiar to this Court than that a
4 constitutional right,' or a right of any other sort, 'may be
5 forfeited . . . by the failure to make timely assertion of the
6 right before a tribunal having jurisdiction to determine it.'"
7 Stern, 131 S.Ct. at 2608, quoting United States v. Olano, 507 U.S.
8 725, 731 (1993).
9 In this case, it is unquestioned that Nekoba had ample
10 opportunity to appear in the adversary proceeding and assert a
11 challenge to the bankruptcy court’s exercise of subject matter
12 jurisdiction over HNB’s claims against him. He did not oppose
13 removal of the state court action to the bankruptcy court.
14 Likewise, though he was give notice of the requests for entry of
15 both the original and deficiency judgment against him, he did not
16 object. When entered, he did not appeal those judgments.
17 Instead, his first appearance in the bankruptcy court was six
18 months later when he sought an evidentiary hearing, not to
19 challenge any judgment, but to seek a ruling that certain
20 properties he owned with his wife were not subject to the Writ of
21 Execution issued in favor of HNB. It was not until the July 5,
22 2011 hearing, and the Supreme Court’s decision in Stern, that he
23 finally altered his position addressing the merits of the
24 proceedings and attacked the bankruptcy court’s subject matter
25 jurisdiction.
26 Nekoba seemingly recognizes that his attack on the bankruptcy
27 court’s jurisdiction to enter the judgments is time-barred.
28 Apparently to counter this, on appeal, he now tardily advances an
-12-
1 argument that the bankruptcy court lacked jurisdiction to enter
2 the post-judgment order:
3 While the September 23, 2010 Final Judgment in Adv. No.
10-9009 was rendered before Stern v. Marshall, and might
4 not be subject to challenge even if an Article I judge
entered judgment against Mr. Nekoba, that is not the
5 case with the enforcement of the judgment, which began
on December 30, 2010, when HNB initiated its Rule 69
6 supplemental proceedings.
7 Appellant’s Reply Br. at 11. This is the first time in the
8 bankruptcy court or on appeal, that Nekoba suggests that the
9 proceedings relating to the Writ of Execution are somehow separate
10 from those resulting in entry of the Judgment. Up to that point
11 in this action, Nekoba has addressed the Writ of Execution as a
12 legal consequence of the Judgment, not as a separate proceeding
13 requiring Stern analysis. In the Reply Brief, Nekoba offers an
14 extended discussion of how supplementary proceedings to aid in
15 collection of a judgment fall within the prohibited zone of Stern:
16 “The Rule 69 supplemental proceeding raises the issue of whether
17 during the enforcement phase of an adversary proceeding judgment,
18 does the Stern v. Marshall decision entitle Mr. Nekoba to an
19 Article III judge to enforce the writ of execution.” Appellant’s
20 Reply Brief at 15.
21 Of course, as can be seen from Nekoba’s own words, this is a
22 new issue raised for the first time only in his Reply Brief. This
23 argument was not made to the bankruptcy court, nor does it appear
24 in his Opening Brief in this appeal. An appellant may not raise
25 arguments on appeal that were not raised and adequately argued in
26 the bankruptcy court. Conn. Gen. Life Ins. Co. v. New Images of
27 Beverly Hills, 321 F.3d 878, 882 (9th Cir. 2003) (“These arguments
28 are raised for the first time on appeal, and because they were
-13-
1 never argued before the district court, we deem them waived.”);
2 Concrete Equip. Co. v. Virgil Bros. Constr., Inc. (In re Virgil
3 Bros. Constr., Inc.), 193 B.R. 513, 520 (9th Cir. BAP 1996) ("The
4 rule is well established that an issue not raised by a party in
5 the court below will not be considered on appeal, absent
6 exceptional circumstances."). Moreover, by waiting to make his
7 argument in a reply, without mentioning it in his Opening Brief,
8 he impermissibly prejudices HNB’s ability to respond to it.
9 Friends of Yosemite Valley v. Kempthorne, 520 F.3d 1024, 1033 (9th
10 Cir. 2008) (deeming waived issues not raised in the opening
11 brief).
12 In sum, we decline to consider Neboka’s Stern argument, in
13 this appeal.
14 VI. CONCLUSION
15 Nekoba could not wait until long after the Judgment was final
16 to collaterally attack the subject matter jurisdiction, or
17 Constitutional power, of the bankruptcy court to enter that
18 Judgment. Since this is the sole basis Neboka offers to reverse
19 the bankruptcy court’s order, we AFFIRM.
20
21
22
23
24
25
26
27
28
-14-
| {
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[DO NOT PUBLISH]
IN THE UNITED STATES COURT OF APPEALS
FOR THE ELEVENTH CIRCUIT
________________________ FILED
U.S. COURT OF APPEALS
No. 08-14936 ELEVENTH CIRCUIT
SEPTEMBER 23, 2010
Non-Argument Calendar
________________________ JOHN LEY
CLERK
D. C. Docket Nos. 07-00261-CV-3-LAC/MD,
06-00111-CR-3-L
CHRISTOPHER MICHAEL STANTON,
a.k.a. Christopher Stanton,
Petitioner-Appellant,
versus
UNITED STATES OF AMERICA,
Respondent-Appellee.
________________________
Appeal from the United States District Court
for the Northern District of Florida
_________________________
(September 23, 2010)
Before BLACK, MARTIN and COX, Circuit Judges.
PER CURIAM:
Christopher Stanton appeals the denial of his 28 U.S.C. § 2255 motion for
habeas relief. Stanton contends—and the Government concedes—the district
court erred in finding his counsel was not ineffective for failing to file a direct
appeal.1 After review, we reverse and remand the district court’s denial of
Stanton’s § 2255 motion.2
A direct appeal of a federal conviction is a matter of right. Rodriquez v.
United States, 395 U.S. 327, 329–30 (1969). “[A] lawyer who disregards specific
instructions from the defendant to file a notice of appeal acts in a manner that is
professionally unreasonable.” Roe v. Flores-Ortega, 528 U.S. 470, 477 (2000). In
cases where the defendant has not instructed counsel to file an appeal, counsel
nevertheless has a “constitutionally imposed duty to consult with the defendant
about an appeal when . . . [the] particular defendant reasonably demonstrated to
counsel that he was interested in appealing.” Id. at 480. The duty to consult
“requires informing a client about his right to appeal, advising the client about the
1
Specifically, the Government concedes Stanton’s counsel failed to “consult” with him
about an appeal, as that term has been defined by binding precedent. The Government does not
concede counsel disregarded Stanton’s request to file a direct appeal. We do not consider this
latter issue as counsel’s failure to consult entitles Stanton to the only relief he seeks on appeal.
2
When reviewing the denial of a § 2255 motion, we review a district court’s factual
findings for clear error and legal issues de novo. Lynn v. United States, 365 F.3d 1225, 1232
(11th Cir. 2004). An ineffective assistance of counsel claim is a mixed question of law and fact
that is subject to de novo review. Caderno v. United States, 256 F.3d 1213, 1216–17 (11th Cir.
2001).
2
advantages and disadvantages of taking an appeal, and making a reasonable effort
to determine whether the client wishes to pursue an appeal, regardless of the
merits of such an appeal.” Thompson v. United States, 504 F.3d 1203, 1206 (11th
Cir. 2007). In cases where counsel has failed to conduct a proper consultation, the
defendant must demonstrate “there is a reasonable probability that, but for
counsel’s deficient failure to consult with him about an appeal, he would have
timely appealed.” Roe, 528 U.S. at 484.
In Thompson, we addressed the issue of adequacy of consultation. 504 F.3d
at 1206. Undisputed testimony in Thompson showed (1) Thompson expressed to
counsel that he was unhappy with his sentence directly after the court imposed it;
(2) counsel told Thompson he had a right to appeal, but noted he did not think an
appeal would be worthwhile, without explaining the reasoning behind this
position; (3) Thompson responded “fine;” and (4) the exchange lasted no more
than five minutes. Id. at 1207. Citing Roe, we concluded the consultation was
inadequate, stating “[s]imply asserting the view that an appeal would not be
successful does not constitute ‘consultation’ in any meaningful sense.” Id. We
held that counsel made no effort “to discover Thompson’s informed wishes
regarding an appeal,” and concluded evidence that Thompson was dissatisfied
3
with his sentence and asked his attorney about appealing was sufficient to show
the requisite prejudice. Id. at 1207–08.
Here, there is no dispute Stanton reasonably demonstrated an interest in
appealing. Counsel admitted Stanton (1) requested an appeal after the jury
returned its verdict, and (2) nodded his head when counsel told him there were no
appealable issues. In light of this evidence, the Government has conceded Stanton
“reasonably demonstrated to [counsel] that he was interested in appealing,” and
that counsel “had a duty to consult with [Stanton] about an appeal.” We agree.
Counsel’s statement that there were no appealable issues without further
explanation did not constitute adequate consultation. See Thompson, 504 F.3d at
1206–07. Moreover, Stanton has demonstrated that, but for counsel’s failure to
perfect an appeal on his behalf, he would have appealed. Stanton expressed
interest in his appeal, and requested counsel’s help in reducing his sentence.
Therefore, there is a reasonably probability Stanton would have exercised his right
to appeal.
Stanton is entitled to pursue an out-of-time appeal of his conviction and
sentence. Accordingly, we reverse and remand the district court’s denial of
Stanton’s § 2255 motion.
REVERSED AND REMANDED.
4
| {
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